Finance Bill

House of Commons

Session 2008 - 09
Internet Publications
Other Bills before Parliament

Finance Bill

Finance Bill
Part 3 — Pensions
37

73
FSCS involvement in relation to insurance in connection with pensions
(1)
The Treasury may by regulations make provision for and in connection with
the application of the relevant taxes in relation to circumstances in which there
is relevant intervention under the FSCS.
(2)
“Relevant intervention” means—
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(a)
anything done under, or while seeking to make, arrangements for
securing continuity of insurance in connection with registered pension
schemes,
(b)
anything done as part of measures for safeguarding policyholders in
connection with registered pension schemes, or
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(c)
the payment of compensation in connection with registered pension
schemes.
(3)
“The FSCS” means the Financial Services Compensation Scheme (established
under Part 15 of the Financial Services and Markets Act 2000).
(4)
The provision that may be made by regulations under this section includes
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provision imposing any of the relevant taxes (as well as provisions for
exemptions or reliefs).
(5)
The relevant taxes are—
(a)
income tax,
(b)
capital gains tax,
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(c)
corporation tax,
(d)
inheritance tax,
(e)
stamp duty land tax,
(f)
stamp duty, and
(g)
stamp duty reserve tax.
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(6)
Regulations under this section may include provision having effect in relation
to any time before they are made if the provision does not increase any
person’s liability to tax.
(7)
The provision made by regulations under this section may be framed as
provision modifying, or applying with appropriate modifications, provisions
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having effect in relation to registered pension schemes.
(8)
Regulations under this section may include—
(a)
provision amending any enactment or instrument, and
(b)
consequential, supplementary and transitional provision.
(9)
Regulations under this section are to be made by statutory instrument.
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(10)
A statutory instrument containing regulations under this section is subject to
annulment in pursuance of a resolution of the House of Commons.
(11)
In this section “registered pension scheme” means a pension scheme within the
meaning of Part 4 of FA 2004 which is registered under Chapter 2 of that Part
of that Act.
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74
Power to make retrospective non-charging provision
(1)
In section 282 of FA 2004 (orders and regulations under Part 4), insert at the

Finance Bill
Part 4 — Value added tax
38

beginning—
“(A1)
Any order or regulations made by the Treasury or the Commissioners
for Her Majesty’s Revenue and Customs under this Part may include
provision having effect in relation to times before the order is, or
regulations are, made if that provision does not increase any person’s
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liability to tax.
(A2)
Subsection (A1) does not limit any specific power to make provision by
an order or regulations in relation to times before the order is, or
regulations are, made.”
(2)
In consequence of the amendment made by subsection (1), omit the following
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provisions of Part 4 of FA 2004—
(a)
section 164(2)(d),
(b)
section 281(4),
(c)
section 283(3C),
(d)
in Schedule 28, paragraphs 3(2CA) and 17(4A), and
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(e)
in Schedule 29A, paragraph 9(2).
(3)
In consequence of subsection (2), omit—
(a)
in FA 2006, in Schedule 23, paragraph 34(4), and
(b)
in FA 2008, in Schedule 29, paragraph 2.
Part 4
20
Value added tax
75
Place of supply of services etc
Schedule 36 contains provisions about the place of supply of services for the
purposes of value added tax and related matters.
76
Repayment to those in business in other States
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(1)
VATA 1994 is amended as follows.
(2)
In subsection (3) of section 39 (repayment of VAT to those in business
overseas)—
(a)
in the words before paragraph (a), after “such cases” insert “and to such
extent”,
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(b)
in sub-paragraph (ii) of paragraph (b), after “Act” insert “in respect of
such period as may be prescribed” and omit the “and” at the end,
(c)
after that paragraph insert—
“(ba)
for and in connection with the payment of interest to or
by the Commissioners (including in relation to the
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repayment of interest wrongly paid), and”, and
(d)
in paragraph (c), for “methods by which” substitute “time by which and
manner in which claims must be made,”.

Finance Bill
Part 4 — Value added tax
39

(3)
After that section insert—
“39A
Applications for forwarding of VAT repayment claims to other
member States
The Commissioners must make arrangements for dealing with
applications made to the Commissioners by taxable persons, in
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accordance with Council Directive 2008/9/EC, for the forwarding to
the tax authorities of another member State of claims for refunds of
VAT on—
(a)
supplies to them in that member State, or
(b)
the importation of goods by them into that member State from
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places outside the member States.”
(4)
In section 83(1) (appeals), after paragraph (h) insert—
“(ha)
any decision of the Commissioners to refuse to make a
repayment under a scheme under section 39;”.
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Information relating to cross-border supplies of services to taxable recipients
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(1)
Paragraph 2 of Schedule 11 to VATA 1994 (accounting for VAT and submission
of particulars of transactions etc) is amended as follows.
(2)
In sub-paragraph (3), for “which involve the movement of goods between
member States” substitute “to which this sub-paragraph applies”.
(3)
After that paragraph insert—
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  “(3ZA)
Sub-paragraph (3) above applies to—
(a)
transactions involving the movement of goods between
member States, and
(b)
transactions involving the supply of services to a person in a
member State other than the United Kingdom who is
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required to pay VAT on the supply in accordance with
provisions of the law of that other member State giving effect
to Article 196 of Council Directive 2006/112/EC.”
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Effect of VAT changes on arbitration of rent for agricultural holdings
(1)
In paragraph 4(2) of Schedule 2 to the Agricultural Holdings Act 1986
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(frequency of arbitrations of rent: changes in rent to be disregarded), insert at
the end—
“(d)
an increase or reduction of rent arising from—
(i)
the exercise of an option to tax under Schedule 10 to
the Value Added Tax Act 1994,
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(ii)
the revocation of such an option, or
(iii)
a change in the rate of value added tax applicable to
grants of interests in or rights over land in respect of
which such an option has effect.”
(2)
Paragraph 4(2)(d) of Schedule 2 to that Act (as inserted by subsection (1))
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includes an increase or reduction of rent arising from an option, revocation or
change in rate that takes effect before the day on which this Act is passed.
(3)
The references in that provision and in subsection (2) to an option to tax, or to
the exercise or revocation of such an option, under Schedule 10 to VATA 1994

Finance Bill
Part 5 — Stamp taxes
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include a reference to an election to waive exemption, or to the making or
revocation of such an election, under that Schedule (as it had effect before 1
June 2008).
Part 5
Stamp taxes
5
Stamp duty land tax
79
Exercise of collective rights by tenants of flats
(1)
Section 74 of FA 2003 (collective enfranchisement by leaseholders) is amended
as follows.
(2)
For subsection (1) substitute—
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“(1)
This section applies where a chargeable transaction is entered into by a
person or persons nominated or appointed by qualifying tenants of
flats contained in premises in exercise of—
(a)
a right under Part 1 of the Landlord and Tenant Act 1987 (right
of first refusal), or
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(b)
a right under Chapter 1 of Part 1 of the Leasehold Reform,
Housing and Urban Development Act 1993 (right to collective
enfranchisement).”
(3)
In subsection (2)—
(a)
omit “In that case,”, and
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(b)
for “flats in respect of which the right of collective enfranchisement is
being exercised” substitute “qualifying flats contained in the premises”.
(4)
For subsection (4) substitute—
“(4)
In this section—
“flat” and “qualifying tenant” have the same meaning as in the
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Chapter or Part of the Act conferring the right being exercised;
“qualifying flat” means a flat that is held by a qualifying tenant
who is participating in the exercise of the right.”
(5)
For the heading substitute “Exercise of collective rights by tenants of flats”.
(6)
Accordingly, in section 55(5) of that Act (amount of tax chargeable), for
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“collective enfranchisement by leaseholders” substitute “exercise of collective
rights by tenants of flats”.
(7)
The amendments made by this section have effect in relation to transactions
with an effective date on or after 22 April 2009.
80
Registered providers of social housing
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(1)
Part 4 of FA 2003 (stamp duty land tax) is amended as follows.
(2)
Section 71 (certain acquisitions by registered social landlord) is amended as
follows.

Finance Bill
Part 5 — Stamp taxes
41

(3)
Insert at the beginning—
“(A1)
A land transaction under which the purchaser is a profit-making
registered provider of social housing is exempt from charge if the
transaction is funded with the assistance of a public subsidy.”
(4)
In subsection (4), for “subsection (1)(c)” substitute “this section”.
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(5)
Schedule 9 (right to buy etc) is amended as follows.
(6)
In paragraph 5 (shared ownership leases: “qualifying body” etc)—
(a)
in sub-paragraph (2), insert at the end—
“(g)
a registered provider of social housing that is not
within paragraph (b) (subject to sub-paragraph
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(2A)).”, and
(b)
after that sub-paragraph insert—
   “(2A)
A registered provider of social housing within sub-
paragraph (2)(g) (“R”) is only a qualifying body in relation to
a lease of premises if the following has been funded with the
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assistance of a grant or other financial assistance under
section 19 of the Housing and Regeneration Act 2008—
(a)
the purchase or construction of the premises by R (or
a person connected with R), or
(b)
the adaptation of the premises by R (or a person
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connected with R) for use as a dwelling.
     (2B)
Section 839 of the Taxes Act 1988 (connected persons) has
effect for the purposes of sub-paragraph (2A).”
(7)
In paragraph 7 (shared ownership trusts: introduction)—
(a)
in sub-paragraph (3), omit “(within the meaning of paragraph 5(2))”,
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and
(b)
insert at the end—
    “(7)
In Condition 2 “qualifying body” means—
(a)
a qualifying body within the meaning of paragraph
5(2)(a) to (f), or
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(b)
a registered provider of social housing within
paragraph 5(2)(g) (subject to sub-paragraph (8)).
      (8)
A registered provider of social housing within paragraph
5(2)(g) (“R”) is only a qualifying body in relation to a shared
ownership trust if the following has been or is being funded
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with the assistance of a grant or other financial assistance
under section 19 of the Housing and Regeneration Act 2008—
(a)
the purchase or construction of the trust property by
R (or a person connected with R), or
(b)
the adaptation of the trust property by R (or a person
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connected with R) for use as a dwelling.
      (9)
Section 839 of the Taxes Act 1988 (connected persons) has
effect for the purposes of sub-paragraph (8).”
(8)
The amendments made by this section have effect in relation to transactions
with an effective date on or after the day on which this Act is passed.
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