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Income Tax Bill


Income Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments

537

 

(b)   

in paragraph (c) for “those purposes” substitute “the purposes of

extra liability”,

(c)   

for “his income” substitute “the person’s Step 3 income”, and

(d)   

for “that amount” substitute “the amount of the deficiency or (as the

case may be) the amount mentioned in paragraph (c)”.

5

      (3)  

In subsection (3) for “his total income” substitute “the person’s Step 3

income”.

      (4)  

Omit subsection (4).

298        

For section 11 (visiting forces, agents-general etc) substitute—

“11     

Visiting forces and official agents

10

(1)   

If section 766 of ITA 2007 (visiting forces and staff of designated

allied headquarters) applies to an individual throughout a period,

the period is not treated for capital gains tax purposes as—

(a)   

a period of residence in the United Kingdom, or

(b)   

creating a change of the individual’s residence or domicile.

15

(2)   

If an individual is entitled to immunity from income tax by virtue of

section 774 of ITA 2007 (which provides immunity from income tax

for official agents of Commonwealth countries or the Republic of

Ireland etc), the individual is entitled to the same immunity from

capital gains tax as that to which a member of the staff of a mission

20

is entitled under the Diplomatic Privileges Act 1964.

(3)   

“A member of the staff of a mission” is to be read in accordance with

the Diplomatic Privileges Act 1964.”

299        

In section 16(1) (computation of losses) for “section 72 of the Finance Act

1991” substitute “sections 261B, 261D and 263ZA”.

25

300        

In section 37 (consideration chargeable to tax on income) at the end insert—

“(5)   

If—

(a)   

because section 692(4) or (6) of ITA 2007 applies, the person

charged to tax under Chapter 3 of Part 12 of that Act

(transactions in land) is a person other than the person (“A”)

30

by whom the gain was realised, and

(b)   

the income tax has been paid,

   

for the purposes of this section the amount charged to that tax is

regarded as having been charged as the income of A.

(6)   

If—

35

(a)   

because section 710(5) of that Act applies, the person charged

to tax under Chapter 4 of Part 12 of that Act (sales of

occupation income) is a person other than the person (“B”)—

(i)   

for whom the capital amount was obtained, or

(ii)   

in the case of income treated as arising under section

40

712 of that Act, by whom the property or right was

sold or realised, and

(b)   

the income tax has been paid,

   

for the purposes of this section the amount charged to that tax is

regarded as having been charged as the income of B.

45

 

 

Income Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments

538

 

(7)   

In subsection (6) “capital amount” has the same meaning as in

Chapter 4 of Part 12 of that Act (sales of occupation income) (see

section 710(7) of that Act).”

301        

In section 39 (exclusion of expenditure by reference to tax on income) after

subsection (3) insert—

5

“(4)   

If—

(a)   

because section 692(4) or (6) of ITA 2007 applies, the person

charged to tax under Chapter 3 of Part 12 of that Act

(transactions in land) is a person other than the person (“A”)

by whom the gain was realised, and

10

(b)   

the income tax has been paid,

   

for the purposes of this section the amount charged to that tax is

regarded as having been charged as the income of A.”

302        

In section 79(8) (charge on settlor with interest in settlement etc:

supplementary provisions) for “691(2) of the Taxes Act (certain income of

15

maintenance funds for historic buildings not to be income of settlor etc)”

substitute “508 of ITA 2007 (trustees’ election in respect of income arising

from heritage maintenance property)”.

303        

In section 97(3) (settlements etc: supplementary provisions) for “section

740(2)(b) of the Taxes Act” substitute “section 666 of ITA 2007”.

20

304        

In section 98(2) (power to obtain information for purposes of sections 87 to

90)—

(a)   

for the words from the beginning to “745(1)” substitute “Sections

681(3) to (5), 682 and 683 of ITA 2007 shall have effect in relation to

subsection (1) above as they have effect in relation to section 681(1)

25

and (2) of that Act”, and

(b)   

in paragraph (a) for “Chapter III of Part XVII of the Taxes Act”

substitute “Chapter 2 of Part 12 of that Act”.

305        

In section 101B(1)(a) (transfer of a company’s assets to VCT), for “section

842AA of the Taxes Act” substitute “Part 6 of ITA 2007”.

30

306        

In section 101C(7) (transfer within group to VCT), for “section 842AA of the

Taxes Act” substitute “Part 6 of ITA 2007”.

307   (1)  

Amend section 105A (shares acquired on the same day: elections for

alternative treatment) as follows.

      (2)  

In subsection (4)—

35

(a)   

after “Chapter 3 of Part 7 of the Taxes Act” insert “, relief under Part

5 of ITA 2007”,

(b)   

after “section 299 of the Taxes Act” insert “or section 246 of ITA

2007”,

(c)   

for “of that Act” substitute “or subsection (3) of section 246”, and

40

(d)   

for “that section” substitute “section 299 or subsection (4) of section

246”.

      (3)  

In subsection (7)—

(a)   

after “Chapter 3 of Part 7 of the Taxes Act” insert “or relief under Part

5 of ITA 2007”,

45

(b)   

for “that Act” substitute “the Taxes Act or section 245 of ITA 2007”,

and

 

 

Income Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments

539

 

(c)   

after “that Chapter” insert “or relief under that Part”.

      (4)  

After subsection (8) insert—

“(9)   

In this section references to Part 5 of ITA 2007 or any provision of that

Part are to a Part or provision that applies only in relation to shares

issued after 5 April 2007.”

5

308        

After section 125 insert—

“Share loss relief

125A    

Effect of share loss relief

(1)   

If loss relief under section 573 of the Taxes Act or Chapter 6 of Part 4

of ITA 2007 (“share loss relief”) is obtained in respect of a loss or any

10

part of a loss, no deduction is to be made in respect of the loss or (as

the case may be) the part under this Act.

(2)   

If a claim is made for share loss relief in respect of a loss accruing on

the disposal of shares, section 30 has effect in relation to the disposal

as if for the references in subsections (1)(b) and (5) to a tax-free

15

benefit there were substituted references to any benefit whether tax-

free or not.

(3)   

All such adjustments of corporation tax on chargeable gains or

capital gains tax are to be made, whether by way of assessment or by

way of discharge or repayment of tax, as may be required in

20

consequence of—

(a)   

share loss relief being obtained in respect of an allowable loss,

or

(b)   

such relief not being obtained in respect of the whole or part

of such a loss in respect of which a claim is made.”

25

309        

In section 148C(1) (deemed disposals at a loss under section 564(4) of

ITTOIA 2005) for “section 392 of ICTA” substitute “section 152 of ITA 2007”.

310   (1)  

Amend section 150A (enterprise investment schemes) as follows.

      (2)  

In subsection (2) after “section 312 (1A)(a) of the Taxes Act” insert “or section

159(2) of ITA 2007”.

30

      (3)  

In subsection (3) for paragraphs (a), (aa) and (b) substitute—

“(a)   

an individual’s liability to income tax has been reduced (or

treated by virtue of section 304 of the Taxes Act or section 245

of ITA 2007 (spouses and civil partners) as reduced) for any

year of assessment under section 289A of the Taxes Act or

35

section 158 of ITA 2007 in respect of any issue of shares,

(b)   

the amount of the reduction (“A”) is less than the amount

(“B”) which is equal to tax at the savings rate for that year on

the amount subscribed for the issue, and

(c)   

A is not found under section 289A(2)(b) of the Taxes Act or

40

(as the case may require) is not within paragraph (b) solely by

virtue of section 29(2) and (3) of ITA 2007,”.

      (4)  

In subsection (4) after “the Taxes Act” insert “or as provided by section 246

of ITA 2007”.

 

 

Income Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments

540

 

      (5)  

In subsection (8B) for the words from “subsection (2)” to the end substitute

“section 306(2) of the Taxes Act or section 203(1) of ITA 2007 and in

accordance with section 306 of the Taxes Act or sections 204 and 205 of ITA

2007”.

      (6)  

In subsection (8C) after “Taxes Act” insert “or section 159(2) of ITA 2007”.

5

      (7)  

In subsection (8D)—

(a)   

after “section 304A of the Taxes Act” insert “or section 247 of ITA

2007”, and

(b)   

for paragraph (b) substitute—

“(b)   

the following—

10

(i)   

subsections (2)(b), (3) and (4) of section 304A

of the Taxes Act and subsection (5) of that

section so far as relating to section 306(2) of

that Act, or

(ii)   

sections 247(3)(b), 248(2)(a) and 249 of ITA

15

2007,

   

shall apply for the purposes of this section as they

apply for the purposes of Chapter 3 of Part 7 of the

Taxes Act or Part 5 of ITA 2007.”

      (8)  

In subsection (10A) for “the same meaning as in the Taxes Act” substitute

20

“the meaning given in section 923 of ITA 2007”.

      (9)  

In subsection (11)—

(a)   

after “Taxes Act” insert “or Part 5 of ITA 2007”, and

(b)   

after “that Chapter” insert “or means shares that meet the

requirements of section 173(2) of ITA 2007”.

25

     (10)  

After subsection (12) insert—

“(13)   

References in this section to Part 5 of ITA 2007 or any provision of

that Part are to a Part or provision that applies only in relation to

shares issued after 5 April 2007.”

311   (1)  

Amend section 150B (enterprise investment scheme: reduction of relief) as

30

follows.

      (2)  

In subsection (1)—

(a)   

after “section 300(1A)(a) of the Taxes Act” insert “or section 213(2)(a)

of ITA 2007”, and

(b)   

for “that Act” substitute “the Taxes Act or section 224(2)(a) of ITA

35

2007”.

      (3)  

In subsection (6) for “Subsections (11) and (12)” substitute “Subsections (11)

to (13)”.

312        

In section 150D (enterprise investment scheme: application of taper relief)

after “or” insert “relief under” and after “Taxes Act” insert “or Part 5 of ITA

40

2007,”.

313        

In section 151A(7) (venture capital trusts: reliefs) for “the meaning of the

Taxes Act” substitute “the meaning given in section 923 of ITA 2007”.

314   (1)  

Amend section 151B (VCTs: supplementary) as follows.

      (2)  

In subsection (3)—

45

 

 

Income Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments

541

 

(a)   

in paragraph (a) for “been given” substitute “obtained” and for “Part

1 of Schedule 15B to the Taxes Act” substitute “Chapter 2 of Part 6 of

ITA 2007”, and

(b)   

in paragraphs (b) and (c) for “been given” substitute “obtained” and

for “that Part of that Schedule” substitute “that Chapter of that Part”.

5

      (3)  

In subsection (6)(b) for “section 842AA(8) of the Taxes Act” substitute

“section 281(3) of ITA 2007”.

      (4)  

In subsection (8)(b) for “given” substitute “obtained” and for “Part 1 of

Schedule 15B to the Taxes Act” substitute “Chapter 2 of Part 6 of ITA 2007”.

315        

After section 151B insert—

10

“151BA  

CITR: identification of securities or shares on a disposal

(1)   

This section applies for the purpose of identifying the securities or

shares disposed of in any case where—

(a)   

an individual or company (“the investor”) disposes of part of

a holding of securities or shares (“the holding”), and

15

(b)   

the holding includes securities or shares to which CITR is

attributable in respect of one or more years of assessment or

accounting periods that have been held by the investor

continuously from the time they were issued until the

disposal.

20

(2)   

Any disposal by the investor of securities or shares included in the

holding which have been acquired by the investor on different days

is treated as relating to those acquired on an earlier day rather than

to those acquired on a later day.

(3)   

If there is a disposal by the investor of securities or shares included

25

in the holding which have been acquired by the investor on the same

day, any of those securities or shares—

(a)   

to which CITR is attributable, and

(b)   

which have been held by the investor continuously from the

time they were issued until the time of disposal,

30

   

are treated as disposed of after any other securities or shares

included in the holding which were acquired by the investor on that

day.

(4)   

For the purposes of this section a holding of securities is any number

of securities of a company which—

35

(a)   

carry the same rights,

(b)   

were issued under the same terms, and

(c)   

are held by the investor in the same capacity.

   

It does not matter for this purpose that the number of the securities

grows or diminishes as securities carrying those rights and issued

40

under those terms are acquired or disposed of.

(5)   

For the purposes of this section a holding of shares is any number of

shares in a company which—

(a)   

are of the same class, and

(b)   

are held by the investor in the same capacity.

45

 

 

Income Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments

542

 

   

It does not matter for this purpose that the number of the shares

grows or diminishes as shares of that class are acquired or disposed

of.

(6)   

Chapter 1 of Part 4 (share pooling, etc) has effect subject to this

section.

5

(7)   

Sections 104 to 107 (which make provision for the identification of

securities and shares on a disposal) do not apply to securities or

shares to which CITR is attributable.

(8)   

In a case to which section 127 (equation of original shares and new

holding) applies, shares included in the new holding are treated for

10

the purposes of subsections (2) and (3) as acquired when the original

shares were acquired.

(9)   

In subsection (8)—

(a)   

the reference to section 127 includes a reference to that

section as it is applied by virtue of any enactment relating to

15

chargeable gains, and

(b)   

“original shares” and “new holding” have the same meaning

as in section 127, or (as the case may be) that section as

applied by virtue of the enactment in question.

(10)   

In this section and sections 151BB and 151BC—

20

(a)   

if the investor is an individual—

(i)   

“CITR” has the meaning given by section 333 of ITA

2007,

(ii)   

references to CITR being attributable to securities,

shares or debentures are to be read in accordance with

25

section 357 of that Act, and

(iii)   

references to securities, shares or debentures having

been held by the investor continuously are to be read

in accordance with section 380 of that Act,

(b)   

if the investor is a company—

30

(i)   

“CITR” means relief under Part 5 of Schedule 16 to

the Finance Act 2002,

(ii)   

references to CITR being so attributable are to be read

in accordance with paragraph 26 of that Schedule,

and

35

(iii)   

references to securities, shares or debentures having

been held by the investor continuously are to be read

in accordance with paragraph 49 of that Schedule.

316        

After section 151BA insert—

“151BB  

CITR: rights issues etc

40

(1)   

If—

(a)   

an individual or company (“the investor”) holds shares in the

CDFI which are of the same class and held in the same

capacity (“the existing holding”),

(b)   

there is a reorganisation affecting the existing holding as a

45

result of an allotment which—

 

 

Income Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments

543

 

(i)   

falls within section 126(2)(a) (an allotment of shares or

debentures in respect of and in proportion to an

original holding), and

(ii)   

is not an allotment of corresponding bonus shares,

(c)   

immediately after the reorganisation, CITR is attributable to

5

the shares included in the existing holding or the shares or

debentures allotted in respect of those shares, in respect of

one or more years of assessment or accounting periods, and

(d)   

if CITR is attributable to the shares included in the existing

holding at that time, those shares have been held by the

10

investor continuously from the time they were issued until

the reorganisation,

   

sections 127 to 130 (treatment of share capital following a

reorganisation) do not apply in relation to the existing holding.

(2)   

Section 116(10) (reorganisations, conversions and reconstructions)

15

does not apply in any case where the old asset consists of shares held

(in the same capacity) by the investor—

(a)   

that have been held by the investor continuously from the

time they were issued until the relevant transaction, and

(b)   

to which CITR is attributable immediately before that

20

transaction.

   

In this subsection “old asset” and “the relevant transaction” have the

meaning given by section 116.

(3)   

For the purposes of subsection (1)—

“corresponding bonus shares” means bonus shares that—

25

(a)   

are issued in respect of shares included in the existing

holding, and

(b)   

are in the same company, are of the same class, and

carry the same rights as, those shares,

“reorganisation” has the meaning given in section 126.

30

(4)   

The following provisions of this Act have effect subject to this

section—

section 116 (reorganisations, conversions and reconstructions);

Chapter 2 of Part 4 (reorganisation of share capital, conversion

of securities etc).

35

(5)   

In this section “the CDFI” is to be read—

(a)   

if the investor is an individual, in accordance with section

334(2) of ITA 2007,

(b)   

if the investor is a company, in accordance with paragraph

1(2) of Schedule 16 to the Finance Act 2002.”

40

317        

After section 151BB insert—

“151BC  

CITR: company reconstructions etc

(1)   

If—

(a)   

an individual or company (“the investor”) holds shares in or

debentures of a company (“company A”),

45

(b)   

there is a reconstruction or amalgamation affecting that

holding (“the existing holding”),

 

 

 
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