Finance Bill

House of Lords

Session 2013 - 14
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Finance Bill

Finance Bill
Part 3 — Annual tax on enveloped dwellings
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(a)
the whole or part of the dwelling has been designated under section 31
of IHTA 1984,
(b)
an undertaking has been made with respect to the dwelling under
section 78 of that Act (settled property: conditionally exempt
occasions), and
5
(c)
a transfer of property or other event is a conditionally exempt occasion
by virtue of that designation and that undertaking.
(4)
The taxable value of the single-dwelling interest on any day is taken to be zero
if no chargeable event has occurred with respect to the dwelling in the time
between the conditionally exempt occasion and the beginning of that day.
10
(5)
In this section—
“chargeable event” means an event which is a chargeable event under
section 32 of IHTA 1984;
“conditionally exempt occasion” is to be read in accordance with section
78(2) of that Act;
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“transfer of value” has the same meaning as in that Act.
Power to modify reliefs
156
Modification of reliefs
(1)
The Treasury may by regulations—
(a)
amend this Part for the purpose of providing further relief, or further
20
exemptions, from tax (whether by modifying an existing relief or
exemption or otherwise);
(b)
amend or repeal any of sections 132 to 155 for purposes not falling
within paragraph (a);
(c)
make any amendment of any other provision of this Part that may be
25
necessary in consequence of provision under paragraph (b).
(2)
In subsection (1)—
(a)
the reference to providing further relief from tax includes the provision
of relief for additional persons or categories of person or in additional
cases or circumstances;
30
(b)
the reference to providing further exemptions from tax includes the
provision of exemptions for additional persons or categories of person
or in additional cases or circumstances.
Alternative property finance
157
Land sold to financial institution and leased to person
35
(1)
This section applies where—
(a)
section 71A of FA 2003 (land sold to financial institution and leased to
person) or section 72 of that Act (land in Scotland sold to financial
institution and leased to person) applies in relation to arrangements
entered into between a financial institution and another person (“the
40
lessee”), and
(b)
the land in which the institution purchases a major interest under the
first transaction consists of or includes one or more dwellings (or parts
of a dwelling).

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(2)
If the lessee is a company, this Part has effect in relation to times when the
arrangements are in operation as if—
(a)
the interest held by the financial institution as mentioned in subsection
(3)(b) were held by the lessee (and not by the financial institution), and
(b)
the lease or sub-lease granted under the second transaction had not
5
been granted.
(3)
The reference in subsection (2) to times when the arrangements are in
operation is to times when—
(a)
the lessee holds the leasehold interest granted to it under the second
transaction, and
10
(b)
the interest purchased under the first transaction (or that interest except
so far as transferred by a further transaction) is held by a financial
institution.
(4)
A company treated under subsection (2)(a) as holding an interest at a particular
time is treated as holding it as a member of a partnership if at the time in
15
question the company holds the leasehold interest as a member of the
partnership (and this Part has effect accordingly in relation to the other
members of the partnership).
(5)
In relation to times when the arrangements operate for the benefit of a
collective investment scheme, this Part has effect as if—
20
(a)
the interest held by the financial institution as mentioned in subsection
(6)(b) were held by the lessee for the purposes of a collective investment
scheme (and were not held by the financial institution), and
(b)
the lease or sub-lease granted under the second transaction had not
been granted.
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(6)
The reference in subsection (5) to times when the arrangements operate for the
benefit of a collective investment scheme is to times when—
(a)
the lessee holds the leasehold interest for the purposes of a collective
investment scheme, and
(b)
the interest purchased under the first transaction (or that interest except
30
so far as transferred by a further transaction) is held by a financial
institution.
(7)
In this section—
“financial institution” has the meaning given by section 73BA of FA 2003;
“the first transaction” has the same meaning as in section 71A or (as the
35
case requires) 72 of FA 2003;
“further transaction” has the same meaning as in section 71A of FA 2003;
“the leasehold interest” means the interest granted to the lessee under the
second transaction;
“the second transaction” has the same meaning as in section 71A or (as the
40
case requires) 72 of FA 2003.
(8)
The reference in subsection (1) to a major interest in land is to be read in
accordance with section 117 of FA 2003.
(9)
Where the lessee is an individual, references in subsections (5) and (6) to the
lessee are to be read, in relation to times after the death of the lessee, as
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references to the lessee’s personal representatives.

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(10)
In relation to transactions in relation to which section 29 of the Scotland Act
2012 (disapplication of UK stamp duty land tax) has effect, this section has
effect as if—
(a)
in subsection (1) the words “or section 72 of that Act (land in Scotland
sold to financial institution and leased to person)” were omitted, and
5
(b)
in subsection (7) the words, “or (as the case requires) section 72” were
omitted (in each place).
Administration and payment of tax
158
Responsibility for collection and management
The Commissioners for Her Majesty’s Revenue and Customs are responsible
10
for the collection and management of annual tax on enveloped dwellings.
159
Annual tax on enveloped dwellings return
(1)
Where tax is charged on a person for a chargeable period with respect to a
single-dwelling interest the person must deliver a return for the period with
respect to the interest.
15
(2)
A return under subsection (1) must be delivered by the end of the period of 30
days beginning with first day in the period on which the person is within the
charge with respect to the interest.
(3)
If the first day in the chargeable period on which the person is within the
charge with respect to the interest (“day 1”) is a valuation date only because of
20
section 124 (new dwellings) or section 125 (dwellings produced from other
dwellings)—
(a)
subsection (2) does not apply, and
(b)
the return must be delivered by the end of the period of 90 days
beginning with day 1.
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(4)
A return under this section must be delivered to an officer of Revenue and
Customs, and is called an “annual tax on enveloped dwellings return”.
160
Return of adjusted chargeable amount
(1)
A person on whom tax is charged for a chargeable period with respect to a
single-dwelling interest must deliver a further return for the period with
30
respect to the interest if the first or second condition is met.
(2)
The return must be delivered by the end of the period of 30 days beginning
with the first day of the period following the period for which the tax is
charged (but see subsection (3)).
(3)
If the return is required because the second condition is met and the adjusted
35
chargeable amount is affected by an event that has occurred after the end of the
chargeable period mentioned in subsection (1), the return must be delivered by
the end of the period of 30 days beginning with the day on which that event
occurred.
(4)
The first condition is that—
40
(a)
the person has not made a claim under section 100 (interim relief) with
respect to the interest for the chargeable period, and

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(b)
the adjusted chargeable amount is greater than the amount charged
under section 99 with respect to the single-dwelling interest for the
period.
(5)
The second condition is that—
(a)
the person has made one or more claims under section 100 with respect
5
to the interest for the chargeable period, and
(b)
the sum of amounts A and B, as calculated under that section, in
connection with the last of those claims is less than the adjusted
chargeable amount.
(6)
A return under this section must be delivered to an officer of Revenue and
10
Customs, and is called a “return of the adjusted chargeable amount”.
161
Return to include self assessment
(1)
A return must include a self assessment.
(2)
In subsection (1) “return” means—
(a)
an annual charge on enveloped dwellings return, or
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(b)
a return of the adjusted chargeable amount.
(3)
In the case of an annual tax on enveloped dwellings return, “self assessment”
means an assessment of—
(a)
the amount of tax to which the person is chargeable under section 99 for
the period in respect of the interest, and
20
(b)
if the return includes a claim under section 100 (interim relief), the tax
payable after the relief.
(4)
In the case of a return of the adjusted chargeable amount, “self assessment”
means an assessment of—
(a)
the adjusted chargeable amount, and
25
(b)
the additional tax payable in accordance with section 163(2).
(5)
A self assessment must include a statement of the amount taken to be the
market value of the interest on each valuation date (earlier than the date on
which the return is delivered) that is relevant for the purposes of the
assessment.
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162
Returns, enquiries, assessments and other administrative matters
(1)
Schedule 33 contains provision about returns, enquiries and related matters.
(2)
The Treasury may by regulations—
(a)
make any amendments of Schedule 33 that they may at any time think
appropriate;
35
(b)
make any amendment of any other provision of this Part that may be
necessary in consequence of provision under paragraph (a).
163
Payment of tax
(1)
Tax charged on a person under section 99 for a chargeable period with respect
to a single-dwelling interest must be paid not later than the filing date for the
40
annual tax on enveloped dwellings return required to be made for the period
with respect to the interest.

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(2)
So far as a chargeable person’s adjusted chargeable amount for a chargeable
period with respect to a single-dwelling interest exceeds the amount payable
under subsection (1) (as modified, where applicable, by section 100(3)), the
amount of the difference must be paid not later than the filing date for the
return of the adjusted chargeable amount under section 160.
5
(3)
Tax payable as a result of the amendment of a return must be paid—
(a)
immediately, or
(b)
if the amendment is made on or before the filing date for the return, not
later than that date.
(4)
In subsection (3) “return” means—
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(a)
an annual tax on enveloped dwellings return, or
(b)
a return of the adjusted chargeable amount.
(5)
Tax payable in accordance with a determination or assessment by an officer of
Revenue and Customs must be paid within the period of 30 days beginning
with the day on which the determination or assessment is issued.
15
164
Information and enforcement
In Schedule 34—
(a)
Part 1 contains provision about information and inspection powers,
and
(b)
Part 2 contains provision about penalties.
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165
Collection and recovery of tax etc
(1)
Schedule 12 to FA 2003 (stamp duty land tax: collection and recovery of tax)
has effect in relation to the collection and recovery of tax under this Part as it
has effect in relation to stamp duty land tax.
(2)
The reference in subsection (1) to tax under this Part includes any unpaid
25
penalty or interest under this Part.
Application of provisions
166
Companies
(1)
In this Part “company” means a body corporate but does not include—
(a)
a corporation sole, or
30
(b)
any partnership (see section 167(1)).
(2)
Everything to be done by a company under this Part must be done by the
company acting through—
(a)
the proper officer of the company, or
(b)
another person who has the express, implied or apparent authority of
35
the company to act on its behalf for the purpose.
(3)
Service of a document on a company under this Part may be effected by serving
the document on the proper officer.
(4)
Tax due from any company that is incorporated under the law of a country or
territory outside the United Kingdom may be recovered from the proper
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officer of the company (as well as by any means available in the absence of this
subsection).
(5)
The proper officer—
(a)
may retain, out of any money that may come into the officer’s hands on
the company’s behalf, enough money to pay that tax, and
5
(b)
is entitled to be fully reimbursed by the company (whether by that
method or another) for amounts recovered from the officer under
subsection (4).
(6)
For the purposes of this section the proper officer of a company is—
(a)
the secretary, or a person acting as secretary, of the company, or
10
(b)
if the company does not have a proper officer within paragraph (a), the
treasurer, or a person acting as treasurer, of the company.
(7)
If a liquidator has been appointed for the company—
(a)
subsections (2)(b) and (6) do not apply, and
(b)
the liquidator is the proper officer of the company.
15
(8)
If an administrator has been appointed for the company—
(a)
subsection (6) does not apply, and
(b)
the administrator is the proper officer of the company.
(9)
If two or more persons are appointed to act jointly or concurrently as the
administrator of the company, the proper officer of the company is—
20
(a)
whichever of those persons is specified in a notice given by the
administrators to an officer of Revenue and Customs for the purposes
of this section, or
(b)
if no notice is given under paragraph (a), whichever of those persons is
designated by an officer of Revenue and Customs as the proper officer
25
for those purposes.
(10)
See also section 153 (public bodies) and section 154 (bodies established for
national purposes).
167
Partnerships
(1)
In this Part “partnership” means—
30
(a)
a partnership within the Partnerships Act 1890,
(b)
a limited partnership registered under the Limited Partnerships Act
1907,
(c)
a limited liability partnership formed under the Limited Liability
Partnerships Act 2000 or the Limited Liability Partnerships Act
35
(Northern Ireland) 2002, or
(d)
a firm or entity of a similar character to any of those mentioned in
paragraphs (a) to (c) formed under the law of a country or territory
outside the United Kingdom.
(2)
This Part has effect as follows in relation to a partnership (for instance, a
40
limited liability partnership formed as mentioned in subsection (1)(c)) that is
itself capable of being entitled to, or of acquiring or disposing of, a chargeable
interest—
(a)
transactions entered into on behalf of the partnership are treated as
entered into by or on behalf of the partners;
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(b)
where the partnership is entitled to a single-dwelling interest, this Part
has effect as if the partners were jointly entitled to the interest (and the
partnership had no entitlement to it).
(3)
For the purposes of this Part a partnership is treated as the same partnership
despite a change in membership if any person who was a member before the
5
change remains a member after the change.
(4)
For the purposes of this Part—
(a)
a collective investment scheme is not regarded as a partnership, and
(b)
accordingly, a member of a partnership by or on whose behalf a single-
dwelling interest is held for the purposes of a collective investment
10
scheme is not regarded as entitled to the interest as a member of the
partnership.
(5)
Anything required or authorised by this Part to be done by or in relation to the
responsible partners for a partnership may instead be done by or in relation to
any representative partner or partners.
15
(6)
A representative partner means a partner nominated by a majority of the
partners to act as the representative of the partnership for the purposes of this
Part of this Act.
(7)
Any such nomination, or the revocation of such a nomination, has effect only
after notice of the nomination, or revocation, has been given to an officer of
20
Revenue and Customs.
Supplementary provisions
168
Miscellaneous amendments and transitory provision
Schedule 35 contains—
(a)
miscellaneous amendments, and
25
(b)
provision about the chargeable period beginning on 1 April 2013.
169
Orders and regulations
(1)
Orders and regulations under this Part are to be made by statutory instrument.
(2)
A statutory instrument containing an order or regulations made under this
Part is subject to annulment in pursuance of a resolution of the House of
30
Commons.
(3)
Subsection (2) does not apply to—
(a)
an instrument containing only an order under section 101(5), or
(b)
an instrument to which subsection (5) applies.
(4)
A statutory instrument containing (whether alone or with other provision)
35
provision made under section 156(1) or 162(2) may not be made unless a draft
of the instrument has been laid before and approved by a resolution of the
House of Commons.
(5)
An order or regulations under this Part—
(a)
may make different provision for different purposes,
40
(b)
may include consequential or transitional provisions or savings.