Amendments proposed to the Finance Bill - continued House of Commons

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Mr Richard Ottaway [R]
Mr David Heathcoat-Amory [R]
Mr Howard Flight [R]

295

Schedule     22,     page     444,     line     43,     leave out 'alter' and insert 'increase'.

   

Mr Richard Ottaway [R]
Mr David Heathcoat-Amory [R]
Mr Howard Flight [R]

296

Schedule     22,     page     445,     line     4,     leave out from beginning to end of line 42 on page 448.

   

Mr Andrew Smith

325

Schedule     22,     page     453,     line     9,     at end insert—

'Part XIIA

Application of provisions to partnerships

Introduction

    127A.—(1) The Inland Revenue may make provision by regulations as to the application of this Schedule in relation to activities carried on by a company in partnership.

    (2) Nothing in the following provisions of this Part of this Schedule shall be read as restricting the generality of this power.

Calculation of partnership profits

    127B. The regulations may provide that—

      (a) for the purpose of calculating the profits of a partner which is a tonnage tax company, the profits of the partnership shall be calculated as if the partnership were a tonnage tax company, and

      (b) for the purpose of calculating the profits of a partner which is not a tonnage tax company, the profits of the partnership shall be calculated as if the partnership were not a tonnage tax company.

Qualifying partnerships

    127C.—(1) The regulations may provide that activities carried on by a company in partnership are not to be regarded as qualifying activities of that company unless the partnership is a qualifying partnership.

    "Qualifying activities" here means core qualifying activities, qualifying secondary activities or qualifying incidental activities.

    (2) Subject to any provision made by the regulations, a "qualifying partnership" means a partnership that if it were a company would meet the requirements in paragraph 16(1) (qualifying companies).

Ships owned by or chartered to partners

    127D. The regulations may provide that a ship which is not partnership property but which—

      (a) is owned by or chartered to a member (or two or more members) of a partnership, and

      (b) is a ship in relation to which activities of the partnership business are carried on,

    shall be treated as if it were owned by or chartered to every member of the partnership and as if everything done by or to any of the partners in relation to it had been done by or to all the partners.

Transactions not at arm's length

    127E. The regulations may provide that for the purposes of paragraphs 58 and 59 (transactions not at arm's length) the partnership shall be treated—

      (a) as an entity separate and distinct from the persons that are its members, and

      (b) as if it were a tonnage tax company.

Adjustments for capital allowance purposes

    127F. The regulations may provide that where a partner leaves tonnage tax, such adjustments shall be made for capital allowance purposes, in relation to that partner and all or any of the other partners, with respect to—

      (a) the amount of qualifying expenditure under Part II of the Capital Allowances Act 1990 (plant and machinery), and

      (b) the amount of unrelieved qualifying expenditure under Part I of that Act (industrial buildings),

    as may be specified in the regulations.

General

    127G. Regulations under this Part of this Schedule—

      (a) may make different provision for different cases, and

      (b) may contain such supplementary, incidental and transitional provision as appears to the Inland Revenue to be appropriate.'.

   

Mr Andrew Smith

326

Schedule     22,     page     456,     line     54,     at end insert '(and see paragraphs 27(4) and (5) and 28(1A))'.


   

Mr David Heathcoat-Amory
Mr Richard Ottaway
Mr Howard Flight [R]

351

*Schedule     23,     page     457,     line     8,     leave out 'a telecommunications cable system' and insert 'wired, radio or optical transmission paths for the transfer of voice, data or information'.

   

Mr David Heathcoat-Amory
Mr Richard Ottaway
Mr Howard Flight [R]

352

*Schedule     23,     page     457,     line     15,     after 'disposal', insert 'or grant'.

   

Mr David Heathcoat-Amory
Mr Richard Ottaway
Mr Howard Flight [R]

353

*Schedule     23,     page     457,     line     23,     after 'disposal', insert 'or grant'.

   

Mr David Heathcoat-Amory
Mr Richard Ottaway
Mr Howard Flight [R]

354

*Schedule     23,     page     457,     leave out lines 29 to 38.

   

Mr Andrew Smith

327

Schedule     23,     page     458,     line     27,     leave out from second 'the' to end of line 28 and insert 'amount of any profits chargeable to income tax or corporation tax'.

   

Mr Andrew Smith

328

Schedule     23,     page     458,     line     32,     at end insert 'if the associate or associated company acquired the IRU before that date'.


   

Mr David Heathcoat-Amory
Mr Richard Ottaway
Mr Howard Flight [R]

350

*Clause     93,     page     65,     line     17,     at end insert—

    '(5) This section attributes a chargeable gain to trustees under section 13 if, and only if, these trustees are, when that gain accrues to a company, (or were at any time in the previous five years of assessment) either—

      (a) not resident or ordinarily resident in the United Kingdom, or

      (b) regarded for the purposes of any double taxation relief arrangements as resident in a territory other than the United Kingdom.'.

   

Mr David Heathcoat-Amory
Mr Richard Ottaway
Mr Howard Flight [R]

347

*Clause     93,     page     66,     line     17,     at end insert—

    '(5) This section should not operate to deny relief under any double taxation arrangements where a chargeable gain accrues to a company at any time in a period of five or more consecutive years of assessment for which it is regarded as resident in a territory other than the United Kingdom for the purposes of these double taxation arrangements.'.

   

Mr David Heathcoat-Amory
Mr Richard Ottaway
Mr Howard Flight [R]
Mr Michael Jack

348

*Clause     93,     page     66,     line     17,     at end insert—

    '(5) This section shall not apply in relation to a company where the Board have, on the application of the company notified the company that the Board are satisfied that the company was established outside the United Kingdom for bona fida commercial reasons and was not established as part of a scheme of which the main purpose is avoidance of liability to capital gains tax or corporation tax.

    (6) Subsections (2) to (5) of section 138 shall have effect in relation to subsection (5) above as they have effect in relation to subsection (1) of that section.'.

   

Mr David Heathcoat-Amory
Mr Richard Ottaway
Mr Howard Flight [R]

349

*Clause     93,     page     66,     line     17,     at end insert—

    '(5) This section shall not apply to a company making a chargeable gain unless the trustees referred to in subsection (1) above have control of that company as defined in section 840 TA 1988.'.

   

Mr Nick St. Aubyn

150

Clause     93,     page     66,     line     18,     leave out '21st March 2000' and insert '6th April 2002'.


   

Mr Andrew Smith

337

*Schedule     27,     page     482,     leave out lines 10 to 22.

   

Mr Andrew Smith

338

*Schedule     27,     page     482,     line     42,     leave out from beginning to 'provisions' in line 43 and insert 'Paragraph 9 has effect wherever the enactment amended by that paragraph falls to be construed, so far as it applies'.


   

Mr Andrew Smith

329

Clause     100,     page     69,     line     28,     at end insert—

    '(5) Any payment by A to B, or by B to A, in pursuance of an agreement between them in connection with the election—

      (a) shall not be taken into account in computing profits or losses of either company for corporation tax purposes, and

      (b) shall not for any purposes of the Corporation Tax Acts be regarded as a distribution or a charge on income,

    provided it does not exceed the amount of the chargeable gain or allowable loss that is treated, as a result of the disposal, as accruing to B.'.


   

Mr Andrew Smith

355

*Schedule     29,     page     490,     line     21,     leave out from beginning to 'was' in line 25 and insert—

      '(a) if the taxpayer company was a member of a group at the time when the gain accrued—

          (i) a company which was at that time the principal company of the group, and

          (ii) any other company which in any part of the period of twelve months ending with that time was a member of that group and owned the asset disposed of, or any part of it, or where that asset is an interest or right in or over another asset, owned either asset or any part of either asset; and

      (b) if the gain forms part of the chargeable profits of the taxpayer company for corporation tax purposes by virtue of section 10(3), any person who is, or during the period of twelve months ending with the time when the gain accrued.'.

   

Mr Andrew Smith

356

*Schedule     29,     page     491,     line     48,     leave out 'has' and insert 'and "principal company" have'.

 
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