Corporation Tax Bill

House of Commons

Session 2009 - 10
Internet Publications
Other Bills before Parliament

Corporation Tax Bill

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
653

(7)
Accordingly, “lessor” and “lessee” include prospective and former
lessors and lessees.”
552
In section 809M(3) (meaning of “relevant person”)—
(a)
in paragraph (c) for “has the same meaning as in the Corporation Tax
Acts (see sections 414 and 415 of ICTA)” substitute “is to be read in
5
accordance with Chapter 2 of Part 10 of CTA 2010 (see in particular
section 439 of that Act)”,
(b)
in paragraph (ca) for “section 419 of ICTA (see sections 417(1) and
419(7) of” substitute “section 455 of CTA 2010 (see sections 454 and
455(5) of”, and
10
(c)
in paragraph (cb) for “section 838 of ICTA” substitute “Chapter 3 of
Part 24 of CTA 2010”.
553
In section 836(3) (jointly held property) for “section 254 of ICTA” substitute
“section 1117 of CTA 2010”.
554
In section 899(5) (meaning of “qualifying annual payment”) for paragraph
15
(b) substitute—
“(b)
a payment which is a qualifying payment for the purposes of
Chapter 2 of Part 6 of CTA 2010 (certain payments to
charity),”.
555
In section 918 (manufactured dividends on UK shares: Real Estate
20
Investment Trusts)—
(a)
in subsection (1)(b) for sub-paragraphs (i) and (ii) substitute—
“(i)
paid by a company UK REIT in respect of
profits or gains (or both) of the company’s
property rental business, or
25
(ii)
paid by the principal company of a group UK
REIT in respect of profits or gains (or both) of
property rental business of members of the
group.”,
(b)
in subsection (3) for “company to which Part 4 of FA 2006 applies”
30
substitute “company UK REIT”, and
(c)
after subsection (7) insert—
“(8)
In subsection (1) “gains” includes chargeable gains.”
556   (1)
Amend section 928 (chargeable payments connected with exempt
distributions) as follows.
35
      (2)
In subsection (1) for “section 214(1) of ICTA” substitute “section 1086 of CTA
2010”.
      (3)
In subsection (5) for “section 214 of ICTA” substitute “sections 1086 to 1090
of CTA 2010 (see section 1086(6) of that Act)”.
557
In section 936(2) (recipients who are to be paid gross)—
40
(a)
in paragraph (b) for “section 519A(2) of ICTA” substitute “section 986
of CTA 2010”,
(b)
in paragraph (e) for “section 507(1) of ICTA” substitute “section 468
of CTA 2010”, and
(c)
for paragraph (f) substitute—
45
“(f)
a body which is an association for the purposes of
section 469(1)(a) of CTA 2010 (scientific research

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
654

associations) and complies with the conditions in
subsections (2) and (3) of that section,”.
558
In section 953(6) (how a set-off claim works)—
(a)
in paragraph (a) for “section 7(2) of ICTA” substitute “section 967 of
CTA 2010”, and
5
(b)
in paragraph (b) for “section 11(3)” substitute “section 968”.
559
In section 972(6) (regulations under section 971) for “section 121(2)(c) of FA
2006” substitute “section 548(7) of CTA 2010,”.
560   (1)
Amend section 973 (income tax due in respect of distributions) as follows.
      (2)
In subsection (1)(b) for “section 121(1) of FA 2006” substitute “section 548(5)
10
or (6) of CTA 2010”.
      (3)
In subsection (2)—
(a)
for “company to which Part 4 of FA 2006 applies (Real Estate
Investment Trusts)” substitute “company UK REIT”, and
(b)
for “C (tax-exempt)” substitute “the company’s property rental
15
business”.
      (4)
In subsection (3)—
(a)
for “group to which Part 4 of FA 2006 applies” substitute “group UK
REIT”, and
(b)
for paragraph (b) substitute—
20
“(b)
it is a distribution of amounts shown in the financial
statement under section 532(2)(a) of CTA 2010
(statement of group’s property rental business) as—
(i)
profits or gains (or both) of UK members of
the group, or
25
(ii)
profits or gains (or both) of UK property rental
business of non-UK members of the group.”
      (5)
For subsection (4) substitute—
“(4)
In this section—
“company UK REIT” and “group UK REIT” have the same
30
meaning as in Part 12 of CTA 2010 (see sections 523(5) and
524(5) of that Act),
“group” and “principal company” have the same meaning as in
Part 12 of CTA 2010 (see section 606 of that Act), and
“property rental business” and “UK property rental business”
35
have the same meaning as in Part 12 of CTA 2010 (see sections
519 and 520 of that Act).”
      (6)
In subsection (5) for the words from “UK resident” to the end substitute “UK
or non-UK company are to be read in accordance with Part 12 of CTA 2010
(see section 521 of that Act).
40
561   (1)
Amend section 974 (regulations under section 973) as follows.
      (2)
In subsection (1)(j)(ii) for “tax-exempt business” substitute “property rental
business”.
      (3)
In subsection (2)—
(a)
for “tax-exempt business” substitute “property rental business”, and
45

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
655

(b)
for “Part 4 of FA 2006 has ceased to apply to a company” substitute
“the company or group (as the case may be) has ceased to be a UK
REIT”.
      (4)
In subsection (3) for “section 107(9)(b) of FA 2006” substitute “section 530(6)
of CTA 2010”.
5
      (5)
For subsection (6) substitute—
“(6)
In this section—
“property rental business” has the same meaning as in Part 12
of CTA 2010 (see section 519 of that Act), and
“UK REIT” has the same meaning as in Part 12 of CTA 2010 (see
10
section 518(4) of that Act).”
562   (1)
Amend section 989 (definitions) as follows.
      (2)
In the definition of “authorised unit trust” for “section 468(6) to (9) of ICTA”
substitute “sections 616 and 619 of CTA 2010”.
      (3)
In the definition of “body of persons” for “or”, in the second place it appears
15
(before “society”), substitute “and”.
      (4)
In the definition of “close company” for “has the same meaning as in the
Corporation Tax Acts (see sections 414 and 415 of ICTA)” substitute “is to be
read in accordance with Chapter 2 of Part 10 of CTA 2010 (see in particular
section 439 of that Act)”.
20
      (5)
In the definition of “distribution” for the words from “same” to the end
substitute “meaning given by Chapters 2 to 5 of Part 23 of CTA 2010”.
      (6)
In the definition of “permanent establishment” for “has the meaning given
by section 148 of FA 2003” substitute “is to be read in accordance with
Chapter 2 of Part 24 of CTA 2010”.
25
      (7)
In the definition of “qualifying distribution” for “section 14(2) of ICTA”
substitute “section 1136 of CTA 2010”.
      (8)
In the definition of “51% subsidiary” for “section 838 of ICTA” substitute
“Chapter 3 of Part 24 of CTA 2010”.
      (9)
In the definition of “75% subsidiary” for “section 838 of ICTA” substitute
30
“Chapter 3 of Part 24 of CTA 2010”.
     (10)
For the definition of “tax” substitute—
““tax”, if neither income tax nor corporation tax is specified,
means either of those taxes,”.
     (11)
In the definition of “umbrella scheme” for “section 468(6) to (9) of ICTA”
35
substitute “section 619 of CTA 2010”.
     (12)
In the definition of “unit holder” for “section 468(6) to (9) of ICTA” substitute
“sections 616 and 619 of CTA 2010”.
563
In section 991 (meaning of “bank”) after subsection (4) insert—
“(5)
An order under subsection (2)(e) may include provision for a
40
designation to have effect only in relation to the application of this
section by a provision specified in the order.”

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
656

564
In section 992(2) (meaning of “company”) for “section 468 of ICTA
(authorised unit trusts)” substitute “section 617 of CTA 2010 (authorised unit
trust treated as UK resident company)”.
565
In section 994(1) (meaning of “connected” person: supplementary) in the
definition of “control” for “section 416 of ICTA” substitute “sections 450 and
5
451 of CTA 2010”.
566
In section 997(5) (meaning of “international accounting standards”) for
“section 50(2) and (3) of FA 2004” substitute “section 1127 of CTA 2010”.
567   (1)
Amend section 999 (meaning of “local authority”) as follows.
      (2)
In subsection (1)—
10
(a)
in paragraph (a) for “section 69” substitute “section 1(2)”, and
(b)
in paragraph (b) for “that section” substitute “section 69(1) of that
Act”.
      (3)
For subsection (3) substitute—
“(3)
In the Income Tax Acts “local authority”, in relation to Northern
15
Ireland, means a district council constituted under section 1 of the
Local Government Act (Northern Ireland) 1972 (c. 9 (N.I.)).”
568
In section 1000 (meaning of “local authority association”) for subsections (4)
and (5) substitute—
“(4)
For the purposes of condition A, if a member (“M”) of a local
20
authority association is a representative of, or is appointed by, a local
authority, group of local authorities or a local authority association,
the authority, group or association concerned (rather than M) is to be
treated as a constituent member of the local authority association.”
569
In section 1016(2) (table of provisions to which that section applies), in Part
25
3 of the table—
(a)
omit the entry relating to section 214(1)(ab) of ICTA, and
(b)
at the end insert—

“Section 1086(2) of CTA 2010
Chargeable payments

connected with exempt

30

distributions”

570
In section 1017 (abbreviated references to Acts) at the appropriate place
insert—
““CTA 2010” means the Corporation Tax Act 2010,”.
571   (1)
Amend Schedule 2 (transitional and savings) as follows.
35
      (2)
In paragraph 51(1)(i) in the inserted subsection (6)—
(a)
for “paragraphs 1 and 3 of Schedule 18 to ICTA” substitute “Chapter
6 of Part 5 of CTA 2010”, and
(b)
in paragraph (a) for “paragraph 3 to the first company” substitute
“section 166 of that Act to company A”.
40

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
657

      (3)
After paragraph 57 insert (in Part 6)—
“Application in relation to corresponding bonus shares
57A   (1)
For the purposes of this Part of this Schedule, if—
(a)
any shares (“the original shares”) have been issued to an
individual before a particular date, or are treated under
5
this paragraph as having been issued to the individual
before a particular date, and
(b)
any corresponding bonus shares are issued to the
individual on or after that date,

the bonus shares are treated as having been issued at the time the
10
original shares were issued to the individual or are treated as
having been so issued.
      (2)
In this paragraph “bonus shares” and “corresponding bonus
shares” have the same meaning as in Chapter 6 of Part 4.”
      (4)
In paragraph 80(f) in the inserted subsection (6)—
15
(a)
for “paragraphs 1 and 3 of Schedule 18 to ICTA” substitute “Chapter
6 of Part 5 of CTA 2010”, and
(b)
in paragraph (a) for “paragraph 3 to the first company” substitute
“section 166 of that Act to company A”.
572
In Schedule 4 (index of defined expressions)—
20
(a)
omit—
(i)
the 3 entries relating to “C (tax-exempt)”, and
(ii)
the 3 entries relating to “G (property rental business)”, and
(b)
at the appropriate places insert—

“company UK REIT (in Chapter 2 of
section 591(1)

25

Part 11)

company UK REIT (in Chapter 4 of
section 606(2)

Part 11)

company UK REIT (in Chapter 9 of
section 591(1) (as

Part 15)
applied by section

30

926(1))”

“group UK REIT (in Chapter 2 of
section 591(1)

Part 11)

group UK REIT (in Chapter 4 of Part
section 606(2)

11)

35

group UK REIT (in Chapter 9 of Part
section 591(1) (as

15)
applied by section

926(1))”

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
658

“principal company (in Chapter 4 of
section 606(5)”

Part 11)

“property rental business (in
section 591(1)

Chapter 2 of Part 11)

property rental business (in Chapter
section 606(6A)

5

4 of Part 11)

property rental business (in Chapter
section 591(1) (as

9 of Part 15)
applied by section

926(1))”

Finance Act 2007 (c. 11)
10
573
The Finance Act 2007 is amended as follows.
574
Omit section 3 (small companies’ rates and fractions for financial year 2007).
575
In paragraph 5(4)(b) of Schedule 24 (potential lost revenue: normal rule)—
(a)
for “subsection (4) of section 419 of ICTA” substitute “section 458 of
CTA 2010”, and
15
(b)
for “subsection (4A)” substitute “subsection (5)”.
Finance Act 2008
576
The Finance Act 2008 is amended as follows.
577
In section 6(3) (charge and main rates for financial year 2009) for “same
meaning as in Chapter 5 of Part 12 of ICTA (see section 502(1) and (1A))”
20
substitute “meaning given by section 276 of CTA 2010”.
578
Omit section 7 (small companies’ rates and fractions for financial year 2008).
579
In section 165(1) (interpretation) at the appropriate place insert—
““CTA 2010” means the Corporation Tax Act 2010,”.
580   (1)
Amend Schedule 19 (reduction of basic rate of income tax: relief for gift aid
25
charities) as follows.
      (2)
In paragraph 1(3)—
(a)
omit paragraph (a) and the “or” at the end of paragraph (b),
(b)
after paragraph (b) insert—
“(ba)
section 472 of CTA 2010 (charitable
30
companies),
(bb)
section 475 of CTA 2010 (eligible
bodies), or”, and
(c)
in paragraph (c) for “paragraph 5(1)(c) of Schedule 18 to FA 2002”
substitute “section 664(1) of CTA 2010”.
35
      (3)
In paragraph 1(4)(a) for “(3)(a) or (c)” substitute “(3)(ba), (bb) or (c)”.
581   (1)
Amend Schedule 20 (leases of plant or machinery) as follows.

Corporation Tax Bill
Schedule 1 — Minor and consequential amendments
Part 2 — Other enactments
659

      (2)
In paragraph 2(3)—
(a)
for “to 809ZD” substitute “to 809ZF”, and
(b)
in paragraph (a)—
(i)
for “section 809ZB(4)” substitute “section 809ZF(3) to (5)”,
and
5
(ii)
the substituted subsection (which as a result of paragraph (i)
is substituted for section 809ZF(3) to (5)) is renumbered “(3)”.
      (3)
In paragraph 11—
(a)
in sub-paragraph (2) omit “Section 502B of ICTA or”,
(b)
in sub-paragraph (5) omit “section 502B of ICTA or”,
10
(c)
in sub-paragraph (7) omit “section 502B(2) of ICTA or”,
(d)
in sub-paragraph (8) omit “Section 502C of ICTA or”, and
(e)
in sub-paragraph (9) omit “section 502D of ICTA or”.
582   (1)
Amend Schedule 36 (information and inspection powers) as follows.
      (2)
In paragraph 36—
15
(a)
in sub-paragraph (1)(b) for “section 767A or 767AA of ICTA”
substitute “section 710 or 713 of CTA 2010”, and
(b)
in sub-paragraph (3) for “Section 769 of ICTA” substitute “Chapter 7
of Part 14 of CTA 2010”.
      (3)
In paragraph 37B(3)—
20
(a)
omit paragraph (a), and
(b)
at the end of paragraph (b) insert “or
(c)
section 733 of CTA 2010 (company liable to
counteraction of corporation tax advantage).”
583
In paragraph 7(4) of Schedule 41 (potential lost revenue)—
25
(a)
for “subsection (4) of section 419 of ICTA” substitute “section 458 of
CTA 2010”, and
(b)
for “subsection (4A)” substitute “subsection (5)”.
Crossrail Act 2008 (c. 18)
584   (1)
Schedule 13 to the Crossrail Act 2008 (transfer schemes: tax provisions) is
30
amended as follows.
      (2)
In paragraph 3(1) (interpretation: supplementary) at the appropriate place
insert—
““CTA 2010” means the Corporation Tax Act 2010;”.
      (3)
In paragraph 18(7) for “section 839 of ICTA” substitute “section 1122 of CTA
35
2010”.
      (4)
In paragraph 30(2) for “sections 768 to 768E of ICTA” substitute “Chapters 2
to 5 of Part 14 of CTA 2010”.
      (5)
In paragraph 34(7) for “section 839 of ICTA” substitute “section 1122 of CTA
2010”.
40
      (6)
In paragraph 42 (group relief)—
(a)
in sub-paragraph (a) for “section 410(1) or (2) of ICTA” substitute
“section 154(3) or 155(3) of CTA 2010”, and