|
| |
|
section 683 (restrictions on particulars to be provided by banks). |
| |
682 | Restrictions on particulars to be provided by solicitors |
| |
(1) | In relation to anything done by a solicitor on behalf of a client who does not |
| |
consent to the information otherwise required from the solicitor under section |
| |
681 being provided, the solicitor may not be compelled under that section to do |
| 5 |
| |
(a) | state that the solicitor is or was acting on behalf of a client, and |
| |
(b) | give the name and address of the client and any relevant person. |
| |
(2) | In the case of anything done by the solicitor in connection with the transfer of |
| |
any asset by or to an individual who is ordinarily UK resident to or by a body |
| 10 |
corporate to which subsection (6) applies, the transferor and the transferee are |
| |
| |
(3) | In the case of anything done by the solicitor in connection with any associated |
| |
operation in relation to any such transfer, the persons concerned in the |
| |
associated operations are relevant persons. |
| 15 |
(4) | In the case of anything done by the solicitor in connection with the formation |
| |
or management of a body corporate to which subsection (6) applies, the body |
| |
corporate is a relevant person. |
| |
(5) | In the case of anything done by the solicitor in connection with— |
| |
(a) | the creation of any settlement as a result of which income becomes |
| 20 |
payable to a person abroad, or |
| |
(b) | the execution of the trusts of any such settlement, |
| |
| the settlor and that person are relevant persons. |
| |
(6) | This subsection applies to bodies corporate resident or incorporated outside |
| |
the United Kingdom which— |
| 25 |
(a) | are, or if UK resident would be, close companies, and |
| |
(b) | are not companies whose business consists wholly or mainly of the |
| |
carrying on of a trade or trades. |
| |
(7) | In this section “settlement” and “settlor” have the meanings given by section |
| |
| 30 |
(8) | In the application of this section to Scotland, any reference to the trusts of a |
| |
settlement is a reference to the purposes of the settlement. |
| |
683 | Restrictions on particulars to be provided by banks |
| |
(1) | Section 681 does not oblige a bank to provide any particulars of any ordinary |
| |
banking transactions between the bank and a customer carried out in the |
| 35 |
ordinary course of banking business, unless subsection (2) or (3) applies. |
| |
(2) | This subsection applies if the bank has acted or is acting on behalf of the |
| |
customer in connection with— |
| |
(a) | the creation of any settlement as a result of which income becomes |
| |
payable to a person abroad, or |
| 40 |
(b) | the execution of the trusts of any such settlement. |
| |
|
| |
|
| |
|
(3) | This subsection applies if the bank has acted or is acting on behalf of the |
| |
customer in connection with the formation or management of a body corporate |
| |
to which section 682(6) applies. |
| |
| |
“bank” has the meaning given by section 925, and |
| 5 |
“settlement” has the meaning given by section 620 of ITTOIA 2005. |
| |
(5) | In the application of this section to Scotland, any reference to the trusts of a |
| |
settlement is a reference to the purposes of the settlement. |
| |
684 | Special Commissioners’ jurisdiction on appeals |
| |
The jurisdiction of the Special Commissioners on any appeal includes |
| 10 |
jurisdiction to affirm or replace any decision taken by an officer of Revenue and |
| |
Customs in exercise of the officer’s functions under— |
| |
(a) | section 670 (exemption: all relevant transactions post-4 December 2005 |
| |
| |
(b) | section 671 (meaning of “commercial transaction”), |
| 15 |
(c) | section 672 (exemption: all relevant transactions pre-5 December 2005 |
| |
| |
(d) | section 675 (partial exemption where later associated operations fail |
| |
| |
(e) | section 676(2) (no duplication of charges: choice of persons in relation |
| 20 |
to whom income is taken into account). |
| |
| |
| |
| |
| 25 |
(1) | This Chapter has effect for the purpose of preventing the avoidance of income |
| |
tax by persons concerned with land or the development of land. |
| |
(2) | This Chapter imposes a charge to income tax in some circumstances where |
| |
gains of a capital nature are obtained from disposing of land. |
| |
686 | Meaning of disposing of land |
| 30 |
(1) | For the purposes of this Chapter land is disposed of if the property in the land |
| |
or control over the land is effectively disposed of— |
| |
(a) | by one or more transactions, or |
| |
(b) | by any arrangement or scheme. |
| |
(2) | It does not matter for the purposes of subsection (1) if the transactions, |
| 35 |
arrangement or scheme concern— |
| |
| |
(b) | property deriving its value from the land (see section 705(2)). |
| |
| |
|
| |
|
| |
|
section 694 (transactions, arrangements, sales and realisations relevant for |
| |
| |
section 695 (tracing value). |
| |
687 | Priority of other income tax provisions |
| |
This Chapter has effect subject to— |
| 5 |
(a) | Chapter 5 of Part 5 of ITTOIA 2005 (settlements: amounts treated as |
| |
| |
(b) | any other provision of the Tax Acts treating income as belonging to a |
| |
| |
Charge on gains from transactions in land |
| 10 |
688 | Charge to tax on gains from transactions in land |
| |
(1) | Income tax is charged on income treated as arising under section 689 (income |
| |
treated as arising when gains obtained from some land disposals). |
| |
(2) | For exemptions from the charge, see— |
| |
section 698 (exemption: gain attributable to period before intention to |
| 15 |
| |
section 699 (exemption: disposals of shares in companies holding land as |
| |
| |
section 700 (exemption: private residences). |
| |
689 | Income treated as arising when gains obtained from some land disposals |
| 20 |
(1) | This section applies if— |
| |
(a) | any of the conditions specified in subsection (3) is met as respects land, |
| |
(b) | a gain of a capital nature is obtained from the disposal of all or part of |
| |
| |
(c) | all or part of the land is situated in the United Kingdom, and |
| 25 |
(d) | a person within section 690(1)(a), (b) or (c) obtains the gain. |
| |
(2) | The gain is treated for income tax purposes as income arising when the gain is |
| |
| |
(3) | The conditions are that— |
| |
(a) | the land is acquired with the sole or main object of realising a gain from |
| 30 |
disposing of all or part of the land, |
| |
(b) | any property deriving its value from the land is acquired with the sole |
| |
or main object of realising a gain from disposing of all or part of the |
| |
| |
(c) | the land is held as trading stock, and |
| 35 |
(d) | the land is developed with the sole or main object of realising a gain |
| |
from disposing of all or part of the land when developed. |
| |
(4) | It does not matter for the purposes of this section whether the person within |
| |
section 690(1)(a), (b) or (c) obtains the gain for that person or another person. |
| |
|
| |
|
| |
|
(5) | For the purposes of this section, if, for example by a premature sale, a person |
| |
(“A”) directly or indirectly transmits the opportunity of realising a gain to |
| |
another person (“B”), A obtains B’s gain for B. |
| |
(6) | For the meaning of “another person”, see section 696. |
| |
690 | Person obtaining gain |
| 5 |
(1) | The persons referred to in section 689(1)(d) are— |
| |
(a) | the person acquiring, holding or developing the land, |
| |
(b) | a person connected with a person within paragraph (a), and |
| |
(c) | a person who is a party to, or concerned in, an arrangement or scheme |
| |
| 10 |
(2) | An arrangement or scheme is within this subsection if— |
| |
(a) | it is effected as respects all or part of the land, and |
| |
(b) | it enables a gain to be realised— |
| |
(i) | by any indirect method, or |
| |
(ii) | by any series of transactions. |
| 15 |
(3) | For the purposes of this section any number of transactions may be regarded |
| |
as constituting a single arrangement or scheme if— |
| |
(a) | a common purpose can be discerned in them, or |
| |
(b) | there is other sufficient evidence of a common purpose. |
| |
| 20 |
(1) | Tax is charged under this Chapter on the full amount of income treated as |
| |
| |
(2) | See section 693 (method of calculating gain) for how to calculate the amount of |
| |
| |
| 25 |
(1) | The person liable for any tax charged under this Chapter on income is the |
| |
person whose income it is. |
| |
(2) | The general rule is that that person is the person who realises the gain. |
| |
(3) | But that rule is subject to subsections (4) and (6). |
| |
(4) | If all or any part of the gain accruing to a person (“A”) is derived from value |
| 30 |
provided directly or indirectly by another person (“B”), the income is B’s. |
| |
(5) | Subsection (4) applies whether or not the value is put at the disposal of A. |
| |
(6) | If all or any part of the gain accruing to a person is derived from an opportunity |
| |
of realising a gain provided directly or indirectly by another person, the |
| |
income is the other person’s. |
| 35 |
(7) | For the meaning of “another person”, see section 696. |
| |
(8) | In applying section 949 (territorial scope of charges including the charge under |
| |
this Chapter) for the purposes of this Chapter, an amount treated as arising to |
| |
a non-UK resident under section 689 is treated as being from a source in the |
| |
|
| |
|
| |
|
United Kingdom so far (and only so far) as the land to which the disposal |
| |
relates is in the United Kingdom. |
| |
693 | Method of calculating gain |
| |
(1) | Subsections (3) to (5) apply for calculating a gain for the purposes of this |
| |
| 5 |
(2) | But, except so far as those subsections make provision, such method is to be |
| |
used for those purposes as is just and reasonable in the circumstances. |
| |
| |
(a) | take into account the value of what is obtained for disposing of the |
| |
| 10 |
(b) | allow only such expenses as are attributable to the land disposed of. |
| |
(4) | If a freehold is acquired and on disposal the reversion is retained, account may |
| |
be taken of the way in which trading profits are calculated in such a case. |
| |
(5) | Account may be taken of the adjustments to be made in calculating trading |
| |
profits under section 158 of ITTOIA 2005 (lease premiums etc: reduction of |
| 15 |
| |
(6) | In this section “trading profits” means the profits under Part 2 of ITTOIA 2005 |
| |
(trading profits) of a person dealing in land. |
| |
(7) | In the application of this section in Scotland— |
| |
“freehold” means the interest of the owner, and |
| 20 |
“reversion” means the interest of the landlord in property subject to a |
| |
| |
(8) | See also section 697 (valuations and apportionments). |
| |
Further provisions relevant to the charge |
| |
694 | Transactions, arrangements, sales and realisations relevant for Chapter |
| 25 |
(1) | For the purposes of this Chapter, account is to be taken of any method, |
| |
however indirect, by which— |
| |
(a) | any property or right is transferred or transmitted, or |
| |
(b) | the value of any property or right is enhanced or diminished. |
| |
| 30 |
(a) | the occasion of the transfer or transmission of any property or right |
| |
| |
(b) | the occasion when the value of any property or right is enhanced, |
| |
| may be an occasion when tax is charged under this Chapter. |
| |
(3) | Subsections (1) and (2) apply in particular— |
| 35 |
(a) | to sales, contracts and other transactions made otherwise than for full |
| |
consideration or for more than full consideration, |
| |
(b) | to any method by which any property or right, or the control of any |
| |
property or right, is transferred or transmitted by assigning— |
| |
(i) | share capital or other rights in a company, |
| 40 |
(ii) | rights in a partnership, or |
| |
|
| |
|
| |
|
(iii) | an interest in settled property, |
| |
(c) | to the creation of an option affecting the disposition of any property or |
| |
right and the giving of consideration for granting it, |
| |
(d) | to the creation of a requirement for consent affecting such a disposition |
| |
and the giving of consideration for granting it, |
| 5 |
(e) | to the creation of an embargo affecting such a disposition and the |
| |
giving of consideration for releasing it, and |
| |
(f) | to the disposal of any property or right on the winding up, dissolution |
| |
or termination of a company, partnership or trust. |
| |
| 10 |
(1) | This section applies if it is necessary to determine the extent to which the value |
| |
of any property or right is derived from any other property or right for the |
| |
purposes of this Chapter. |
| |
(2) | Value may be traced through any number of companies, partnerships and |
| |
| 15 |
(3) | The property held by a company, partnership or trust must be attributed to the |
| |
shareholders, partners or beneficiaries at each stage in such manner as is |
| |
appropriate in the circumstances. |
| |
696 | Meaning of “another person” |
| |
(1) | For the purposes of this Chapter references to other persons are to be read in |
| 20 |
accordance with subsections (2) to (4). |
| |
(2) | A partnership or partners in a partnership may be regarded as a person or |
| |
persons distinct from the individuals or other persons who are for the time |
| |
| |
(3) | The trustees of settled property may be regarded as persons distinct from the |
| 25 |
individuals or other persons who are for the time being the trustees. |
| |
(4) | Personal representatives may be regarded as persons distinct from the |
| |
individuals or other persons who are for the time being personal |
| |
| |
697 | Valuations and apportionments |
| 30 |
(1) | All such valuations are to be made as are appropriate to give effect to this |
| |
| |
(2) | For the purposes of this Chapter, any expenditure, receipt, consideration or |
| |
other amount may be apportioned by such method as is just and reasonable in |
| |
| 35 |
| |
698 | Exemption: gain attributable to period before intention to develop formed |
| |
(1) | This section applies if— |
| |
|
| |
|
| |
|
(a) | income is treated as arising because the condition mentioned in section |
| |
689(3)(d) is met (land developed with sole or main object of realising a |
| |
gain from its disposal when developed), and |
| |
(b) | part of the income is fairly attributable to a period before the intention |
| |
| 5 |
(2) | No liability to income tax arises under this Chapter in respect of that part of the |
| |
| |
(3) | In applying this section account must be taken of the treatment under Part 2 of |
| |
ITTOIA 2005 (trading profits) of a person who appropriates land as trading |
| |
| 10 |
699 | Exemption: disposals of shares in companies holding land as trading stock |
| |
(1) | No liability to income tax arises under this Chapter in respect of a gain on |
| |
property deriving value from land if— |
| |
(a) | the gain is obtained by the holder of shares, |
| |
(b) | the gain arises as a result of the holder of shares falling within section |
| 15 |
690(1)(a) or (b) (persons acquiring, holding or developing land and |
| |
| |
(c) | the circumstances are such as are mentioned in subsections (2) and (3). |
| |
(2) | The gain arises on a disposal of shares in— |
| |
(a) | a company which holds that land as trading stock, or |
| 20 |
(b) | a company which directly or indirectly owns at least 90% of the |
| |
ordinary share capital of another company which itself holds that land |
| |
| |
(3) | All the land so held is disposed of— |
| |
(a) | in the normal course of its trade by the company which holds it, and |
| 25 |
(b) | so as to procure that all opportunity of profit in respect of the land |
| |
| |
(4) | This section does not affect any liability as a result of any person falling within |
| |
section 690(1)(c) (parties to arrangements and schemes, etc). |
| |
700 | Exemption: private residences |
| 30 |
No liability to income tax arises under this Chapter in respect of a gain accruing |
| |
| |
(a) | the gain is exempt from capital gains tax as a result of sections 222 to |
| |
226 of TCGA 1992 (private residences), or |
| |
(b) | it would be so exempt but for section 224(3) of that Act (residences |
| 35 |
acquired partly with a view to making a gain). |
| |
| |
701 | Recovery of tax where consideration receivable by person not assessed |
| |
(1) | This section applies if a person (“A”) is assessed to tax under this Chapter in |
| |
respect of consideration receivable by another person (“B”). |
| 40 |
|
| |
|