Session 2017-19
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Other Bills before Parliament


 
 

1

 

House of Commons

 
 

Tuesday 16 January 2018

 

Public Bill Committee Proceedings

 

Finance (No. 2) Bill


 

(Except Clause 8; Clause 33 and Schedule 9; Clauses 40 and 41 and Schedule 11; New Clauses


 

or new Schedules relating to the income tax treatment of armed forces’ accommodation al­


 

lowances, the bank levy, stamp duty land tax, the effect of the Bill on equality, or the effect of


 

the Bill on tax avoidance or evasion)


 

[Fifth and Sixth Sittings]


 

Glossary

 

This document shows the fate of each clause, schedule, amendment and new clause.

 

The following terms are used:

 

Agreed to: agreed without a vote.

 

Agreed to on division: agreed following a vote.

 

Negatived: rejected without a vote.

 

Negatived on division: rejected following a vote.

 

Not called: debated in a group of amendments, but not put to a decision.

 

Not moved: not debated or put to a decision.

 

Question proposed: debate underway but not concluded.

 

Withdrawn after debate: moved and debated but then withdrawn, so not put to a decision.

 

Not selected: not chosen for debate by the Chair.

 

 

Clauses 30 and 31 Agreed to.

 



 
 

Public Bill Committee Proceedings: 16 January 2018        

2

 

Finance (No. 2) Bill, continued

 
 

Peter Dowd

 

Anneliese Dodds

 

Jeff Smith

 

Negatived on division  54

 

Clause  32,  page  23,  line  37,  at end insert—

 

“(2A)    

After section 6 of TIOPA 2010 (the effect given by section 2 to double taxation

 

arrangements), insert—

 

“6A    

Review of changes made by section 32 of Finance Act 2018

 

(1)    

Within twelve months of the passing of the Finance Act 2018, the

 

Chancellor of the Exchequer must review the effects of the changes made

 

by section 32 of that Act on the operation of double taxation

 

arrangements.

 

(2)    

The review under this section must consider in particular—

 

(a)    

the extent to which those changes facilitate UK law giving effect

 

to the Multilateral Instrument in a way which coheres with the

 

principles of Policy Coherence for Development;

 

(b)    

the extent to which those changes facilitate UK law giving effect

 

to the Multilateral Instrument in a way which coheres with the

 

UN Model Tax Treaty;

 

(c)    

the effect of those changes on the number of disputes decided by

 

arbitration;

 

(d)    

the counterparties in each such case;

 

(e)    

the outcome in each such case; and

 

(f)    

the effects of those changes on the public revenue of the United

 

Kingdom.

 

(3)    

The Chancellor of the Exchequer must lay before the House of Commons

 

the report of the review under this section as soon as practicable after its

 

completion.

 

(4)    

In this section—

 

“the Multilateral Instrument” means the Multilateral Treaty to

 

Implement Tax Treaty related Measures to Prevent Base Erosion

 

and Profit Shifting;

 

“the principles of Policy Coherence and Development” are to be

 

interpreted in the light of relevant publications of the

 

Organisation of Economic and Development Cooperation and of

 

the 2011 Busan Partnership for Effective Development

 

Cooperation, the UN Millennium Declaration and the 2010 UN

 

Millennium Development Goals Summit; and

 

“the UN Model Tax Treaty” means the United Nations Model

 

Double Taxation Convention between Developed and

 

Developing Countries published in 2011.””


 
 

Public Bill Committee Proceedings: 16 January 2018        

3

 

Finance (No. 2) Bill, continued

 
 

Peter Dowd

 

Anneliese Dodds

 

Jeff Smith

 

Not called  55

 

Clause  32,  page  24,  line  3,  leave out subsection (4).

 

Clause Agreed to.

 

Clauses 34 and 35 Agreed to.

 


 

Peter Dowd

 

Anneliese Dodds

 

Jeff Smith

 

Negatived on division  62

 

Schedule  10,  page  142,  line  40,  at end insert—

 

“87Q  

Review of taxation of capital payments received from a settlement

 

(1)    

Within six months of the passing of the Finance Act 2018, the Chancellor of the

 

Exchequer must review the effects of the changes to this Chapter made by

 

Schedule 10 to that Act.

 

(2)    

The review under this section must consider the effects of those changes on—

 

(a)    

the taxation regime for settlements, and

 

(b)    

anti-avoidance measures for settlements.

 

(3)    

The Chancellor of the Exchequer must lay before the House of Commons the

 

report of the review under this section as soon as practicable after its

 

completion.””

 

Peter Dowd

 

Anneliese Dodds

 

Jeff Smith

 

Negatived on division  63

 

Schedule  10,  page  142,  line  40,  at end insert—

 

“87Q  

Public register of capital payments received from settlements

 

(1)    

The Chancellor of the Exchequer must by regulations establish a

 

register of capital payments received from settlements to which this

 

Chapter applies within 12 months of the passing of the Finance Act

 

2018.

 

(2)    

A register established under subsection (1) shall record in relation to

 

capital payments—

 

(a)    

the recipient beneficiary;

 

(b)    

the settlor; and

 

(c)    

the trustees of the settlement from which the capital payment

 

is received.

 

(3)    

That part of the register containing information in paragraph (c) shall

 

be made available to the public.”

 

    (1A)  

In section 98(1), after “87”, insert “, 87Q”.””


 
 

Public Bill Committee Proceedings: 16 January 2018        

4

 

Finance (No. 2) Bill, continued

 
 

Mel Stride

 

Agreed to  2

 

Schedule  10,  page  146,  line  7,  after “is” insert “—

 

(a)    

where the individual is UK resident for the year,”

 

Mel Stride

 

Agreed to  51

 

Schedule  10,  page  146,  line  9,  at end insert “, and

 

(b)    

where the individual is non-UK resident for the year, treated for the

 

purposes of subsection (2) and sections 643I to 643L (but no other

 

purpose) as income of the individual for the year, subject to subsection

 

(5).”

 

Mel Stride

 

Agreed to  52

 

Schedule  10,  page  146,  line  33,  leave out from “purposes” to second “for” in line

 

34 and insert “as income of the settlor for the year and, in a case within paragraph (b), not

 

as income of the individual”

 

Mel Stride

 

Agreed to  5

 

Schedule  10,  page  147,  line  4,  at end insert—

 

“(7)    

If—

 

(a)    

an enactment other than this section contains a reference (however

 

expressed) to—

 

(i)    

income treated as arising by this section, or

 

(ii)    

an amount treated as income by this section, and

 

(b)    

the reference mentions this section without mentioning any particular

 

provision of this section,

 

    

the reference is (in accordance with subsection (1)(b)) to be read as not including

 

amounts treated as income by subsection (1)(b) except so far as they are treated

 

as income of the settlor of a settlement by subsection (3) or (4).”

 

Mel Stride

 

Agreed to  6

 

Schedule  10,  page  148,  line  4,  at end insert—

 

“(4)    

In this section and sections 643C to 643M, a reference to a benefit provided by

 

trustees of a settlement is to—

 

(a)    

a benefit treated by subsection (6) as provided by the trustees, or

 

(b)    

any other benefit if it is provided by the trustees directly, or indirectly,

 

out of—

 

(i)    

property comprised in the settlement, or

 

(ii)    

income arising under the settlement.

 

(5)    

In this section and sections 643C to 643M, a reference to a benefit provided by

 

trustees of a settlement to an individual is to—

 

(a)    

a benefit treated by subsection (6) as provided by the trustees to the

 

individual, or

 

(b)    

any other benefit if it is provided by the trustees to the individual directly,

 

or indirectly, out of—

 

(i)    

property comprised in the settlement, or

 

(ii)    

income arising under the settlement.


 
 

Public Bill Committee Proceedings: 16 January 2018        

5

 

Finance (No. 2) Bill, continued

 
 

(6)    

Where—

 

(a)    

income arises under a settlement, and

 

(b)    

the income, before being distributed, is the income of a person other than

 

the trustees,

 

    

a benefit is for the purposes of subsection (4)(a) treated as provided by the trustees

 

and is for the purposes of subsection (5)(a) treated as provided by the trustees to

 

the person.

 

(7)    

A benefit treated as provided by subsection (6) is treated—

 

(a)    

as consisting of the income mentioned in that subsection, but after any

 

reduction in accordance with Chapter 8 of Part 9 of ITA 2007 for

 

trustees’ expenses, and

 

(b)    

as provided at the time that income arises.”

 

Mel Stride

 

Agreed to  7

 

Schedule  10,  page  148,  leave out lines 14 to 18 and insert—

 

“PFSI is the total of—

 

(a)    

any protected foreign-source income—

 

(i)    

arising under the settlement in the year or in any earlier

 

tax year,

 

(ii)    

that would be treated under section 624 as income of the

 

settlor but for section 628A,

 

(iii)    

that can be used directly or indirectly to provide benefits

 

for the individual, and

 

(iv)    

on which the individual is not liable to income tax

 

(ignoring for this purpose any liability under section

 

643A), and

 

(b)    

any protected foreign-source income—

 

(i)    

arising under the settlement in the year or in any earlier

 

tax year,

 

(ii)    

that would be treated under section 629 as income of the

 

settlor but for section 630A, and

 

(iii)    

on which the relevant child concerned (see section 629)

 

is not liable to income tax (ignoring for this purpose any

 

liability under section 643A),”

 

Mel Stride

 

Agreed to  8

 

Schedule  10,  page  148,  line  25,  leave out “all amounts which” and insert “so much

 

of PFSI as is”

 

Mel Stride

 

Agreed to  9

 

Schedule  10,  page  148,  line  26,  leave out “are”

 

Mel Stride

 

Agreed to  10

 

Schedule  10,  page  148,  line  29,  leave out “all amounts which” and insert “so much

 

of PFSI as is”


 
 

Public Bill Committee Proceedings: 16 January 2018        

6

 

Finance (No. 2) Bill, continued

 
 

Mel Stride

 

Agreed to  11

 

Schedule  10,  page  148,  line  30,  leave out “are”

 

Mel Stride

 

Agreed to  12

 

Schedule  10,  page  149,  line  33,  leave out “available”

 

Mel Stride

 

Agreed to  13

 

Schedule  10,  page  149,  leave out lines 37 to 40

 

Mel Stride

 

Agreed to  14

 

Schedule  10,  page  149,  line  41,  at end insert—

 

“(6)    

In this section and section 643G—

 

“protected income” means the income that forms PFSI in the calculation of

 

the settlement’s available protected income in the case of the relevant

 

individual for the year, and

 

“the relevant individual”—

 

(a)    

where the deemed income is treated as income of an individual

 

by section 643A(1)(a) both before and after the application of

 

section 643A(3) and (4), means that individual, and

 

(b)    

where the deemed income is treated as income of the settlor by

 

section 643A(3) or (4) after having been treated as income of

 

another individual by section 643A(1), means that other

 

individual.”

 

Mel Stride

 

Agreed to  15

 

Schedule  10,  page  149,  line  43,  leave out “subsection (2)” and insert “this section”

 

Mel Stride

 

Agreed to  16

 

Schedule  10,  page  150,  line  2,  leave out from “settlement,” to end of line 7 and

 

insert “the year and the relevant individual,

 

(b)    

“protected income” and “the relevant individual” have the meaning given

 

by section 643F(6), and

 

(c)    

“the settlement” and “the year” mean, respectively, the settlement and tax

 

year mentioned in section 643F.”

 

Mel Stride

 

Agreed to  17

 

Schedule  10,  page  150,  line  10,  after first “the” insert “relevant”

 

Mel Stride

 

Agreed to  18

 

Schedule  10,  page  150,  line  16,  leave out “available”


 
 

Public Bill Committee Proceedings: 16 January 2018        

7

 

Finance (No. 2) Bill, continued

 
 

Mel Stride

 

Agreed to  19

 

Schedule  10,  page  150,  line  17,  at end insert—

 

“(ca)    

where the whole or part of an item of the protected income is, in respect

 

of benefits provided by the trustees in the year or in any earlier tax year,

 

taken into account in charging income tax under Chapter 2 of Part 13 of

 

ITA 2007 (transfer of assets abroad) for the year or any earlier tax year,

 

reduce the item by so much of itself as is so taken into account,

 

(cb)    

where the whole or part of an item of the protected income is, by

 

reference to benefits provided by the trustees to individuals other than the

 

relevant individual, treated by section 643A or 643J or 643L as income

 

for the year or any earlier tax year, reduce the item by so much of itself

 

as is so treated,”

 

Mel Stride

 

Agreed to  20

 

Schedule  10,  page  150,  line  18,  leave out “643A as arising to the” and insert

 

“643A(1) (before the application of section 643A(3) and (4)) as arising to the relevant”

 

Mel Stride

 

Agreed to  21

 

Schedule  10,  page  150,  line  19,  after “benefits” insert “referred to in paragraph (a)”

 

Mel Stride

 

Agreed to  22

 

Schedule  10,  page  150,  line  23,  after “benefits” insert “referred to in paragraph (a)”

 

Mel Stride

 

Agreed to  23

 

Schedule  10,  page  150,  line  24,  leave out “available”

 

Mel Stride

 

Agreed to  24

 

Schedule  10,  page  150,  line  25,  leave out second “the” and insert “those”

 

Mel Stride

 

Agreed to  25

 

Schedule  10,  page  150,  line  26,  leave out “available”

 

Mel Stride

 

Agreed to  26

 

Schedule  10,  page  150,  line  27,  at end insert—

 

“(3)    

For the purposes of subsection (2)(ca), the whole or part of an item of the

 

protected income is to be treated as taken into account in respect of a benefit so

 

far as the item or part—

 

(a)    

is matched under section 735A of ITA 2007 with notional income with

 

which the benefit is matched under that section, or

 

(b)    

would be matched under that section (if it applied also for this purpose)

 

with notional income with which the benefit would be matched under that

 

section (if it applied also for this purpose),

 

    

and here “notional income” means income which is treated as arising under

 

section 732 of ITA 2007.”


 
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Revised 16 January 2018