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21

 

House of Commons

 
 

Tuesday 22nd May 2007

 

Public Bill Committee Proceedings

 

Finance Bill


 

(except Clauses 1, 3, 7, 8, 12, 20, 21, 25, 67 and 81 to 84, Schedules 1, 18, 22 and 23, and


 

New Clauses relating to Microgeneration)


 

[eightH and ninth SITTINGS]


 

Clause 34 Agreed to.

 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Withdrawn  15

 

Clause  35,  page  26,  line  30,  after ‘No’, insert ‘qualifying expenditure shall form

 

any part of the residue of qualifying expenditure when a’.

 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Not called  16

 

Clause  35,  page  26,  line  33,  after ‘Part,’, insert—

 

‘(ab)    

the qualifying expenditure in question is incurred after 21st March 2007

 

otherwise than pursuant to a relevant pre-commencement contract (see

 

subsection (7));’.

 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Not called  17

 

Clause  35,  page  26,  line  38,  leave out ‘before 1st April 2011’.


 
 

Public Bill Committee Proceedings: 22nd May 2007          

22

 

Finance Bill, continued

 
 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Not called  18

 

Clause  35,  page  26,  line  40,  leave out subsections (2) and (3).

 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Not called  19

 

Clause  35,  page  27,  line  9,  after ‘No’, insert ‘qualifying expenditure shall form any

 

part of the residue of qualifying expenditure when a’.

 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Not called  20

 

Clause  35,  page  27,  line  10,  after ‘if’, insert—

 

‘(a)    

the qualifying expenditure in question is incurred after 21st March 2007

 

otherwise than pursuant to a relevant pre-commencement contract; and

 

(b)    

’.

 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Not called  21

 

Clause  35,  page  27,  line  12,  leave out subsection (5).

 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Not called  22

 

Clause  35,  page  27,  line  16,  leave out ‘subsections (4) and (5)’ and insert

 

‘subsection (4)’.

 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Not called  23

 

Clause  35,  page  27,  line  19,  leave out ‘before 1st April 2011’.


 
 

Public Bill Committee Proceedings: 22nd May 2007          

23

 

Finance Bill, continued

 
 

Mrs Theresa Villiers

 

Mr Mark Francois

 

Mr Mark Hoban

 

Mr Paul Goodman

 

Mr David Evennett

 

Negatived on division  24

 

Clause  35,  page  27,  line  27,  at end add—

 

‘(8)    

This section shall not come into force unless the Treasury have laid before

 

Parliament a report setting out the impact of the abolition of balancing

 

adjustments and of the agricultural and industrial buildings allowances.’.

 

Julia Goldsworthy

 

Dr Vincent Cable

 

Mr Colin Breed

 

Not called  183

 

Clause  35,  page  27,  line  27,  at end add—

 

‘(8)    

This section shall not come into force until the Treasury has laid before the House

 

of Commons a report on consultations which it shall undertake with the

 

agriculture and tourism industry within the period of six months from the date of

 

the passing of this Act about the effects on those industries of the provisions of

 

this section.’.

 

Clause Agreed to.

 

Clauses 36 and 37 Agreed to.

 


 

Mr Stephen Timms

 

Agreed to  120

 

Schedule  7,  page  118,  line  23,  after ‘being’ insert ‘all of the assets of the

 

company’s long-term insurance fund which are’.

 

Mr Stephen Timms

 

Agreed to  105

 

Schedule  7,  page  123,  line  37,  leave out ‘linked assets’ and insert ‘assets linked to

 

the relevant business so far as so referable’.

 

Mr Stephen Timms

 

Agreed to  121

 

Schedule  7,  page  125,  line  39,  leave out from ‘under’ to end of line 40 and insert

 

‘section 444ABD(1).’.

 

Mr Stephen Timms

 

Agreed to  122

 

Schedule  7,  page  126,  leave out lines 12 and 13 and insert ‘section 444ABD(1).’.

 

Mr Stephen Timms

 

Agreed to  123

 

Schedule  7,  page  130,  line  35,  leave out ‘in relation to that category of business’.


 
 

Public Bill Committee Proceedings: 22nd May 2007          

24

 

Finance Bill, continued

 
 

Mr Stephen Timms

 

Agreed to  124

 

Schedule  7,  page  130,  line  35,  at end insert—

 

‘(3A)    

Where the relevant income arises from foreign currency assets, the whole of the

 

foreign tax is attributable to gross roll-up business, unless the case is one where

 

subsection (7) below applies.”.’.

 

Mr Stephen Timms

 

Agreed to  125

 

Schedule  7,  page  130,  line  40,  leave out from ‘for’ to end of line 42 and insert ‘the

 

words following “is” substitute “gross roll-up business.”

 

      (7)  

In subsection (6)—

 

(a)    

omit “or 432D” (in both places), and

 

(b)    

for “the category of business in question” and “that category”

 

substitute “gross roll-up business”.

 

    (7A)  

In subsection (7), for—

 

(a)    

“the category of business in question”, and

 

(b)    

“that category”,

 

            

substitute “gross roll-up business”.’.

 

Mr Stephen Timms

 

Agreed to  87

 

Schedule  7,  page  132,  line  8,  after ‘(b)’ insert ‘of subsection (6)’.

 

Mr Stephen Timms

 

Agreed to  126

 

Schedule  7,  page  133,  line  5,  leave out ‘subsection (1)’ and insert ‘subsections (1)

 

and (1A)’.

 

Schedule, as amended, Agreed to.

 

Clause 38 Agreed to.

 


 

Mr Stephen Timms

 

Agreed to  127

 

Schedule  8,  page  140,  line  10,  leave out ‘85A(3)(a)’ and insert ‘85A(3)(b)’.

 

Mr Stephen Timms

 

Agreed to  128

 

Schedule  8,  page  140,  line  17,  leave out ‘85A(3)(a)’ and insert ‘85A(3)(b)’.

 

Mr Stephen Timms

 

Agreed to  88

 

Schedule  8,  page  144,  line  39,  leave out from beginning to ‘charged’ in line 41 and

 

insert ‘the profits of the life assurance business of the company for the preceding

 

accounting period were’.

 

Schedule, as amended, Agreed to.


 
 

Public Bill Committee Proceedings: 22nd May 2007          

25

 

Finance Bill, continued

 
 

Clause 39 Agreed to.

 


 

Mr Stephen Timms

 

Agreed to  129

 

Schedule  9,  page  151,  leave out lines 12 to 19.

 

Mr Stephen Timms

 

Agreed to  89

 

Schedule  9,  page  159,  line  13,  leave out from ‘to’ to end of line 14 and insert

 

‘periods of account beginning on or after 1st January 2007 where the transfer of business

 

or demutualisation concerned took place before 21st March’.

 

Schedule, as amended, Agreed to.

 

Clause 40 Agreed to.

 


 

Mr Stephen Timms

 

Agreed to  90

 

Schedule  10,  page  159,  line  22,  leave out from beginning to end of line 10 on page

 

163 and insert—

 

‘Contingent loans

 

1          

In section 83ZA(4) of FA 1989 (contingent loans), for “the end of the”

 

substitute “any time during a”.’.

 

Mr Stephen Timms

 

Agreed to  130

 

Schedule  10,  page  163,  line  16,  leave out ‘by an insurance company held in a non-

 

profit fund’ and insert ‘held by an insurance company in a non-profit fund.

 

(1A)    

For the purposes of subsection (1) above—

 

(a)    

an increase in the value of structural assets includes any amount by which

 

their fair value when they cease to be structural assets, or come to be held

 

otherwise than in any of the company’s non-profit funds, exceeds their

 

admissible value at the end of the preceding period of account, and

 

(b)    

a decrease in the value of structural assets includes any amount by which

 

the admissible value of the assets at the end of the period of account in

 

which they become structural assets, or come to be held in any of the

 

company’s non-profit funds, is less than their historic cost.’.

 

Mr Stephen Timms

 

Agreed to  131

 

Schedule  10,  page  163,  line  29,  after ‘be’ insert ‘a structural asset or comes to be

 

held otherwise than in any of the company’s non-profit funds and, immediately before it

 

came to be a structural asset held in any of the company’s non-profit funds it (or any part

 

of it) was’.


 
 

Public Bill Committee Proceedings: 22nd May 2007          

26

 

Finance Bill, continued

 
 

Mr Stephen Timms

 

Agreed to  132

 

Schedule  10,  page  163,  line  34,  leave out from ‘the’ to end of line 46 and insert

 

‘relevant period of account.

 

(4A)    

For the purposes of subsection (4) above “the relevant value difference”, in

 

relation to an asset, is—equation: plus[times[char[H],char[C]],minus[times[char[A],char[V]]]]

 

    

where—

 

HC is its historic cost, and

 

AV is its admissible value at the relevant time.

 

(4B)    

In subsection (4) above “the relevant period of account” means—

 

(a)    

in a case within paragraph (a) of that subsection, the period of account in

 

which the asset ceases to be a structural asset or comes to be held

 

otherwise than in any of the company’s non-profit funds, and

 

(b)    

in a case within paragraph (b) of that subsection, the period of account in

 

which the asset first comes to be held otherwise than by the company or

 

(where the company is a member of a group) otherwise than by a

 

company which is a member of the group;

 

    

and section 170 of the Taxation of Chargeable Gains Act 1992 (meaning of

 

“group” etc) has effect for the interpretation of this subsection.

 

(4C)    

In this section “historic cost”, in relation to an asset which is or has been held in

 

any of the company’s non-profit funds, means—

 

(a)    

where the asset came to be held in any of the company’s non-profit funds

 

on acquisition from another person, the consideration given by the

 

company for the acquisition of the asset, and

 

(b)    

otherwise, its fair value when it came to be held in any of the company’s

 

non-profit funds.

 

(4D)    

In subsection (4A) above “admissible value”, in relation to an asset and a time,

 

means the value of the asset as shown in column 1 of Form 13 of the periodical

 

return for the period ending with that time (or as would be so shown if there were

 

a periodical return covering a period ending with that time).

 

(5)    

In subsection (4A) above “the relevant time” means—

 

(a)    

in a case where assets become structural assets held in any of the

 

company’s non-profit funds by virtue of the commencement of this

 

section, 1st January 2007, and

 

(b)    

otherwise, the time when the assets become structural assets held in any

 

of the company’s non-profit funds.’.

 

Mr Stephen Timms

 

Agreed to  133

 

Schedule  10,  page  164,  line  3,  after ‘to’ insert ‘its’.

 

Mr Stephen Timms

 

Agreed to  91

 

Schedule  10,  page  164,  line  20,  at end insert—

 

    ‘(4)  

In section 211 of TCGA 1992 (transfers of business: application of section 139

 

of that Act), as amended by paragraph 14 of Schedule 9 to this Act, after

 

subsection (2) insert—

 

“(2A)    

The reference in subsection (2) above to assets included in the transfer

 

does not include structural assets within the meaning of section 83XA

 

of the Finance Act 1989.”


 
 

Public Bill Committee Proceedings: 22nd May 2007          

27

 

Finance Bill, continued

 
 

      (5)  

In paragraph 17 of Schedule 7AC to TCGA 1992 (substantial shareholdings

 

exemption: special rules for assets of insurance company’s long-term

 

insurance fund), after sub-paragraph (4) insert—

 

“(4A)  

The reference in sub-paragraph (2) to an asset of the investing

 

company’s long-term insurance fund, and the references in sub-

 

paragraphs (3) and (4) to shares or an interest in shares held as

 

assets of its long-term insurance fund, do not include a structural

 

asset, or structural assets, within the meaning of section 83XA of

 

the Finance Act 1989.”.’.

 

Mr Stephen Timms

 

Agreed to  92

 

Schedule  10,  page  170,  line  33,  leave out ‘amendments made by paragraph 1 to 3’

 

and insert ‘amendment made by paragraph 1 has effect on and after 10th May 2007.

 

      ( )  

The amendments made by paragraphs 3,’.

 

Mr Stephen Timms

 

Agreed to  93

 

Schedule  10,  page  170,  line  35,  at end insert—

 

    ‘( )  

But the amendment made by paragraph 3(4) does not apply where the transfer

 

of business concerned took place before 10th May 2007.’.

 

Schedule, as amended, Agreed to.

 

Clause 41 Agreed to.

 


 

Mr Stephen Timms

 

Agreed to  76

 

Schedule  11,  page  172,  line  38,  leave out from first ‘the’ to ‘and’ in line 40 and

 

insert ‘reinsurance to close amounts of the members,’.

 

Mr Stephen Timms

 

Agreed to  77

 

Schedule  11,  page  173,  leave out lines 1 to 6 and insert—

 

‘(a)    

the reference to reinsurance to close amounts of any member of a

 

Lloyd’s syndicate is to any consideration which, in accordance with

 

the rules or practice of Lloyd’s, is given (or any amount which, in

 

accordance with those rules or practice, is treated as consideration

 

given) by the member in respect of the liabilities arising from the

 

member’s underwriting business in an underwriting year for the

 

purpose of closing the accounts of the business for that year, and’.

 

Mr Stephen Timms

 

Agreed to  78

 

Schedule  11,  page  173,  line  19,  at end insert—

 

‘(10A)  

The Commissioners for Her Majesty’s Revenue and Customs may by

 

regulations—

 

(a)    

provide in prescribed circumstances for paragraph 1 not to apply in

 

relation to any member of a Lloyd’s syndicate, or


 
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