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Finance (No.2) Bill


Finance (No.2) Bill
Part 5 — Final provisions

19

 

27      

Asbestos compensation settlements

Schedule 14 contains provision about the taxation of settlements the purpose

of which is to make compensation payments to or in respect of individuals

affected by an asbestos-related condition.

Part 5

5

Final provisions

32 Interpretation

33 Short title

 
 

20

Finance (No.2) Bill
Schedule 1 — Shared lives care

 

Schedules

Schedule 1

Section 1

 

Shared lives care

Extension of foster-care relief

1          

Chapter 2 of Part 7 of ITTOIA 2005 (foster-care relief) is amended as follows.

5

2     (1)  

Section 803 (overview of Chapter 2) is amended as follows.

      (2)  

For subsection (1) substitute—

“(1)   

This Chapter provides relief on income from the provision by an

individual of qualifying care.

   

The relief is referred to in this Chapter as “qualifying care relief”.”

10

      (3)  

In subsections (2) and (5), for “foster-care” substitute “qualifying care”.

3     (1)  

Section 804 (person who qualifies for relief) is amended as follows.

      (2)  

For subsection (1) substitute—

“(1)   

An individual qualifies for qualifying care relief for a tax year if the

individual—

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(a)   

has qualifying care receipts for the tax year (see section 805),

and

(b)   

does not derive any taxable income, other than qualifying

care receipts, from a relevant trade or arrangement.”

      (3)  

In subsection (3), for “foster-care” substitute “qualifying care”.

20

      (4)  

After that subsection insert—

“(4)   

Subsection (1) is subject to section 804A.”

4          

After section 804 insert—

“804A   

Shared lives care: further condition for relief

(1)   

This section applies if an individual (“N”) has qualifying care

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receipts for a tax year in respect of the provision of shared lives care.

(2)   

N does not qualify for qualifying care relief in respect of those

receipts if the placement cap is exceeded for the residence (or any of

the residences) used by N to provide the care from which those

receipts are derived.

30

(3)   

The placement cap is exceeded for a residence if, at any given time

during the relevant period, shared lives care is being provided there

(whether by N or anyone else) for more than 3 people in total.

 

 

Finance (No.2) Bill
Schedule 1 — Shared lives care

21

 

(4)   

The relevant period, in relation to a residence, is the period for which

the residence is N’s only or main residence during the income period

for the receipts (see section 805).

(5)   

If the placement cap is so exceeded but N also has qualifying care

receipts for the tax year in respect of the provision of foster care, this

5

Chapter is to apply to N for the tax year as if—

(a)   

references to qualifying care were to foster care, and

(b)   

accordingly, references (other than in this section) to

qualifying care receipts did not include receipts in respect of

the provision of shared lives care.

10

(6)   

In determining the number of people for whom shared lives care is

being provided at any given time, brothers and sisters (including

half-brothers and half-sisters) count as one person.”

5     (1)  

In section 805(1) (meaning of “foster-care receipts”)—

(a)   

for “foster-care” substitute “qualifying care”, and

15

(b)   

in paragraph (a), for “foster care” substitute “qualifying care”.

      (2)  

Accordingly, in the heading of section 805, for “foster-care” substitute

qualifying care”.

6          

After section 805 insert—

“805A   

Meaning of providing qualifying care

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For the purposes of this Chapter qualifying care is provided if an

individual (alone or in partnership) provides—

(a)   

foster care but not shared lives care,

(b)   

shared lives care but not foster care, or

(c)   

both foster care and shared lives care.”

25

7          

After section 806 insert—

“806A   

Meaning of providing shared lives care

(1)   

For the purposes of this Chapter shared lives care is provided by an

individual if—

(a)   

the individual provides accommodation and care for an adult

30

or child (“X”) who has been placed with the individual, and

(b)   

the conditions in subsection (2) are met.

(2)   

The conditions are—

(a)   

the accommodation is in the individual’s own home,

(b)   

the accommodation and care are provided on the basis that X

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will share the individual’s home and daily family life during

the placement,

(c)   

the placement is made under a specified social care scheme,

(d)   

the individual does not provide the accommodation and care

as a foster carer, and

40

(e)   

the individual is not excluded within the meaning of section

806(5).

(3)   

Section 806(5) has effect for the purposes of subsection (2)(e) as if

references to the child were to X (whatever X’s age).

 
 

Finance (No.2) Bill
Schedule 1 — Shared lives care

22

 

(4)   

“Specified social care scheme” means a social care scheme of a kind

specified or described in an order made by the Treasury.

(5)   

An order under subsection (4) may make provision having effect in

relation to the tax year current on the day on which the order is

made.

5

(6)   

In this section—

“care” means personal care, including assistance and support;

“home” means an individual’s only or main residence;

“social care scheme” means a scheme, service or arrangement

for those who, by reason of age, illness, disability or other

10

vulnerability, are in need of care.

806B    

Meaning of “residence”

(1)   

In this Chapter “residence” means—

(a)   

a building, or part of a building, occupied or intended to be

occupied as a separate residence, or

15

(b)   

a caravan or houseboat.

(2)   

If a building, or part of a building, designed for permanent use as a

single residence is temporarily divided into two or more separate

residences, it is still treated as a single residence.”

8     (1)  

In section 807 (calculation of “total foster-care receipts”), for “foster-care”

20

substitute “qualifying care”.

      (2)  

Accordingly, in the heading of that section, for “foster-care” substitute

qualifying care”.

9          

In section 808(1)(b) (the individual’s limit), before “child” insert “adult or”.

10         

For section 809 substitute—

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“809    

Share of fixed amount: residence used by more than one carer

“(1)   

This section applies if in a tax year—

(a)   

the residence used to provide the qualifying care from which

an individual’s qualifying care receipts for the tax year are

derived is also used by another individual to provide

30

qualifying care, and

(b)   

the other individual also has qualifying care receipts for the

tax year.

(2)   

Each individual’s share of the fixed amount for the tax year is the

fixed amount divided by the total number of individuals who—

35

(a)   

use the residence in the tax year to provide qualifying care,

and

(b)   

have qualifying care receipts for the tax year.”

11         

In section 810(1) (share of fixed income: income period not a year), for

“foster-care” substitute “qualifying care”.

40

12    (1)  

Section 811 (the amount per child) is amended as follows.

 
 

Finance (No.2) Bill
Schedule 1 — Shared lives care

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      (2)  

For subsection (1) substitute—

“(1)   

An individual’s amount per adult or child for a tax year is found by

multiplying—

(a)   

the number of weeks during the income period for the tax

year in which the individual provides qualifying care for the

5

adult or child, by

(b)   

the weekly amount for the adult or child.

(1A)   

The weekly amount for an adult is £250.”

      (3)  

In subsection (3), for “subsection (2)” substitute “subsection (1A) or (2)”.

      (4)  

In subsection (4), for “foster care for a child” substitute “qualifying care for

10

an adult or child”.

      (5)  

Accordingly, in the heading, before “child” insert “adult or”.

13         

For section 812 substitute—

“812    

Full qualifying care relief: introduction

Sections 813 and 814 (which give the full form of qualifying care

15

relief) apply if—

(a)   

an individual qualifies for qualifying care relief for a tax year,

(b)   

the individual’s total qualifying care receipts for the tax year

do not exceed the individual’s limit for the tax year, and

(c)   

sections 822 and 823 do not apply (accounting date for trade

20

not 5 April).”

14    (1)  

In section 813(1) (full foster-care relief: trading income), for “foster-care”

substitute “qualifying care”.

      (2)  

Accordingly, in the heading of section 813, for “foster-care” substitute

qualifying care”.

25

15    (1)  

In section 814(1) (full foster-care relief: income chargeable under Chapter 8

of Part 5), for “foster-care” substitute “qualifying care”.

      (2)  

Accordingly, in the heading of section 814, for “foster-care” substitute

qualifying care”.

16         

In section 815(a) and (b) (alternative calculation of profits: introduction), for

30

“foster-care” substitute “qualifying care”.

17         

In section 816(1) and (2)(a) (alternative calculation of profits: trading

income), for “foster-care” substitute “qualifying care”.

18         

In section 817(1) and (2)(a) (alternative calculation of profits: income

chargeable under Chapter 8 of Part 5), for “foster-care” substitute

35

“qualifying care”.

19         

In section 818(1)(a) and (b) (election for alternative method of calculating

profits), for “foster-care” substitute “qualifying care”.

20         

In section 819(1)(b) (adjustment of assessment), for “foster care” substitute

“qualifying care”.

40

21         

In section 820(a) and (b) (periods of account not ending on 5th April), for

“foster-care” substitute “qualifying care”.

 
 

Finance (No.2) Bill
Schedule 1 — Shared lives care

24

 

22    (1)  

Section 821 (meaning of “relevant limit”) is amended as follows.

      (2)  

In subsection (1)—

(a)   

for “foster-care” substitute “qualifying care”, and

(b)   

in paragraph (b), before “child” insert “adult or”.

      (3)  

In subsection (2), before “child”, in both places where it occurs, insert “adult

5

or”.

23         

In section 822(1) (full relief), for “foster-care” substitute “qualifying care”.

24         

In section 823(1)(a) and (2)(a) (alternative method of calculating profits), for

“foster-care” substitute “qualifying care”.

25         

In section 824(1)(a) and (2)(b) (capital allowances: introduction), for “foster-

10

care” substitute “qualifying care”.

26         

In section 825(2) and (4)(a) (carried forward unrelieved qualifying

expenditure), for “foster care” substitute “qualifying care”.

27         

In section 826(b) (excluded capital expenditure), for “foster care” substitute

“qualifying care”.

15

28         

In section 827(a) (excluded capital expenditure: subsequent treatment of

asset), for “foster care” substitute “qualifying care”.

29         

Accordingly, for the heading of Chapter 2 of Part 7 of ITTOIA 2005

substitute “qualifying care relief”.

Consequential amendments

20

30         

ITTOIA 2005 is amended as follows.

31         

In section 1(5) (overview of Act), for “foster-care” substitute “qualifying

care”.

32    (1)  

In section 23 (rent-a-room and foster-care relief)—

(a)   

in subsection (3), for “foster-care” substitute “qualifying care”, and

25

(b)   

in subsection (4), for “foster care” substitute “qualifying care”.

      (2)  

Accordingly—

(a)   

in the heading of that section, for “foster-care” substitute

qualifying care”, and

(b)   

in the heading immediately preceding that section, for “foster-care

30

substitute “qualifying care”.

33         

In section 688(2)(b) (income charged), for “foster care” substitute “qualifying

care”.

34         

In the heading of Part 7, for “FOSTER-CARE” substitute “QUALIFYING

CARE”.

35

35         

In the table in Part 2 of Schedule 4 (index of expressions defined in this Act

etc)—

(a)   

omit the entries for “foster-care receipts” and “foster-care relief”,

(b)   

after the entry for “provides foster care” insert—

 

“provides qualifying care (in Chapter 2 of

section 805A

 

40

 

Part 7)

  
 
 

Finance (No.2) Bill
Schedule 1 — Shared lives care

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provides shared lives care (in Chapter 2 of

section 806A”,

 
 

Part 7)

  
 

(c)   

after the entry for “purchased life annuity” insert—

 

“qualifying care receipts (in Chapter 2 of

section 805

 
 

Part 7)

  

5

 

qualifying care relief (in Chapter 2 of Part 7)

section 803(1)”,

 

(d)   

after the entry for “residence” insert—

 

“residence (in Chapter 2 of Part 7)

section 806B”,

 

           

and

(e)   

in the entry for “total foster-care receipts”, for “foster-care” substitute

10

“qualifying care”.

Commencement

36    (1)  

The amendments made by this Schedule have effect for the tax year 2010-11

and subsequent tax years.

      (2)  

But an individual within sub-paragraph (3) may elect to be treated for

15

income tax purposes as if those amendments had effect instead for the tax

year 2011-12 and subsequent tax years (and accordingly to remain entitled,

for the tax year 2010-11, to the benefit of any relevant concession so far as

applicable to the individual).

      (3)  

An individual is within this sub-paragraph if the individual has qualifying

20

care receipts for the tax year 2010-11 in respect of the provision of shared

lives care (with or without qualifying care receipts in respect of the provision

of foster care).

      (4)  

A relevant concession is an existing HMRC concession (within the meaning

of section 160 of FA 2008)—

25

(a)   

which is in force immediately before the passing of this Act, and

(b)   

to which effect is given (in whole or in part) by this Schedule.

      (5)  

An election under sub-paragraph (2) must be made on or before the first

anniversary of the normal self-assessment filing date for the tax year 2010-11

(or such later date as an officer of Revenue and Customs may, in a particular

30

case, allow).

Transitional provision

37    (1)  

This paragraph applies if—

(a)   

an individual had qualifying care receipts in respect of the provision

of shared lives care—

35

(i)   

for the pre-commencement tax year, or

(ii)   

for a continuous series of tax years up to and including the

pre-commencement tax year,

(b)   

the receipts were receipts of a trade,

 
 

 
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