Finance (No.2) Bill

House of Commons

Session 2010 - 11
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Finance (No.2) Bill

Finance (No.2) Bill
Schedule 13 — Excise duties: compliance checks
Part 3 — Information and inspection powers
103

purposes of that trade, regardless of who owns or occupies the
premises.”
11
After that section insert—
“112A
Section 112: supplementary powers
(1)
The power in section 112(1) includes power to inspect any business
5
documents that are on the premises.
(2)
“Business documents” means documents (or copies of documents)
that relate to the carrying on of the revenue trader’s trade, whether
or not ones that a person may be required to produce under section
118B.
10
(3)
Subsections (4) to (8) of section 118B apply to documents inspected
under section 112(1) as they apply to documents produced under
section 118B.
(4)
The power in section 112(1) also includes power—
(a)
to mark items that have been examined or inspected, and
15
anything containing such items, for the purpose of indicating
that they have been examined or inspected, and
(b)
to obtain and record information (whether electronically or
otherwise) relating to the premises, items and documents
that have been examined or inspected.”
20
12
After section 118B insert—
“118BA
Further duty to provide information and documents
(1)
An officer may by notice in writing require a person to provide
documents if—
(a)
they are reasonably required by the officer for the purpose of
25
protecting, securing, collecting or managing revenues
derived from duties of excise, and
(b)
the officer has reasonable cause to believe that the person is
in possession or control of them.
(2)
An officer may not give a notice under this section without the
30
approval of the tribunal.
(3)
An application for approval may be made without notice (except as
required under subsection (4)).
(4)
The tribunal may not give its approval unless—
(a)
it is satisfied that, in the circumstances, the officer proposing
35
to give the notice is justified in doing so,
(b)
the person to whom the notice is to be given has been told
that the documents are required and given a reasonable
opportunity to make representations to an officer, and
(c)
the tribunal has been given a summary of any
40
representations made by that person.
(5)
Paragraphs (b) and (c) of subsection (4) do not apply to the extent
that the tribunal is satisfied that taking the action specified in those
paragraphs might prejudice the protection, security, collection or
management of revenues derived from duties of excise.
45

Finance (No.2) Bill
Schedule 13 — Excise duties: compliance checks
Part 3 — Information and inspection powers
104

(6)
A decision of the tribunal under this section is final (despite the
provisions of sections 11 and 13 of the Tribunals, Courts and
Enforcement Act 2007).
(7)
The following provisions of Schedule 36 to the Finance Act 2008
apply to a notice under this section as they apply to an information
5
notice—
(a)
paragraphs 7 and 8 (complying with notices and producing
copies of documents),
(b)
paragraphs 15 and 16 (powers to copy and remove
documents),
10
(c)
Part 4 (restrictions on powers) except paragraphs 21, 21A and
28, and
(d)
Part 9 (miscellaneous provisions and interpretation) so far as
relevant to the provisions listed above.
(8)
The powers in this section apply to information as they apply to
15
documents (and “documents” is to be read accordingly).
(9)
Nothing in this section affects or limits section 118B.
118BB
Inspection powers: goods-based duties
(1)
This section applies to premises if an officer has reasonable cause to
believe that—
20
(a)
the premises are used in connection with the supply,
importation or exportation of goods of a class or description
chargeable with a duty of excise, and
(b)
any such goods, or documents relating to any such goods, are
on the premises.
25
(2)
The officer may at any reasonable time enter and inspect the
premises and inspect—
(a)
any goods found on the premises, and
(b)
any documents found on the premises that appear to the
officer to relate to the supply, importation or exportation of
30
goods of a class or description chargeable to duty of excise.
(3)
For the purposes of this section—
(a)
it does not matter if the premises are used partly for a
purpose mentioned in subsection (1)(a) and partly for other
purposes (including as a dwelling), but
35
(b)
the officer may not enter or inspect any part of the premises
that is used solely as a dwelling.
(4)
Premises used to hold or store goods in connection with their supply,
importation or exportation are taken to be premises used in
connection with the supply, importation or exportation of goods,
40
regardless of who owns or occupies the premises.
118BC
Inspection powers: gaming duty
(1)
This section applies to premises if an officer has reasonable cause to
believe that section 10 gaming is taking place, has taken place or is
about to take place on the premises.
45

Finance (No.2) Bill
Schedule 13 — Excise duties: compliance checks
Part 3 — Information and inspection powers
105

(2)
The officer may at any reasonable time enter and inspect the
premises and inspect—
(a)
accounts, records and other documents in the custody or
control of any person who is engaging, or whom the officer
reasonably suspects of engaging, in section 10 gaming or in
5
any activity by reason of which the person is or may become
liable to gaming duty, and
(b)
any equipment that is being, or the officer reasonably
suspects of having been or of being intended to be, used on
the premises for or in connection with section 10 gaming.
10
(3)
Subsection (1) does not permit an officer to enter or inspect a
particular part of premises if—
(a)
the officer has no reasonable cause to believe that section 10
gaming is taking place, has taken place or is about to take
place in that part, and
15
(b)
the part is used solely as a dwelling.
(4)
“Section 10 gaming” means gaming to which section 10 of the
Finance Act 1997 applies.
118BD
Inspection powers: supplementary provision
(1)
If an officer, in the course of exercising a power under section 118BB
20
or 118BC, finds reason to believe that the premises are owned or used
by a revenue trader (within the meaning of section 112), the officer
may also exercise any power that the officer could have exercised
under section 112 if the officer had entered the premises under that
section.
25
(2)
Subsections (4) to (8) of section 118B apply to documents inspected
under section 118BB or 118BC as they apply to documents produced
under section 118B.
(3)
The powers under sections 118BB and 118BC include power—
(a)
to mark items that have been inspected, and anything
30
containing such items, for the purpose of indicating that they
have been inspected, and
(b)
to obtain and record information (whether electronically or
otherwise) relating to the premises, items and documents
that have been inspected.”
35
13
In section 118C (entry and search of premises and persons), omit subsections
(2), (2A) and (2B).
14
In section 118D (order for access to recorded information), in subsection (5),
for “118B and 118C” substitute “118B to 118C”.
15    (1)
Section 118G (offences under Part 9) is amended as follows.
40
      (2)
The existing provisions become subsection (1).
      (3)
After that subsection insert—
“(2)
Part 7 of Schedule 36 to the Finance Act 2008 (penalties) applies to a
person who fails to comply with a notice under section 118BA as it
applies to a person who fails to comply with an information notice.
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Finance (No.2) Bill
Schedule 14 — Asbestos compensation settlements
106

(3)
Part 8 of that Schedule (offences) applies in relation to documents
that are or are likely to be the subject of a notice under section 118BA
as it applies in relation to documents that are or are likely to be the
subject of an information notice (with the reference to approval of the
tribunal in accordance with paragraph 3 or 5 of that Schedule being
5
read as a reference to approval of the tribunal in accordance with
section 118BA of this Act).”
16    (1)
Section 161A (power to search premises: search warrant) is amended as
follows.
      (2)
After subsection (2) insert—
10
“(2A)
The power in subsection (2)(a) includes power to search for and
remove documents relating to any such thing (including documents
about title, storage and movement).”
      (3)
In subsection (3), for “subsections (1) and (2)” substitute “subsections (1), (2)
and (2A)”.
15
Schedule 14
Section 31

Asbestos compensation settlements
Inheritance tax
1     (1)
Section 58 of IHTA 1984 (relevant property) is amended as follows.
      (2)
For the word “and” at the end of subsection (1)(e) substitute—
20
“(ea)
property comprised in an asbestos compensation settlement,
and”.
      (3)
After subsection (3) insert—
“(4)
In subsection (1)(ea) above “asbestos compensation settlement”
means a settlement—
25
(a)
the sole or main purpose of which is making compensation
payments to or in respect of individuals who have, or had
before their death, an asbestos-related condition, and
(b)
which is made before 24 March 2010 in pursuance of an
arrangement within subsection (5) below.
30
(5)
An arrangement is within this subsection if it is—
(a)
a voluntary arrangement that has taken effect under Part 1 of
the Insolvency Act 1986 or Part 2 of the Insolvency (Northern
Ireland) Order 1989,
(b)
a compromise or arrangement that has taken effect under
35
section 425 of the Companies Act 1985, Article 418 of the
Companies (Northern Ireland) Order 1986 or Part 26 of the
Companies Act 2006, or
(c)
an arrangement or compromise of a kind corresponding to
any of those mentioned in paragraph (a) or (b) above that has
40
taken effect under, or as a result of, the law of a country or
territory outside the United Kingdom.”

Finance (No.2) Bill
Schedule 14 — Asbestos compensation settlements
107

      (4)
The amendments made by this paragraph are treated as having come into
force on 6 April 2006.
Capital gains tax
2     (1)
Section 271 of TCGA 1992 (other miscellaneous exemptions) is amended as
follows.
5
      (2)
After subsection (1)(e) insert—
“(ea)
any gain accruing on the disposal by the trustees of an
asbestos compensation settlement of any property comprised
in the settlement;”.
      (3)
After subsection (1) insert—
10
“(1ZA)
In subsection (1)(ea) above “asbestos compensation settlement”
means a settlement—
(a)
the sole or main purpose of which is making compensation
payments to or in respect of individuals who have, or had
before their death, an asbestos-related condition, and
15
(b)
which is made before 24 March 2010 in pursuance of an
arrangement within subsection (1ZB) below.
(1ZB)
An arrangement is within this subsection if it is—
(a)
a voluntary arrangement that has taken effect under Part 1 of
the Insolvency Act 1986 or Part 2 of the Insolvency (Northern
20
Ireland) Order 1989,
(b)
a compromise or arrangement that has taken effect under
section 425 of the Companies Act 1985, Article 418 of the
Companies (Northern Ireland) Order 1986 or Part 26 of the
Companies Act 2006, or
25
(c)
an arrangement or compromise of a kind corresponding to
any of those mentioned in paragraph (a) or (b) above that has
taken effect under, or as a result of, the law of a country or
territory outside the United Kingdom.”
      (4)
The amendments made by this paragraph are treated as having come into
30
force on 6 April 2006.
Income tax
3     (1)
ITA 2007 is amended as follows.
      (2)
In section 462(11) (overview of Part), after “charitable trusts” insert “and
section 838A for special provision about asbestos compensation
35
settlements”.
      (3)
After section 838 (exemption from income tax for local authorities and local
authority associations) insert—
“838A
Asbestos compensation settlements
(1)
The trustees of an asbestos compensation settlement are not liable to
40
income tax in respect of the income of the trustees.
(2)
In this section “asbestos compensation settlement” means a
settlement—

Finance (No.2) Bill
Schedule 14 — Asbestos compensation settlements
108

(a)
the sole or main purpose of which is making compensation
payments to or in respect of individuals who have, or had
before their death, an asbestos-related condition, and
(b)
which is made before 24 March 2010 in pursuance of an
arrangement within subsection (3).
5
(3)
An arrangement is within this subsection if it is—
(a)
a voluntary arrangement that has taken effect under Part 1 of
the Insolvency Act 1986 or Part 2 of the Insolvency (Northern
Ireland) Order 1989,
(b)
a compromise or arrangement that has taken effect under
10
section 425 of the Companies Act 1985, Article 418 of the
Companies (Northern Ireland) Order 1986 or Part 26 of the
Companies Act 2006, or
(c)
an arrangement or compromise of a kind corresponding to
any of those mentioned in paragraph (a) or (b) that has taken
15
effect under, or as a result of, the law of a country or territory
outside the United Kingdom.”
      (4)
The amendments made by sub-paragraphs (2) and (3) are treated as having
had effect for the tax year 2007-08 and subsequent tax years.
      (5)
ICTA is treated as having had effect for the tax year 2006-07 with an
20
amendment, after section 518 of that Act, which corresponds to that made by
sub-paragraph (3).