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[AS AMENDED IN PUBLIC BILL COMMITTEE] |
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grant certain duties, to alter other duties, and to amend the law relating to the |
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National Debt and the Public Revenue, and to make further provision in |
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WE, Your Majesty’s most dutiful and loyal subjects, the Commons of the |
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United Kingdom in Parliament assembled, towards raising the necessary |
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supplies to defray Your Majesty’s public expenses, and making an addition to the |
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public revenue, have freely and voluntarily resolved to give and to grant unto Your |
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Majesty the several duties hereinafter mentioned; and do therefore most humbly |
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beseech Your Majesty that it may be enacted, and be it enacted by the Queen’s most |
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Excellent Majesty, by and with the advice and consent of the Lords Spiritual and |
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Temporal, and Commons, in this present Parliament assembled, and by the authority |
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of the same, as follows:— |
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Income tax, corporation tax and capital gains tax |
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Income tax and corporation tax |
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Schedule 1 contains provision extending foster-care relief to other forms of |
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2 | Payments to special guardians and those in receipt of residence orders |
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(1) | Part 6 of ITTOIA 2005 (exempt income) is amended as follows. |
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(2) | In section 744 (payments to adopters: England and Wales)— |
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(a) | the existing provision becomes subsection (1), |
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(b) | in that subsection, omit the “and” before paragraph (e) and after that |
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“(f) | payments made under regulations under section 14F of |
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the Children Act 1989 (special guardianship support |
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services) to a person appointed as a child’s special |
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(g) | payments made to a person under section 17 of that Act |
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(provision of services for children in need, their families |
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and others) by reason of that person being a person in |
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whose favour a residence order with respect to a child is |
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(h) | payments made to a person, in respect of a child, under |
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paragraph 15 of Schedule 1 to that Act (local authority |
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contribution to child’s maintenance to recipients in |
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whose favour residence order is in force), and |
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(i) | payments made in accordance with— |
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(i) | an order under that Schedule (orders for |
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financial relief against parents etc), or |
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(ii) | a maintenance agreement, |
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| for the benefit of a child, to a person appointed as the |
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child’s special guardian or a person in whose favour a |
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residence order with respect to the child is in force.”, |
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(c) | after that subsection insert— |
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“(2) | But a payment is not within subsection (1)(f), (g), (h) or (i) if— |
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(a) | it is made to an excluded relative of the child, |
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(b) | it is made to a person appointed as the child’s special |
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guardian and an excluded relative is also appointed as |
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the child’s special guardian, or |
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(c) | it is made to a person in whose favour a residence order |
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is in force with respect to the child and that order is also |
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in favour of an excluded relative. |
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“excluded relative”, in relation to a child, means— |
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(a) | a parent of the child, or |
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(b) | a person who is, or has been, the husband or wife |
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or civil partner of a parent of the child; |
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“maintenance agreement” has the meaning given by |
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paragraph 10(1) of Schedule 1 to the Children Act 1989; |
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“residence order” has the meaning given by section 8 of |
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(d) | in the heading, after “adopters” insert “, etc”. |
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(3) | In section 745 (payments to adopters: Scotland)— |
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(a) | the existing provision becomes subsection (1), |
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(b) | in that subsection, omit the “and” before paragraph (d) and after that |
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“(e) | payments made to a person under section 50 of the |
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Children Act 1975, or section 22 of the Children |
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(Scotland) Act 1995, by reason of that person being a |
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person with whom a child is to live by virtue of a |
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(f) | payments of aliment made— |
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(i) | in accordance with an award of aliment under |
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the Family Law (Scotland) Act 1985, or |
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(ii) | under an agreement (within the meaning of |
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section 7(5) of that Act), |
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| for the benefit of a child, to a person in whose favour a |
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residence order with respect to the child is in force.”, |
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(c) | after that subsection insert— |
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“(2) | A payment is not within subsection (1)(e) or (f) if— |
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(a) | it is made to an excluded relative of the child, or |
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(b) | it is made to a person in whose favour a residence order |
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is in force with respect to the child and that order is also |
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in favour of an excluded relative. |
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“excluded relative”, in relation to a child, means— |
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(a) | a parent of the child, or |
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(b) | a person who is, or has been, the husband or wife |
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or civil partner of a parent of the child; |
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“residence order” has the meaning given by section |
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11(2)(c) of the Children (Scotland) Act 1995.”, and |
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(d) | in the heading, after “adopters” insert “, etc”. |
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(4) | In section 746 (payments to adopters: Northern Ireland)— |
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(a) | the existing provision becomes subsection (1), |
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(b) | in that subsection, omit the “and” before paragraph (c) and after that |
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“(d) | payments made to a person under Article 18 of the |
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Children (Northern Ireland) Order 1995 (S.I. 1995/755 |
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(NI 2)) (general duty of authority to provide personal |
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social services) by reason of that person being a person |
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in whose favour a residence order with respect to a child |
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(e) | payments made to a person, in respect of a child, under |
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paragraph 17 of Schedule 1 to that Order (local authority |
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contribution to child’s maintenance to recipients in |
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whose favour residence order is in force), and |
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(f) | payments made in accordance with— |
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(i) | an order under that Schedule (orders for |
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financial relief against parents etc), or |
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(ii) | a maintenance agreement, |
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| for the benefit of a child, to a person in whose favour a |
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residence order with respect to the child is in force.”, |
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(c) | after that subsection insert— |
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“(2) | But a payment is not within subsection (1)(d), (e) or (f) if— |
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(a) | it is made to an excluded relative of the child, or |
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(b) | it is made to a person in whose favour a residence order |
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is in force with respect to the child and that order is also |
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in favour of an excluded relative. |
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“excluded relative”, in relation to a child, means— |
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(a) | a parent of the child, or |
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(b) | a person who is, or has been, the husband or wife |
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or civil partner of a parent of the child; |
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“maintenance agreement” has the meaning given by |
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paragraph 12 of Schedule 1 to the Children (Northern |
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“residence order” has the meaning given by Article 8 of |
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(d) | in the heading, after “adopters” insert “, etc”. |
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(5) | The amendments made by this section have effect in relation to the tax year |
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2010-11 and subsequent tax years. |
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3 | Qualifying care relief: capital allowances |
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(1) | Chapter 2 of Part 7 of ITTOIA 2005 (qualifying care relief) is amended as |
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(2) | In section 824 (capital allowances: introduction), after subsection (2) insert— |
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“(2A) | In this group of sections, in relation to a relevant individual— |
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(a) | “the care business” means the provision of qualifying care by |
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(b) | “care business expenditure” means qualifying expenditure |
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incurred on the provision of plant or machinery wholly or |
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partly for the care business, |
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(c) | “care business pool” means a pool of care business expenditure |
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(even if the balance for the time being is nil), and |
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(d) | a reference to “another activity” is to a qualifying activity |
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carried on by the individual other than the care business. |
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(2B) | In this group of sections, plant or machinery is referred to as being “in” |
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a pool if qualifying expenditure incurred on its provision has been |
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allocated at any time to that pool.” |
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(3) | For section 825 substitute— |
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“825 | Unallocated capital expenditure |
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(1) | This section applies if— |
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(a) | at the beginning of a relevant chargeable period of a relevant |
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individual, there is care business expenditure which has not |
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been allocated to a care business pool, |
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(b) | the individual is entitled under CAA 2001 to allocate the |
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expenditure, or a part of it, to a care business pool for that |
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(c) | the previous chargeable period was not a relevant chargeable |
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(2) | So much of the expenditure as the individual is entitled to allocate to a |
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care business pool for that period is to be treated for the purposes of |
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CAA 2001 as allocated to the appropriate kind of care business pool for |
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that period (whether or not any of it is actually so allocated). |
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(3) | For the different kinds of pool, see section 54 of CAA 2001. |
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825A | Deemed disposal event |
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(1) | Subsection (2) applies to a care business pool for a relevant chargeable |
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period of a relevant individual if the previous chargeable period was |
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not a relevant chargeable period. |
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(2) | CAA 2001 is to apply as if— |
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(a) | a disposal event occurs immediately after the beginning of the |
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relevant chargeable period in respect of plant or machinery in |
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(b) | disposal receipts fall to be brought into account in the pool for |
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the period because of that event, and |
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(c) | the total of the receipts equals the sum of amount A and amount |
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B (or nil if there are no such amounts). |
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(3) | Amount A is the amount of any expenditure treated as allocated to the |
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pool for the period by virtue of section 825 (whether or not any of it is |
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(4) | Amount B is the amount of any unrelieved qualifying expenditure |
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carried forward in the pool from the previous chargeable period. |
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825B | Plant or machinery used for care business |
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(1) | This section applies if— |
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(a) | disposal receipts fall to be brought into account in a pool for a |
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relevant chargeable period by virtue of section 825A, and |
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(b) | on the re-start date, the relevant individual still owns any of the |
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plant or machinery which was in that pool and is still using any |
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of it for the purposes of the care business. |
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(2) | The re-start date is the first day of the first subsequent chargeable |
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period which is not a relevant chargeable period. |
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(3) | A reference in this section to the retained plant or machinery is to so |
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much of the plant or machinery in the pool as the relevant individual— |
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(a) | still owns on the re-start date, and |
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(b) | is still using on that date for the purposes of the care business. |
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(4) | The individual is to be treated under CAA 2001— |
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(a) | as having brought the retained plant or machinery into use on |
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the re-start date for the purposes of the care business, |
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(b) | as having incurred capital expenditure on the provision of that |
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plant or machinery for those purposes on that date, and |
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(c) | as owning that plant and machinery as a result of having |
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incurred that expenditure. |
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(5) | The total amount of expenditure which the individual is to be treated |
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as having incurred (for all of the retained plant or machinery) is the |
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(a) | the total market value of the retained plant or machinery on the |
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(b) | an amount equal to the disposal receipts brought into account |
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in the pool as described in subsection (1)(a). |
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(6) | If the individual is treated under section 13 of CAA 2001 as having |
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incurred notional expenditure before the re-start date as a result of |
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bringing plant or machinery in the pool into use for the purposes of |
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another activity, the amount mentioned in subsection (5)(b) must be |
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reduced by the total amount of that expenditure, as determined in |
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accordance with section 825C(2). |
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(7) | But subsection (6) does not apply if the plant or machinery which was |
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brought into use for the purposes of another activity is the retained |
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plant or machinery (for example, where it was brought into use only |
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partly for the purposes of that other activity). |
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(8) | The question whether the provision of the retained plant or machinery |
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is to be treated as wholly or only partly for the purposes of the care |
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business is to be determined according to whether the use referred to in |
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subsection (3)(b) is wholly or only partly for those purposes. |
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825C | Plant or machinery used for other qualifying activities |
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(1) | This section applies if— |
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(a) | disposal receipts fall to be brought into account in a pool by |
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virtue of section 825A because of a disposal event, and |
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(b) | after that disposal event, the relevant individual brings any of |
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the plant or machinery in that pool into use for the purposes of |
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(2) | Section 13 of CAA 2001 has effect as if the total amount of the notional |
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expenditure which the individual is treated under that section as |
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having incurred, for all of the plant or machinery in that pool which is |
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brought into use for the purposes of the other activity, were the smaller |
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(a) | the total market value of that plant or machinery on the day on |
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which it is brought into use for the purposes of that other |
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(b) | an amount equal to the disposal receipts brought into account |
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in the pool as mentioned in subsection (1)(a). |
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(3) | Subsection (2) does not apply to plant or machinery brought into use |
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for the purposes of another activity if— |
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(a) | the individual is treated by virtue of section 825B as having |
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already brought that plant or machinery into use for the |
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purposes of the care business, or |
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(b) | this section has already applied to that plant or machinery since |
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(4) | The amount mentioned in subsection (2)(b) must be reduced by the |
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appropriate sum if some plant or machinery in the pool is brought into |
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use for the purposes of another activity after — |
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(a) | the individual is treated by virtue of section 825B as having |
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brought other plant or machinery in that pool into use for the |
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purposes of the care business, or |
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(b) | this section has applied to other plant or machinery in that pool |
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since the disposal event. |
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(5) | The appropriate sum is— |
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(a) | in a case within paragraph (a) of subsection (4), the total amount |
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of expenditure which the individual is treated by virtue of |
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section 825B as having incurred on the provision of that other |
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(b) | in a case within paragraph (b) of that subsection, the total |
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amount of the notional expenditure (as determined in |
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accordance with subsection (2)) which the individual is treated |
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under section 13 of CAA 2001 as having incurred on the |
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provision of that other plant or machinery since the disposal |
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825D | Subsequent disposal events |
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(1) | This section applies to an item of plant or machinery which a relevant |
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(a) | is treated by virtue of section 825B as bringing into use, or |
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(b) | brings into use in circumstances where section 825C(2) applies. |
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(2) | The date (in either case) on which the item is brought or treated as |
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brought into such use is referred to in this section as the applicable date. |
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(3) | The first disposal event to occur in respect of the item on or after the |
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applicable date is to be regarded for the purposes of section 60(3) of |
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CAA 2001 as the first such event. |
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(4) | That event requires a disposal value to be brought into account |
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regardless of anything to the contrary in section 64(1) of that Act. |
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(5) | But a reference in section 62 of that Act to the amount of qualifying |
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expenditure incurred by the individual on the provision of that item is |
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a reference to the amount of qualifying expenditure originally incurred |
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by the individual on its provision (and not to any proportion of the total |
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amount treated by virtue of section 825B or 825C as having been |
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(4) | The amendments made by this section have effect in relation to chargeable |
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periods ending on or after the day on which this Act is passed (“the |
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(5) | For anyone who was a relevant individual for the most recent chargeable |
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period ending before the commencement day, sections 825B and 825C of |
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ITTOIA 2005 have effect (on and after that day) as if references in those sections |
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to section 825A were references to section 825 as it was in force immediately |
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before the commencement day. |
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(1) | Section 378 of ITEPA 2003 (deductions from seafarers’ earnings: eligibility) is |
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(2) | In subsection (1)(a), after “relevant taxable earnings” insert “or EEA-resident |
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