House of Commons - Explanatory Note
Income Tax Bill - continued          House of Commons

back to previous text

Clause 460: Residence etc of claimants

1336.     This clause sets out the residence-related requirement referred to in each of the previous three clauses. It is based on section 278 of ICTA. Subsections (2) and (3) are the same as in section 56.

1337.     Individuals who, under the source legislation, were able to claim the reliefs only by virtue of meeting the condition in section 278(2)(a) of ICTA are catered for by provisions remaining in ICTA, as amended by this Bill. See the overview commentary on Part 3.

Clause 461: Spreading of patent royalty receipts

1338.     This clause allows the recipient of a lump sum patent royalty to claim a tax reduction if the royalty was for the use of the patent over a period of two years or more. It is based on section 527 of ICTA.

1339.     The amount of the royalty is notionally spread equally over the number of complete years for which the use of the patent extended (up to a maximum of six). The total additional tax that would have been due on that basis is compared to the tax attributable to the whole royalty in the year of receipt. If it is less, a tax reduction equal to the difference is given.

 
 
previous section Bill Home page  
 
House of Commons home page Houses of Parliament home page House of Lords home page search page enquiries ordering index

© Parliamentary copyright 2006
Prepared: 8 December 2006