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by a chargeable transaction in respect of which relief under Part 1 of | |
Schedule 7 to this Act was available but was not claimed. | |
(3) The references in section 113(1)(c) of, and in paragraph 3(3) or 4(3) of | |
Schedule 35 to, the Finance Act 2002 (c. 23) (which relate to the | |
circumstances in which stamp duty company acquisitions relief is | 5 |
withdrawn) to a transfer at market value by a duly stamped instrument on | |
which ad valorem duty was paid and in respect of which section 76 relief was | |
not claimed shall be read, on or after the implementation date, as including | |
a reference to a transfer at market value by a chargeable transaction on | |
which stamp duty land tax was chargeable and in respect of which relief | 10 |
under Part 2 of Schedule 7 to this Act was available but was not claimed. | |
Earlier related transactions under stamp duty | |
7 (1) In relation to a transaction that is not an SDLT transaction but which is | |
linked to an SDLT transaction and accordingly falls to be taken into account | |
in determining the rate of stamp duty land tax chargeable on the latter | 15 |
transaction, any reference in this Part to the chargeable consideration for the | |
first-mentioned transaction shall be read as a reference to the consideration | |
by reference to which ad valorem stamp duty was payable in respect of the | |
instrument by which that transaction was effected. | |
(2) In paragraph 3 of Schedule 9 (relief for transfer of reversion under shared | 20 |
ownership lease where election made for market value treatment) as it | |
applies in a case where the original lease was granted before the | |
implementation date— | |
(a) the reference to a lease to which paragraph 2 of that Schedule applies | |
shall be read as a reference to a lease to which section 97 of the | 25 |
Finance Act 1980 applied (which made corresponding provision for | |
stamp duty), and | |
(b) the reference to an election having been made for tax to be charged | |
under that paragraph shall be read accordingly as a reference to a | |
corresponding election having been in relation to stamp duty under | 30 |
that section. | |
(3) In section 54 (exceptions from deemed market value rule for transactions | |
with connected company) the reference in subsection (4)(b) to group relief | |
having been claimed in respect of a transaction shall be read in relation to a | |
transaction carried out before the implementation date as a reference to | 35 |
relief having been claimed under section 42 of the Finance Act 1930 (c. 28), | |
section 11 of the Finance Act (Northern Ireland) 1954 (c. 23 (N. I.)) or section | |
151 of the Finance Act 1995 (c. 4) in respect of stamp duty on the instrument | |
by which the transaction was effected. | |
Exercise of option or right of pre-emption acquired before implementation date | 40 |
8 (1) This paragraph applies where— | |
(a) an option binding the grantor to enter into a land transaction, or | |
(b) a right of pre-emption preventing the grantor from entering into, or | |
restricting the right of the grantor to enter into, a land transaction, | |
is acquired before the implementation date and exercised on or after that | 45 |
date. | |
(2) Where the option or right was acquired on or after 17th April 2003, any | |
consideration for the acquisition is treated as part of the chargeable | |
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consideration for the transaction resulting from the exercise of the option or | |
right. | |
(3) Where the option or right was varied on or after 17th April 2003 and before | |
the implementation date, any consideration for the variation is treated as | |
part of the chargeable consideration for the transaction resulting from the | 5 |
exercise of the option or right. | |
(4) Whether or not sub-paragraph (2) or (3) applies, the acquisition of the option | |
or right and any variation of the option or right is treated as linked with the | |
land transaction resulting from the exercise of the option or right. | |
But not so as to require the consideration for the acquisition or variation to | 10 |
be counted twice in determining the rate of tax chargeable on the land | |
transaction resulting from the exercise of the option or right. | |
(5) Where this paragraph applies any ad valorem stamp duty paid on the | |
acquisition or variation of the option or right shall go to reduce the amount | |
of tax payable on the transaction resulting from the exercise of the option or | 15 |
right (but not so as to give rise to any repayment). | |
Supplementary | |
9 In this Schedule “contract” includes any agreement. | |
Schedule 20 | |
Section 125 | |
Stamp duty: restriction to instruments relating to stock or marketable | 20 |
securities | |
Part 1 | |
Supplementary provisions | |
Reduction of stamp duty where instrument partly relating to stock or marketable securities | |
1 (1) This paragraph applies where stamp duty under Part 1 of Schedule 13 to the | 25 |
Finance Act 1999 (c. 16) (transfer on sale) is chargeable on an instrument that | |
relates partly to stock or marketable securities and partly to property other | |
than stock or marketable securities. | |
(2) In such a case— | |
(a) the consideration in respect of which duty would otherwise be | 30 |
charged shall be apportioned, on a just and reasonable basis, as | |
between the stock or marketable securities and the other property, | |
and | |
(b) the instrument shall be charged only in respect of the consideration | |
attributed to the stock or marketable securities. | 35 |
Apportionment of consideration for stamp duty purposes | |
2 (1) Where part of the property referred to in section 58(1) of the Stamp Act 1891 | |
(c. 39) (consideration to be apportioned between different instruments as | |
parties think fit) consists of stock or marketable securities, that provision | |
shall have effect as if “the parties think fit” read “is just and reasonable”. | 40 |
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(a) part of the property referred to in section 58(2) of the Stamp Act 1891 | |
(c. 39) (property contracted to be purchased by two or more persons | |
etc) consists of stock or marketable securities, and | |
(b) both or (as the case may be) all the relevant persons are connected | 5 |
with one another, | |
that provision shall have effect as if the words from “for distinct parts of the | |
consideration” to the end of the subsection read “, the consideration shall be | |
apportioned in such manner as is just and reasonable, so that a distinct | |
consideration for each part of the property transferred is set forth in the | 10 |
transfer relating to that part, and the transfer shall be charged with ad | |
valorem duty in respect of that consideration.”. | |
(3) If in a case where sub-paragraph (1) or (2) applies the consideration is | |
apportioned in a manner that is not just and reasonable, the enactments | |
relating to stamp duty shall have effect as if— | 15 |
(a) the consideration had been apportioned in a manner that is just and | |
reasonable, and | |
(b) the amount of any distinct consideration set forth in any transfer | |
relating to a part of the property transferred were such amount as is | |
found by a just and reasonable apportionment (and not the amount | 20 |
actually set forth). | |
(4) For the purposes of sub-paragraph (2)— | |
(a) a person is a relevant person if he is a person by or for whom the | |
property is contracted to be purchased; | |
(b) the question whether persons are connected with one another shall | 25 |
be determined in accordance with section 839 of the Taxes Act 1988. | |
Part 2 | |
Consequential amendments and repeals | |
Removal of unnecessary references to “conveyance” | |
3 In the enactments relating to stamp duty for “conveyance or transfer”, | 30 |
wherever occurring, substitute “transfer”. | |
Finance Act 1895 | |
4 In section 12 of the Finance Act 1895 (c. 16) (collection of stamp duty in cases | |
of property vested by Act or purchased under statutory powers)— | |
(a) in paragraph (a) for “property is” substitute “stock or marketable | 35 |
securities are”; | |
(b) in paragraph (b) for “property” substitute “stock or marketable | |
securities”; | |
(c) in the closing words for “conveyance”, in both places where that | |
word occurs, substitute “transfer”. | 40 |
Finance Act 1990 | |
5 In section 108 of the Finance Act 1990 (c. 29) (transfer of securities: abolition | |
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of stamp duty), for subsections (1) to (6) substitute— | |
“(1) Stamp duty shall not be chargeable under Schedule 13 to the Finance | |
Act 1999 (transfer of securities).”. | |
Finance Act 1999 | |
6 In paragraph 1(2) of Schedule 13 to the Finance Act 1999 (c. 16) for | 5 |
“conveyance on sale” substitute “transfer on sale”. | |
Power to make further consequential amendments or repeals | |
7 (1) The Treasury may by regulations make such other amendments or repeals | |
of enactments relating to stamp duty or stamp duty reserve tax as appear to | |
them appropriate in consequence of the abolition of stamp duty except on | 10 |
instruments relating to stock or marketable securities. | |
(2) The regulations may include such transitional provisions and savings as | |
appear to the Treasury to be appropriate. | |
(3) Regulations under this paragraph shall be made by statutory instrument | |
which shall be subject to annulment in pursuance of a resolution of the | 15 |
House of Commons. | |
Schedule 21 | |
Section 138 | |
Approved share plans and schemes | |
Part 1 | |
Share incentive plans | 20 |
Introductory | |
1 Schedule 2 to the Income Tax (Earnings and Pensions) Act 2003 (c. 1) | |
(approved share incentive plans) is amended as follows. | |
Participation in more than one connected plan in a tax year | |
2 After paragraph 18 insert— | 25 |
“Participation in more than one connected SIP in a tax year | |
18A (1) The plan must provide that, if an individual participates in an | |
award of shares under the plan in a tax year in which he has | |
already participated in an award of shares under one or more | |
other approved SIPs established by the company or a connected | 30 |
company— | |
(a) paragraph 35 (maximum annual award of free shares), | |
(b) paragraph 46 (maximum amount of partnership share | |
money deductions), and | |
(c) paragraph 64 (limit on amount reinvested), | 35 |
apply as if the plan and the other plan or plans were a single plan. | |
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(2) In this paragraph “connected company” has the same meaning as | |
in paragraph 18.”. | |
3 In paragraph 13 (eligibility of individuals: introduction), for the entry | |
relating to paragraph 18 substitute— | |
“paragraph 18 (requirement not to participate | 5 |
simultaneously in connected SIPs), | |
paragraph 18A (successive participation in connected SIPs), | |
and”. | |
4 In paragraph 14(7) (eligibility to participate dependent on certain | |
requirements of plan being met), for paragraph (b) substitute— | 10 |
“(b) not participating simultaneously in connected SIPs (see | |
paragraph 18), | |
(ba) successive participation in connected SIPs (see paragraph | |
18A), and”. | |
5 In paragraph 18 (requirement not to participate in connected SIPs), omit sub- | 15 |
paragraph (1)(a) (successive participation in connected SIPs). | |
6 After paragraph 71 insert— | |
“Duty to monitor participants in connected schemes | |
71A The trust instrument must require the trustees to maintain records | |
of participants who have participated in one or more other | 20 |
approved SIPs established by the company or a connected | |
company.”. | |
Partnership shares | |
7 (1) Paragraph 46 (maximum amount of partnership share money deductions) is | |
amended as follows. | 25 |
(2) In sub-paragraph (1), for the words after “must not exceed” substitute | |
“£1,500 in any tax year.”. | |
(3) In sub-paragraph (2), for the words after “an employee’s salary” substitute | |
“for any tax year must not exceed 10% of the employee’s salary for the tax | |
year.”. | 30 |
(4) After that sub-paragraph insert— | |
“(4A) A limit lower than that specified in sub-paragraph (2) may be | |
framed— | |
(a) as a proposition substituting a percentage lower than that | |
so specified, or | 35 |
(b) as a proposition that a particular description of earnings is | |
not to be regarded as forming part of an employee’s salary | |
for the purposes of that sub-paragraph.”. | |
(5) Sub-paragraphs (2) and (3) have effect for the year 2003-04 and subsequent | |
years of assessment. | 40 |
8 In paragraph 47 (minimum amount of deductions)— | |
(a) for “in any month” substitute “on any occasion”, and | |
(b) omit sub-paragraph (3). | |
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Part 2 | |
SAYE option schemes | |
Introductory | |
9 Schedule 3 to the Income Tax (Earnings and Pensions) Act 2003 (c. 1) | |
(approved SAYE option schemes) is amended as follows. | 5 |
Minor correction | |
10 In paragraph 25(3)(a) (limit on contributions under CCS schemes linked to | |
approved SAYE schemes), after “SAYE” insert “option”. | |
Exercise of options: scheme-related employment ends because of change of control or transfer | |
11 (1) Paragraph 34 (exercise of options: scheme-related employment ends) is | 10 |
amended as follows. | |
(2) In sub-paragraph (2)(a), after “1996” insert “or ER(NI)O 1996”. | |
(3) In sub-paragraph (5)— | |
(a) for “provide that,” substitute “make provision about the time when | |
the options may be exercised”, and | 15 |
(b) omit the words following paragraph (b). | |
(4) After that sub-paragraph insert— | |
“(5A) If the scheme makes provision by virtue of sub-paragraph (5), the | |
provision must be either— | |
(a) that the options may be exercised within 6 months after the | 20 |
termination date, or | |
(b) that the options may be exercised within 6 months after the | |
date (if any) when P ceases to hold the employment which | |
(before the termination date) was the scheme-related | |
employment for a reason within sub-paragraph (2)(a) or | 25 |
(b).”. | |
Alteration of schemes | |
12 (1) Paragraph 42 (withdrawal of approval) is amended as follows. | |
(2) In sub-paragraph (2), after “to be met;” insert— | |
“(aa) an alteration is made in a key feature of the scheme | 30 |
without the approval of the Inland Revenue;”. | |
(3) After that sub-paragraph insert— | |
“(2A) For the purposes of sub-paragraph (2)(aa) the Inland Revenue | |
may not withhold their approval unless it appears to them at the | |
time in question that the scheme as proposed to be altered would | 35 |
not then be approved on an application under paragraph 40. | |
(2B) For the purposes of that sub-paragraph a “key feature” of a scheme | |
is a provision of the scheme which is necessary in order to meet the | |
requirements of this Schedule.”. | |
(4) For paragraph 43 (approval ineffective after unapproved alteration and | 40 |
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notice of decisions) and the heading before it substitute— | |
“Notice of decision about alteration | |
43 Where the Inland Revenue— | |
(a) have been requested to approve any alteration in a SAYE | |
option scheme that has been approved, and | 5 |
(b) have decided whether or not to approve the alteration, | |
they must give notice of their decision to the scheme organiser.”. | |
(5) For paragraph 44(1)(b) (appeal against decision not to approve alteration) | |
substitute— | |
“(b) decide to refuse approval under paragraph 42(2)(aa).”. | 10 |
Part 3 | |
CSOP schemes | |
Introductory | |
13 The Income Tax (Earnings and Pensions) Act 2003 (c. 1) is amended as | |
follows. | 15 |
Exercise of options: exclusion of income tax liability | |
14 (1) Section 524 (no charge in respect of exercise of option under CSOP scheme) | |
is amended as follows. | |
(2) For subsection (1)(b) substitute— | |
“(b) Condition A or B is met.”. | 20 |
(3) For subsections (2) and (3) substitute— | |
“(2) Condition A is that the option is exercised— | |
(a) on or after the third anniversary of the date on which it was | |
granted, but | |
(b) not later than the tenth anniversary of that date. | 25 |
(2A) Condition B is that the option— | |
(a) is exercised before the third anniversary of the date on which | |
it was granted, and | |
(b) is so exercised by virtue of a provision included in the scheme | |
under paragraph 24 of Schedule 4 (exercise of options after | 30 |
ceasing to be director or employee) in circumstances in which | |
subsection (2B) applies. | |
(2B) This subsection applies if the individual exercising the option— | |
(a) has ceased to be a full-time director or qualifying employee | |
of the scheme organiser (or, in the case of a group scheme, a | 35 |
constituent company) because of injury, disability, | |
redundancy or retirement, and | |
(b) exercises the option within 6 months of the day on which he | |
ceases to be such a director or employee. | |
(2C) In subsection (2B)— | 40 |
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