|
| |
|
(3) | Condition A is that the pension scheme directly holds the interest |
| |
in the taxable property which gives rise to the unauthorised |
| |
| |
| |
(a) | the pension scheme holds the interest in the property |
| 5 |
indirectly through one vehicle, and |
| |
(b) | that vehicle is wholly owned by the pension scheme. |
| |
| |
(a) | the pension scheme holds the interest in the property |
| |
indirectly through more than one vehicle (a “chain” of |
| 10 |
| |
(b) | each vehicle in the chain is wholly owned by another |
| |
vehicle in the chain or by the pension scheme. |
| |
| |
(a) | the pension scheme holds the interest in the property |
| 15 |
indirectly through one vehicle, and |
| |
(b) | the vehicle is not wholly owned by the pension scheme, |
| |
| the amount of the unauthorised payment is a proportion of the |
| |
total taxable amount determined by reference to the extent of the |
| |
pension scheme’s interest in the vehicle. |
| 20 |
| |
(a) | the pension scheme holds the interest in the property |
| |
indirectly through one or more chains of vehicles, and |
| |
(b) | one or more vehicles in such a chain is not wholly owned |
| |
by another vehicle in the chain or by the pension scheme, |
| 25 |
| the amount of the unauthorised payment is the amount or the total |
| |
of all the amounts found under sub-paragraph (8) for each chain |
| |
through which the pension scheme owns the interest in the |
| |
| |
(8) | The amount is a proportion of the total taxable amount |
| 30 |
determined by reference to the extent of the interest held directly |
| |
by the pension scheme or another vehicle in the chain in each |
| |
| |
(a) | starting with the vehicle which holds the interest in the |
| |
| 35 |
(b) | ending with the vehicle in which the pension scheme |
| |
directly holds an interest. |
| |
(9) | For the purposes of this paragraph a vehicle is wholly owned by a |
| |
person if no other person directly holds an interest in the vehicle. |
| |
(10) | This paragraph is subject to paragraph 44. |
| 40 |
42 (1) | References in this Schedule to the extent of an interest held directly |
| |
by a person in a vehicle are references to the proportion of the |
| |
interests of everyone who directly holds an interest in the vehicle |
| |
which on a just and reasonable apportionment is represented by |
| |
| 45 |
(2) | Sub-paragraph (1) is subject to paragraph 43, which explains how |
| |
to determine the extent of a person’s interest in a vehicle for the |
| |
|
| |
|
| |
|
purposes of the taxable property provisions where the vehicle is a |
| |
| |
(3) | The Treasury may by regulations— |
| |
(a) | amend paragraph 43, or |
| |
(b) | amend this Part of this Schedule for the purposes of |
| 5 |
explaining how to determine the extent of a person’s |
| |
interest in a vehicle in other cases. |
| |
(4) | Regulations under sub-paragraph (3) may include provision |
| |
having effect in relation to times before they are made. |
| |
43 (1) | For the purposes of this Schedule, and except in a case to which |
| 10 |
sub-paragraph (3) applies, the extent of a person’s interest in a |
| |
company is determined by reference to whichever of the following |
| |
gives the person the greatest interest in the company— |
| |
(a) | the percentage of the share capital or issued share capital |
| |
of the company owned by the person; |
| 15 |
(b) | the percentage of the voting rights in the company owned |
| |
| |
(c) | the percentage of all the income of the company to which |
| |
| |
(d) | the percentage of the amounts distributed on a distribution |
| 20 |
in relation to the company to which the person has a right; |
| |
(e) | the percentage of the assets of the company to which the |
| |
person has a right on a winding-up or in any other |
| |
| |
(f) | where the person has a right to a percentage of a particular |
| 25 |
asset or description of assets of the company, or of the |
| |
income or gains from such an asset or description (either |
| |
generally or in particular circumstances), that percentage |
| |
or the highest of all the percentages found under this |
| |
| 30 |
(2) | For the purposes of sub-paragraph (1) a person is treated as |
| |
owning or having a right to anything which the person will only |
| |
| |
| |
(b) | if the person exercises a right to acquire it, or |
| 35 |
(c) | if some other uncertain future event occurs or does not |
| |
| |
| |
(a) | a person has an interest in a company as a result of lending |
| |
the company money to fund the acquisition of an interest |
| 40 |
| |
(b) | this sub-paragraph gives the person a greater interest in |
| |
the company than any interest given by sub-paragraph (1), |
| |
| for the purposes of this Schedule the extent of the person’s interest |
| |
in the company is determined by the proportion that the value of |
| 45 |
the loan bears to the total value of the assets held directly by the |
| |
| |
(4) | For the purposes of sub-paragraph (3)— |
| |
|
| |
|
| |
|
(a) | assets must be valued in accordance with generally |
| |
accepted accounting practice, |
| |
(b) | no account is to be taken of liabilities secured against or |
| |
otherwise relating to assets (whether generally or |
| |
| 5 |
(c) | where generally accepted accounting practice offers a |
| |
choice of valuation between cost basis and fair value, fair |
| |
| |
Deemed acquisition: adjustment |
| |
44 (1) | This paragraph applies where an investment-regulated pension |
| 10 |
scheme is treated as acquiring an interest in taxable property by |
| |
virtue of paragraph 28 (increase in extent of interest in vehicle). |
| |
(2) | The amount of the unauthorised payment treated as made by the |
| |
pension scheme is— |
| |
| 15 |
UP is the amount that would have been the amount of the |
| |
unauthorised payment apart from this paragraph; and |
| |
UPB is the amount that would have been the amount of any |
| |
unauthorised payment treated as made by the pension |
| |
scheme if it had acquired the interest in the property |
| 20 |
immediately before the increase in the extent of the interest |
| |
in the vehicle (assuming the total taxable amount in |
| |
relation to the unauthorised payment to be that given |
| |
| |
| 25 |
45 (1) | This paragraph has effect for determining— |
| |
(a) | whether the whole of an unauthorised payment treated as |
| |
made by a pension scheme is to be treated as made to a |
| |
member of the scheme, and |
| |
(b) | if not, how much of the unauthorised payment is to be |
| 30 |
treated as made to the member. |
| |
(2) | If the interest in the taxable property which gives rise to the |
| |
unauthorised payment is held by the pension scheme for the |
| |
| |
(a) | the arrangement under the pension scheme relating to the |
| 35 |
| |
(b) | at least one other arrangement under the pension scheme, |
| |
| the unauthorised payment is to be apportioned on a just and |
| |
reasonable basis between all of the arrangements for the purposes |
| |
of which the interest in the property is held. |
| 40 |
(3) | Otherwise, the whole of the unauthorised payment is to be treated |
| |
| |
14 (1) | Schedule 34 (non-UK schemes: application of certain charges) is amended as |
| |
| |
(2) | In paragraph 1 (member payment charges)— |
| 45 |
|
| |
|
| |
|
(a) | in sub-paragraph (3)(a), after “charge” insert “(except as imposed by |
| |
virtue of section 174A (taxable property held by investment- |
| |
regulated pension schemes))”, and |
| |
(b) | in sub-paragraph (4), after “Part” insert “(apart from the taxable |
| |
| 5 |
(3) | After paragraph 7 insert— |
| |
“Unauthorised payment charge: taxable property |
| |
7A (1) | The Commissioners for Her Majesty’s Revenue and Customs may |
| |
by regulations make provision for a transfer member of a relevant |
| |
non-UK scheme to be liable to the unauthorised payment charge |
| 10 |
in the same or similar circumstances to those in which— |
| |
(a) | a member of a registered pension scheme is liable to that |
| |
charge by virtue of section 174A and Schedule 29A (taxable |
| |
property held by investment-regulated pension scheme), |
| |
(b) | the scheme administrator of such a scheme is liable to the |
| 15 |
scheme sanction charge by virtue of section 185A (income |
| |
from taxable property) or 185F (gains from taxable |
| |
| |
(c) | a member of such a scheme is liable to the scheme sanction |
| |
charge by virtue of those provisions in consequence of |
| 20 |
provision made by regulations under section 273ZA. |
| |
| |
(a) | make provision for the application of any or all of the |
| |
taxable property provisions in relation to a transfer |
| |
member of a relevant non-UK scheme subject to any |
| 25 |
omissions, additions and other modifications contained in |
| |
| |
(b) | include provision having effect in relation to times before |
| |
| |
(c) | contain transitional provisions and savings, and |
| 30 |
(d) | make different provision for different cases.” |
| |
15 | In Schedule 36 (transitional provisions and savings), after paragraph 37 |
| |
| |
“Pre-commencement holdings of taxable property |
| |
37A (1) | This paragraph applies in relation to an investment-regulated |
| 35 |
| |
(a) | on 6th April 2006 the pension scheme holds an interest in |
| |
taxable property which it acquired before that date, and |
| |
(b) | immediately before that date the pension scheme was not |
| |
prohibited from holding the interest in the property, |
| 40 |
| and, in a case where immediately before that date the interest in |
| |
the property was held directly by a person other than the pension |
| |
scheme, if the pension scheme was not prohibited from holding |
| |
the interest it held in that person at that time. |
| |
(2) | This paragraph also applies in relation to an investment-regulated |
| 45 |
| |
|
| |
|
| |
|
(a) | before 6th April 2006 a contract to acquire an interest in |
| |
property was entered into by the pension scheme or a |
| |
person in whom the pension scheme directly or indirectly |
| |
held an interest when the contract was entered into, |
| |
(b) | the pension scheme does not acquire the interest in the |
| 5 |
property before that date, |
| |
(c) | the property is taxable property on that date, and |
| |
(d) | immediately before that date the pension scheme would |
| |
not have been prohibited from holding the interest in the |
| |
| 10 |
| and, in a case where the contract to acquire the interest in the |
| |
property was entered into by a person in whom the pension |
| |
scheme directly or indirectly held an interest, if the pension |
| |
scheme was not prohibited from holding the interest it held in that |
| |
person immediately before that date. |
| 15 |
(3) | The taxable property provisions (apart from this paragraph and |
| |
paragraphs 37B to 37E) do not apply in relation to the pension |
| |
scheme and the interest in the property. |
| |
(4) | For the purposes of this Schedule a pension scheme is to be treated |
| |
as having been prohibited from holding an interest in property, or |
| 20 |
in a person, immediately before 6th April 2006 if approval could |
| |
have been withdrawn under section 591B, 620(7) or 650 of ICTA on |
| |
the basis of the holding of the interest at that time. |
| |
(5) | This paragraph is subject to paragraphs 37B to 37E. |
| |
37B (1) | Paragraph 37A ceases to apply to an investment-regulated |
| 25 |
pension scheme and an interest in taxable property on the relevant |
| |
date if Condition A, B or C is met. |
| |
(2) | Condition A is that there is a change in the occupation or use of the |
| |
property such that, if the change had occurred immediately before |
| |
6th April 2006, the pension scheme would have been prohibited |
| 30 |
from holding the interest in the property at that time. |
| |
| |
(a) | the taxable property is residential property on 6th April |
| |
| |
(b) | improvement works on the property are begun on or after |
| 35 |
| |
(4) | Condition C is that there is a change in the pension scheme’s |
| |
| |
(a) | any person who holds the interest in the property directly, |
| |
| 40 |
(b) | any person who has entered into a contract to acquire the |
| |
interest in the property, |
| |
| such that, if the change had occurred immediately before 6th April |
| |
2006, the pension scheme would have been prohibited from |
| |
holding the interest in the person at that time. |
| 45 |
(5) | For the purposes of this paragraph the relevant date is— |
| |
(a) | where Condition A is met, the date on which the change in |
| |
the occupation or use of the taxable property takes place, |
| |
|
| |
|
| |
|
(b) | where Condition B is met, the date on which the |
| |
improvement works are substantially completed, or |
| |
(c) | where Condition C is met, the date on which the change in |
| |
the pension scheme’s interest in the person takes place, |
| |
| but where the pension scheme has not acquired the interest in the |
| 5 |
property by what would otherwise be the relevant date, the |
| |
relevant date is the date on which it acquires the interest. |
| |
(6) | Where Condition A, B or C is met the pension scheme is to be |
| |
treated for the purposes of the taxable property provisions as |
| |
acquiring the interest in the property on the relevant date. |
| 10 |
(7) | For the purposes of Schedule 29A the total taxable amount in |
| |
relation to any unauthorised payment which the pension scheme |
| |
is treated as having made by reason of the acquisition is— |
| |
(a) | the market value on the relevant date of the interest in the |
| |
property held by the person who holds it directly, or |
| 15 |
(b) | if the interest in the property is a lease at a rent, the amount |
| |
of consideration that would be treated as given by the |
| |
person for the lease by virtue of paragraph 34 of Schedule |
| |
29A if it were assigned to the person on that date. |
| |
| 20 |
(a) | the pension scheme holds the interest in the property |
| |
| |
(b) | the interest is not a lease at a rent, |
| |
| for the purposes of section 185G (gains from taxable property: |
| |
disposal by person holding directly) the pension scheme is to be |
| 25 |
treated as having acquired the interest for a consideration equal to |
| |
its market value on 6th April 2006. |
| |
(9) | For the purposes of sub-paragraph (3)(b) improvement works are |
| |
to be taken to have been begun before 6th April 2006 only if— |
| |
(a) | a binding contract for the works was entered into before |
| 30 |
| |
(b) | a substantial amount of the works has been carried out |
| |
| |
(10) | For the purposes of this Schedule “improvement works” means, in |
| |
relation to a property, works which— |
| 35 |
(a) | materially improve the property, and |
| |
(b) | are not carried out wholly for the purposes of complying |
| |
with a statutory requirement or a requirement imposed by |
| |
a government department, a statutory body or a person |
| |
holding a statutory office. |
| 40 |
(11) | For the purposes of sub-paragraph (10)(a) a property is materially |
| |
improved by works only if— |
| |
(a) | its market value on the date the works are substantially |
| |
completed (“MVW”) exceeds what would have been its |
| |
market value on that date if the works had not been carried |
| 45 |
| |
(b) | the amount by which MVW exceeds MV is greater than |
| |
| |
|
| |
|
| |
|
(12) | For the purposes of sub-paragraph (10)(b)— |
| |
“statutory body” means a body set up by or under an |
| |
enactment (including an enactment comprised in, or an |
| |
instrument made under, an Act of the Scottish Parliament); |
| |
“statutory office” means a body set up by or under such an |
| 5 |
| |
“statutory requirement” means a requirement imposed by |
| |
provision made by or under such an enactment. |
| |
(13) | This paragraph is subject to paragraph 37D. |
| |
37C (1) | This paragraph applies where— |
| 10 |
(a) | on 6th April 2006 an investment-regulated pension scheme |
| |
holds an interest in taxable property which it acquired |
| |
| |
(b) | immediately before that date the pension scheme was |
| |
prohibited from holding the interest. |
| 15 |
(2) | This paragraph also applies where— |
| |
(a) | on 6th April 2006 an investment-regulated pension scheme |
| |
holds an interest in taxable property indirectly which it |
| |
acquired before that date, and |
| |
(b) | immediately before that date the pension scheme was |
| 20 |
prohibited from holding the interest it held in the person |
| |
that held the interest in the property directly at that time. |
| |
(3) | The pension scheme is to be treated for the purposes of the taxable |
| |
property provisions as acquiring the interest in the property on |
| |
| 25 |
(4) | For the purposes of Schedule 29A the total taxable amount in |
| |
relation to any unauthorised payment which the pension scheme |
| |
is treated as having made by reason of the acquisition is— |
| |
(a) | the market value on 6th April 2006 of the interest in the |
| |
property held by the person who holds it directly, or |
| 30 |
(b) | if the interest in the property is a lease at a rent, the amount |
| |
of consideration that would be treated as given by the |
| |
person for the lease by virtue of paragraph 34 of Schedule |
| |
29A if it were assigned to the person on that date. |
| |
| 35 |
(a) | the pension scheme holds the interest in the property |
| |
| |
(b) | the interest is not a lease at a rent, |
| |
| for the purposes of section 185G (gains from taxable property: |
| |
disposal by person holding directly) the pension scheme is to be |
| 40 |
treated as having acquired the interest for a consideration equal to |
| |
its market value on 6th April 2006. |
| |
37D (1) | This paragraph applies where— |
| |
(a) | sub-paragraph (1) or (2) of paragraph 37A applies in |
| |
relation to a pension scheme and an interest in property, |
| 45 |
(b) | immediately before 6th April 2006 the pension scheme was |
| |
a self-invested personal pension scheme or a small self- |
| |
| |
|
| |
|