Corporation Tax Bill

House of Commons

Session 2008 - 09
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Other Bills before Parliament

Corporation Tax Bill

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
736

709
In section 934(4) (non-UK resident companies) for “section 11(2) of ICTA”
substitute “section 19 of CTA 2009”.
710
In section 937(5)(c) (partnerships)—
(a)
for “section 11(2) of ICTA” substitute “section 19 of CTA 2009”, and
(b)
for “sections 114 and 115 of ICTA” substitute “Part 17 of that Act”.
5
711
In section 939(1)(b) (duty to retain bonds where issue treated as payment of
interest) for “section 582(1)(a) of ICTA” substitute “section 413 of CTA 2009”.
712   (1)
Amend section 941 (deemed payments to unit holders and deemed
deductions of income tax) as follows.
      (2)
In subsection (1), after “ITTOIA 2005” insert “or Chapter 5 of Part 10 of CTA
10
2009”.
      (3)
In subsection (2), after “ITTOIA 2005” insert “and section 973(2) of CTA
2009”.
      (4)
Omit subsections (4) and (5).
      (5)
In subsection (6)—
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(a)
in the definition of “deemed deduction”, omit “or (5)”, and
(b)
in the definition of “deemed payment”, omit “or (4)”.
713
In section 948(2) (meaning of “accounting period”) for the words from
“section” to “assessment)” substitute “Chapter 2 of Part 2 of CTA 2009
(accounting periods)”.
20
714
In section 965(2) (overview of sections 966 to 970) for “section 556 of ICTA”
substitute “section 1309 of CTA 2009”.
715   (1)
Amend section 971 (income tax in respect of non-resident landlords) as
follows.
      (2)
In subsection (2) for the words from “chargeable” to the end substitute
25
“chargeable as the profits of a UK property business under Chapter 3 of Part
3 of ITTOIA 2005 or Chapter 3 of Part 4 of CTA 2009.”
      (3)
In subsection (3)(a) for “Schedule A business, or a UK property business,”
substitute “UK property business (within the meaning of Chapter 2 of Part 3
of ITTOIA 2005 or Chapter 2 of Part 4 of CTA 2009)”.
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716
In section 976(6) (arrangements for payments of interest less tax or at a
specified net rate) for paragraph (b) substitute—
“(b)
interest which is required to be brought into account under
Part 5 of CTA 2009 (loan relationships) as a non-trading
credit of the recipient.”
35
717
In section 980(2) (derivative contracts: exception from duties to deduct) for
“Schedule 26 to FA 2002” substitute “Part 7 of CTA 2009”.
718
In section 989 (definitions) omit the definition of “Schedule A business”.
719
In section 1017 (abbreviated references to Acts) after the definition of “CAA
2001” insert—
40
““CTA 2009” means the Corporation Tax Act 2009,”.
720
In Schedule 4 (index of defined expressions) omit the entry for “Schedule A
business”.

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
737

Finance Act 2007 (c. 11)
721
The Finance Act 2007 is amended as follows.
722
In section 113 (interpretation) after the definition of “CRCA 2005” insert—
““CTA 2009” means the Corporation Tax Act 2009;”.
723
In Schedule 3 (managed service companies) omit paragraph 10.
5
724   (1)
Amend Schedule 7 (insurance business: gross roll-up business etc) as
follows.
      (2)
In paragraph 85—
(a)
in sub-paragraph (1) omit “(a “Case VI loss”)” and “(a “Case I loss”)”,
and
10
(b)
in sub-paragraph (2)—
(i)
for “Case VI losses” substitute “losses so treated”, and
(ii)
for “Case I losses” substitute “losses of the transferee”.
      (3)
For the italic cross-heading before paragraph 85 substitute “Losses
transferred under section 444AZA”.
15
      (4)
In paragraph 86(4) and (5) for “Case VI” substitute “gross roll-up business”.
      (5)
For the italic cross-heading before paragraph 86 substitute “Losses
transferred under section 444AZB”.
725   (1)
Amend Schedule 13 (sale and repurchase of securities) as follows.
      (2)
In paragraph 1(1) after “in that case” insert “in respect of chargeable gains”.
20
      (3)
Omit paragraphs 2 to 5, 7 to 10 and 12.
      (4)
In paragraph 14—
(a)
in the definition of “creditor quasi-repo” for “paragraph 8” substitute
“section 544 of CTA 2009”,
(b)
in the definition of “creditor repo” for “paragraph 7” substitute
25
“section 543 of CTA 2009”,
(c)
in the definition of “debtor quasi-repo” for “paragraph 3” substitute
“section 549 of CTA 2009”,
(d)
in the definition of “debtor repo” for “paragraph 2” substitute
“section 548 of CTA 2009”, and
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(e)
in the definition of “the loan relationship rules” for “Chapter 2 of Part
4 of FA 1996” substitute “Part 5 of CTA 2009”.
      (5)
In paragraph 15(9)(b) for “paragraph 12” and “paragraph 10” substitute
“section 547 of CTA 2009” and “section 546 of that Act” respectively.
726
In paragraph 28(fa) of Schedule 24 (penalties for errors)—
35
(a)
in paragraph (i) for “Schedule 20 to FA 2000” substitute “Chapter 2
or 7 of Part 13 of CTA 2009”,
(b)
in paragraph (ii) for “Schedule 22 to FA 2001” substitute “Chapter 3
or 4 respectively of Part 14 of CTA 2009”,
(c)
omit paragraph (iii), and
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(d)
in paragraph (iv) for “Schedule 5 to FA 2006” substitute “Chapter 3
of Part 15 of CTA 2009”.

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
738

Finance Act 2008 (c. 9)
727
The Finance Act 2008 is amended as follows.
728
Omit section 29 (cap on R&D aid).
729
Omit section 36(1) (company gains from investment life insurance contracts
etc).
5
730
In section 77(6), in the words after paragraph (b) for “section 578A of ICTA
and section 50 of ITTOIA 2005 apply” substitute “section 50 of ITTOIA 2005
applies”.
731
In section 154(6) (stamp duty and stamp duty reserve tax: alternative
investment bonds) after “2005” insert “or section 507 of CTA 2009”.
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732
In section 165(1) (interpretation) after the definition of “CRCA 2005” insert—
““CTA 2009” means the Corporation Tax Act 2009,”.
733
In Schedule 10 (cap on R&D aid), omit paragraphs 1 to 7.
734
Omit Schedule 13 (company gains from investment life insurance contracts).
735
In Schedule 15 (changes in trading stock), omit Part 2.
15
736
In Schedule 25 (first-year tax credits)—
(a)
in paragraph 14(6)(b) for “paragraph 4(4) of Schedule 11 to FA 1996”
substitute “section 391(3)(b) of CTA 2009”, and
(b)
in paragraph 16(3)(b) for “paragraph 4(4) of Schedule 11 to FA 1996”
substitute “section 391(3)(b) of CTA 2009”.
20
Crossrail Act 2008 (c.18)
737
The Crossrail Act 2008 is amended as follows.
738   (1)
Amend Schedule 13 (transfer schemes: tax provisions) as follows.
      (2)
In paragraph 3 (interpretation: supplementary) after the definition of “CAA
2001” insert—
25
““CTA 2009” means the Corporation Tax Act 2009;”.
      (3)
In paragraph 5(5) (computation of profits and losses in respect of transfer of
trade) for the words from “under” to the end substitute “under Part 3 of CTA
2009 in respect of the trade or part of a trade in question for periods in which
the trade was carried on wholly or partly in the United Kingdom.”
30
      (4)
In paragraph 6(5) (transfers of trading stock) for “has the same meaning as
in section 100 of ICTA” substitute “has the meaning given by section 163 of
CTA 2009”.
      (5)
In paragraph 13 (continuity in relation to transfer of intangible assets)—
(a)
in sub-paragraph (1) for “Schedule 29 to FA 2002” substitute “Part 8
35
of CTA 2009”, and
(b)
in sub-paragraph (2) for “Schedule”, in both places where it occurs,
substitute “Part”.
      (6)
In paragraph 14 (continuity in relation to loan relationships)—
(a)
in sub-paragraph (1) for “Chapter 2 of Part 4 of FA 1996” substitute
40
“Part 5 of CTA 2009”, and

Corporation Tax Bill
Schedule 2 — Transitionals and savings
Part 1 — General provisions
739

(b)
in sub-paragraph (2) for “paragraph 12(8) of Schedule 9 to” substitute
“section 335(6) of”.
      (7)
In paragraph 15 (continuity in relation to derivative contracts)—
(a)
in sub-paragraph (1) for “Schedule 26 to FA 2002” substitute “Part 7
of CTA 2009”, and
5
(b)
in sub-paragraph (2) for “paragraph 28(6) of that Schedule”
substitute “section 624(3) of that Act”.
      (8)
In paragraph 18(6) (transfers of trading stock) for “has the same meaning as
in section 100 of ICTA” substitute “has the meaning given by section 163 of
CTA 2009”.
10
      (9)
In paragraph 23 (neutral effect of transfer of intangible assets)—
(a)
in sub-paragraph (1) for “Schedule 29 to FA 2002” substitute “Part 8
of CTA 2009”, and
(b)
in sub-paragraph (2) for “Schedule”, in both places where it occurs,
substitute “Part”.
15
     (10)
In paragraph 24 (neutral effect of transfer for loan relationships and
derivative contracts)—
(a)
in sub-paragraph (a) for “Chapter 2 of Part 4 of FA 1996” substitute
“Part 5 of CTA 2009”, and
(b)
in sub-paragraph (b) for “Schedule 26 to FA 2002” substitute “Part 7
20
of that Act”.
     (11)
In paragraph 34(6) (transfers of trading stock) for the words from “has” to
the end substitute “has the meaning given by section 174 of ITTOIA 2005 (as
respects income tax) or section 163 of CTA 2009 (as respects corporation
tax).”
25
     (12)
In paragraph 40 (transfers involving private persons: loan relationships)—
(a)
in sub-paragraph (1) for “Paragraph 11 of Schedule 9 to FA 1996”
substitute “Section 444 of CTA 2009”, and
(b)
in sub-paragraph (2) for “Chapter 2 of Part 4 of FA 1996” and “that
Chapter” substitute “Part 5 of CTA 2009” and “that Part”
30
respectively.
Schedule 2
Section 1325

Transitionals and savings
Part 1
General provisions
35
Continuity of the law: general
1
The repeal of provisions and their enactment in a rewritten form by this Act
does not affect the continuity of the law.
2
Paragraph 1 does not apply to any change made by this Act in the effect of
the law.
40

Corporation Tax Bill
Schedule 2 — Transitionals and savings
Part 1 — General provisions
740

3
Any subordinate legislation or other thing which—
(a)
has been made or done, or has effect as if made or done, under or for
the purposes of a superseded enactment so far as it applied for
relevant tax purposes, and
(b)
is in force or effective immediately before the commencement of the
5
corresponding rewritten provision,

has effect after that commencement as if made or done under or for the
purposes of the rewritten provision.
4     (1)
Any reference (express or implied) in this Act, another enactment or an
instrument or document to a rewritten provision is to be read as including,
10
in relation to times, circumstances or purposes in relation to which any
corresponding superseded enactment had effect for relevant tax purposes, a
reference to the superseded enactment so far as applying for those relevant
tax purposes.
      (2)
In particular, any reference (express or implied) in this Act, another
15
enactment or an instrument or document to—
(a)
the profits of a UK property business, or
(b)
similar concepts created by this Act,

is to be read as including, in relation to times, circumstances or purposes in
relation to which any corresponding concept in a superseded enactment had
20
effect for corporation tax purposes, a reference to that concept so far as
applying for corporation tax purposes.
      (3)
Any reference (express or implied) in this Act, another enactment or an
instrument or document to—
(a)
things done under or for the purposes of a rewritten provision, or
25
(b)
things falling to be done under or for the purposes of a rewritten
provision,

is to be read as including, in relation to times, circumstances or purposes in
relation to which any corresponding superseded enactment had effect for
relevant tax purposes, a reference to things done or falling to be done under
30
or for the purposes of the superseded enactment so far as applying for those
relevant tax purposes.
5     (1)
Any reference (express or implied) in any enactment, instrument or
document to a superseded enactment in its application for relevant tax
purposes is to be read, so far as is required for those relevant tax purposes,
35
as including, in relation to times, circumstances or purposes in relation to
which any corresponding rewritten provision has effect, a reference to the
rewritten provision.
      (2)
In particular, any reference (express or implied) in any enactment,
instrument or document to Schedule A or D or the Cases of Schedule D in
40
their application for corporation tax purposes is to be read, so far as is
required for corporation tax purposes, as including, in relation to times,
circumstances or purposes in relation to which any corresponding rewritten
concept has effect, as a reference to the rewritten concept.
      (3)
Any reference (express or implied) in any enactment, instrument or
45
document to—
(a)
things done under or for the purposes of a superseded enactment in
its application for relevant tax purposes, or

Corporation Tax Bill
Schedule 2 — Transitionals and savings
Part 2 — Changes in the law
741

(b)
things falling to be done under or for the purposes of a superseded
enactment in its application for relevant tax purposes,

is to be read, so far as is required for those relevant tax purposes, as
including, in relation to times, circumstances or purposes in relation to
which any corresponding rewritten provision has effect, a reference to
5
things done or falling to be done under or for the purposes of the rewritten
provision.
6
Paragraphs 1 to 5 have effect instead of section 17(2) of the Interpretation Act
1978 (c. 30) (but are without prejudice to any other provision of that Act).
7
Paragraphs 4 and 5 apply only so far as the context permits.
10
General saving for old transitional provisions and savings
8     (1)
The repeal by this Act of a transitional or saving provision relating to the
coming into force of a provision rewritten in this Act does not affect the
operation of the transitional or saving provision, so far as it is not specifically
rewritten in this Act but remains capable of having effect in relation to the
15
corresponding provision of this Act.
      (2)
The repeal by this Act of an enactment previously repealed subject to
savings does not affect the continued operation of those savings.
      (3)
The repeal by this Act of a saving on the previous repeal of an enactment
does not affect the operation of the saving so far as it is not specifically
20
rewritten in this Act but remains capable of having effect.
Interpretation
9     (1)
In this Part—
“enactment” includes subordinate legislation (within the meaning of
the Interpretation Act 1978),
25
“relevant tax purposes” means, in relation to a superseded enactment,
tax purposes for which the enactment has been rewritten by this Act,
and
“superseded enactment” means an earlier enactment which has been
rewritten by this Act for certain tax purposes (whether it applied
30
only for those purposes or for those and other tax purposes).
      (2)
References in this Part to the repeal of a provision include references to its
revocation and to its express or implied disapplication for corporation tax
purposes.
      (3)
References in this Part to tax purposes are not limited to corporation tax
35
purposes.
Part 2
Changes in the law
10    (1)
This paragraph applies if, in the case of any person—
(a)
a thing is done or an event occurs before 1 April 2009, and
40
(b)
because of a change in the law made by this Act, the corporation tax
consequences of that thing or event for the relevant period are
different from what they would otherwise have been.

Corporation Tax Bill
Schedule 2 — Transitionals and savings
Part 5 — Company residence: exceptions to section 14
742

      (2)
This paragraph also applies if, in the case of any person—
(a)
a thing is done or an event occurs before 6 April 2009, and
(b)
because of a change in the law made by this Act, the income tax
consequences of that thing or event for the relevant period are
different from what they would otherwise have been.
5
      (3)
If the person mentioned in sub-paragraph (1) or (2) so elects, this Act applies
with such modifications as may be necessary to secure that the corporation
tax or (as the case may be) income tax consequences for the relevant period
are the same as they would have been if the change in the law had not been
made.
10
      (4)
In sub-paragraphs (1) to (3) “the relevant period” means—
(a)
for corporation tax purposes, any accounting period beginning
before and ending on or after 1 April 2009, and
(b)
for income tax purposes, any period of account beginning before and
ending on or after 6 April 2009.
15
      (5)
If this paragraph applies in the case of two or more persons in relation to the
same thing or event, an election made under this paragraph by any one of
those persons is of no effect unless a corresponding election is made by the
other or each of the others.
      (6)
An election under this paragraph must be made—
20
(a)
for corporation tax purposes, not later than two years after the end of
the accounting period, and
(b)
for income tax purposes, on or before the first anniversary of the
normal self-assessment filing date for the tax year in which the
period of account ends.
25
Part 3
Charge to corporation tax on income
Effect of repeal of section 9(1) of ICTA on relevance of case law
11
The repeal by this Act of section 9(1) of ICTA does not affect the relevance
for corporation tax purposes of any case law that was relevant for those
30
purposes immediately before the repeal.
Part 4
Accounting periods
Companies in administration
12
Section 10(1)(i) and (j), (2), (3) and (4) apply only in relation to companies
35
that enter administration (under the Insolvency Act 1986 (c. 45) or
otherwise) on or after 15 September 2003.
Part 5
Company residence: exceptions to section 14
13    (1)
Subject to sub-paragraph (2), section 14 does not apply to a company if—
40