National Insurance Contributions Bill

House of Commons

Session 2005 - 06
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Other Bills before Parliament

National Insurance Contributions Bill

National Insurance Contributions Bill
8

(4)
Regulations under subsection (1) may be made so as to have
retrospective effect but must not have effect in relation to any time
before 2nd December 2004.
(5)
In particular, regulations under subsection (1) made by virtue of
subsection (4) may affect any of the following matters—
5
(a)
liability to pay contributions, including liability to pay Class 1
contributions at a reduced rate by virtue of Chapter 2 of Part 3
of the Pensions Act;
(b)
the amount of any contribution, including the amount of any
such reduced rate contribution and of any related rebate under
10
section 37(1D) or 38A(2C) of that Act;
(c)
entitlement to a contributory benefit or contribution-based
jobseeker’s allowance;
(d)
the amount of any such benefit or allowance;
(e)
entitlement to a statutory payment;
15
(f)
the amount of any such payment;
(g)
liability to make minimum payments (within the meaning of
the Pensions Act) to occupational pension schemes;
(h)
the amount of any such payment;
(i)
liability to make payments under section 38A(3) of the Pensions
20
Act or to pay minimum contributions under section 39 of that
Act;
(j)
the amount of any such payment or contribution.
(6)
In such a case, where the matter has been determined before the time
when the regulations are made, the regulations may provide for the
25
matter to be redetermined accordingly.
(7)
If (ignoring this subsection) the operative provisions would directly or
indirectly have effect in any case so as—
(a)
to remove a person’s entitlement to a contributory benefit,
contribution-based jobseeker’s allowance or statutory payment,
30
or
(b)
to reduce the amount of any such benefit, allowance or payment
to which a person has an entitlement,

those provisions are to be read with such modifications as are necessary
to ensure that they do not have that effect.
35
(8)
For the purposes of subsection (7)—
(a)
“the operative provisions” are section 4B(7) to (10) and any
provision made by virtue of section 4B(2) or under subsection
(1) of this section;
(b)
a person’s “entitlement” includes any future entitlement which
40
the person may have.
(9)
The powers conferred by this section are without prejudice to any
powers conferred by or by virtue of any other provision of this Act or
any other enactment.
(10)
In particular, any modification of any provision of an instrument by
45
regulations made under subsection (1) is without prejudice to any other
power to amend or revoke the provisions of the instrument (including
the modified provision).

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(11)
For the purposes of this section—
“the commencement day” means the day on which the National
Insurance Contributions Act 2006 was passed;
“enactment” includes—
(a)
Northern Ireland legislation, and
5
(b)
an instrument made under Northern Ireland legislation
(as well as an instrument made under an Act);
“statutory payment” means—
(a)
statutory sick pay, statutory maternity pay, statutory
paternity pay or statutory adoption pay; or
10
(b)
any other payment prescribed by regulations made by
the Treasury with the concurrence of the relevant
Northern Ireland department (if any);
“the relevant Northern Ireland department”, in relation to
regulations made under this section, means each Northern
15
Ireland department responsible for any of the matters to which
the regulations relate.”
(2)
In section 172 of that Act (parliamentary control of statutory instruments)—
(a)
in subsection (11A), after “by virtue of section” insert “4B(2), 4C,”, and
(b)
after subsection (11B) insert—
20
“(11C)
In the case of a statutory instrument containing (whether alone
or with other provisions) regulations made by virtue of section
4B(2) to which subsection (11A) above applies, the draft of the
instrument must be laid before Parliament before the end of the
period of 12 months beginning with the appropriate date.
25
(11D)
For the purposes of subsection (11C), the “appropriate date”
means—
(a)
where the corresponding retrospective tax provision
was passed or made before the day on which the
National Insurance Contributions Act 2006 was passed,
30
the date upon which that Act was passed, and
(b)
in any other case, the date upon which the
corresponding retrospective tax provision was passed
or made.
(11E)
For the purposes of subsection (11D), “the corresponding
35
retrospective tax provision” in relation to the regulations
means—
(a)
the retrospective tax provision mentioned in subsection
(1) of section 4B in relation to which the regulations are
to be made by virtue of subsection (2) of that section, or
40
(b)
where there is more than one such tax provision,
whichever of those provisions was the first to be passed
or made.”
3
Class 1A contributions: power to make provision in consequence of
retrospective tax legislation: Great Britain
45
(1)
After section 10ZB of the Social Security Contributions and Benefits Act 1992

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(c. 4) insert—
“10ZC
Class 1A contributions: power to make provision in consequence of
retrospective tax legislation
(1)
The Treasury may by regulations make such provision as appears to
the Treasury to be expedient for any purpose of the law relating to
5
Class 1A contributions in consequence of any relevant retrospective tax
provision—
(a)
which is passed or made at or before the time when the
regulations are made, or
(b)
which may be passed or made after that time.
10
(2)
“Relevant retrospective tax provision” means a provision of the Income
Tax Acts which—
(a)
has retrospective effect, and
(b)
affects the amount of general earnings received by an earner
from an employment on which he is chargeable to income tax
15
under the employment income Parts of ITEPA 2003 for a tax
year.
(3)
It does not matter whether the relevant retrospective tax provision was
passed or made before the commencement day.
(4)
Regulations under this section may, in particular, make provision—
20
(a)
modifying any provision of any enactment (including this Act
and any enactment passed or made on or after the
commencement day);
(b)
for any provision of any such enactment to apply in such cases,
and with such modifications (if any), as the regulations may
25
prescribe.
(5)
Regulations under this section may be made so as to have retrospective
effect but must not have effect in relation to any time before 2nd
December 2004.
(6)
In particular, regulations under this section made by virtue of
30
subsection (5)—
(a)
may affect matters determined before the time when the
regulations are made, and
(b)
may provide for those matters to be redetermined accordingly.
(7)
Regulations under this section—
35
(a)
may not impose any liability to pay a Class 1A contribution, and
(b)
may not increase the amount of any Class 1A contribution.
(8)
The powers conferred by this section are without prejudice to—
(a)
any liability to pay a Class 1A contribution which arises by
virtue of any relevant retrospective tax provision, and
40
(b)
any powers conferred by or by virtue of any other provision of
this Act or any other enactment.
(9)
In particular, any modification of any provision of an instrument by
regulations under this section is without prejudice to any other power
to amend or revoke the provisions of the instrument (including the
45
modified provision).

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(10)
For the purposes of this section—
“the commencement day” means the day on which the National
Insurance Contributions Act 2006 was passed;
“enactment” includes an instrument made under an Act.”
(2)
In section 176 of that Act (parliamentary control of statutory instruments), in
5
subsection (1)(a), at the appropriate place in the list insert—
“section 10ZC;”.
4
Class 1A contributions: power to make provision in consequence of
retrospective tax legislation: Northern Ireland
(1)
After section 10ZB of the Social Security Contributions and Benefits (Northern
10
Ireland) Act 1992 (c. 7) insert—
“10ZC
Class 1A contributions: power to make provision in consequence of
retrospective tax legislation
(1)
The Treasury may by regulations make such provision as appears to
the Treasury to be expedient for any purpose of the law relating to
15
Class 1A contributions in consequence of any relevant retrospective tax
provision—
(a)
which is passed or made at or before the time when the
regulations are made, or
(b)
which may be passed or made after that time.
20
(2)
“Relevant retrospective tax provision” means a provision of the Income
Tax Acts which—
(a)
has retrospective effect, and
(b)
affects the amount of general earnings received by an earner
from an employment on which he is chargeable to income tax
25
under the employment income Parts of ITEPA 2003 for a tax
year.
(3)
It does not matter whether the relevant retrospective tax provision was
passed or made before the commencement day.
(4)
Regulations under this section may, in particular, make provision—
30
(a)
modifying any provision of any enactment (including this Act
and any enactment passed or made on or after the
commencement day);
(b)
for any provision of any such enactment to apply in such cases,
and with such modifications (if any), as the regulations may
35
prescribe.
(5)
Regulations under this section may be made so as to have retrospective
effect but must not have effect in relation to any time before 2nd
December 2004.
(6)
In particular, regulations under this section made by virtue of
40
subsection (5)—
(a)
may affect matters determined before the time when the
regulations are made, and
(b)
may provide for those matters to be redetermined accordingly.
(7)
Regulations under this section—
45

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(a)
may not impose any liability to pay a Class 1A contribution, and
(b)
may not increase the amount of any Class 1A contribution.
(8)
The powers conferred by this section are without prejudice to—
(a)
any liability to pay a Class 1A contribution which arises by
virtue of any relevant retrospective tax provision, and
5
(b)
any powers conferred by or by virtue of any other provision of
this Act or any other enactment.
(9)
In particular, any modification of any provision of an instrument by
regulations under this section is without prejudice to any other power
to amend or revoke the provisions of the instrument (including the
10
modified provision).
(10)
For the purposes of this section—
“the commencement day” means the day on which the National
Insurance Contributions Act 2006 was passed;
“enactment” includes an instrument made under an Act.”
15
(2)
In section 172 of that Act (parliamentary control of statutory instruments), in
subsection (11A), before “11(3)” insert “10ZC,”.
Agreements and joint elections
5
Agreements and joint elections: Great Britain
(1)
Schedule 1 to the Social Security Contributions and Benefits Act 1992 (c. 4)
20
(supplementary provisions relating to Class 1 contributions) is amended as
follows.
(2)
In paragraph 3A (restrictions on recovery of employer’s contributions), in sub-
paragraph (2A)—
(a)
after “relates to” insert “—
25
(a)
”, and
(b)
after “market value)” insert “, or
(b)
any contribution, or any part of any contribution,
liability to which arises as a result of regulations being
given retrospective effect by virtue of section 4B(2)
30
(earnings: power to make retrospective provision in
consequence of retrospective tax legislation)”.
(3)
In paragraph 3B (transfer of liability for employer’s contributions to
employee), in sub-paragraph (7B)—
(a)
after “relate to” insert “—
35
(a)
”, and
(b)
after “market value)” insert “, or
(b)
any liability, or any part of any liability, to a
contribution arising as a result of regulations being
given retrospective effect by virtue of section 4B(2)
40
(earnings: power to make retrospective provision in
consequence of retrospective tax legislation)”.
(4)
The amendments made by this section have effect in relation to agreements
and elections whether entered into or made before, or on or after, the day on

National Insurance Contributions Bill
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which this Act is passed (including those entered into or made before 2nd
December 2004).
6
Agreements and joint elections: Northern Ireland
(1)
Schedule 1 to the Social Security Contributions and Benefits (Northern Ireland)
Act 1992 (c. 7) (supplementary provisions relating to Class 1 contributions) is
5
amended as follows.
(2)
In paragraph 3A (restrictions on recovery of employer’s contributions), in sub-
paragraph (2A)—
(a)
after “relates to” insert “—
(a)
”, and
10
(b)
after “market value)” insert “, or
(b)
any contribution, or any part of any contribution,
liability to which arises as a result of regulations being
given retrospective effect by virtue of section 4B(2)
(earnings: power to make retrospective provision in
15
consequence of retrospective tax legislation)”.
(3)
In paragraph 3B (transfer of liability for employer’s contributions to
employee), in sub-paragraph (7B)—
(a)
after “relate to” insert “—
(a)
”, and
20
(b)
after “market value)” insert “, or
(b)
any liability, or any part of any liability, to a
contribution arising as a result of regulations being
given retrospective effect by virtue of section 4B(2)
(earnings: power to make retrospective provision in
25
consequence of retrospective tax legislation)”.
(4)
The amendments made by this section have effect in relation to agreements
and elections whether entered into or made before, or on or after, the day on
which this Act is passed (including those entered into or made before 2nd
December 2004).
30
Disclosure of avoidance
7
Disclosure of contributions avoidance arrangements
(1)
The Social Security Administration Act 1992 (c. 5) is amended as follows.
(2)
After section 132 insert—
“Contributions avoidance arrangements
35
132A
Disclosure of contributions avoidance arrangements
(1)
The Treasury may by regulations make provision requiring, or relating
to, the disclosure of information in relation to any notifiable
contribution arrangements or notifiable contribution proposal.
(2)
The only provision which may be made under subsection (1) is
40
provision applying (with or without modification), or corresponding
to, any of the following provisions—

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(a)
any provision of, or made under, Part 7 of the Finance Act 2004
(disclosure of tax avoidance schemes) so far as that provision
relates to income tax;
(b)
section 98C of the Taxes Management Act 1970 (penalties for
failure to comply with Part 7 of the Finance Act 2004) and any
5
other provision of the Taxes Management Act 1970 so far as it
relates to a penalty under that section;
(c)
any provision made under section 132 of the Finance Act 1999
or section 135 of the Finance Act 2002 (electronic
communications);
10
(d)
any provision of any other enactment or instrument (including
any enactment or instrument passed or made on or after the day
on which the National Insurance Contributions Act 2006 was
passed) which requires, or relates to, the disclosure of
information in relation to tax avoidance arrangements which
15
relate in whole or in part to income tax.
(3)
For the purposes of subsection (1)—
“notifiable contribution arrangements” means any arrangements
which—
(a)
enable, or might be expected to enable, any person to
20
obtain an advantage in relation to a contribution, and
(b)
are such that the main benefit, or one of the main
benefits, that might be expected to arise from the
arrangements is the obtaining of that advantage;
“notifiable contribution proposal” means a proposal for
25
arrangements which, if entered into, would be notifiable
contribution arrangements (whether the proposal relates to a
particular person or to any person who may seek to take
advantage of it).
(4)
Where, at any time after the passing of the National Insurance
30
Contributions Act 2006, a relevant tax provision is passed or made
which changes the notifiable tax matters, the Treasury may, by
regulations, amend the definitions in subsection (3) so as to make an
analogous change to the matters in respect of which information may
be required to be disclosed by virtue of this section.
35
(5)
In subsection (4)—
“the notifiable tax matters” means the arrangements, proposals or
other matters in respect of which information is or may be
required to be disclosed under a relevant tax provision;
“relevant tax provision” means a provision mentioned in
40
subsection (2).
(6)
No provision made by regulations under this section may require any
person to disclose to the Commissioners for Her Majesty’s Revenue
and Customs, or any other person, any information with respect to
which a claim to legal professional privilege, or, in Scotland, to
45
confidentiality of communications, could be maintained in legal
proceedings.
(7)
In this section—
“advantage”, in relation to any contribution, means—