Taxation (International and Other Provisions) Bill

House of Commons

Session 2009 - 10
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Other Bills before Parliament

Taxation (International and Other Provisions) Bill

Taxation (International and Other Provisions) Bill
Schedule 8 — Minor and consequential amendments
Part 5 — Offshore funds
364

159
Omit section 35 (which introduces Schedule 15).
160
Omit paragraphs 1 to 94 and 97 to 99 of Schedule 15 (tax treatment of
financing costs and income).
Part 5
Offshore funds
5
Inheritance Tax Act 1984 (c. 51)
161
The Inheritance Tax Act 1984 is amended as follows.
162
In section 174(1)(a) (income tax and unpaid inheritance tax) for “made under
section 41(1) of the Finance Act 2008” substitute “under section 354(1) of the
Taxation (International and Other Provisions) Act 2010”.
10
Taxation of Chargeable Gains Act 1992 (c. 12)
163
TCGA 1992 is amended as follows.
164
In section 108(1)(c) (identification of relevant securities for corporation tax)
for “made under section 41(1) of the Finance Act 2008” substitute “under
section 354(1) of TIOPA 2010”.
15
165
In section 212(1)(b) (annual deemed disposal of unit trusts etc) for “section
40A of the Finance Act 2008” substitute “section 355 of TIOPA 2010”.
166
In Schedule 7AD (gains of insurance company from venture capital
investment partnership) in paragraph 7(1) for “made under section 41(1) of
the Finance Act 2008” substitute “under section 354(1) of TIOPA 2010”.
20
Income Tax (Trading and Other Income) Act 2005 (c. 5)
167
ITTOIA 2005 is amended as follows.
168
In section 378A(7) (offshore fund distributions) for “section 40A of FA 2008”
substitute “section 354 of TIOPA 2010 (see sections 355 to 363 of that Act)”.
Finance Act 2008 (c. 9)
25
169
FA 2008 is amended as follows.
170
Omit sections 40A to 42A (offshore funds).
Corporation Tax Act 2009 (c. 4)
171
CTA 2009 is amended as follows.
172
In section 489 (meaning of “offshore fund etc”)—
30
(a)
for “Sections 40A to 40G of FA 2008” substitute “Sections 355 to 363
of TIOPA 2010”, and
(b)
for “sections 40A to 42A” substitute “Part 8”.
Finance Act 2009 (c. 10)
173
FA 2009 is amended as follows.
35

Taxation (International and Other Provisions) Bill
Schedule 8 — Minor and consequential amendments
Part 6 — Oil activities
365

174
Omit paragraph 6 of Schedule 22 (restriction on regulation-making power
under section 41 of FA 2008).
Part 6
Oil activities
Finance Act 1980 (c. 48)
5
175
FA 1980 is amended as follows.
176
In section 107(7) (transmedian fields) for “Chapter V of Part XII of the Taxes
Act 1988” substitute “Chapter 16A of Part 2 of the Income Tax (Trading and
Other Income) Act 2005”.
Finance Act 1982 (c. 39)
10
177
FA 1982 is amended as follows.
178
In section 134(1) (alternative valuation of ethane used for petrochemical
purposes) for “Chapter V of Part XII of the Taxes Act 1988” substitute
“Chapter 16A of Part 2 of the Income Tax (Trading and Other Income) Act
2005”.
15
179
In Schedule 19 (supplementary provisions relating to advance petroleum
revenue tax) omit paragraph 10(7).
Income and Corporation Taxes Act 1988 (c. 1)
180
ICTA is amended as follows.
181
Omit section 493(1) to (6) (valuation of oil disposed of or appropriated in
20
certain circumstances).
182
Omit section 495 (regional development grants).
183
Omit section 496 (tariff receipts and tax-exempt tariffing receipts).
184
Omit section 502(1) and (2) (interpretation of Chapter 5).
Finance Act 1991 (c. 31)
25
185
FA 1991 is amended as follows.
186
Omit sections 62 to 65 (abandonment guarantees and abandonment
expenditure).
Finance Act 1999 (c. 16)
187
FA 1999 is amended as follows.
30
188
In section 98(7) (qualifying assets) for paragraphs (b) and (c) substitute—
“(ba)
Chapter 16A of Part 2 of the Income Tax (Trading and Other
Income) Act 2005 (oil activities).”
Income Tax (Trading and Other Income) Act 2005 (c. 5)
189
ITTOIA 2005 is amended as follows.
35

Taxation (International and Other Provisions) Bill
Schedule 8 — Minor and consequential amendments
Part 7 — Alternative finance arrangements
366

190
In section 16(3) (oil extraction and related activities) for “section 502(1) of
ICTA” substitute “sections 225A and 225B”.
191
In Part 2 of Schedule 4 (index of defined expressions) at the appropriate
places insert—

“abandonment guarantee (in Chapter 16A of
section 225N(6)”

5

Part 2)

“chargeable period (in Chapter 16A of Part 2)
section 225E”

“contributing participator (in Chapter 16A of
section 225R(3)”

Part 2)

“the defaulter (in Chapter 16A of Part 2)
section 225R(3)”

10

“default payment (in Chapter 16A of Part 2)
section 225R(3)”

“designated area (in Chapter 16A of Part 2)
section 225E”

“the guarantor (in Chapter 16A of Part 2)
section 225N(6)”

“oil (in Chapter 16A of Part 2)
section 225E”

“oil extraction activities (in Chapter 16A of
section 225A”

15

Part 2)

“oil field (in Chapter 16A of Part 2)
section 225E”

“oil rights (in Chapter 16A of Part 2)
section 225B”

“OTA 1975 (in Chapter 16A of Part 2)
section 225E”

“participator (in Chapter 16A of Part 2)
section 225E”

20

“the relevant participator (in Chapter 16A of
section 225N(6)”

Part 2)

“ring fence income (in Chapter 16A of Part 2)
section 225C”

“ring fence trade (in Chapter 16A of Part 2)
section 225D”

Income Tax Act 2007 (c. 3)
25
192
ITA 2007 is amended as follows.
193
In section 80(3) (ring fence income) for “same meaning as in Chapter 5 of Part
12 of ICTA (see section 502 of that Act)” substitute “meaning given by
sections 225A and 225B”.
Part 7
30
Alternative finance arrangements
Finance Act 1986 (c. 41)
194
FA 1986 is amended as follows.

Taxation (International and Other Provisions) Bill
Schedule 8 — Minor and consequential amendments
Part 7 — Alternative finance arrangements
367

195
In section 78(7)(d) (loan capital)—
(a)
for “which fall within section 48A of the Finance Act 2005” substitute
“to which section 564G of the Income Tax Act 2007”, and
(b)
after “bonds)” insert “applies”.
196
In section 79 (loan capital: new provisions)—
5
(a)
in subsection (6), as it has effect by virtue of subsection (8A)(a) of that
section, for “section 48A(1) of the Finance Act 2005”, in both places,
substitute “section 564G(1) of the Income Tax Act 2007”, and
(b)
in subsection (8A)(b) for “section 48A of the Finance Act 2005”
substitute “section 564G of the Income Tax Act 2007”.
10
197
In section 99(9A) (interpretation)—
(a)
for “falling within section 48A of the Finance Act 2005” substitute “to
which section 564G of the Income Tax Act 2007”, and
(b)
after “bonds)” insert “applies”.
Taxation of Chargeable Gains Act 1992 (c. 12)
15
198
TCGA 1992 is amended as follows.
199
In section 99(2) (application of Act to unit trust schemes) for “section 99A”
substitute “sections 99A and 151W(a)”.
200
In section 117 (meaning of “qualifying corporate bond”) for subsection (6D)
substitute—
20
“(6D)
Section 151T provides for arrangements to which section 151N
(alternative finance arrangements: investment bond arrangements)
applies also to be a corporate bond for the purposes of this section.”
201
Omit section 151F (treatment of alternative finance arrangements).
202
In the Table in section 288(8) (interpretation), in the entry for “unit trust
25
scheme” and “unit holder”, for “and 99A” substitute “, 99A and 151W(a)”.
Income Tax (Earnings and Pensions) Act 2003 (c. 1)
203
ITEPA 2003 is amended as follows.
204
In section 420(1) (meaning of securities etc) for paragraph (h) and the “and”
immediately preceding it substitute “and
30
(h)
arrangements to which section 564G of ITA 2007 (alternative
finance arrangements: investment bond arrangements)
applies.”
Finance Act 2003 (c. 14)
205
FA 2003 is amended as follows.
35
206
In section 71A(8) (alternative property finance: land sold to a financial
institution and leased to individual) for “section 46 of the Finance Act 2005”
substitute “section 564B of the Income Tax Act 2007”.
207
In section 72(7) (alternative property finance in Scotland: land sold to a
financial institution and leased to individual) for “section 46 of the Finance
40
Act 2005” substitute “section 564B of the Income Tax Act 2007”.

Taxation (International and Other Provisions) Bill
Schedule 8 — Minor and consequential amendments
Part 7 — Alternative finance arrangements
368

208
In section 72A(8) (alternative property finance in Scotland: land sold to a
financial institution and individual in common) for “section 46 of the
Finance Act 2005” substitute “section 564B of the Income Tax Act 2007”.
209
In section 73(5)(a) (alternative property finance: land sold to a financial
institution and resold to individual) for “section 46 of the Finance Act 2005”
5
substitute “section 564B of the Income Tax Act 2007”.
210
In section 73C (alternative finance investment bonds) for “falling within
section 48A of the Finance Act 2005 (alternative finance investment bonds)”
substitute “to which section 564G of the Income Tax Act 2007 or section 151N
of the Taxation of Chargeable Gains Act 1992 (investment bond
10
arrangements) applies”.
Income Tax (Trading and Other Income) Act 2005 (c. 5)
211
ITTOIA 2005 is amended as follows.
212
In Part 2 of Schedule 4 (index of defined expressions) insert at the
appropriate place—
15

“interest
section 564M of ITA 2007”

Finance Act 2005 (c. 7)
213
FA 2005 is amended as follows.
214
Omit sections 46 to 47A, 48(1), 48A, 48B(1) to (5) and (9) and 49 to 57
(alternative finance arrangements).
20
215
In Schedule 2 (alternative finance arrangements: further provisions) omit
paragraphs 1, 8 and 10 to 13.
Finance Act 2006 (c. 25)
216
FA 2006 is amended as follows.
217
Omit section 97 (beneficial loans to employees).
25
218
Omit section 98 (orders amending Chapter 5 of Part 2 of FA 2005).
Income Tax Act 2007 (c. 3)
219
ITA 2007 is amended as follows.
220
In section 2 (overview of Act) after subsection (10) insert—
“(10A)
Part 10A is about alternative finance arrangements.”
30
221
In section 383(6) (relief for interest payments)—
(a)
for “section 51(2) of FA 2005” substitute “section 564O”, and
(b)
for “falling within section 47 of that Act” substitute “to which section
564C applies”.
222
In section 849(4) (interaction with other Income Tax Acts provisions) for the
35
words from the beginning to “make” substitute “Section 564Q (deduction of
income tax at source under this Part) makes”.

Taxation (International and Other Provisions) Bill
Schedule 8 — Minor and consequential amendments
Part 8 — Leasing arrangements: finance leases and loans
369

223
In Schedule 4 (index of expressions defined in that Act) insert at the
appropriate place—

“alternative finance arrangements
section 564A(2)”

(in Part 10A)

“alternative finance return (in Part
sections 564I to 564L”

5

10A)

Corporation Tax Act 2009 (c. 4)
224
CTA 2009 is amended as follows.
225
Omit section 521 (power to extend Chapter 6 of Part 6 of CTA 2009 etc to
other arrangements).
10
226
Omit section 1310(5) (orders and regulations).
Finance Act 2009 (c. 10)
227
FA 2009 is amended as follows.
228
In section 123 (alternative finance investment bonds) for “falling within
section 48A of FA 2005 (alternative finance investment bonds)” substitute
15
“to which section 564G of ITA 2007 or section 151N of TCGA 1992
(investment bond arrangements) applies”.
229   (1)
Amend Schedule 61 (alternative finance investment bonds) as follows.
      (2)
In paragraph 1(1) (interpretation) in the definition of “alternative finance
investment bond” for “within section 48A of FA 2005 (alternative finance
20
investment bond: introduction)” substitute “to which section 564G of ITA
2007 or section 151N of TCGA 1992 (investment bond arrangements)
applies”.
      (3)
For paragraph 2 (issue, transfer and redemption of rights under bond not to
be treated as chargeable transaction) substitute—
25
“2
Section 564S of ITA 2007 (treatment of bond-holder and bond-
issuer) applies for the purposes of any enactment about stamp
duty land tax as it applies for the purposes of the Income Tax
Acts.”
      (4)
In paragraph 4(1) for “section 48B(2) of FA 2005” substitute “section 564S of
30
ITA 2007”.
Part 8
Leasing arrangements: finance leases and loans
Taxation of Chargeable Gains Act 1992 (c. 12)
230
The Taxation of Chargeable Gains Act 1992 is amended as follows.
35
231
In section 37 (consideration chargeable to tax on income) at the end of

Taxation (International and Other Provisions) Bill
Schedule 8 — Minor and consequential amendments
Part 8 — Leasing arrangements: finance leases and loans
370

subsection (2) add—

“See also section 37A(4) and (5) (consideration on disposal of certain
leases).”
Finance Act 1997 (c. 16)
232   (1)
FA 1997 is amended as follows.
5
      (2)
Omit section 82 (finance leases and loans).
      (3)
In Schedule 12 (leasing arrangements: finance leases and loans) omit
paragraphs 1 to 7, 9 to 17 and 20 to 30.
Capital Allowances Act 2001 (c. 2)
233
The Capital Allowances Act 2001 is amended as follows.
10
234
In section 60(1)(c) (meaning of “disposal receipt”) for “paragraph 11” to
“sum)” substitute “section 614BS of ITA 2007”.
235
In section 420(b) (meaning of “disposal receipt”) for “paragraph 11” to
“sum)” substitute “section 614BS of ITA 2007”.
236
In section 476(1)(b) (disposal value of patent rights) for “paragraph 11” to
15
“sum)” substitute “section 614BS of ITA 2007”.
Income Tax Act 2007 (c. 3)
237
The Income Tax Act 2007 is amended as follows.
238
In section 2 (overview of Act) after subsection (11) insert—
“(11A)
Part 11A is about leasing arrangements involving finance leases or
20
loans.”
239
In Schedule 4 (index of defined expressions) at the appropriate places
insert—

“accountancy rental earnings (in
section 614AB(1)”

Part 11A)

25

“accountancy rental excess (in
section 614BH(1) to (4)”

Chapter 2 of Part 11A)

“accountancy rental excess (in
section 614BH(1) to (4),

Chapter 3 of Part 11A)
as it has effect as a

result of section 614CD”

30

“asset (in Part 11A)
section 614DG”

“asset representing the leased asset
section 614DD”

(in Part 11A)

“cumulative accountancy rental
section 614BH(5)”

excess (in Chapter 2 of Part 11A)

35