House of Commons Amendments

House of Commons

Session 2007 - 08
Internet Publications
Other Bills before Parliament

Public Bill Committee: 19th June 2008
443

Finance Bill, continued

“700A
Employment-related securities etc: remittance basis

(1)
This section applies if—

(a)
section 698 or 700 applies, and

(b)
part or all of the amount that counts as employment income is

foreign securities income or is likely to be foreign securities

income.

(2)
The amount of the payment treated under section 696 as made is

limited to—

(a)
the amount that, on the basis of the best estimate that can

reasonably be made, is likely to count as employment income,

minus

(b)
the amount that, on the basis of such an estimate, is likely to

be foreign securities income.

(3)
References in this section to “foreign securities income” are to income

that is foreign securities income for the purposes of section 41A.”’.

Jane Kennedy

271

Schedule  7,  page  176,  line  40,  leave out ‘8(2)’ and insert ‘8’.

Jane Kennedy

272

Schedule  7,  page  176,  line  41,  leave out from ‘plan),’ to end of line 42 and insert

‘for sub-paragraph (2) substitute—

  “(2)
An employee is a UK resident taxpayer if—

(a)
the employee’s earnings from the employment by reference

to which the employee meets the employment requirement

are (or would be if there were any) general earnings to

which section 15 applies (earnings for year when employee

UK resident), and

(b)
those general earnings are (or would be if there were any)

earnings for a tax year in which the employee is ordinarily

resident in the United Kingdom.”’.

Jane Kennedy

273

Schedule  7,  page  176,  line  43,  leave out ‘6(2)(c)’ and insert ‘6(2)’.

Jane Kennedy

274

Schedule  7,  page  176,  line  44,  leave out from ‘scheme),’ to end of line 45 and insert

‘for paragraph (c) substitute—

“(c)
E’s earnings from the office or employment within

paragraph (a) are (or would be if there were any) general

earnings to which section 15 applies (earnings for year

when employee UK resident),

(ca)
those general earnings are (or would be if there were any)

earnings for a tax year in which E is ordinarily resident in

the United Kingdom, and”.’.

Public Bill Committee: 19th June 2008
444

Finance Bill, continued

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

381

Schedule  7,  page  178,  line  2,  at end insert ‘where the source ceased after 5 April

2007’.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

382

Schedule  7,  page  178,  leave out lines 40 to 45 and insert—

‘(1)
Deductions are allowed from the income mentioned in section 832(2) where—

(a)
the income is from a trade, profession or vocation carried on outside the

United Kingdom; and

(b)
the income is overseas property income.

(2)
In the case of section 832B(1)(a) the same deductions are allowed as are allowed

under the Income Taxes Acts where the trade, profession or vocation is carried

out in the United Kingdom.

(3)
In the case of section 832B(1)(b) the same deductions are allowed as are allowed

under the Income Taxes Acts where the property business is carried on overseas

and taxed on the arising basis.”’.

Jane Kennedy

348

Schedule  7,  page  180,  line  25,  at end insert—

‘(3A)
Sections 42 and 43 of the Management Act (procedure and time limit

for making claims), except section 42(1A) of that Act, apply in

relation to an election under this section as they apply in relation to a

claim for relief.’.

Jane Kennedy

335

Schedule  7,  page  182,  line  40,  at end insert—

‘58A
In section 119A (increase in expenditure by reference to tax charged in relation

to employment-related securities), after subsection (5) insert—

“(5A)
See also section 119B (unremitted foreign securities income).”

58B
After that section insert—

“119B
Section 119A: unremitted foreign securities income

(1)
For the purposes of section 119A reduce the amount that counts as

employment income by so much of that amount (if any) as is

unremitted foreign securities income.

(2)
In this section “unremitted foreign securities income” means income

that—

(a)
is foreign securities income for the purposes of section 41A of

ITEPA 2003 (employment income from ERS charged on

remittance basis), and

Public Bill Committee: 19th June 2008
445

Finance Bill, continued

(b)
has not been remitted to the United Kingdom by the end of the

tax year in which the disposal mentioned in section 119A(1)

occurs.

(3)
The following provisions apply if any of the unremitted foreign

securities income is remitted to the United Kingdom after the end of

the tax year referred to in subsection (2)(b).

(4)
The person liable for the capital gains tax on any chargeable gains

arising on the disposal may make a claim for section 119A(2) to have

effect as if the remitted income had been remitted before the end of

that tax year.

(5)
All adjustments (by way of repayment of tax, assessment or otherwise)

are to be made which are necessary to give effect to a claim under

subsection (4).

(6)
Those adjustments may be made at any time, despite anything to the

contrary in any enactment relating to capital gains tax.”’.

Jane Kennedy

349

Schedule  7,  page  184,  line  6,  leave out paragraph 70.

Jane Kennedy

350

Schedule  7,  page  184,  line  20,  leave out paragraph 73.

Jane Kennedy

336

Schedule  7,  page  184,  line  35,  leave out ‘and 32’ and insert ‘to 32, 34C and 58B’.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

399

Schedule  7,  page  184,  line  37,  leave out ‘2008’ and insert ‘2009’.

Jane Kennedy

337

Schedule  7,  page  184,  line  37,  at end insert ‘(except employment-related securities

acquired pursuant to a securities option acquired before 6 April 2008).’.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

400

Schedule  7,  page  184,  line  39,  leave out ‘2008-09’ and insert ‘2009-10’.

Public Bill Committee: 19th June 2008
446

Finance Bill, continued

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

401

Schedule  7,  page  184,  line  39,  at end insert ‘, except for the amendment made by

paragraph 1 to insert a new section 809G in Part 14 of ITA 2007, which has effect for the

tax year 2008-09 and subsequent tax years.’.

Jane Kennedy

491

Schedule  7,  page  186,  line  25,  at end insert—

    ‘(6)
In this paragraph “property” does not include money.

      (7)
“Money” has the same meaning as in section 809U of ITA 2007.’.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

383

Schedule  7,  page  187,  leave out lines 1 to 9 and insert ‘, and

(b)
before 6 April 2008 the money was received in the United Kingdom.’.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

386

Schedule  7,  page  187,  leave out lines 1 to 3 and insert—

‘(b)
the loan was made for the purpose of enabling the individual to—

(i)
acquire an interest in residential property in the United Kingdom,

(ii)
carry out a remortgaging exercise with respect to residential

property in the United Kingdom, or

(iii)
furnish, decorate, repair or enhance a residential property in the

United Kingdom, and’.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

387

Schedule  7,  page  187,  line  6,  leave out from ‘money’ to ‘and’ in line 7 and insert

‘for any of the purposes referred to in subsection (1)(b),’.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

384

Schedule  7,  page  187,  line  10,  leave out ‘Relevant foreign income’ and insert

‘Foreign income gains’.

Public Bill Committee: 19th June 2008
447

Finance Bill, continued

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

388

Schedule  7,  page  187,  line  10,  leave out ‘Relevant foreign income’ and insert

‘Foreign income and gains’.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

385

Schedule  7,  page  187,  leave out lines 13 to 21.

Mr Philip Hammond

Mr Mark Hoban

Mr David Gauke

Justine Greening

389

Schedule  7,  page  187,  leave out lines 13 to 19.

Jane Kennedy

492

Schedule  7,  page  187,  line  17,  at end insert ‘or

(d)
the interest ceases to be owned by the individual,’.

Jane Kennedy

493

Schedule  7,  page  187,  line  19,  at end insert—

  ‘(3A)
If—

(a)
before 12 March 2008, money was lent to the individual outside the

United Kingdom (“the subsequent loan”),

(b)
the subsequent loan was made for the purpose of enabling the

individual to repay—

(i)
the loan mentioned in sub-paragraph (1), or

(ii)
another loan in relation to which sub-paragraphs (2) and (3)

apply (by virtue of this sub-paragraph),


and for no other purpose, and

(c)
before 6 April 2008—

(i)
the money was received in the United Kingdom,

(ii)
the individual used the money to repay the loan referred to in

paragraph (b)(i) or (ii), and

(iii)
repayment of the subsequent loan was secured on the interest

referred to in sub-paragraph (1)(c),


sub-paragraphs (2) and (3) apply in relation to the subsequent loan (and for this

purpose references there to the debt or the loan are to be read as references to

the subsequent loan).’.

Jane Kennedy

338

Schedule  7,  page  187,  line  21,  at end insert—

‘86A (1)
This paragraph applies in relation to employment-related securities if—

Public Bill Committee: 19th June 2008
448

Finance Bill, continued

(a)
the date of the acquisition is on or after 6 April 2008 and on or before

31 July 2008, and

(b)
Chapter 2 of Part 7 of ITEPA 2003 (restricted securities) applies in

relation to the securities by virtue only of amendments made by this

Schedule.

      (2)
Section 431 of ITEPA 2003 (election for full or partial disapplication of

Chapter) has effect in relation to the employment-related securities as if in

subsection (5)(b) for “more than 14 days after the acquisition” there were

substituted “after 14 August 2008”.’.

Jane Kennedy

402A

Schedule  7,  page  187,  line  31,  at end insert—

  ‘(1A)
In subsection (1), after paragraph (a) insert—

“(aa)
any reference to anything accruing is to be read as a reference

to it arising (and similar references are to be read

accordingly);”.’.

Jane Kennedy

403

Schedule  7,  page  187,  line  32,  leave out ‘(4)’ and insert ‘(5)’.

Jane Kennedy

404

Schedule  7,  page  187,  line  33,  leave out from beginning to end of line 17 on page

188 and insert—

‘“(2)
If—

(a)
offshore income gains arise to the trustees of a settlement in a

tax year, and

(b)
section 87 of the 1992 Act (gains of non-resident settlements)

applies to the settlement for that year,


the OIG amount for the settlement for that year is the amount of the

offshore income gains.

(3)
Sections 87, 87A, 87C to 90 and 96 to 98 of, and Schedule 4C to, the

1992 Act apply in relation to OIG amounts as if—

(a)
references to section 2(2) amounts (except those in paragraph

7B(2)(b) and (4) of Schedule 4C) were to OIG amounts,

(b)
references to chargeable gains (except the one in paragraph

1(5) of Schedule 4C) were to offshore income gains,

(c)
references to anything accruing were to it arising (and similar

references, except the one in paragraph 1(5) of Schedule 4C,

were read accordingly), and

(d)
sections 87(4), 88(2) to (5), 89(4) and 97(6) and paragraphs

1(3A), 3 to 7, 8AA, 12 and 13 of Schedule 4C were omitted.

(4)
Section 87A of the 1992 Act applies for a tax year by virtue of

subsection (3) before it applies for that year otherwise than by virtue

of that subsection.

(5)
If, by virtue of subsection (1) or (3), offshore income gains are treated

as arising to a person, for the purposes of section 761 as it applies in

relation to the offshore income gains treat the person as having made

the disposal in question.’.

Public Bill Committee: 19th June 2008
449

Finance Bill, continued

Jane Kennedy

405

Schedule  7,  page  188,  line  18,  leave out from ‘(6)’ to end and insert ‘—

(a)
for “subsection (2) above” substitute “(3)”,

(b)
for “accrued” substitute “arisen”, and

(c)
omit “Chapter 2 of Part 13 of ITA 2007 or”.’.

Jane Kennedy

406

Schedule  7,  page  188,  leave out line 20 and insert—

‘“762ZA
Offshore income gains: application of transfer of assets abroad

provisions

(1)
Chapter 2 of Part 13 of ITA 2007 (transfer of assets abroad) applies in

relation to an offshore income gain arising to a person resident or

domiciled outside the United Kingdom (and not resident or ordinarily

resident in the United Kingdom) as if the offshore income gain were

income becoming payable to the person.

(2)
Income treated as arising under that Chapter by virtue of subsection

(1) is regarded as “foreign” for the purposes of section 726, 730 or 735

of that Act.

(3)
Subsection (1) does not apply in relation to an offshore income gain if

(and to the extent that) it is treated, by virtue of section 762(1), as

arising to a person resident or ordinarily resident in the United

Kingdom.

(4)
The following provisions apply if section 762(2) applies in relation to

an offshore income gain (“the relevant offshore income gain”).

(5)
If—

(a)
by virtue of section 762(3) an offshore income gain is treated

as arising in a tax year to a person resident or ordinarily

resident in the United Kingdom, and

(b)
it is so treated by reason of the relevant offshore income gain

(or part of it),


for that and subsequent tax years subsection (1) does not apply in

relation to the relevant offshore income gain (or that part).

(6)
If, by virtue of subsection (1) as it applies in relation to the relevant

offshore income gain, income is treated under Chapter 2 of Part 13 of

ITA 2007 as arising in a tax year, reduce (with effect from the

following tax year) the OIG amount in question by the amount of the

income.’.

762ZB
Income treated as arising under section 761(1): remittance basis’.

Jane Kennedy

407

Schedule  7,  page  188,  leave out lines 27 to 32 and insert—

‘(2)
Treat the income as relevant foreign income of the individual.’.