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Income Tax Bill


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

615

 

465        

Omit sections 126 to 130 (individuals in partnership: exit charge).

466        

In section 155(6)(a) and (b) (persons by whom scheme may be established:

supplementary) for “section 840A(1)(b) of ICTA” substitute “section

991(2)(b) of ITA 2007”.

467        

In section 161 (meaning of “payment” etc) for subsection (8) substitute—

5

“(8)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

468   (1)  

Amend section 162 (meaning of “loan”) as follows.

      (2)  

In subsection (2)(a) for “section 841 of ICTA” substitute “section 1005 of ITA

10

2007”.

      (3)  

For subsection (6) substitute—

“(6)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

15

469        

In section 172A (surrender) for subsection (11) substitute—

“(11)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

470        

In section 172B (increase in rights of connected person on death) for

20

subsection (9) substitute—

“(9)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

471        

In section 172C (allocation of unallocated employer contributions) for

25

subsection (7) substitute—

“(7)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

472        

In section 172D (limit on increase in benefits) for subsection (6) substitute—

30

“(6)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

473   (1)  

Amend section 189 (relevant UK individual) as follows.

      (2)  

In subsection (2)—

35

(a)   

omit the “and” immediately after paragraph (b),

(b)   

after paragraph (b) insert—

“(ba)   

income which is chargeable under Part 3 of ITTOIA

2005 and is immediately derived from the carrying on

of a UK furnished holiday lettings business (whether

40

individually or as a partner acting personally in a

partnership), and”, and

 

 

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

616

 

(c)   

for paragraph (c) substitute—

“(c)   

income to which subsection (2A) applies.”

      (3)  

After subsection (2) insert—

“(2A)   

This subsection applies to income if—

(a)   

it is patent income, and

5

(b)   

the individual, alone or jointly, devised the invention for

which the patent in question was granted.”

      (4)  

After subsection (4) insert—

“(5)   

“UK furnished holiday lettings business” means a UK property

business so far as consisting of the commercial letting of furnished

10

holiday accommodation (within the meaning of Chapter 6 of Part 3

of ITTOIA 2005).

(6)   

If there is a letting of accommodation only part of which is holiday

accommodation, just and reasonable apportionments are to be made

for the purpose of determining what is comprised in a UK furnished

15

holiday lettings business.

(7)   

“Patent income” means—

(a)   

royalties or other sums paid in respect of the use of a patent

charged to tax under section 579 of ITTOIA 2005,

(b)   

amounts on which tax is payable under section 587 or 593 of

20

ITTOIA 2005, or

(c)   

amounts on which tax is payable under—

(i)   

section 472(5) of the Capital Allowances Act, or

(ii)   

paragraph 100 of Schedule 3 to that Act.”

474        

In section 192 (relief at source) omit subsection (5).

25

475        

In section 193(6) (relief under net pay arrangements)—

(a)   

for “from the total income” substitute “in calculating the net income”,

and

(b)   

at the end insert “(see Step 2 of the calculation in section 23 of ITA

2007)”.

30

476        

In section 194(1) (relief on making of claim)—

(a)   

for “from the total income” substitute “in calculating the net income”,

and

(b)   

at the end insert “(see Step 2 of the calculation in section 23 of ITA

2007)”.

35

477        

In section 266A (member’s liability) for subsection (7) substitute—

“(7)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

478        

In section 273 (members liable as scheme administrator) for subsection (11)

40

substitute—

“(11)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

 

 

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

617

 

479        

In section 278 (market value) for subsection (4) substitute—

“(4)   

For the purposes of this section whether a person is connected with

another person is determined in accordance with section 993 of ITA

2007.”

480   (1)  

Amend section 279 (other definitions) as follows.

5

      (2)  

In subsection (1)—

(a)   

omit the definition of “charity”,

(b)   

after the definitions of “pension credit” and “pension debit” insert

“and”, and

(c)   

omit the words after the definition of “pension sharing order or

10

provision”.

      (3)  

After that subsection insert—

“(1A)   

In this Part, so far as it forms part of the Corporation Tax Acts,

expressions which are defined for the purposes of the Income Tax

Acts are to be given the same meaning as they have in the Income

15

Tax Acts.”

481   (1)  

Amend section 280 (abbreviations and general index) as follows.

      (2)  

In subsection (1) omit the “and” immediately before the definition of

“ITTOIA 2005” and after that definition insert “, and

“ITA 2007” means the Income Tax Act 2007.”

20

      (3)  

In subsection (2)—

(a)   

in the entry for “basic rate”, in the second column, for “section 832(1)

of ICTA” substitute “section 6(2) of ITA 2007 (as applied by section

989 of that Act)”,

(b)   

in the entry for “basic rate limit”, in the second column, for “section

25

832(1) of ICTA” substitute “section 20(2) of ITA 2007 (as applied by

section 989 of that Act)”,

(c)   

in the entry for “chargeable gain”, in the second column, for “section

832(1) of ICTA” substitute “section 989 of ITA 2007”,

(d)   

in the entry for “charity”, in the second column, for “section 279(1)”

30

substitute “section 989 of ITA 2007”,

(e)   

in the entry for “company”, in the second column, for “section 832(1)

of ICTA” substitute “section 992 of ITA 2007”,

(f)   

in the entry for “higher rate”, in the second column, for “section

832(1) of ICTA” substitute “section 6(2) of ITA 2007 (as applied by

35

section 989 of that Act)”,

(g)   

after the entry for “money purchase benefits” insert—

 

“net income

section 23 of ITA 2007

 
  

(as applied by section

 
  

989 of that Act)”,

 

40

(h)   

in the entry for “period of account”, in the second column, for

“section 832(1) of ICTA” substitute “section 989 of ITA 2007”,

(i)   

in the entry for “personal representatives”, in the second column, for

“section 279(1)” substitute “section 989 of ITA 2007”,

 

 

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

618

 

(j)   

in the entry for “property investment LLP”, in the second column, for

“section 842B of ICTA” substitute “section 1004 of ITA 2007”,

(k)   

in the entry for “retail prices index”, in the second column, for

“section 279(1)” substitute “section 989 of ITA 2007”,

(l)   

in the entry for “tax year”, in the second column, for “section 279(1)”

5

substitute “section 4(2) of ITA 2007 (as applied by section 989 of that

Act)”,

(m)   

in the entry for “the tax year 2006-07 etc”, in the second column, for

“section 279(1)” substitute “section 4(4) of ITA 2007 (as applied by

section 989 of that Act)”, and

10

(n)   

in the entry for “total income” for “section 835 of ICTA” substitute

“section 23 of ITA 2007 (as applied by section 989 of that Act)”.

482   (1)  

Amend Schedule 15 (charge to income tax on benefits received by former

owner of property) as follows.

      (2)  

For paragraph 2 substitute—

15

“2    (1)  

For the purposes of this Schedule whether a person is connected

with another person is determined in accordance with section 993

of the Income Tax Act 2007.

      (2)  

But for those purposes sections 993 and 994 of that Act are to be

read as if in those sections—

20

(a)   

“relative” included uncle, aunt, nephew and niece, and

(b)   

“settlement”, “settlor” and “trustee” had the same

meanings as in IHTA 1984.”

      (3)  

In paragraph 9(1) for paragraph (c) substitute—

“(c)   

sections 720 to 730 of the Income Tax Act 2007,”.

25

483        

In paragraph 4 of Schedule 27 (meaning of “offshore installation”) for

“sections 573 and 574” substitute “section 573”.

484        

In paragraph 4 of Schedule 29A (investment-regulated pension schemes) for

sub-paragraph (2) substitute—

    “(2)  

For the purposes of sub-paragraph (1) whether a person is

30

connected with another person is determined in accordance with

section 993 of ITA 2007.”

485        

In paragraph 11D of Schedule 36 (transitional provisions) for sub-paragraph

(5) substitute—

    “(5)  

For the purposes of this paragraph whether a person is connected

35

with another person is determined in accordance with section 993

of ITA 2007.”

Pensions Act 2004 (c. 35)

486        

The Pensions Act 2004 is amended as follows.

487        

In Schedule 3 (restricted information held by the Regulator: certain

40

permitted disclosures to facilitate exercise of functions), in the entry relating

to the Commissioners of Inland Revenue or their officers—

(a)   

omit the “or” immediately after paragraph (f), and

 

 

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

619

 

(b)   

in the second column after paragraph (g) insert “or—

(h)   

the Income Tax Act 2007 (so far as relating to

functions previously exercised under the Income and

Corporation Taxes Act 1988).”

488        

In Schedule 8 (restricted information held by the Board: certain permitted

5

disclosures to facilitate exercise of functions), in the entry relating to the

Commissioners of Inland Revenue or their officers—

(a)   

omit the “or” immediately after paragraph (e), and

(b)   

in the second column after paragraph (f) insert “or—

(g)   

the Income Tax Act 2007 (so far as relating to

10

functions previously exercised under the Income and

Corporation Taxes Act 1988).”

Constitutional Reform Act 2005 (c. 4)

489        

The Constitutional Reform Act 2005 is amended as follows.

490        

In paragraph 4 of Schedule 7 (protected functions of the Lord Chancellor) at

15

the end of Part A (general) insert—

          

Income Tax Act 2007

          

Section 704(1)”.

491        

In the table in Part 3 of Schedule 14 (appointments by the Lord Chancellor:

offices to which paragraph 2(2)(d) of Schedule 12 to the Act applies) at the

20

end add—

 

“Chairman of section 704

Section 704(1) of the Income

 
 

tribunal

Tax Act 2007”

 
 

Member of section 704

  
 

tribunal

  

25

Income Tax (Trading and Other Income) Act 2005 (c. 5)

492        

The Income Tax (Trading and Other Income) Act 2005 is amended as

follows.

493        

In section 1 (overview of Act) omit subsection (2).

494        

In section 12(3) (profits of mines etc) for “Chapter 1 of Part 10 of ICTA”

30

substitute “Part 4 of ITA 2007”.

495   (1)  

Amend section 13 (visiting performers) as follows.

      (2)  

In subsection (8) omit the definitions of “payment” and “transfer”.

      (3)  

After that subsection insert—

“(9)   

In this section and section 14—

35

(a)   

references to a payment include references to a payment by

way of loan of money, and

(b)   

references to a transfer do not include references to a transfer

of money but, subject to that, include references to—

 

 

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

620

 

(i)   

a temporary transfer (as by way of loan), and

(ii)   

a transfer of a right (whether or not a right to receive

money).

(10)   

This section does not apply to payments or transfers of a kind

prescribed in regulations under section 966(6) of ITA 2007.”

5

496        

In section 17(3) (effect of becoming or ceasing to be a UK resident) for “set

off under section 385 of ICTA against” substitute “deducted under section 83

of ITA 2007 from”.

497        

Omit section 51 (patent royalties).

498   (1)  

Amend section 52 (exclusion of double relief for interest) as follows.

10

      (2)  

In subsections (1), (5) and (6) for “section 353 of ICTA” substitute “section

383 of ITA 2007”.

      (3)  

In subsection (6) for “section 368(3) of ICTA” substitute “section 387(2) and

(3) of that Act”.

499        

In section 87(5) (expenses of research and development) for “section 837A of

15

ICTA” substitute “section 1006 of ITA 2007”.

500        

In section 108(4) (gifts of trading stock etc to charities) omit paragraphs (c)

and (d).

501        

In section 179(a) (connected persons) for “section 839 of ICTA” substitute

“section 993 of ITA 2007”.

20

502   (1)  

Amend section 232 (treatment of trading adjustment income) as follows.

      (2)  

In subsection (3) for “Chapter 1 of Part 10 of ICTA” substitute “Part 4 of ITA

2007”.

      (3)  

In subsection (4) for the words from “the trade” to the end substitute “the

trade is relevant UK earnings within section 189(2)(b) of FA 2004,

25

adjustment income is similarly relevant UK earnings.”

503        

In section 248(3) (debts paid after cessation)—

(a)   

for “section 109A(4) or (4A) of ICTA” substitute “section 96 of ITA

2007”, and

(b)   

after “expenditure)” insert “as a result of subsection (1)(b) of that

30

section”.

504   (1)  

Amend section 250 (receipts relating to post-cessation expenditure) as

follows.

      (2)  

In subsection (1) for “section 109A of ICTA” substitute “section 96 of ITA

2007”.

35

      (3)  

In subsection (2)—

(a)   

in paragraph (a) for “section 109A(2)(a) or (b) of ICTA” substitute

“section 97(2) or (3) of ITA 2007”,

(b)   

in paragraph (b) for “section 109A(2)(c) of ICTA” substitute “section

97(4) of ITA 2007”, and

40

(c)   

in paragraph (c) for “section 109A(2)(d) of ICTA” substitute “section

97(5) of ITA 2007”.

 

 

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

621

 

505        

In section 254(3)(b) (allowable deductions) for “section 90(4) of FA 1995”

substitute “section 261D of TCGA 1992”.

506   (1)  

Amend section 256 (treatment of post-cessation receipts) as follows.

      (2)  

In subsection (1)(b) omit “earned income within section 833(4)(c) of ICTA

or”.

5

      (3)  

In subsection (2) omit “earned income or”.

507        

In section 272(2) (profits of a property business: application of trading

income rules), omit the entry in the table relating to section 51.

508        

In section 322(2) (commercial letting of furnished holiday

accommodation)—

10

(a)   

omit paragraphs (b) and (c), and

(b)   

for paragraph (f) and the “and” immediately before that paragraph

substitute—

“(f)   

section 189(2)(ba) of FA 2004 (meaning of “relevant

UK earnings” for pension purposes),

15

(g)   

Part 4 of ITA 2007 ( loss relief: see section 127 of that

Act), and

(h)   

section 836(3) of ITA 2007 (jointly held property: see

exception D).”

509        

In section 327(2)(b) (capital allowances and loss relief) for “Chapter 1 of Part

20

10 of ICTA” substitute “Part 4 of ITA 2007”.

510   (1)  

Amend section 328 (earned income and relevant UK earnings for pension

purposes) as follows.

      (2)  

In subsection (2) for “treated as” to the end substitute “relevant UK earnings

within section 189(2)(ba) of FA 2004.”

25

      (3)  

In the sidenote omit “Earned income and”.

511        

In section 333(3) (treatment of property business adjustment income) for

“Chapter 1 of Part 10 of ICTA” substitute “Part 4 of ITA 2007”.

512        

In section 354(2) (other rules about what counts as a “post-cessation

receipt”)—

30

(a)   

after “section 248 (debts paid after cessation)” insert “(reading the

reference in subsection (3) to section 96 of ITA 2007 as a reference to

section 125 of that Act)”, and

(b)   

after “section 250 (receipts relating to post-cessation expenditure)”

insert “(reading the reference in subsection (1) to section 96 of ITA

35

2007 as a reference to section 125 of that Act)”.

513        

In section 369(4) (charge to tax on interest) for the words from “sections

714(5)” to the end substitute “Chapter 3 of Part 12 of ITA 2007 (exemption for

interest on securities to which Chapter 2 of that Part applies)”.

514        

In section 372(2) (building society dividends) for the words from “has” to the

40

end substitute “includes any distribution (whether or not described as a

dividend)”.

515   (1)  

Amend section 397 (tax credits for qualifying distributions: UK residents

and eligible non-UK residents) as follows.

 

 

 
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