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Finance Bill
Schedule 20 — Pension schemes etc: miscellaneous

237

 

      (4)  

In paragraph 24(1) (conditions applying for paragraph 23), for “paragraph

23” substitute “paragraphs 22 and 23”.

      (5)  

In paragraph 25(2) (provisions supplementing paragraph 24), for “23(1)”

substitute “22 or 23”.

Transitional provision: primary protection

5

15         

In paragraph 11D of Schedule 36 (lump sum death benefits to be taken into

account as part of individual’s pre-commencement rights only if paid under

policy not significantly varied since 5th April 2006), after sub-paragraph (2)

insert—

   “(2A)  

A variation of the terms of a policy of life insurance made in order

10

to comply with the Employment Equality (Age) Regulations 2006

or Employment Equality (Age) Regulations (Northern Ireland)

2006 (or any regulations amending or replacing them) is to be

ignored for the purposes of sub-paragraph (2).

     (2B)  

Where a policy of life insurance held on 5th April 2006 for the

15

purposes of an occupational pension scheme is surrendered and a

new one is taken out—

(a)   

as part of a retirement-benefit activities compliance

exercise, or

(b)   

to comply with the Employment Equality (Age)

20

Regulations 2006 or Employment Equality (Age)

Regulations (Northern Ireland) 2006 (or any regulations

amending or replacing them),

           

the new policy is to be treated for the purposes of sub-paragraph

(2) as if it were the same as the old.

25

     (2C)  

For this purpose a policy of life insurance is surrendered and a

new one is taken out as part of a retirement-benefit activities

compliance exercise if—

(a)   

the surrender of the old policy and taking out of the new

policy constitute or form part of a transaction the purpose

30

of which is to secure that the activities of the pension

scheme are limited to retirement-benefit activities within

the meaning of section 255 of the Pensions Act 2004 or

Article 232 of the Pensions (Northern Ireland) Order 2005,

and

35

(b)   

the rights under the old policy and the new policy are not

significantly different.”

Transitional provision: enhanced protection

16         

Schedule 36 (transitional provision) is amended as follows.

17    (1)  

Paragraph 12 (when enhanced protection ceases) is amended as follows.

40

      (2)  

In paragraph (c) of sub-paragraph (2), for “solely for the purposes of a

permitted transfer” substitute “in permitted circumstances”.

      (3)  

After that sub-paragraph insert—

   “(2A)  

An arrangement is made in permitted circumstances if it is

made—

45

 

 

Finance Bill
Schedule 20 — Pension schemes etc: miscellaneous

238

 

(a)   

for the purposes of a permitted transfer,

(b)   

as part of a retirement-benefit activities compliance

exercise, or

(c)   

as part of an age-equality compliance exercise.

     (2B)  

For the purposes of sub-paragraph (2A)(b) an arrangement (“the

5

new arrangement”) relating to an individual is made as part of a

retirement-benefit activities compliance exercise if—

(a)   

it is made in connection with the cancellation of rights

under another arrangement relating to the individual (“the

old arrangement”),

10

(b)   

the old arrangement and the new arrangement relate to the

same employment,

(c)   

there is a prospective entitlement to pension death benefits

within section 167(1) or lump sum death benefits within

section 168(1) (or both) under both the old arrangement

15

and the new arrangement,

(d)   

the making of the new arrangement and the cancellation of

the old arrangement constitute or form part of a

transaction the purpose of which is to secure that the

activities of the pension scheme under which the

20

arrangement is made are limited to retirement-benefit

activities within the meaning of section 255 of the Pensions

Act 2004 or Article 232 of the Pensions (Northern Ireland)

Order 2005, and

(e)   

the rights cancelled under the old arrangement and the

25

rights conferred under the new arrangement are not

significantly different.

     (2C)  

For the purposes of sub-paragraph (2A)(c) an arrangement (“the

new arrangement”) is made as part of an age-equality compliance

exercise if—

30

(a)   

it is made in connection with the cancellation of rights

under another arrangement relating to the individual (“the

old arrangement”),

(b)   

the old arrangement and the new arrangement relate to the

same employment,

35

(c)   

there is a prospective entitlement to pension death benefits

within section 167(1) or lump sum death benefits within

section 168(1) (or both) under both the old arrangement

and the new arrangement, and

(d)   

the new arrangement is made, and the old arrangement

40

cancelled, in order to comply with the Employment

Equality (Age) Regulations 2006 or Employment Equality

(Age) Regulations (Northern Ireland) 2006 (or any

regulations amending or replacing them).”

      (4)  

In sub-paragraph (7)—

45

(a)   

omit paragraph (a),

(b)   

in paragraph (b), omit “held for the purposes of, or representing

accrued rights under, the arrangement”, and

(c)   

in paragraph (c), for “those” (in both places) substitute “the”.

      (5)  

In paragraph (a) of sub-paragraph (8), omit—

50

 

 

Finance Bill
Schedule 20 — Pension schemes etc: miscellaneous

239

 

(a)   

“, or two or more money purchase arrangements that are not cash

balance arrangements,”, and

(b)   

“or” at the end.

      (6)  

After paragraph (b) of that sub-paragraph insert—

“(c)   

where the arrangement is a cash balance arrangement or a

5

defined benefits arrangement relating to a present or

former employment, they are transferred in connection

with a relevant business transfer so as to become held for

the purposes of, or to represent rights under, a cash

balance arrangement or defined benefits arrangement

10

made under a registered pension scheme or recognised

overseas pension scheme, or

(d)   

where the arrangement (“the old arrangement”) is a cash

balance arrangement or a defined benefits arrangement,

they are transferred as part of a retirement-benefit

15

activities compliance exercise so as to become held for the

purposes of, or to represent rights under, a cash balance

arrangement or defined benefits arrangement (“the new

arrangement”) relating to the same employment as the old

arrangement and made under a registered pension scheme

20

or recognised overseas pension scheme.”

      (7)  

After that sub-paragraph insert—

   “(8A)  

For the purposes of sub-paragraph (8)(c) “relevant business

transfer” means a transfer of an undertaking or a business (or part

of an undertaking or a business) from one person to another—

25

(a)   

which involves the transfer of at least 20 employees, and

(b)   

in the case of which, if the transferor and the transferee are

bodies corporate, they would not be treated as members of

the same group for the purposes of Chapter 4 of Part 10 of

ICTA.

30

     (8B)  

For the purposes of sub-paragraph (8)(d) sums or assets held for

the purposes of, or representing accrued rights under, the old

arrangement are transferred as part of a retirement-benefit

activities compliance exercise if—

(a)   

there is a prospective entitlement to pension death benefits

35

within section 167(1) or lump sum death benefits within

section 168(1) (or both) under both the old arrangement

and the new arrangement, and

(b)   

the transfer constitutes or forms part of a transaction the

purpose of which is to secure that the activities of the

40

pension scheme under which the old arrangement was

made are limited to retirement-benefit activities within the

meaning of section 255 of the Pensions Act 2004 or Article

232 of the Pensions (Northern Ireland) Order 2005.”

      (8)  

In sub-paragraph (9)—

45

(a)   

in paragraph (a), omit “, or each of the arrangements,” and “and” at

the end,

(b)   

in paragraph (b), after “(8)(b)” insert “or (d)” and after “15” insert “to

17”, and

 

 

Finance Bill
Schedule 20 — Pension schemes etc: miscellaneous

240

 

(c)   

after that paragraph insert “and

(c)   

if the transfer is a permitted transfer by virtue of

sub-paragraph (8)(c), this paragraph (and

paragraphs 13, 15 to 17 and 17A(3)) apply as if the

arrangement to which the transfer is made were the

5

same as that from which it is made and (if the

employment is transferred) as if the employment

with the transferee were the employment with the

transferor.”

      (9)  

After that sub-paragraph insert—

10

   “(10)  

The Treasury may by order amend sub-paragraph (8) (and make

other amendments consequential on any amendment of that sub-

paragraph).”

18         

In paragraph 14 (relevant contributions), after sub-paragraph (3) insert—

   “(3A)  

A variation of the terms of a policy made in order to comply with

15

the Employment Equality (Age) Regulations 2006 or Employment

Equality (Age) Regulations (Northern Ireland) 2006 (or any

regulations amending or replacing them) is to be ignored for the

purposes of sub-paragraph (3).

     (3B)  

Where a policy of insurance on the life of the individual issued, or

20

issued in respect of insurances made, before 6th April 2006 is

surrendered and a new one is taken out—

(a)   

as part of a retirement-benefit activities compliance

exercise, or

(b)   

as part of an age-equality compliance exercise.

25

           

the new policy is to be treated for the purposes of sub-paragraph

(3) as if it were the same as the old.

     (3C)  

For the purposes of sub-paragraph (3B)(a) a policy is surrendered,

and a new policy of life insurance is taken out, as part of a

retirement-benefit activities compliance exercise if—

30

(a)   

the surrender of the old policy and the taking out of the

new policy constitute or form part of a transaction the

purpose of which is to secure that the activities of the

pension scheme under which the arrangement is made are

limited to retirement-benefit activities within the meaning

35

of section 255 of the Pensions Act 2004 or Article 232 of the

Pensions (Northern Ireland) Order 2005, and

(b)   

the rights under the old policy and the new policy are not

significantly different.

     (3D)  

For the purposes of sub-paragraph (3B)(b) a policy is surrendered,

40

and a new policy of life insurance is taken out, as part of an age-

equality compliance exercise if—

(a)   

the old policy is surrendered, and the new policy is taken

out, in order to comply with the Employment Equality

(Age) Regulations 2006 or Employment Equality (Age)

45

Regulations (Northern Ireland) 2006 (or any regulations

amending or replacing them), and

(b)   

any significant difference between the rights under the old

policy and the rights under the new policy is attributable

 

 

Finance Bill
Schedule 20 — Pension schemes etc: miscellaneous

241

 

to the need to comply with those Regulations (or any

regulations amending or replacing them).”

19    (1)  

Paragraph 15 (relevant benefit accrual) is amended as follows.

      (2)  

In sub-paragraph (2), after “arrangement” (in both places) insert “which are

transferred”.

5

      (3)  

In sub-paragraph (7), for “15 and 16” substitute “16 and 17”.

Inheritance tax: lump sum death benefits

20         

In section 58 of IHTA 1984 (settlements: “relevant property”), after

subsection (2) insert—

“(2A)   

For the purposes of subsection (1)(d) above—

10

(a)   

property applied to pay lump sum death benefits within

section 168(1) of the Finance Act 2004 in respect of a member

of a registered pension scheme is to be taken to be held for the

purposes of the scheme from the time of the member’s death

until the payment is made, and

15

(b)   

property applied to pay lump sum death benefits in respect

of a member of a section 615(3) scheme is to be taken to be so

held if the benefits are paid within the period of two years

beginning with the earlier of the day on which the member’s

death was first known to the trustees or other persons having

20

the control of the fund and the day on which they could first

reasonably be expected to have known of it.”

Benefits under employer-financed retirement benefits schemes

21         

In section 393B of ITEPA 2003 (employer-financed retirement benefits

schemes: relevant benefits), after subsection (4) insert—

25

“(4A)   

Regulations under subsection (3)(d) may include provision having

effect in relation to times before they are made.”

Consequential amendments

22    (1)  

In section 167(2) of FA 2004 (meaning of “pension death benefit”), for

““Pension” substitute “In this Part “pension”.

30

      (2)  

In section 280(2) of that Act (index of expressions), insert at the appropriate

place—

 

“pension death benefit

section 167(2)”.

 

23    (1)  

In section 1(1) of the Pension Schemes Act 1993 (c. 48) (categories of pension

schemes), in paragraph (b) of the definition of “personal pension scheme”,

35

omit “any of the paragraphs of”.

      (2)  

In section 1(1) of the Pension Schemes (Northern Ireland) Act 1993 (c. 49)

(categories of pension schemes), in paragraph (b) of the definition of

“personal pension scheme”, omit “any of the paragraphs of”.

 

 

Finance Bill
Schedule 21 — Exemptions from stamp duty and SDRT: intermediaries, repurchases etc

242

 

Commencement

24    (1)  

The amendments made by paragraphs 2 to 4 and 23 are deemed to have

come into force on 6th April 2007.

      (2)  

The amendment made by paragraph 5 has effect in relation to payments

made on or after 6th April 2007.

5

      (3)  

The amendments made by paragraphs 6, 7(2), 9 to 11, 15 to 19 and 22 are

deemed always to have had effect.

      (4)  

The amendment made by paragraph 7(3) has effect in relation to reductions

occurring on or after 6th April 2007.

      (5)  

The amendments made by paragraph 8 have effect in relation to

10

notifications given on or after 6th December 2006.

      (6)  

The amendments made by paragraph 12 have effect in relation to lump sums

paid on or after 6th April 2006.

      (7)  

The amendments made by paragraph 13 have effect in relation to deaths

occurring on or after 6th April 2006.

15

      (8)  

The amendments made by paragraph 14 are deemed to have come into force

on 1st January 2007.

      (9)  

The amendment made by paragraph 20 has effect in relation to lump sum

death benefits paid on or after 6th April 2006.

Schedule 21

20

Section 72

 

Exemptions from stamp duty and SDRT: intermediaries, repurchases etc

Intermediaries

1     (1)  

Section 80A of FA 1986 (exemption from stamp duty: sales to intermediaries)

is amended as follows.

      (2)  

For subsections (1) to (3) substitute—

25

“(1)   

Stamp duty shall not be chargeable on an instrument transferring

stock of a particular kind on sale to a person or the person’s nominee

if—

(a)   

the person is a member of a regulated market on which stock

of that kind is regularly traded; and

30

(b)   

the person is an intermediary and is recognised as such by the

market in accordance with arrangements approved by the

Commissioners.

(1A)   

Stamp duty shall not be chargeable on an instrument transferring

stock of a particular kind on sale to a person or the person’s nominee

35

if—

(a)   

the person is a member of a multilateral trading facility, or a

recognised foreign exchange, on which stock of that kind is

regularly traded;

 

 

Finance Bill
Schedule 21 — Exemptions from stamp duty and SDRT: intermediaries, repurchases etc

243

 

(b)   

the person is an intermediary and is recognised as such by the

facility or exchange in accordance with arrangements

approved by the Commissioners; and

(c)   

the sale is effected on the facility or exchange.

(1B)   

Stamp duty shall not be chargeable on an instrument transferring

5

stock of a particular kind on sale to a person or the person’s nominee

if—

(a)   

the person is an intermediary who is approved for the

purposes of this section by the Commissioners; and

(b)   

stock of that kind is regularly traded on a regulated market.

10

(1C)   

Stamp duty shall not be chargeable on an instrument transferring

stock of a particular kind on sale to a person or the person’s nominee

if—

(a)   

the person is an intermediary who is approved for the

purposes of this section by the Commissioners;

15

(b)   

stock of that kind is regularly traded on a multilateral trading

facility or a recognised foreign exchange; and

(c)   

the sale is effected on the facility or exchange.

(2)   

Stamp duty shall not be chargeable on an instrument transferring

stock of a particular kind on sale to a person or the person’s nominee

20

if—

(a)   

the person is a member of a regulated market, a multilateral

trading facility or a recognised foreign options exchange;

(b)   

options to buy or sell stock of that kind are regularly traded

on, and are listed by or quoted on, that market, facility or

25

exchange;

(c)   

the person is an options intermediary and is recognised as

such by that market, facility or exchange in accordance with

arrangements approved by the Commissioners; and

(d)   

stock of that kind is regularly traded on a regulated market.

30

(2A)   

Stamp duty shall not be chargeable on an instrument transferring

stock of a particular kind on sale to a person or the person’s nominee

if—

(a)   

the person is a member of a regulated market, a multilateral

trading facility or a recognised foreign options exchange;

35

(b)   

options to buy or sell stock of that kind are regularly traded

on, and are listed by or quoted on, that market, facility or

exchange;

(c)   

the person is an options intermediary and is recognised as

such by that market, facility or exchange in accordance with

40

arrangements approved by the Commissioners; and

(d)   

the sale is effected on a relevant qualifying exchange on

which stock of that kind is regularly traded or is effected on

a relevant qualifying exchange pursuant to the exercise of a

relevant option and options to buy or sell stock of that kind

45

are regularly traded on, and are listed by or quoted on, that

exchange;

   

and in paragraph (d) “relevant qualifying exchange” means a

multilateral trading facility, a recognised foreign options exchange

or a recognised foreign exchange.

50

 

 

 
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