Finance Bill

House of Commons

Session 2009 - 10
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Finance Bill

Finance Bill
Part 2 — Anti-avoidance and revenue protection
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(5)
In paragraph 11(3)(b), after “22 April” insert “2009”.
(6)
After paragraph 16 insert—
“Individuals with relevant income below £150,000 in 2009-10
16A   (1)
This paragraph has effect if the individual’s relevant income for the
tax year 2009-10 is less than £150,000.
5
      (2)
References in this Schedule to a pre-22 April 2009 pension input
amount are to a pre-9 December 2009 pension input amount.
      (3)
References in this Schedule to noon on 22 April 2009 are to 9
December 2009.
      (4)
Other references in this Schedule to 22 April 2009 (except in
10
paragraph 2) are to 9 December 2009.
      (5)
The reference in paragraph 16(2) to 21 April 2009 is to 8 December
2009.
      (6)
If the amount arrived at in the case of the individual under sub-
paragraph (1) of paragraph 2 for the tax year 2009-10 is less than
15
£150,000, take the steps in that sub-paragraph in relation to the tax
year 2007-08 and the tax year 2008-09.

If the result is £150,000 or more for either or both of those earlier tax
years the individual’s relevant income for the tax year 2009-10 is to
be assumed for the purposes of sub-paragraph (1) to be £150,000.
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      (7)
If there is a scheme the main purpose, or one of the main purposes,
of which is to secure that the individual’s relevant income for the tax
year 2009-10 is less than £150,000, it is to be assumed for the purposes
of sub-paragraph (1) to be £150,000.”
(7)
The amendments made by this section have effect for the tax year 2009-10 and
25
subsequent tax years (but see paragraph 21(2) of Schedule 35 to FA 2009).
50
Information
In section 251(5) of FA 2004 (persons who can be required to provide
information to scheme administrators etc), after paragraph (a) insert—
“(aa)
employers of members of a registered pension scheme,”.
30
Value added tax and insurance premium tax
51
Extension of reverse charge provisions to supplies of services
(1)
In section 55A of VATA 1994 (customers to account for tax on supplies of goods
of a kind used in missing trader intra-community fraud), after “goods” (in each
place, including the heading) insert “or services”.
35
(2)
In paragraph 2(3B) of Schedule 11 to that Act (power to require notifications
relating to supplies to which section 55A(6) applies), after “goods” insert “or
services”.

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Part 2 — Anti-avoidance and revenue protection
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52
Insurance premium tax: separate contracts
(1)
Part 3 of FA 1994 (insurance premium tax) is amended as follows.
(2)
Section 72 (meaning of “premium”) is amended as follows.
(3)
After subsection (1A) insert—
“(1AA)
A contract (“the relevant contract”) is not to be regarded as a separate
5
contract for the purposes of subsection (1A) above if conditions A to D
are met.
(1AB)
Condition A is that the insured is an individual (“I”) and enters into the
taxable insurance contract in a personal capacity.
(1AC)
Condition B is that I—
10
(a)
is required to enter into the relevant contract by, or as a
condition of entering into, the taxable insurance contract, or
(b)
would be unlikely to enter into the relevant contract without
also entering into the taxable insurance contract.
(1AD)
Condition C is that—
15
(a)
the amount charged to I under the relevant contract in respect
of any particular services is not open to negotiation by I, or
(b)
the other terms on which particular services are to be provided
to I under the relevant contract are not open to such negotiation.
(1AE)
Condition D is that the amount charged to I under the taxable insurance
20
contract is arrived at without a comprehensive assessment having been
undertaken of the individual circumstances of I which might affect the
level of risk.”
(4)
After subsection (9) insert—
“(9A)
Provision may be made by order amending subsections (1AA) to (1AE)
25
above.”
(5)
In section 74(4) and (6) (orders which need to be approved by House of
Commons), for “or 71” substitute “, 71 or 72”.
(6)
The amendment made by subsection (3) has effect in relation to payments
made on or after 24 March 2010.
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Inheritance tax
53
Reversionary interests of purchaser or settlor etc in relevant property
(1)
In IHTA 1984, after section 81 insert—
“81A
Reversionary interests in relevant property
(1)
Where a reversionary interest in relevant property to which—
35
(a)
a person who acquired it for a consideration in money or
money’s worth, or
(b)
the settlor or the spouse or civil partner of the settlor,

(a “relevant reversioner”) is beneficially entitled comes to an end by
reason of the relevant reversioner becoming entitled to an interest in
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possession in the relevant property, the relevant reversioner is to be

Finance Bill
Part 2 — Anti-avoidance and revenue protection
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treated as having made a disposition of the reversionary interest at that
time.
(2)
A transfer of value of a reversionary interest in relevant property to
which a relevant reversioner is beneficially entitled is to be taken to be
a transfer which is not a potentially exempt transfer.”
5
(2)
The amendment made by subsection (1) has effect in relation to reversionary
interests to which a relevant reversioner becomes beneficially entitled on or
after 9 December 2009.
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Interests in possession
(1)
IHTA 1984 is amended as follows.
10
(2)
In section 3A (potentially exempt transfers)—
(a)
in subsection (6), omit “other than section 52”, and
(b)
after that subsection insert—
“(6A)
The reference in subsection (6) above to any provision of this
Act does not include section 52 below except where the transfer
15
of value treated as made by that section is one treated as made
on the coming to an end of an interest which falls within section
5(1B) below.”
(3)
In section 5 (meaning of estate)—
(a)
in subsection (1)(a)(ii), after “below” insert “unless it falls within
20
subsection (1B) below”, and
(b)
after subsection (1A) insert—
“(1B)
An interest in possession falls within this subsection if the
person—
(a)
was domiciled in the United Kingdom on becoming
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beneficially entitled to it, and
(b)
became beneficially entitled to it by virtue of a
disposition which was prevented from being a transfer
of value by section 10 below.”
(4)
In—
30
(a)
section 49(1A) (treatment of interests in possession),
(b)
section 51(1A) (disposal of interest in possession), and
(c)
section 52(2A) and (3A) (charge on termination of interest in
possession),

insert at the end (not as part of paragraph (c))—
35

            “or falls within section 5(1B) above.”
(5)
In section 57A(1A) (relief where property enters maintenance fund), insert at
the end (not as part of paragraph (c))—

“or fell within section 5(1B) above.”
(6)
In section 100(1A) (alterations of capital etc where participators are trustees),
40
insert at the end (not as part of paragraph (c))—

“or falls within section 5(1B) above.”
(7)
In section 101(1A) (companies’ interests in settled property), insert at the end

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Part 2 — Anti-avoidance and revenue protection
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(not as part of paragraph (b))—

“or falls within section 5(1B) above.”
(8)
In section 102ZA(1)(b)(ii) of FA 1986 (gifts with reservation: termination of
interests in possession), after “serial interest” insert “or falls within section
5(1B) of the 1984 Act”.
5
(9)
In F(No.2)A 1987, omit section 96(2)(c).
(10)
The amendments made by this section have effect in relation to an interest in
possession to which a person is beneficially entitled if the person becomes
beneficially entitled to it on or after 9 December 2009.
Stamp taxes
10
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SDRT: depositary receipt systems and clearance services systems
(1)
Part 4 of FA 1986 (stamp duty reserve tax) is amended as follows.
(2)
In section 95(1) (depositary receipts: exceptions), before “there shall be” insert
“subject to section 97C,”.
(3)
In section 97(1) (clearance services: exceptions), before “there shall be” insert
15
“subject to section 97C,”.
(4)
In section 97B (transfer between depositary receipt system and clearance
system), after subsection (1) insert—
“(1A)
Subsection (1) is subject to section 97C.”
(5)
After that section insert—
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“97C
Transfers to non-EU depositary receipt and clearance services systems
(1)
This section applies where arrangements are made in accordance with
which chargeable securities are—
(a)
issued to an EU system, and
(b)
subsequently transferred from an EU system to a non-EU
25
system.
(2)
Nothing in section 95(1), 97(1) or 97B(1) disapplies a charge to tax under
section 93 or 96 in respect of that transfer if—
(a)
the chargeable securities have not previously been transferred,
or
30
(b)
where they have previously been transferred, the transfer (or, if
more than one, each of them) was an exempt transfer.
(3)
For the purposes of subsection (1)(a) chargeable securities are issued to
an EU system if—
(a)
pursuant to an arrangement of the kind mentioned in section
35
93(1), they are issued to a nominee in respect of an EU
depositary receipt issuer, or
(b)
pursuant to an arrangement of the kind mentioned in section
96(1), they are issued to a nominee in respect of an EU clearance
service operator.
40
(4)
For the purposes of subsection (1)(b)—

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Part 2 — Anti-avoidance and revenue protection
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(a)
a transfer is from an EU system if it is from a company which is
incorporated under the law of a member State and at the time of
the transfer falls within section 67(6) or 70(6), and
(b)
a transfer is to a non-EU system if it is to a company which is not
incorporated under the law of a member State and at the time of
5
the transfer falls within section 67(6) or 70(6).
(5)
In this section—
“arrangements” includes any agreement, understanding, scheme,
transaction or series of transactions (whether or not legally
enforceable);
10
“EU clearance service operator” means a person—
(a)
whose business is or includes the provision of clearance
services for the purchase and sale of chargeable
securities, and
(b)
who—
15
(i)
if it is a company, is incorporated under the law
of a member State, and
(ii)
in any other case, is resident in a member State;
“EU depositary receipt issuer” means a person—
(a)
whose business is or includes issuing depositary
20
receipts for chargeable securities, and
(b)
who—
(i)
if it is a company, is incorporated under the law
of a member State, and
(ii)
in any other case, is resident in a member State;
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“exempt transfer” means a transfer in respect of which, by reason
of section 90(5), 95(1), 97(1) or 97B(1), no charge to stamp duty
reserve tax arises;
“nominee”—
(a)
in respect of an EU clearance service operator, means a
30
person whose business is or includes holding
chargeable securities as nominee for the EU clearance
service operator, and
(b)
in respect of an EU depositary receipt issuer, means a
person whose business is or includes holding
35
chargeable securities as nominee or agent for the EU
depositary receipt issuer.”
(6)
The amendments made by this section have effect in relation to transfers of
chargeable securities on or after 1 October 2009.
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SDLT: partnerships
40
(1)
In section 75C of FA 2003 (SDLT anti-avoidance: supplemental)—
(a)
in subsection (8), omit paragraph (b) (and the “and” before it), and
(b)
after that subsection insert—
“(8A)
Nothing in Part 3 of Schedule 15 applies to the notional
transaction under section 75A.”
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(2)
The amendments made by subsection (1) have effect in relation to any notional
transaction of which the effective date is on or after 24 March 2010.

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(3)
But those amendments do not have effect in relation to a notional transaction
if any scheme transaction is—
(a)
completed before that date,
(b)
effected in pursuance of a contract entered into and substantially
performed before that date, or
5
(c)
effected in pursuance of a contract entered into before that date and not
excluded by subsection (4).
(4)
A scheme transaction effected in pursuance of a contract entered into before 24
March 2010 is excluded by this subsection if—
(a)
there is any variation of the contract, or assignment (or assignation) of
10
rights under the contract, on or after 24 March 2010,
(b)
the transaction is effected in consequence of the exercise on or after that
date of any option, right of pre-emption or similar right, or
(c)
it is a land transaction and on or after that date there is an assignment
(or assignation), subsale or other transaction relating to the whole or
15
part of the subject-matter of the contract as a result of which a person
other than the purchaser under the contract becomes entitled to call for
a conveyance.
Administration
57
Disclosure of tax avoidance schemes
20
Schedule 18 contains amendments of the provisions relating to the disclosure
of tax avoidance schemes.
58
Security for payment of PAYE
(1)
Section 684 of ITEPA 2003 (PAYE regulations) is amended as follows.
(2)
In subsection (2), after item 4A insert—
25
“4B
Provision for and in connection with requiring the giving, in
specified circumstances, of security (or further security) for the
payment of amounts in respect of which a person is or may be
accountable to the Commissioners under the regulations.”
(3)
After subsection (4) insert—
30
“(4A)
A person who fails to comply with a requirement imposed under PAYE
regulations to give security, or further security, for the payment of any
amount commits an offence if the failure continues for such period as is
specified; and a person guilty of an offence under this subsection is
liable on summary conviction to a fine not exceeding level 5 on the
35
standard scale.”
59
Opening of postal packets
(1)
Section 106 of the Postal Services Act 2000 (power to detain postal packets
containing contraband) is amended as follows.
(2)
In subsection (4), for paragraphs (a) and (b) substitute “in the presence of a
40
representative of the postal operator”.

Finance Bill
Part 3 — Other provisions
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(3)
Omit subsection (5).
(4)
In subsection (7)(b), omit “if he is absent”.
Part 3
Other provisions
Income tax: benefits in kind
5
60
Zero and low emission vehicles
(1)
Chapter 6 of Part 3 of ITEPA 2003 (taxable benefits: cars, vans and related
benefits) is amended as follows.
(2)
Section 139 (cars first registered in 1998 or later with emissions figure) is
amended as follows.
10
(3)
For subsection (1A) substitute—
“(1A)
A car is a qualifying low emissions car for any year if it has a low CO2
emissions figure for that year.”
(4)
In subsection (1B), for “10%” substitute—
“(a)
in a case where the car’s CO2 emissions figure for the year does
15
not exceed 75 grams per kilometre driven, 5%, and
(b)
otherwise, 10%.”
(5)
In subsection (5), for “this section” substitute “subsections (2)(b) and (3)(a)”.
(6)
Omit subsection (5A).
(7)
Section 140 (cars first registered in 1998 or later without emissions figure) is
20
amended as follows.
(8)
In subsection (3), for the words after “year is” substitute—
“(a)
the special percentage if the car cannot in any circumstances
emit CO2 by being driven, and
(b)
35% in any other case.”
25
(9)
After that subsection insert—
“(3A)
The special percentage is—
(a)
for the tax years 2010-11 to 2014-15, 0%, and
(b)
for the tax year 2015-16 and subsequent tax years, 9%.”
(10)
Omit subsection (4).
30
(11)
In section 149(4) (car fuel benefit), for “for an electrically propelled vehicle”
substitute “or any energy for a car which cannot in any circumstances emit CO2
by being driven.”
(12)
In section 155 (vans), for subsections (1) to (3) substitute—
“(1)
The cash equivalent of the benefit of a van for a tax year is—
35
(a)
nil in a case to which subsection (2) applies, and
(b)
£3,000 in any other case.