|
| |
|
and losses referred to in paragraph (b) of that subsection,” and insert |
| |
| |
(b) | in paragraph (b), for “arising from the assets is, and gains or losses |
| |
accruing on the disposal of the assets are,” substitute “and losses |
| |
arising from the assets, and gains and losses accruing on the disposal |
| |
| |
(c) | omit paragraph (c) and the “and” before it. |
| |
(10) | In consequence of the preceding provisions, omit the provisions specified in |
| |
| |
(11) | The provisions mentioned in sub-paragraph (10) are— |
| |
(a) | section 432AB(2) of ICTA, |
| |
(b) | section 502H of that Act, |
| |
(c) | paragraph 3 of Schedule 11 to FA 1996, |
| |
(d) | paragraph 19(4) of Schedule 12 to FA 1997, |
| |
(e) | paragraphs 36(1) and (3) and 138(2) and (3) of Schedule 29 to FA |
| |
| |
(f) | paragraph 19(4) of Schedule 9 to F(No.2)A 2005, and |
| |
(g) | paragraphs 13(2) and 44 of Schedule 7, and paragraph 5 of Schedule |
| |
| |
(12) | The amendments made by this paragraph have effect in relation to |
| |
accounting periods beginning on or after 1 January 2008. |
| |
| |
18 (1) | In section 431 of ICTA (interpretative provisions relating to insurance |
| |
companies), after subsection (2YA) insert— |
| |
“(2YB) | “BLAGAB profits”, in relation to an accounting period of an |
| |
insurance company, means the company’s BLAGAB income and |
| |
gains for the period reduced (but not below nil) by the company’s |
| |
BLAGAB deductions for the period. |
| |
(2YC) | “BLAGAB income and gains”, in relation to an accounting period of |
| |
an insurance company, means the aggregate of— |
| |
(a) | income chargeable for the period under Schedule A or Case |
| |
III, V or VI of Schedule D so far as referable (in accordance |
| |
with section 432A) to the company’s basic life assurance and |
| |
general annuity business, |
| |
(b) | distributions received in the period from companies resident |
| |
in the United Kingdom so far as so referable, and |
| |
(c) | chargeable gains so far as so referable accruing to the |
| |
company in the period, but (subject to section 210A of the |
| |
1992 Act) after deducting— |
| |
(i) | any allowable losses so referable and so accruing, and |
| |
(ii) | so far as they have not been allowed as a deduction |
| |
from chargeable gains in any previous accounting |
| |
period, any allowable losses so referable previously |
| |
| |
(2YD) | “BLAGAB deductions”, in relation to an accounting period of an |
| |
insurance company, means the aggregate of— |
| |
|
| |
|
| |
|
(a) | amounts falling in respect of any non-trading deficits on the |
| |
company’s loan relationships to be brought into account in |
| |
the period in accordance with paragraph 4 of Schedule 11 to |
| |
the Finance Act 1996, and |
| |
(b) | the expenses deduction given by Step 8 in section 76(7) for the |
| |
| |
(2) | In section 755A(11C) of that Act (treatment of chargeable profits and |
| |
creditable tax apportioned to company carrying on life assurance business), |
| |
omit paragraph (b) and the “and” before it. |
| |
(3) | In section 85A of FA 1989 (excess adjusted Case I profits), for subsections (6) |
| |
| |
“(6) | “The relevant income” means— |
| |
(a) | the company’s BLAGAB income and gains for the accounting |
| |
period (but excluding any amount within this section), and |
| |
(b) | profits of the company chargeable under Case VI of Schedule |
| |
D under section 436A of the Taxes Act 1988 (gross roll-up |
| |
business) for the accounting period.” |
| |
(4) | In section 88 of that Act (meaning of “policy holders’ share of profits”), for |
| |
subsections (3) to (3B) substitute— |
| |
“(3) | For the purposes of subsection (1) above the relevant profits of a |
| |
company for an accounting period consist of the aggregate of— |
| |
(a) | the company’s BLAGAB profits for the period, and |
| |
(b) | profits of the company chargeable under Case VI of Schedule |
| |
D under section 436A of the Taxes Act 1988 (gross roll-up |
| |
business) for the period.” |
| |
| |
(a) | section 89(1B) of FA 1989, |
| |
(b) | in section 210A(10)(a) of TCGA 1992, “(within the meaning of section |
| |
89(1B) of the Finance Act 1989)”, |
| |
(c) | paragraph 21(2) of Schedule 8 to FA 1995, |
| |
(d) | paragraph 2(1) of Schedule 11, and paragraph 56 of Schedule 14, to |
| |
| |
(e) | paragraph 6(1) of Schedule 33 to FA 2003, |
| |
(f) | in paragraph 9(2) of Schedule 7 to FA 2004, paragraphs (a) to (c) and |
| |
the words from”; and, in consequence of” to the end, and |
| |
(g) | paragraphs 58 and 67(2) of Schedule 7, and paragraphs 15(3) and |
| |
16(2) of Schedule 8, to FA 2007. |
| |
(6) | The amendments made by this paragraph have effect in relation to |
| |
accounting periods beginning on or after 1 January 2008. |
| |
Abolition of “inherited estates” apportionment rules |
| |
19 (1) | Chapter 1 of Part 12 of ICTA (insurance companies) is amended as follows. |
| |
(2) | In section 431(2ZB) and (2ZC) (interpretative provisions), insert “or” at the |
| |
end of paragraph (b) and omit paragraph (d) and the “or” before it. |
| |
(3) | In section 432A (apportionment of income and gains), omit— |
| |
|
| |
|
| |
|
(a) | in subsection (6), paragraph (b) of the definition of A (but not the |
| |
| |
(b) | in subsection (8), paragraph (b) and the “and” before it, and |
| |
(c) | subsections (8A) and (8B). |
| |
(4) | In section 432B (apportionment of receipts brought into account), omit |
| |
| |
(5) | The amendments made by this paragraph have effect in relation to periods |
| |
of account beginning on or after 1 January 2007. |
| |
Group relief: gross profits to exclude relevant profits |
| |
20 (1) | In section 434A of ICTA (computation of losses and limitation on relief), |
| |
| |
“(4) | For the purposes of section 403, where the surrendering company is |
| |
an insurance company which is charged to tax under the I minus E |
| |
basis in respect of its life assurance business for the surrender period, |
| |
the company’s gross profits of that period do not include its relevant |
| |
profits (within the meaning of section 88 of the Finance Act 1989) for |
| |
that period; and expressions used in this subsection and section 403 |
| |
have the same meaning here as there.” |
| |
(2) | The amendment made by sub-paragraph (1) has effect in relation to |
| |
accounting periods beginning on or after 1 January 2008. |
| |
| |
21 (1) | In section 434A(3) of ICTA (limitation on relief), after paragraph (a) (before |
| |
the “or” at the end) insert— |
| |
“(aa) | (where the company’s life assurance business is not mutual |
| |
business) in respect of any amount which is a charge on |
| |
income for the purposes of corporation tax,”. |
| |
(2) | The amendment made by sub-paragraph (1) has effect in relation to periods |
| |
of account beginning on or after 1 January 2008 and ending on or after 12 |
| |
| |
Remediation of contaminated land |
| |
22 (1) | Schedule 22 to FA 2001 (remediation of contaminated land) is amended as |
| |
| |
(2) | In paragraph 14 (entitlement to land remediation tax credit)— |
| |
(a) | in sub-paragraph (7), omit “or (13)”, “and charges on income” and |
| |
| |
(b) | in sub-paragraph (8), omit “or (13)”, and |
| |
(c) | in sub-paragraph (9)— |
| |
(i) | for “Step 6” substitute “Step 7”, and |
| |
(ii) | omit “or (13)”, in the first place. |
| |
(3) | In paragraph 17 (restriction on losses carried forward), omit— |
| |
(a) | in sub-paragraph (3)(b), “or (13)”, “and charges on income” and “and |
| |
| |
(b) | in sub-paragraph (4), “or (13)”. |
| |
|
| |
|
| |
|
(4) | In paragraph 21 (provision in respect of I minus E basis), for the words after |
| |
“where” substitute “an insurance company is charged to tax under the I |
| |
minus E basis in respect of its life assurance business for any accounting |
| |
| |
(5) | In paragraph 22(2) (entitlement to relief: I minus E basis), for “is entitled to |
| |
relief for that accounting period in respect of its qualifying expenditure” |
| |
substitute “may treat the amount of its qualifying expenditure as expenses |
| |
payable which fall to be brought into account for that accounting period at |
| |
Step 1 in section 76(7) of the Taxes Act 1988”. |
| |
(6) | In paragraph 24 (entitlement to life assurance company tax credit), omit— |
| |
(a) | in sub-paragraph (3), “or (13)”, in the first place, and |
| |
(b) | in sub-paragraph (2)(b), “or (13)”, “and charges on income” and “and |
| |
| |
(7) | In paragraph 27(1) (restriction on carrying forward expenses payable)— |
| |
(a) | in paragraph (a), omit “or (13)”, and |
| |
(b) | in paragraph (b), omit “for the next accounting period”. |
| |
(8) | The amendments made by this paragraph have effect in relation to |
| |
accounting periods beginning on or after 1 January 2008. |
| |
| |
23 (1) | In section 56 of ICTA (transactions in deposits and debts), omit subsection |
| |
(4) (which relates to section 76(2) computations and is spent). |
| |
(2) | In consequence of sub-paragraph (1), in section 164 of FA 1996, omit |
| |
subsection (4) (which amends section 56(4) of ICTA). |
| |
| |
24 | In section 12AE(2) of TMA 1970 (partnership returns: alternative methods |
| |
for bringing amounts into charge to tax), for “84(2) or (3)” substitute “84(1)”. |
| |
Overseas life assurance business |
| |
25 (1) | Section 431D of ICTA (meaning of “overseas life assurance business”) is |
| |
| |
(2) | In subsections (2) and (4), for “Board” substitute “Commissioners”. |
| |
(3) | In subsection (3), for “Board” substitute “Commissioners for Her Majesty’s |
| |
| |
26 (1) | In section 476(3) of ITTOIA 2005 (foreign policies), omit— |
| |
(a) | “as a result of section 431D(1)(a) of ICTA (business with a non-UK |
| |
resident policy holder)”, and |
| |
(b) | “as a result of section 431D(1) of ICTA”. |
| |
(2) | In consequence of sub-paragraph (1), omit paragraph 78 of Schedule 7 to FA |
| |
| |
(3) | The amendments made by this paragraph have effect as if they were made |
| |
by Schedule 7 to FA 2007 (see section 38(2) of that Act). |
| |
|
| |
|
| |
|
| |
27 (1) | In section 53 of ICTA (farming and market gardening and managing land on |
| |
commercial basis for profit), insert at the end— |
| |
“(5) | The preceding provisions of this section do not apply in relation to— |
| |
(a) | farming or market gardening by an insurance company on |
| |
land which is an asset of the company’s long-term insurance |
| |
| |
(b) | the occupation by an insurance company of land which is |
| |
such an asset for a purpose other than farming or market |
| |
| |
(2) | In section 55 of ICTA (mines, quarries etc), insert at the end— |
| |
“(3) | Subsection (1) does not apply in relation to any concern carried on by |
| |
an insurance company on land which is an asset of the company’s |
| |
long-term insurance fund.” |
| |
(3) | In section 432AB(5) (losses from Schedule A business etc), for “section 392A |
| |
or 392B” substitute “sections 392A and 503, or section 392B,”. |
| |
(4) | The amendments made by this paragraph have effect in relation to |
| |
accounting periods beginning on or after 1 January 2008. |
| |
Controlled foreign companies |
| |
28 (1) | In paragraph 4(1A) of Schedule 25 to ICTA (controlled foreign companies), |
| |
for “436, 439B or 441” substitute “436A”. |
| |
(2) | The amendment made by sub-paragraph (1) has effect in relation to |
| |
accounting periods beginning on or after 1 January 2008. |
| |
| |
29 (1) | In section 757 of ICTA (disposals to which Chapter 5 of Part 17 of that Act |
| |
applies), after subsection (1) insert— |
| |
“(1A) | But this Chapter does not apply to disposals of assets of an insurance |
| |
company’s long-term insurance fund.” |
| |
(2) | The amendment made by sub-paragraph (1) has effect in relation to |
| |
disposals made in accounting periods beginning on or after 1 January 2008. |
| |
| |
30 (1) | In section 444AB(6) of ICTA (transfer schemes transferring whole of |
| |
business), for the words after “means” substitute “the period of account of |
| |
the transferor ending, or treated by section 444AA(2) as ending, |
| |
immediately before the transfer date.” |
| |
(2) | The amendment made by sub-paragraph (1) has effect in relation to transfers |
| |
of business taking place on or after 1 July 2008. |
| |
31 (1) | In section 444ABB(1A)(b)(ii) of ICTA (retained assets), for “liabilities” |
| |
substitute “mathematical reserves (as determined in accordance with section |
| |
1.2 of the Insurance Prudential Sourcebook)”. |
| |
|
| |
|
| |
|
(2) | The amendment made by sub-paragraph (1) has effect in relation to transfers |
| |
of business taking place on or after 1 July 2008. |
| |
32 (1) | In section 444ABD(1) of ICTA (transferor’s period of account including |
| |
transfer), for “liabilities” substitute “mathematical reserves (as determined |
| |
in accordance with section 1.2 of the Insurance Prudential Sourcebook)”. |
| |
(2) | The amendment made by sub-paragraph (1) has effect in relation to transfers |
| |
of business with a transfer date after 21 March 2007. |
| |
| |
33 | In section 431(2) of ICTA, in the definition of “periodical return”, insert at the |
| |
end “(and does not include the Forms mentioned in Rule 9.3(5))”. |
| |
Repeal of section 737D of ICTA |
| |
34 (1) | In ICTA, omit section 737D (power to provide that manufactured payments |
| |
are to be treated as income eligible for relief under section 438). |
| |
(2) | In consequence of sub-paragraph (1), omit— |
| |
(a) | section 83(1) of FA 1995, |
| |
(b) | section 139(6) of FA 2006, and |
| |
(c) | paragraph 175 of Schedule 1 to ITA 2007. |
| |
| |
35 | In paragraph 12 of Schedule 12 to FA 2002 (insurance companies treated as |
| |
large companies), for the words following paragraph (b) substitute “the |
| |
company does not qualify as a small or medium-sized enterprise for the |
| |
purposes of Parts 1 to 3 of this Schedule or Schedule 20 to the Finance Act |
| |
| |
| |
36 (1) | In section 89(7) of FA 1989 (policy holders’ share of profits), for “in respect |
| |
of losses in accordance with section 85A(4)” substitute “in accordance with |
| |
section 85A(4) in respect of losses incurred in an accounting period in which |
| |
31 December 2002 is included or any later accounting period.” |
| |
(2) | The amendment made by sub-paragraph (1) has effect in relation to |
| |
accounting periods beginning on or after 1 January 2008 and ending on or |
| |
| |
Commencement of Schedule 9 to FA 2007 |
| |
37 (1) | Paragraph 17 of Schedule 9 to FA 2007 (transfers: commencement) is |
| |
| |
(2) | In sub-paragraph (2), for “9, 10(3) to (5),” substitute “10(5),”. |
| |
(3) | In sub-paragraph (3)— |
| |
(a) | after “effect” insert “(a)”, and |
| |
(b) | insert at the end “and |
| |
(b) | in relation to periods of account ending after 30 June |
| |
2008 where the transfer of business or |
| |
|
| |
|
| |
|
demutualisation concerned took place on or after 21 |
| |
March 2007 and before 1 July 2008.” |
| |
(4) | After sub-paragraph (4) insert— |
| |
“(4A) | The amendment made by paragraph 9 has effect in relation to |
| |
contracts entered into in a period of account beginning on or after |
| |
| |
| |
“(6) | The amendments made by paragraph 10(3) and (4) have effect in |
| |
relation to assets transferred on or after 1 January 2008.” |
| |
Commencement of Business Transfer Schemes Order |
| |
38 (1) | In article 1(5) of the Insurance Business Transfer Schemes (Amendment of |
| |
the Corporation Tax Acts) Order 2008 (S.I. 2008/381), for “other” substitute |
| |
| |
(2) | In article 29(2), for ““assuming the transferor had continued to carry on the |
| |
business transferred after the transfer”” substitute ““assuming that the |
| |
transferor had continued to carry on the business transferred””. |
| |
(3) | The amendments made by this paragraph are to be treated as always having |
| |
| |
| |
39 (1) | In section 436A(6) of ICTA (gross roll-up business: separate charge on |
| |
profits), omit “under subsection (4) above”. |
| |
(2) | The amendment made by sub-paragraph (1) has effect in relation to periods |
| |
of account beginning on or after 1 January 2008 and ending on or after 12 |
| |
| |
Repeal of spent provision |
| |
40 | In section 88(5) of FA 1989 (policy holders’ share of profits), omit the words |
| |
| |
| |
| |
| |
| |
1 | Chapter 2 of Part 12 of ICTA (friendly societies etc) is amended as follows. |
| |
| |
2 (1) | In section 466(1) (“life or endowment business”), for paragraph (b) |
| |
| |
“(b) | any PHI business (as defined in section 431) if— |
| |
(i) | the contract is one made before 1 September 1996, or |
| |
|
| |
|