|
| |
|
(b) | in FA 1990, section 53, |
| |
(c) | in FA 1991, sections 55 and 56, |
| |
(d) | in TCGA 1992, paragraph 14(40) and (41) of Schedule 10, |
| |
(e) | in FA 1994, paragraph 17 of Schedule 16, |
| |
(f) | in FA 1995, section 81, |
| 5 |
| |
(i) | paragraph 36 of Schedule 20, and |
| |
(ii) | paragraph 9 of Schedule 38, |
| |
(h) | in FA 1997, section 77, |
| |
| 10 |
| |
(ii) | paragraph 14 of Schedule 6, |
| |
(j) | in FA 2003, paragraph 6 of Schedule 38, |
| |
(k) | in ITTOIA 2005, paragraphs 302 and 303 of Schedule 1, |
| |
| 15 |
(i) | in section 64(8), paragraph (f) (and the “and” before it), |
| |
(ii) | in section 72(5), paragraph (f) (and the “and” before it), |
| |
(iii) | in section 448(3), “and section 451”, |
| |
(iv) | in section 449(3), “and section 451”, |
| |
| 20 |
(vi) | in section 505, in subsection (4) “and section 506” and, in |
| |
subsection (5) “and in section 506”, |
| |
| |
(viii) | paragraphs 167 to 170 of Schedule 1, and |
| |
(m) | in FA 2007, paragraph 6 of Schedule 14. |
| 25 |
(5) | The amendments made by subsections (1)(a) and (b), (2) and (3) have effect in |
| |
relation to transactions in securities entered into on or after 1 April 2008. |
| |
(6) | The amendment made by subsection (1)(c) has effect in relation to cases where |
| |
the purchase by the first buyer (within the meaning of section 731(2) of ICTA) |
| |
is made on or after that date. |
| 30 |
(7) | The amendment made by subsection (1)(d) has effect in relation to |
| |
distributions made on or after that date. |
| |
(8) | The amendments made by subsection (4) have effect in accordance with |
| |
| |
| 35 |
64 | Income of beneficiaries under settlor-interested settlements |
| |
(1) | In section 685A of ITTOIA 2005 (settlor-interested settlements), after |
| |
| |
“(5A) | If the recipient of the annual payment is treated by subsection (3) as |
| |
having paid income tax in respect of the annual payment, the amount |
| 40 |
of the payment is treated as the highest part of the recipient’s total |
| |
income for all income tax purposes except the purposes of sections 535 |
| |
to 537 (gains from contracts for life insurance etc: top slicing relief). |
| |
|
| |
|
| |
|
(5B) | See section 1012 of ITA 2007 (relationship between highest part rules) |
| |
for the relationship between— |
| |
(a) | the rule in subsection (5A), and |
| |
(b) | other rules requiring particular income to be treated as the |
| |
highest part of a person’s income.” |
| 5 |
(2) | In section 1012(4) of ITA 2007 (relationship between rules on highest part of |
| |
total income), after the entry relating to section 465A of ITOIA 2005 insert— |
| |
“section 685A(5A) of ITTOIA 2005 (payments from trustees of |
| |
settlor-interested settlements to be treated as highest part of |
| |
| 10 |
(3) | The amendments made by this section have effect for the tax year 2006-07 and |
| |
| |
65 | Income charged at dividend upper rate |
| |
(1) | In section 13(2) of ITA 2007 (income charged at dividend upper rate: |
| |
| 15 |
(a) | omit “and” at the end of paragraph (a), and |
| |
(b) | at the end of paragraph (b) insert “, and |
| |
(c) | is not relevant foreign income charged in accordance |
| |
with section 832 of ITTOIA 2005.” |
| |
(2) | The amendments made by subsection (1) have effect for the tax year 2008-09 |
| 20 |
and subsequent tax years. |
| |
66 | Payments on account of income tax |
| |
(1) | In section 964 of ITA 2007, omit subsection (5) (sums representing income tax |
| |
deducted from annual payments not to be taken into account for the purpose |
| |
of calculating amounts to be paid on account of income tax). |
| 25 |
(2) | The repeal made by subsection (1) has effect in relation to the calculation of the |
| |
relevant amount (within the meaning of section 59A of ICTA) for the tax year |
| |
2008-09 and subsequent tax years. |
| |
67 | Allowances etc for non-resident nationals of an EEA state |
| |
(1) | In section 278 of ICTA (non-residents eligible for reliefs)— |
| 30 |
(a) | in subsection (2)(a), omit “or an EEA national”, and |
| |
| |
(2) | In section 56(3) of ITA 2007 (non-UK residents eligible for personal allowances |
| |
and tax reductions), before paragraph (a) insert— |
| |
“(za) | is a national of an EEA state,”. |
| 35 |
(3) | Accordingly, omit section 145 of FA 1996 (personal reliefs for non-resident EEA |
| |
| |
(4) | The amendments made by this section have effect for the tax year 2008-09 and |
| |
| |
|
| |
|
| |
|
| |
| |
Plant and machinery: qualifying expenditure |
| |
68 | Thermal insulation of buildings |
| |
(1) | Section 28 of CAA 2001 (thermal insulation of industrial buildings) is amended |
| 5 |
| |
| |
(a) | for “consisting of a trade” substitute “other than an ordinary property |
| |
business or an overseas property business”, |
| |
(b) | for “an industrial” substitute “a”, and |
| 10 |
(c) | for “the trade” substitute “the qualifying activity”. |
| |
(3) | In subsection (2), for “an industrial” substitute “a”. |
| |
(4) | After subsection (2) insert— |
| |
“(2A) | Subsection (2) is subject to section 35 (expenditure on plant or |
| |
machinery for use in dwelling-house not qualifying expenditure). |
| 15 |
(2B) | This section does not apply to expenditure within subsection (2) if a |
| |
deduction for that expenditure is allowable— |
| |
(a) | under section 31ZA of ICTA, or |
| |
(b) | under section 312 of ITTOIA 2005, |
| |
| (deductions for expenditure on energy-saving items). |
| 20 |
(2C) | For the purposes of subsection (2B), whether such a deduction is |
| |
allowable is to be determined without regard to subsection (1)(e) of the |
| |
| |
| |
(6) | In the heading, omit “industrial”. |
| 25 |
(7) | In section 23(2) of CAA 2001 (expenditure unaffected by sections 21 and 22), in |
| |
the entry for section 28, omit “industrial”. |
| |
(8) | The amendments made by this section have effect— |
| |
(a) | for corporation tax purposes, in relation to expenditure incurred on or |
| |
| 30 |
(b) | for income tax purposes, in relation to expenditure incurred on or after |
| |
| |
69 | Expenditure on required fire precautions |
| |
(1) | In CAA 2001, omit section 29 (expenditure on required fire precautions). |
| |
(2) | In section 23(2) of that Act, omit “section 29 (fire safety);”. |
| 35 |
(3) | In consequence of the amendment made by subsection (1)— |
| |
(a) | in the Fire and Rescue Services Act 2004 (c. 21) omit paragraph 96 of |
| |
| |
|
| |
|
| |
|
(b) | in the Fire and Rescue Services (Northern Ireland) Order 2006 (S.I. |
| |
2006/1254 (N.I. 9)), omit paragraph 24 of Schedule 3 (and the entry |
| |
relating to CAA 2001 in Schedule 4). |
| |
(4) | The amendments made by subsections (1) and (2) have effect— |
| |
(a) | for corporation tax purposes, in relation to expenditure incurred on or |
| 5 |
| |
(b) | for income tax purposes, in relation to expenditure incurred on or after |
| |
| |
| |
(1) | In section 23 of CAA 2001 (expenditure unaffected by sections 21 and 22)— |
| 10 |
(a) | in subsection (2), after the entry for section 33 insert— |
| |
| “section 33A (integral features);”, and |
| |
(b) | in subsection (4), in List C— |
| |
(i) | in item 2, omit “Electrical systems (including lighting systems) |
| |
| 15 |
| |
(iii) | in item 6, for “Lifts, hoists, escalators and moving walkways.” |
| |
| |
(2) | After section 33 of that Act insert— |
| |
“Expenditure on integral features |
| 20 |
33A | Expenditure on provision or replacement of integral features |
| |
(1) | This section applies where a person carrying on a qualifying activity |
| |
incurs expenditure on the provision or replacement of an integral |
| |
feature of a building or structure used by the person for the purposes |
| |
of the qualifying activity. |
| 25 |
(2) | This Part (including in particular section 11(4)) applies as if— |
| |
(a) | the expenditure were capital expenditure on the provision of |
| |
plant or machinery for the purposes of the qualifying activity, |
| |
| |
(b) | the person who incurred the expenditure owned plant or |
| 30 |
machinery as a result of incurring it. |
| |
(3) | If the expenditure is qualifying expenditure, it may not be deducted in |
| |
calculating the income from the qualifying activity. |
| |
(4) | If the expenditure is not qualifying expenditure, whether it may be so |
| |
deducted is to be determined without regard to this section. |
| 35 |
(5) | For the purposes of this section each of the following is an integral |
| |
| |
(a) | an electrical system (including a lighting system), |
| |
| |
(c) | a space or water heating system, a powered system of |
| 40 |
ventilation, air cooling or air purification, and any floor or |
| |
ceiling comprised in such a system, |
| |
(d) | a lift, an escalator or a moving walkway, |
| |
(e) | external solar shading. |
| |
|
| |
|
| |
|
(6) | The items listed in subsection (5) do not include any asset whose |
| |
principal purpose is to insulate or enclose the interior of a building or |
| |
to provide an interior wall, floor or ceiling which (in each case) is |
| |
intended to remain permanently in place. |
| |
(7) | The Treasury may by order— |
| 5 |
(a) | provide that subsection (5) does not include a feature of a |
| |
building or structure specifed in the order, expenditure on |
| |
which would (if not within subsection (5)) be qualifying |
| |
expenditure other than special rate expenditure, and |
| |
(b) | add to the list in subsection (5) a feature of a building or |
| 10 |
structure expenditure on the provision of which would not |
| |
(apart from the order) be expenditure on the provision of plant |
| |
| |
(8) | An order under subsection (7) may make such incidental, |
| |
supplemental, consequential and transitional provision as the Treasury |
| 15 |
| |
33B | Meaning of “replacement” in section 33A |
| |
(1) | Expenditure to which this section applies is to be treated for the |
| |
purposes of section 33A as expenditure on the replacement of an |
| |
| 20 |
(2) | This section applies to expenditure incurred by a person on an integral |
| |
feature if the amount of the expenditure is more than 50% of the cost of |
| |
replacing the integral feature at the time the expenditure is incurred. |
| |
(3) | Subsection (4) applies where— |
| |
(a) | a person incurs expenditure (“initial expenditure”) on an |
| 25 |
integral feature which is not more than 50% of the cost of |
| |
replacing the integral feature at the time it is incurred, but |
| |
(b) | in the period of 12 months beginning with the initial |
| |
expenditure being incurred the person incurs further |
| |
expenditure on the integral feature. |
| 30 |
| |
(a) | the amount of the initial expenditure, and |
| |
(b) | the amount (or the aggregate of the amounts) of the further |
| |
| |
| is more than 50% of the cost of replacing the integral feature at the time |
| 35 |
the initial expenditure was incurred, this section applies to the initial |
| |
expenditure and the further expenditure. |
| |
(5) | Where section 33A applies because of subsection (4), all such |
| |
assessments and adjustments of assessments are to be made as are |
| |
necessary to give effect to that section.” |
| 40 |
(3) | In section 74(1) of ICTA (general rules as to deductions not allowable), after |
| |
| |
“(da) | any expenditure to which section 33A(3) of the Capital |
| |
Allowances Act (expenditure on provision or replacement of |
| |
integral features) applies;”. |
| 45 |
(4) | In Chapter 4 of Part 2 of ITTOIA 2005 (rules restricting deductions from trade |
| |
|
| |
|
| |
|
profits), after section 55 insert— |
| |
| |
55A | Expenditure on integral features |
| |
Section 33A(3) of CAA 2001 provides that no deduction is allowed in |
| |
respect of certain expenditure on an integral feature of a building or |
| 5 |
structure (within the meaning of that section).” |
| |
(5) | In the table in section 272(2) of ITTOIA 2005 (provisions of Part 2 applicable to |
| |
profits of property business), after the entry relating to section 55 insert— |
| |
| | expenditure on integral features” |
| | |
|
(6) | The amendments made by this section have effect— |
| 10 |
(a) | for corporation tax purposes, in relation to expenditure incurred on or |
| |
| |
(b) | for income tax purposes, in relation to expenditure incurred on or after |
| |
| |
Plant and machinery: annual investment allowance |
| 15 |
71 | Annual investment allowance |
| |
Schedule 24 contains provision about an annual investment allowance in |
| |
respect of certain qualifying expenditure on plant or machinery. |
| |
Plant and machinery: first-year allowances |
| |
72 | First-year allowance for small and medium-sized enterprises discontinued |
| 20 |
(1) | CAA 2001 is amended as follows. |
| |
(2) | Omit section 44 (expenditure incurred by small or medium-sized enterprises). |
| |
(3) | In consequence of the repeal made by subsection (2)— |
| |
(a) | in the list in section 39 (provisions under which first-year allowances |
| |
available), omit the entry relating to section 44, |
| 25 |
(b) | in the list in section 46(1) (provisions subject to general exclusions), |
| |
omit the entry relating to section 44, |
| |
(c) | omit sections 47 to 49 (definition of small and medium-sized |
| |
| |
(d) | in section 52(3) (first-year allowances) omit— |
| 30 |
(i) | in the table, the entry relating to expenditure qualifying under |
| |
| |
(ii) | the words from “In the case” to the end. |
| |
(4) | Omit the following provisions (which relate to provisions repealed by |
| |
| 35 |
(a) | section 142 of FA 2004 (increase in first-year allowance under section 44 |
| |
| |
|
| |
|
| |
|
(b) | section 30 of FA 2006 (increase in first-year allowance under section 44 |
| |
| |
(c) | section 37 of FA 2007 (increase in first-year allowance under section 44 |
| |
| |
(5) | The repeals made by subsections (2) and (3) have effect in relation to |
| 5 |
expenditure incurred on or after the relevant date. |
| |
(6) | But subsection (7) applies in relation to an additional VAT liability incurred on |
| |
or after the relevant date which under section 235 of CAA 2001 is treated as |
| |
| |
(7) | If the original expenditure (within the meaning of that section) was first-year |
| 10 |
qualifying expenditure by virtue of section 44 of CAA 2001, Chapter 18 of Part |
| |
2 of that Act (additional VAT liabilities and rebates) applies to the additional |
| |
VAT liability as if the provisions repealed by this section were not so repealed. |
| |
(8) | The relevant date is— |
| |
(a) | for corporation tax purposes, 1 April 2008, and |
| 15 |
(b) | for income tax purposes, 6 April 2008. |
| |
73 | Repeal of spent first-year allowances |
| |
(1) | CAA 2001 is amended as follows. |
| |
(2) | Omit sections 40 to 43 (first-year allowance for Northern Ireland expenditure |
| |
incurred on or before 11 May 2002). |
| 20 |
(3) | Omit section 45 (first-year allowance for ICT expenditure incurred on or before |
| |
| |
(4) | In Schedule 3 (transitionals and savings), omit paragraphs 46 to 51 (first-year |
| |
allowance for additional VAT liabilities). |
| |
(5) | In consequence of the amendments made by subsections (2) to (4), omit the |
| 25 |
| |
(a) | in the list in section 39 (provisions under which first-year allowances |
| |
available), the entries relating to section 40 and section 45, |
| |
(b) | in section 46 (general exclusions)— |
| |
(i) | in the list in subsection (1), the entries relating to section 40 and |
| 30 |
| |
(ii) | in the heading, from “applying” to “45”, |
| |
(c) | section 51 (disclosure of information between HMRC and Northern |
| |
| |
(d) | in the table in section 52(3) (first-year allowances), the entries relating |
| 35 |
to expenditure qualifying under section 40 and expenditure qualifying |
| |
| |
(e) | section 237(2) (exception to section 236 where section 43 applies), and |
| |
(f) | in Schedule 3 (transitionals and savings), paragraph 14 (application of |
| |
| 40 |
(6) | In consequence of the amendments made by this section, omit— |
| |
(a) | in section 98 of TMA 1970, in the second column of the table, in the |
| |
entry relating to requirements imposed by CAA 2001 “43(5) and (6),”, |
| |
(b) | sections 165 and 166 of FA 2003, and |
| |
(c) | paragraph 84 of Schedule 4 to CRCA 2005. |
| 45 |
|
| |
|