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Energy Bill [HL]


Energy Bill [HL]
Schedule 9 — Taxation provisions relating to nuclear transfer schemes
Part 1 — Transfers to the NDA or a subsidiary of the NDA

202

 

      (2)  

For the purposes of Part 2 of the 2001 Act (capital allowances for plant and

machinery), the NDA or its subsidiary is to be treated—

(a)   

as having incurred capital expenditure on the provision of the plant

or machinery at the time of the transfer; and

(b)   

as having owned the plant or machinery as a result of having

5

incurred that expenditure.

      (3)  

The amount of that expenditure is to be treated as being the book value of

the plant or machinery.

      (4)  

For the purposes of the application of section 61 of that Act in relation to the

transferor the disposal value of the plant or machinery is to be treated as

10

being the book value of the plant or machinery.

      (5)  

The references in this paragraph to the book value of the plant or machinery

are references to the amount which, in accordance with generally accepted

accounting practice (within the meaning of the Tax Acts)—

(a)   

was recognised as its value in the accounts of the transferor at the

15

time of the transfer; or

(b)   

should have been so recognised at that time.

      (6)  

Expressions used in this paragraph and in Part 2 of the 2001 Act have the

same meanings in this paragraph as in that Part.

Capital allowances: transfer not to be transaction between connected persons

20

10         

For the purposes of Part 2 of the 2001 Act references in that Part to a

transaction (however described) between connected persons (within the

meaning of section 839 of the 1988 Act) are not to include references to a

transfer of anything in accordance with a section 42 scheme to the NDA or a

subsidiary of the NDA.

25

Continuity in relation to loan relationships

11    (1)  

This paragraph applies if, in consequence of a section 42 scheme, the NDA

or a subsidiary of the NDA replaces a person as a party to a loan

relationship.

      (2)  

Chapter 2 of Part 4 of the Finance Act 1996 (c. 8) is to have effect in relation

30

to the time when the transfer takes effect and any later time as if—

(a)   

the NDA or its subsidiary had been a party to the loan relationship

at the time when the transferor became a party to it and at all times

since that time; and

(b)   

the loan relationship to which the NDA or its subsidiary is a party

35

after the time when the transfer takes effect is the same loan

relationship as that to which, by virtue of paragraph (a), it is treated

as having been a party before that time.

      (3)  

Expressions used in this paragraph and in Chapter 2 of Part 4 of the Finance

Act 1996 have the same meanings in this paragraph as in that Chapter.

40

Continuity in relation to derivative contracts

12    (1)  

This paragraph applies if, in consequence of a section 42 scheme, the NDA

or a subsidiary of the NDA replaces a person as a party to a derivative

contract.

 

 

Energy Bill [HL]
Schedule 9 — Taxation provisions relating to nuclear transfer schemes
Part 1 — Transfers to the NDA or a subsidiary of the NDA

203

 

      (2)  

Schedule 26 to the Finance Act 2002 (c. 23) is to have effect in relation to the

time when the transfer takes effect and any later time as if—

(a)   

the NDA or its subsidiary had been a party to the derivative contract

at the time when the transferor became a party to it and at all times

since that time; and

5

(b)   

the derivative contract to which the NDA or its subsidiary is a party

after the time when the transfer takes effect is the same derivative

contract as that to which, by virtue of paragraph (a), it is treated as

having been a party before that time.

      (3)  

Expressions used in this paragraph and in Schedule 26 to the Finance Act

10

2002 have the same meanings in this paragraph as in that Schedule.

Continuity in relation to transfer of intangible assets

13    (1)  

Where—

(a)   

property is transferred in accordance with a section 42 scheme to the

NDA or a subsidiary of the NDA, and

15

(b)   

the property transferred includes a chargeable intangible asset of the

transferor,

           

the transfer of that asset is to be treated for the purposes of Schedule 29 to

the Finance Act 2002 as a tax neutral transfer.

      (2)  

Where, in the case of a transfer in accordance with a section 42 scheme of any

20

property to the NDA or a subsidiary of the NDA—

(a)   

the property transferred includes an asset which is not a chargeable

intangible asset of the transferor, but

(b)   

that asset falls to be treated after the transfer as a chargeable

intangible asset of the NDA or its subsidiary,

25

           

that asset shall be treated as acquired by the NDA or its subsidiary for an

amount equal to the amount of the consideration determined for the

purposes of paragraph 3(2) of this Schedule.

      (3)  

Expressions used in this paragraph and in Schedule 29 to the Finance Act

2002 have the same meanings in this paragraph as in that Schedule.

30

Chargeable intangible assets: degrouping charges

14    (1)  

This paragraph applies if a company (“the degrouped company”)—

(a)   

acquired an intangible fixed asset from another company at a time

when both were members of the same group of companies (“the old

group”); and

35

(b)   

ceases by virtue of a transfer to the NDA or a subsidiary of the NDA

in accordance with a section 42 scheme to be a member of the old

group.

      (2)  

Paragraph 58 of Schedule 29 to the Finance Act 2002 (company ceasing to be

member of group) is not to treat the degrouped company as having, by

40

virtue of the transfer, sold and immediately reacquired the asset.

      (3)  

Where sub-paragraph (2) has applied to an asset, paragraph 58 of Schedule

29 to the Finance Act 2002 is to have effect on and after the first subsequent

occasion on which the degrouped company ceases to be a member of a

group of companies (“the new group”) as if—

45

(a)   

the degrouped company, and

(b)   

the company from which it acquired the asset,

 

 

Energy Bill [HL]
Schedule 9 — Taxation provisions relating to nuclear transfer schemes
Part 2 — Transfers relating to BNFL or the UKAEA etc.

204

 

           

had been members of the new group at the time of acquisition.

      (4)  

Expressions used in this paragraph and in paragraph 58 of Schedule 29 to

the Finance Act 2002 (c. 23) have the same meanings in this paragraph as in

that paragraph.

Computation of profits and losses in respect of transfer of trade

5

15    (1)  

This paragraph applies where, in consequence of a section 42 scheme—

(a)   

a BNFL company ceases to carry on a trade or a part of a trade; and

(b)   

an NDA group member begins to carry on the trade or that part of it.

      (2)  

For the purpose of computing, in relation to the time when the scheme

comes into force and subsequent times, the relevant trading profits or losses

10

of the BNFL company and the NDA group member—

(a)   

the trade or part is to be treated as having been a separate trade at the

time of its commencement and as having been carried on by the

NDA group member at all times since its commencement as a

separate trade; and

15

(b)   

the trade carried on by the NDA group member after the time when

the section 42 scheme comes into force is to be treated as the same

trade as that which it is treated, by virtue of paragraph (a), as having

carried on as a separate trade before that time.

      (3)  

This paragraph is subject to paragraph 11.

20

      (4)  

In this paragraph—

“BNFL company” means BNFL or a subsidiary of BNFL;

“NDA group member” means the NDA or a subsidiary of the NDA;

“relevant trading profits and losses” means profits or losses under

Case I of Schedule D in respect of the trade or part of a trade in

25

question.

Part 2

Transfers relating to BNFL or the UKAEA etc.

Application of Part 2 of Schedule

16    (1)  

This Part of this Schedule applies to a transfer if—

30

(a)   

it is a transfer in accordance with a section 42 scheme of securities of

a BNFL company or of property, rights or liabilities of a BNFL

company; and

(b)   

the transferee is a publicly owned company which is not a subsidiary

of the NDA.

35

      (2)  

This Part of this Schedule also applies to a transfer if it is a transfer in

accordance with a section 42 scheme to a transferee falling within sub-

paragraph (3) of—

(a)   

property, rights or liabilities of the UKAEA;

(b)   

securities of a wholly-owned subsidiary of the UKAEA; or

40

(c)   

property, rights or liabilities of such a subsidiary.

      (3)  

The transferee falls within this sub-paragraph if it is—

(a)   

a publicly owned company which is not a subsidiary of the NDA; or

(b)   

the UKAEA.

 

 

Energy Bill [HL]
Schedule 9 — Taxation provisions relating to nuclear transfer schemes
Part 2 — Transfers relating to BNFL or the UKAEA etc.

205

 

      (4)  

In this paragraph “BNFL company” means BNFL or a wholly-owned

subsidiary of BNFL.

Application of rules for reorganisations under same ownership

17         

Where the conditions set out in subsection (1) of section 343 of the Taxes Act

(company reconstructions without a change of ownership) are satisfied in

5

relation to a transfer to which this Part of this Schedule applies, that section

shall have effect in relation to the transfer with the omission of subsection (4)

(which restricts the losses that may be carried forward to the excess of

relevant liabilities over relevant assets).

Chargeable gains: assets to be treated as disposed without a gain or a loss

10

18    (1)  

This paragraph applies for the purposes of the 1992 Act where an asset is

transferred by a transfer to which this Part of this Schedule applies.

      (2)  

The asset shall be treated as disposed of to the transferee for a consideration

of such amount as would secure that, on the disposal, neither a gain nor a

loss accrues to the transferor.

15

Chargeable gains: degrouping charges

19    (1)  

This paragraph applies if a company (“the degrouped company”)—

(a)   

acquired an asset from another company at a time when both were

members of the same group of companies (“the old group”); and

(b)   

ceases by virtue of a transfer to which this Part of this Schedule

20

applies to be a member of the old group.

      (2)  

Section 179 of the 1992 Act (company ceasing to be member of group) is not

to treat the degrouped company as having by virtue of the transfer sold and

immediately reacquired the asset.

      (3)  

Where sub-paragraph (2) has applied to an asset, section 179 of the 1992 Act

25

is to have effect on and after the first subsequent occasion on which the

degrouped company ceases to be a member of a group of companies (“the

new group”) as if—

(a)   

the degrouped company, and

(b)   

the company from which it acquired the asset,

30

           

had been members of the new group at the time of acquisition.

      (4)  

Expressions used in this paragraph and in section 179 of the 1992 Act have

the same meanings in this paragraph as in that section.

Chargeable gains: disposal of debts

20    (1)  

This paragraph applies if—

35

(a)   

a debt owed to any person is transferred by a transfer to which this

Part of this Schedule applies; and

(b)   

the transferor would (apart from this paragraph) be the original

creditor in relation to that debt for the purposes of section 251 of the

1992 Act (disposal of debts).

40

      (2)  

The 1992 Act is to have effect as if the transferee (and not the transferor) were

the original creditor for those purposes.

 

 

Energy Bill [HL]
Schedule 9 — Taxation provisions relating to nuclear transfer schemes
Part 2 — Transfers relating to BNFL or the UKAEA etc.

206

 

Capital allowances: transfer of plant or machinery

21    (1)  

This paragraph applies where—

(a)   

property transferred by a transfer to which this Part of this Schedule

applies includes plant or machinery; and

(b)   

section 343 of the Taxes Act does not apply in relation to the transfer

5

of the plant or machinery.

      (2)  

For the purposes of Part 2 of the 2001 Act (capital allowances for plant and

machinery), the transferee is to be treated—

(a)   

as having incurred capital expenditure on the provision of the plant

or machinery at the time of the transfer; and

10

(b)   

as having owned the plant or machinery as a result of having

incurred that expenditure.

      (3)  

The amount of that expenditure is to be treated as being the book value of

the plant or machinery.

      (4)  

For the purposes of the application of section 61 of that Act in relation to the

15

transferor the disposal value of the plant or machinery is to be treated as

being the book value of the plant or machinery.

      (5)  

The references in this paragraph to the book value of the plant or machinery

are references to the amount which, in accordance with generally accepted

accounting practice (within the meaning of the Tax Acts)—

20

(a)   

was recognised as its value in the accounts of the transferor at the

time of the transfer; or

(b)   

should have been so recognised at that time.

      (6)  

Expressions used in this paragraph and in Part 2 of the 2001 Act have the

same meanings in this paragraph as in that Part.

25

Capital allowances: transfer not to be transaction between connected persons

22         

For the purposes of Part 2 of the 2001 Act references in that Part to a

transaction (however described) between connected persons within the

meaning of section 839 of the Taxes Act are not to include references to a

transfer to which this Part of this Schedule applies.

30

Continuity in relation to loan relationships

23    (1)  

This paragraph applies if, in consequence of a transfer to which this Part of

this Schedule applies, the transferee replaces a person as a party to a loan

relationship.

      (2)  

Chapter 2 of Part 4 of the Finance Act 1996 (c. 8) is to have effect in relation

35

to the time when the transfer takes effect and any later time as if—

(a)   

the transferee had been a party to the loan relationship at the time

when the transferor became a party to it and at all times since that

time; and

(b)   

the loan relationship to which the transferee is a party after the time

40

when the transfer takes effect is the same loan relationship as that to

which, by virtue of paragraph (a), it is treated as having been a party

before that time.

      (3)  

Expressions used in this paragraph and in Chapter 2 of Part 4 of the Finance

Act 1996 have the same meanings in this paragraph as in that Chapter.

45

 

 

Energy Bill [HL]
Schedule 9 — Taxation provisions relating to nuclear transfer schemes
Part 2 — Transfers relating to BNFL or the UKAEA etc.

207

 

Continuity in relation to derivative contracts

24    (1)  

This paragraph applies if, in consequence of a transfer to which this Part of

this Schedule applies, the transferee replaces a person as a party to a

derivative contract.

      (2)  

Schedule 26 to the Finance Act 2002 (c. 23) is to have effect in relation to the

5

time when the transfer takes effect and any later time as if—

(a)   

the transferee had been a party to the derivative contract at the time

when the transferor became a party to it and at all times since that

time; and

(b)   

the derivative contract to which transferee is a party after the time

10

when the transfer takes effect is the same derivative contract as that

to which, by virtue of paragraph (a), it is treated as having been a

party before that time.

      (3)  

Expressions used in this paragraph and in Schedule 26 to the Finance Act

2002 have the same meanings in this paragraph as in that Schedule.

15

Continuity in relation to transfer of intangible assets

25    (1)  

Where—

(a)   

property is transferred by a transfer to which this Part of this

Schedule applies, and

(b)   

the property transferred includes a chargeable intangible asset of the

20

transferor,

           

the transfer of that asset is to be treated for the purposes of Schedule 29 to

the Finance Act 2002 as a tax neutral transfer.

      (2)  

Where, in the case of a transfer of property by a transfer to which this Part of

this Schedule applies—

25

(a)   

the property transferred includes an asset which is not a chargeable

intangible asset of the transferor, but

(b)   

that asset falls to be treated after the transfer as a chargeable

intangible asset of the transferee,

           

that asset shall be treated as acquired by the transferee for an amount equal

30

to the amount of the consideration determined for the purposes of

paragraph 18(2) of this Schedule.

      (3)  

Expressions used in this paragraph and in Schedule 29 to the Finance Act

2002 have the same meanings in this paragraph as in that Schedule.

Chargeable intangible assets: degrouping charges

35

26    (1)  

This paragraph applies if a company (“the degrouped company”)—

(a)   

acquired an intangible fixed asset from another company at a time

when both were members of the same group of companies (“the old

group”); and

(b)   

ceases by virtue of a transfer to which this Part of this Schedule

40

applies to be a member of the old group.

      (2)  

Paragraph 58 of Schedule 29 to the Finance Act 2002 (company ceasing to be

member of group) is not to treat the degrouped company as having, by

virtue of the transfer, sold and immediately reacquired the asset.

      (3)  

Where sub-paragraph (2) has applied to an asset, paragraph 58 of Schedule

45

29 to the Finance Act 2002 is to have effect on and after the first subsequent

 

 

Energy Bill [HL]
Schedule 9 — Taxation provisions relating to nuclear transfer schemes
Part 3 — Transfers relating to relevant site licensees

208

 

occasion on which the degrouped company ceases to be a member of a

group of companies (“the new group”) as if—

(a)   

the degrouped company, and

(b)   

the company from which it acquired the asset,

           

had been members of the new group at the time of acquisition.

5

      (4)  

Expressions used in this paragraph and in paragraph 58 of Schedule 29 to

the Finance Act 2002 (c. 23) have the same meanings in this paragraph as in

that paragraph.

Computation of profits and losses: transfer of trade

27    (1)  

This paragraph applies where, in consequence of a section 42 scheme—

10

(a)   

a BNFL company ceases to carry on a trade or a part of a trade; and

(b)   

a publicly owned company that is not a subsidiary of the NDA (the

“transferee company”) begins to carry on the trade or that part.

      (2)  

For the purpose of computing, in relation to the time when the scheme

comes into force and subsequent times, the relevant trading profits or losses

15

of the BNFL company and the transferee company—

(a)   

the trade or part is to be treated as having been a separate trade at the

time of its commencement and as having been carried on by the

transferee company at all times since its commencement as a

separate trade; and

20

(b)   

the trade carried on by the transferee company after the time when

the section 42 scheme comes into force is to be treated as the same

trade as that which it is treated, by virtue of paragraph (a), as having

carried on as a separate trade before that time.

      (3)  

This paragraph is subject to paragraph 23.

25

      (4)  

In this paragraph—

“BNFL company” means BNFL or a wholly-owned subsidiary of

BNFL; and

“relevant trading profits and losses” means profits or losses under

Case I of Schedule D in respect of the trade or part of a trade in

30

question.

Part 3

Transfers relating to relevant site licensees

28    (1)  

This paragraph applies where, in consequence of a nuclear transfer scheme,

a subsidiary of the NDA becomes a relevant site licensee.

35

      (2)  

For the purposes of the application of the enactments mentioned in sub-

paragraph (3) to the assets of the company which has become a relevant site

licensee, that company shall be treated as continuing, for so long as it is a

relevant site licensee, to be a member of the group of companies of which it

was a member immediately before the scheme took effect.

40

      (3)  

Those enactments are—

(a)   

the 1992 Act;

(b)   

Schedule 29 to the Finance Act 2002;

(c)   

paragraphs 5, 14, 19 and 26 of this Schedule.

 

 

 
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