|
| |
|
157 | Relief in respect of mineral royalties |
| |
(1) | This section applies for the purpose of calculating the profits of a trade if in a |
| |
tax year a person who is UK resident, or ordinarily UK resident, carries on the |
| |
trade the receipts of which include mineral royalties— |
| |
(a) | which the person is entitled to receive under a mineral lease or |
| 5 |
| |
(b) | which are not chargeable to tax under Chapter 8 of Part 3 (rent |
| |
receivable in connection with a UK section 12(4) concern) because of the |
| |
priority rule in section 261. |
| |
(2) | The person is treated as entitled to receive only half of the total of the mineral |
| 10 |
royalties arising under the lease or agreement in the tax year. |
| |
(3) | Sections 341 to 343 (meaning of “mineral lease or agreement” and “mineral |
| |
royalties”) apply for the purposes of this section as they apply for the purposes |
| |
| |
158 | Lease premiums etc: reduction of receipts |
| 15 |
(1) | This section applies for the purpose of calculating the profits of a trade of |
| |
dealing in land if a receipt of the trade falls within one of the following |
| |
| |
(a) | lease premiums within section 277, |
| |
(b) | sums within section 279 (sums payable instead of rent), |
| 20 |
(c) | sums within section 280 (sums payable for surrender of a lease), |
| |
(d) | sums within section 281 (sums payable for variation or waiver of term |
| |
| |
(e) | consideration for the assignment of a lease within section 282 (lease |
| |
granted at an undervalue), and |
| 25 |
(f) | amounts received on the sale of an estate or interest in land within |
| |
section 284 (sales with right to re-conveyance) or section 285 (sale and |
| |
| |
(2) | The receipt is reduced by the relevant amount. |
| |
(3) | The relevant amount is the amount which is treated as a receipt of a property |
| 30 |
business as a result of any of sections 277 to 285. |
| |
| |
(a) | the person carrying on the trade makes a claim under section 301 or 302, |
| |
| |
(b) | as a result of the claim a repayment of tax is made to that person, |
| 35 |
| the relevant amount is the amount which, for the purpose of determining the |
| |
amount of the repayment of tax, is treated as brought into account as a receipt |
| |
in calculating the profits of the property business. |
| |
(5) | If subsection (4) applies, any adjustment of liability to tax may be made— |
| |
(a) | by assessment or otherwise, and |
| 40 |
(b) | at any time at which it could be made if it related only to tax for the tax |
| |
year in which the claim under section 301 or 302 is made. |
| |
|
| |
|
| |
|
| |
159 | Ministers of religion |
| |
(1) | This section applies for the purpose of calculating the profits of the profession |
| |
or vocation of a minister of a religious denomination. |
| |
(2) | If the minister pays rent in respect of a dwelling-house and any part of the |
| 5 |
dwelling-house is used mainly and substantially for the purposes of the |
| |
minister’s duty, a deduction is allowed for— |
| |
(a) | one-quarter of the rent, or |
| |
(b) | if less, the part of the rent that, on a just and reasonable apportionment, |
| |
is attributable to that part of the dwelling-house. |
| 10 |
| |
(a) | an interest in premises belongs to a charity or an ecclesiastical |
| |
| |
(b) | because of that interest, the minister has a residence in the premises |
| |
from which to perform the minister’s duty, and |
| 15 |
(c) | the minister incurs expenses on the maintenance, repair, insurance or |
| |
management of the premises, |
| |
| a deduction is allowed under this subsection for part of those expenses. |
| |
(4) | The amount of the deduction under subsection (3) is—![equation: plus[over[char[A],num[4.0000000000000000,"4"]],minus[char[B]]]](missing.gif) |
| |
| 20 |
A is the amount of the expenses, and |
| |
B is the amount of the expenses for which a deduction is otherwise |
| |
| |
| |
160 | Alternative basis of calculation in early years of practice |
| 25 |
(1) | The profits of a barrister or advocate in independent practice for a period of |
| |
account ending not more than 7 years after the start of such practice may be |
| |
calculated in accordance with this section. |
| |
(2) | For this purpose barristers and advocates start in independent practice when |
| |
they first hold themselves out as available for fee-earning work. |
| 30 |
(3) | The profits of a barrister or advocate for a period of account to which this |
| |
section applies may be calculated— |
| |
| |
(b) | by reference to fees earned whose amount has been agreed or in respect |
| |
of which a fee note has been delivered. |
| 35 |
(4) | Once a particular basis has been adopted it must be applied consistently. |
| |
(5) | If for any period of account an accounting basis is adopted that complies with |
| |
section 25 (generally accepted accounting practice), the exemption from that |
| |
section given by this section ceases. |
| |
|
| |
|
| |
|
(6) | In that case, section 25 applies to all subsequent periods of account. |
| |
Mineral exploration and access |
| |
161 | Mineral exploration and access |
| |
(1) | This section applies for the purpose of calculating the profits of a trade if— |
| |
(a) | the person carrying on the trade incurs expenditure on mineral |
| 5 |
exploration and access in an area or group of sands, and |
| |
(b) | the presence of mineral deposits in commercial quantities has already |
| |
been established in that area or group of sands. |
| |
(2) | A deduction is allowed for the expenditure only if a deduction would have |
| |
been allowed for it if the presence of mineral deposits in commercial quantities |
| 10 |
had not already been established in that area or group of sands. |
| |
(3) | In this section “mineral exploration and access” has the same meaning as in |
| |
Part 5 of CAA 2001 (see section 396(1) of that Act). |
| |
Persons liable to pool betting duty |
| |
162 | Payments by persons liable to pool betting duty |
| 15 |
(1) | This section applies for the purpose of calculating the profits of a trade if— |
| |
(a) | the person carrying on the trade is liable to pool betting duty, |
| |
(b) | there is a reduction in that duty, and |
| |
(c) | the person makes a qualifying payment in consequence of that |
| |
| 20 |
(2) | A qualifying payment is one— |
| |
(a) | made in order to meet (directly or indirectly) capital expenditure |
| |
incurred by any person in improving the safety or comfort of spectators |
| |
at a ground to be used for the playing of association football, or |
| |
(b) | made to trustees established mainly for the support of athletic sports or |
| 25 |
athletic games but with power to support the arts. |
| |
(3) | A deduction is allowed for the qualifying payment. |
| |
Intermediaries treated as making employment payments |
| |
163 | Deduction for deemed employment payment |
| |
(1) | This section applies for the purpose of calculating the profits of a trade, |
| 30 |
profession or vocation carried on by an intermediary who is treated as making |
| |
a deemed employment payment in connection with the trade, profession or |
| |
| |
(2) | A deduction is allowed for— |
| |
(a) | the amount of the deemed employment payment, and |
| 35 |
(b) | the amount of any employer’s national insurance contributions paid by |
| |
the intermediary in respect of it. |
| |
(3) | The deduction is allowed for the period of account in which the deemed |
| |
employment payment is treated as made. |
| |
|
| |
|
| |
|
(4) | No deduction in respect of— |
| |
(a) | the deemed employment payment, or |
| |
(b) | any employer’s national insurance contributions paid by the |
| |
intermediary in respect of it, |
| |
| may be made except in accordance with this section. |
| 5 |
(5) | In this section “deemed employment payment” and “intermediary” have the |
| |
same meaning as in Chapter 8 of Part 2 of ITEPA 2003. |
| |
164 | Special rules for partnerships |
| |
(1) | This section applies for the purpose of calculating the profits of a trade, |
| |
profession or vocation carried on by a firm that is treated as making a deemed |
| 10 |
employment payment in connection with the trade, profession or vocation. |
| |
(2) | The amount of the deduction allowed under section 163 is limited to the |
| |
amount that reduces the profits of the firm for the tax year to nil. |
| |
(3) | The expenses of the firm in connection with the relevant engagements for any |
| |
period of account are limited to the total of— |
| 15 |
(a) | 5% of the amount taken into account in step 1 of the calculation in |
| |
section 54(1) of ITEPA 2003 (calculation of deemed employment |
| |
| |
(b) | the amount deductible in step 3 of that calculation. |
| |
(4) | In this section “deemed employment payment” and “the relevant |
| 20 |
engagements” have the same meaning as in Chapter 8 of Part 2 of ITEPA 2003. |
| |
| |
165 | Deduction for site preparation expenditure |
| |
(1) | This section applies for the purpose of calculating the profits of a trade of a |
| |
period of account in which waste materials are deposited on a waste disposal |
| 25 |
| |
(a) | the person carrying on the trade (“the trader”), or a predecessor, has |
| |
incurred site preparation expenditure in relation to the site in the |
| |
course of carrying on the trade, and |
| |
(b) | at the time the trader first deposits waste materials on the site, the |
| 30 |
trader holds a waste disposal licence which is then in force. |
| |
(2) | A deduction is allowed for the amount of the site preparation expenditure |
| |
allocated to the period of account under section 166. |
| |
(3) | For the purposes of this section “predecessor”, in relation to the trader, means |
| |
| 35 |
(a) | has ceased to carry on the trade carried on by the trader or ceased to |
| |
carry on a trade so far as relating to the site, and |
| |
(b) | has transferred the whole of the site to the trader, |
| |
| and it does not matter for this purpose whether or not the estate or interest in |
| |
the site transferred to the trader is the same as that held by that person. |
| 40 |
(4) | For the purposes of this section and section 166, if site preparation expenditure |
| |
has been incurred by a predecessor— |
| |
|
| |
|
| |
|
(a) | the trade carried on by the trader is treated as the same as the trade |
| |
carried on by the predecessor, and |
| |
(b) | deductions are to be allowed to the trader (and not to the predecessor) |
| |
as if everything done to or by the predecessor were done to or by the |
| |
| 5 |
| |
(a) | the meaning of “site preparation expenditure”, “waste disposal licence” |
| |
and “waste disposal site”, and |
| |
(b) | a rule about pre-trading expenditure, |
| |
| 10 |
166 | Allocation of site preparation expenditure |
| |
(1) | The amount of site preparation expenditure allocated to a period of account for |
| |
the purposes of section 165(2) is the amount given by the formula—![equation: times[char[R],cross[char[E],over[string[(*i1i*)"WD"],plus[times[char[S],char[V]],
times[char[W],char[D]]]]]]](missing.gif) |
| |
| |
RE means residual expenditure (see subsection (2)), |
| 15 |
WD means the volume of waste materials deposited on the waste disposal |
| |
site during the period, and |
| |
SV means the volume of the waste disposal site not used up for the |
| |
deposit of waste materials at the end of the period. |
| |
(2) | “Residual expenditure” means the total of all site preparation expenditure |
| 20 |
incurred by the trader in relation to the waste disposal site at any time before |
| |
the end of the period, less— |
| |
(a) | any of that expenditure for which an allowance has been, or may be, |
| |
made for income or corporation tax purposes under the enactments |
| |
relating to capital allowances, |
| 25 |
(b) | any of that expenditure for which a deduction has been allowed in |
| |
calculating for income or corporation tax purposes the profits of an |
| |
earlier period of account, and |
| |
(c) | if the trader started to carry on the trade before 6th April 1989, the |
| |
excluded amount of any unrelieved old expenditure (see subsections |
| 30 |
| |
(3) | The excluded amount of unrelieved old expenditure is calculated by |
| |
multiplying the unrelieved old expenditure (see subsection (4)) by the |
| |
fraction—![equation: over[string["WD"],plus[string["SV"],times[char[W],char[D]]]]](missing.gif) |
| |
| 35 |
WD means the volume of waste materials deposited on the site before 6th |
| |
| |
SV means the volume of the site not used up for the deposit of waste |
| |
materials immediately before that date. |
| |
(4) | “Unrelieved old expenditure” means site preparation expenditure which— |
| 40 |
|
| |
|
| |
|
(a) | was incurred by the trader in relation to the waste disposal site before |
| |
| |
(b) | does not fall within subsection (2)(a) or (b). |
| |
167 | Site preparation expenditure: supplementary |
| |
(1) | For the purposes of this section and sections 165 and 166— |
| 5 |
“site preparation expenditure”, in relation to a waste disposal site, means |
| |
expenditure incurred on preparing the site for the deposit of waste |
| |
| |
“waste disposal licence” means— |
| |
(a) | a disposal licence under Part 1 of the Control of Pollution Act |
| 10 |
1974 (c. 40) or Part 2 of the Pollution Control and Local |
| |
Government (Northern Ireland) Order 1978 (S.I. 1978/1049 |
| |
| |
(b) | a waste management licence under Part 2 of the Environmental |
| |
Protection Act 1990 (c. 43) or any corresponding provision for |
| 15 |
the time being in force in Northern Ireland, |
| |
(c) | a permit under regulations under section 2 of the Pollution |
| |
Prevention and Control Act 1999 (c. 24) or any corresponding |
| |
provision for the time being in force in Northern Ireland, |
| |
(d) | an authorisation under the Radioactive Substances Act 1960 |
| 20 |
(c. 34) or the Radioactive Substances Act 1993 (c. 12) for the |
| |
disposal of radioactive waste, or |
| |
(e) | a nuclear site licence under the Nuclear Installations Act 1965 |
| |
| |
“waste disposal site” means a site used, or to be used, for the disposal of |
| 25 |
waste materials by their deposit on the site. |
| |
(2) | For the purposes of sections 165 and 166, expenditure incurred for the |
| |
purposes of a trade by a person about to carry on the trade is treated as if it |
| |
| |
(a) | on the date on which the person starts to carry on the trade, and |
| 30 |
(b) | in the course of carrying it on. |
| |
168 | Site restoration payments |
| |
(1) | This section applies for the purpose of calculating the profits of a trade if the |
| |
person carrying on the trade makes a site restoration payment in the course of |
| |
| 35 |
(2) | A deduction is allowed for the unrelieved amount of the payment. |
| |
(3) | The deduction is allowed for the period of account in which the payment is |
| |
| |
(4) | The unrelieved amount of a site restoration payment is the amount of the |
| |
| 40 |
(a) | any amount of the payment that represents expenditure for which an |
| |
allowance has been, or may be, made under the enactments relating to |
| |
| |
(b) | any amount of the payment that represents expenditure for which a |
| |
deduction has been allowed in calculating the profits of the trade of an |
| 45 |
earlier period of account. |
| |
|
| |
|
| |
|
(5) | A “site restoration payment” means a payment made in connection with the |
| |
restoration of a site (or part of a site) in order to comply with— |
| |
(a) | a condition of a waste disposal licence (as defined in section 167(1)), |
| |
(b) | a condition imposed on the grant of planning permission to use the site |
| |
for the collection, treatment, conversion and final depositing of waste |
| 5 |
materials or for the carrying out of any of those activities, or |
| |
(c) | a relevant planning obligation. |
| |
(6) | For this purpose “a relevant planning obligation” means— |
| |
(a) | an obligation arising under an agreement made under section 106 of the |
| |
Town and Country Planning Act 1990 (c. 8) (as originally enacted) or |
| 10 |
any corresponding provision for the time being in force in Northern |
| |
| |
(b) | an obligation arising under an agreement made under section 75 of the |
| |
Town and Country Planning (Scotland) Act 1997 (c. 8), |
| |
(c) | a planning obligation entered into under section 106 of the Town and |
| 15 |
Country Planning Act 1990 (as substituted by section 12 of the Planning |
| |
and Compensation Act 1991 (c. 34)) or any corresponding provision for |
| |
the time being in force in Northern Ireland, or |
| |
(d) | a planning obligation entered into under section 299A of the Town and |
| |
Country Planning Act 1990 or any corresponding provision for the time |
| 20 |
being in force in Northern Ireland. |
| |
Cemeteries and crematoria |
| |
169 | Cemeteries and crematoria: introduction |
| |
(1) | This section and sections 170 to 172 apply for the purpose of calculating the |
| |
profits of a period of account (“the relevant period”) of a trade which consists |
| 25 |
| |
(a) | the carrying on of a cemetery, or |
| |
(b) | the carrying on of a crematorium and, in connection with doing so, the |
| |
maintenance of memorial garden plots, |
| |
| and the following provisions of this section apply for the interpretation of this |
| 30 |
section and those sections. |
| |
(2) | References to the sale of land in a cemetery include the sale of a right of |
| |
interment in land in a cemetery. |
| |
(3) | References to the sale of land in a memorial garden include the appropriation |
| |
of part of a memorial garden in return for a dedication fee or similar payment. |
| 35 |
(4) | “Ancillary capital expenditure” means capital expenditure incurred for the |
| |
purposes of the trade by the person carrying on the trade (“the trader”), or a |
| |
| |
(a) | any building or structure (other than a dwelling-house) which is in the |
| |
cemetery or memorial garden and is likely to have little or no value |
| 40 |
when the cemetery or memorial garden is full, |
| |
(b) | the purchase of an interest in, or the preparation of, any land taken up |
| |
by such a building or structure, or |
| |
(c) | the purchase of an interest in, or the preparation of, any other land in |
| |
the cemetery or memorial garden which is not suitable or adaptable for |
| 45 |
use for interments or memorial garden plots and which is likely to have |
| |
little or no value when the cemetery or memorial garden is full. |
| |
|
| |
|