Section 170.
Taxes Management Act 1970 (c. 9)
1 In section 87A of the Taxes Management Act 1970 (interest on overdue tax for accounting periods ending after appointed day) the following subsection shall be inserted after subsection (4)—
(4A) In a case where—
(a) there is for an accounting period of a company (“the later period”) a relievable amount within the meaning of section 131 of the Finance Act 1993 (non-trading exchange gains and losses),
(b) as a result of a claim under subsection (5) or (6) of that section the whole or part of the relievable amount for the later period is set off against the exchange profits (as defined in subsection (10) of that section) of an earlier accounting period (“the earlier period”), and
(c) disregarding the effect of subsection (5) or (6) (as the case may be) of that section, an amount of corporation tax for the earlier period would carry interest in accordance with this section,
then, in determining the amount of interest payable under this section on corporation tax unpaid for the earlier period, no account shall be taken of any reduction in the amount of that tax resulting from the claim under subsection (5) or (6) of that section except so far as concerns interest for any time after the date on which any corporation tax for the later period became due and payable, as mentioned in subsection (1) above.
Income and Corporation Taxes Act 1988 (c. 1)
2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4 In section 407 of the Taxes Act 1988 (relationship between group relief and other relief) in subsection (2) at the end of paragraph (b) there shall be inserted “ and ”, and after that paragraph there shall be inserted—
(c) relief under section 131(7) of the Finance Act 1993 in respect of the whole or part of a relievable amount for an accounting period after the accounting period the profits of which are being computed;
and the reference in paragraph (c) above to a relievable amount shall be construed in accordance with section 131 of the Finance Act 1993.
5 In section 826 of the Taxes Act 1988 (interest on tax overpaid) the following subsection shall be inserted after subsection (7B)—
(7C) In a case where—
(a) there is for an accounting period of a company (“the later period”) a relievable amount within the meaning of section 131 of the Finance Act 1993 (non-trading exchange gains and losses),
(b) as a result of a claim under subsection (5) or (6) of that section the whole or part of the relievable amount for the later period is set off against the exchange profits (as defined in subsection (10) of that section) of an earlier accounting period (“the earlier period”), and
(c) a repayment falls to be made of corporation tax for the earlier period,
then, in determining the amount of interest (if any) payable under this section on the repayment of corporation tax for the earlier period, no account shall be taken of any increase in the amount of the repayment resulting from the claim under subsection (5) or (6) (as the case may be) of that section except so far as concerns interest for any time after the date on which any corporation tax for the later period became (or, as the case may be, would have become) due and payable, as mentioned in subsection (2) above.
6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finance Act 1989 (c. 26)
7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SCHEDULE 20 Lloyd’s underwriters: special reserve funds
Section 175.
Part I Requirements for and tax consequences of new-style funds
Preliminary
1 (1) In this Part of this Schedule—
“the arrangements” means the arrangements mentioned in section 175(1) of this Act;
“cash call” means a request for funds which, in pursuance of a contract made in accordance with the rules and practices of Lloyd’s, is made to a member by the agent of a syndicate of which he is a member;
“overall premium limit”, in relation to a member and an underwriting year, means the maximum amount which, under the rules of Lloyd’s, the member may accept by way of premiums in that year;
“payment”, unless the contrary intention appears, means a payment in money;
“stop-loss payment” means a payment of insurance money under a stop-loss insurance or a payment out of the High Level Stop Loss Fund;
“syndicate profit”, in relation to a member and an underwriting year, means the amount by which the aggregate of his profits exceeds the aggregate of his losses for the year, and “syndicate loss” shall be construed accordingly.
(2) For the purposes of the definitions of “syndicate profit” and “syndicate loss” in sub-paragraph (1) above—
(a) any reference to profits or losses of a member is a reference to profits or losses which, in the accounts of the syndicates of which he is a member, are shown as arising to him, . . .
(b) any payments under paragraph 3(1), 4(1), (2), (3) or (6), 5(1), (4) or (7) or 6(2) below shall be disregarded.
(c) where the accounts of a syndicate remain open beyond the end of the underwriting year which is the closing year for that syndicate, profits or losses shown in the accounts of the syndicate as arising to a member in any subsequent underwriting year shall be profits or losses of the member for the last underwriting year but one preceding that subsequent underwriting year.
General requirements
2 (1) The arrangements must provide—
(a) for the setting up, in relation to any member, of a special reserve fund vested in one or more trustees who have control over it, and
(b) for the appointment of an authorised fund manager (who may be the trustees or one of the trustees) to invest the capital of the fund and to vary the investments;
and in this sub-paragraph “authorised” means authorised under the rules of Lloyd’s.
(2) The arrangements must be such as to secure that—
(a) any income arising to the trustee or trustees of the special reserve fund shall be added to the capital of the fund and held on the same trusts as the fund; and
(b) except as required or permitted by this Schedule, no payments shall be made into or out of the special reserve fund.
Payments into fund out of syndicate profits
3 (1) The arrangements must be such as to secure that, if the member has made a syndicate profit for an underwriting year, he has the right to make, into his special reserve fund, payments the amount of which is not in the aggregate greater than whichever of the following is the less, namely—
(a) 50 per cent. of that profit; and
(b) the amount (if any) by which 50 per cent. of the member’s overall premium limit for the closing year exceeds the value of the fund as at the end of that year.
(2) Any payments which a member is entitled to make by virtue of sub-paragraph (1) above must be made before the end of such period as may be prescribed.
(3) Where the member did not accept premiums in the closing year, the reference in sub-paragraph (1)(b) above to the member’s overall premium limit for that year shall be construed as a reference to that limit for the latest underwriting year in which he did so.
Payments out of fund to cover cash calls
4 (1) The arrangements must be such as to secure that, if a cash call is made on the member in respect of an underwriting year, there shall be made into a premium trust fund of his, out of his special reserve fund, payments the amount of which is equal in the aggregate to the amount of the call, or the amount of his special reserve fund, whichever is the less.
(1A) References in sub–paragraph (1) above to a cash call include references to a cash call made in respect of an underwriting year determined by paragraph 1(2)(c) above (“the relevant cash call”) if and to the extent that the aggregate amount of the relevant cash call and any previous cash calls made on the member in respect of the syndicate concerned exceeds the net amount of losses arising to the member from that syndicate which have been declared before the date of the relevant cash call after deducting the amount of profits arising to him from that syndicate which have been so declared.
(2) Where the aggregate amount of any payments made under sub-paragraph (1) above in respect of any year is found to exceed the amount of the member’s syndicate loss for the year, there shall be made into his special reserve fund, out of a premium trust fund or ancillary trust fund of his, payments the amount of which is equal in the aggregate to the amount of the excess.
(3) Where a stop-loss payment is made to the member in respect of his syndicate loss for any year, so much of the stop-loss payment as does not exceed the requisite amount shall be paid into his special reserve fund.
(4) In sub-paragraph (3) above “the requisite amount” means so much of the amount (if any) given by sub-paragraph (5) below as does not exceed the aggregate amount mentioned in paragraph (b) of that sub-paragraph.
(5) The amount given by this sub-paragraph is the amount by which—
(a) the amount of the stop-loss payment, and
(b) the aggregate amount of the payments under sub-paragraph (1) above as reduced by the aggregate amount of any payments under sub-paragraph (2) above,
exceeds in the aggregate the amount of the member’s syndicate loss.
(6) Where the whole or any part of a stop-loss payment made to a member is repaid, there shall be made to the member or his personal representatives or assigns, out of his special reserve fund, payments the amount of which is equal in the aggregate to the amount (if any) to which sub-paragraph (7) below applies or the amount of his special reserve fund, whichever is the less.
(7) This sub-paragraph applies to any amount which—
(a) has been paid into the member’s special reserve fund under sub-paragraph (2) or (3) above, but
(b) would not have been so paid but for the stop-loss payment or (as the case may be) the part repaid.
(8) Any payments required by sub-paragraph (1), (2), (3) or (6) above shall be made before the end of such period as may be prescribed.
Payments out of fund to cover syndicate losses
5 (1) The arrangements must be such as to secure that, if the member has sustained a syndicate loss for an underwriting year, there shall be made into a premium trust fund of his, out of his special reserve fund, payments the amount of which is equal in the aggregate to the net amount of the loss or the amount of his special reserve fund, whichever is the less.
(2) Sub-paragraphs (3) and (4) below apply where a stop-loss payment is made to the member in respect of his syndicate loss for any year.
(3) If any payments are subsequently made for the year under sub-paragraph (1) above, the aggregate amount of those payments shall be determined as if the net amount of the syndicate loss were reduced by the amount of the stop-loss payment.
(4) If any payments have previously been made for the year under sub-paragraph (1) above, so much of the stop-loss payment as does not exceed the requisite amount shall be paid into his special reserve fund.
(5) In sub-paragraph (4) above “the requisite amount” means so much of the amount (if any) given by sub-paragraph (6) below as does not exceed the amount mentioned in paragraph (b) of that sub-paragraph.
(6) The amount given by this sub-paragraph is the amount by which—
(a) the amount of the stop-loss payment, and
(b) the aggregate amount of the payments made under sub-paragraph (1) above,
exceeds in the aggregate the net amount of the member’s syndicate loss.
(7) Where the whole or any part of a stop-loss payment made to a member is repaid, there shall be made to the member or his personal representatives or assigns, out of his special reserve fund, payments the amount of which is equal in the aggregate to the aggregate of the amounts (if any) to which sub-paragraphs (8) and (9) below apply or the amount of his special reserve fund, whichever is the less.
(8) This sub-paragraph applies to any amount which—
(a) has not been paid out of the member’s special reserve fund under sub-paragraph (1) above, but
(b) would have been so paid but for the stop-loss payment or (as the case may be) the part repaid.
(9) This sub-paragraph applies to any amount which—
(a) has been paid into the member’s special reserve fund under sub-paragraph (4) above, but
(b) would not have been so paid but for the stop-loss payment or (as the case may be) the part repaid.
(10) Any payments required by sub-paragraph (1), (4) or (7) above shall be made before the end of such period as may be prescribed.
(11) In this paragraph “net amount”, in relation to a member’s syndicate loss for any year, means the amount of the loss as reduced by the amount of any payments made under paragraph 4(1) above for the year.
Valuation and payments out of fund of excess amounts
6 (1) The arrangements must be such as to secure that the fund manager of a member’s special reserve fund—
(a) shall determine in the prescribed manner the value of the fund as at the end of the year 1994 and each subsequent underwriting year; and
(b) shall report the value so determined to the member;
and the report shall also state such other matters as may be prescribed.
(2) If the value (determined under sub-paragraph (1) above) of the fund as at the end of any underwriting year exceeds 50 per cent. of—
(a) the higher of—
(i) the member’s overall premium limit for that year, and
(ii) his overall premium limit for the immediately preceding year; or
(b) where he did not accept premiums in either of those years, his overall premium limit for the last underwriting year in which he did so,
there shall be made to the member or his personal representatives or assigns, out of his special reserve fund, payments the amount of which is equal in the aggregate to the excess.
(3) The payments required by sub-paragraph (2) above shall be made before the end of such period as may be prescribed.
Payments out of fund on cessation
7 (1) The arrangements must provide that, on the member ceasing to carry on his underwriting business, whether by reason of death or otherwise, the amount of his special reserve fund, so far as not required for giving effect to the requirements of paragraph 4 or 5 above, shall be paid over to the member or his personal representatives or assigns.
(2) For the purposes of sub-paragraph (1) above, a payment of an amount shall be in money or in assets forming part of the fund or both, as the member or his personal representatives or assigns may direct.
Entitlement of member for tax purposes
8 (1) Subject to sub-paragraph (2) and paragraph 11(2)-(4)below, a member shall be treated for the purposes of the Income Tax Acts and the Gains Tax Acts as absolutely entitled as against the trustees to the assets forming part of his special reserve fund.
(2) Where an asset is disposed of by a member to the trustees of his special reserve fund, nothing in sub-paragraph (1) above shall affect the operation of the Gains Tax Acts in relation to that disposal.
Tax exemption for profits arising from assets of fund
9 (1) Profits or losses arising from assets forming part of a special reserve fund shall be excluded for the purposes of income tax under the Income Tax Acts, and for the purposes of capital gains tax under the Gains Tax Acts.
(2) Where for any underwriting year income tax has been deducted from any profits arising from assets forming part of a special reserve fund, the fund manager may, at any time after the end of that year, claim repayment of that tax.
(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax consequences of payments into and out of fund
10 (1) In computing for the purposes of income tax the profits of a member’s underwriting business for any year of assessment, the aggregate amount of any payments which, in respect of the relevant underwriting year, are made into his special reserve fund under paragraph 3(1) above shall be deducted as an expense.
(2) In computing for the purposes of income tax the profits of a member’s underwriting business for any year of assessment—
(a) the aggregate amount of any payments which, in respect of the relevant underwriting year, are made out of his special reserve fund under paragraph 4(1) or 5(1) above shall be treated as a trading receipt; and
(b) the aggregate amount of any payments which, in respect of that year, are made into that fund under paragraph 4(2) or (3) or 5(4) above shall be deducted as an expense.
(3) In computing for the purposes of income tax the profits of a member’s underwriting business for any year of assessment, the aggregate amount of any payments which, as a result of the repayment of stop-loss payments in the relevant underwriting year, are made out of his special reserve fund under paragraph 4(6) or 5(7) above shall be treated as a trading receipt.
(4) In computing for the purposes of income tax the profits of a member’s underwriting business for any year of assessment, the aggregate amount of any payments which, in respect of the relevant underwriting year’s closing year, are made out of his special reserve fund under paragraph 6(2) above (including where they are also made under paragraph 7(1) above)shall be treated as a trading receipt.
(5) In this paragraph “the relevant underwriting year”, in relation to a year of assessment, means the underwriting year next but two before its corresponding underwriting year.
Tax consequences of cessation
11 (1) This paragraph applies where a member ceases to carry on his underwriting business,whether by reason of death or otherwise.
(2) In computing for the purposes of income tax the profits of the member’s underwriting business for the relevant year of assessment, any payment under paragraph 7(1) above (except where they are also made under paragraph 6(2) above)which is made to him or his personal representatives or assigns out of his special reserve fund shall be treated—
(a) subject to sub-paragraph (2A) below, as made immediately after the end of the relevant underwriting year; and
(b) as being a single trading receipt of an amount equal to that mentioned in sub-paragraph (3) below.
(2A) Where the member ceases to carry on his underwriting business by reason of his death, any payment falling within sub-paragraph (2) above shall be treated, for the purposes of sections 59C and 86 of the Management Act , as if made immediately after the commencement of his final year of assessment.
(3) The amount referred to in sub-paragraph (2) above is the value of the fund, as determined under paragraph 6(1) above for the penultimate underwriting year and—
(a) as reduced by the aggregate amount of any payments under paragraph 4(1) or (6) or 5(1) or (7) above made after the end of that year;
(b) as increased by the aggregate amount of any payments under paragraph 3(1),4(2) or (3) or 5(4) above so made; . . .
(c) as increased by the amount of any tax repayment . . . under paragraph 9(2) . . . above after the end of that year.
(d) as increased by an amount equal to any profits, and reduced by an amount equal to any losses, arising to the trustees from assets after the end of that year (excluding any gains or losses on assets whose transfer is treated as an acquisition by sub-paragraph (4)(a) or (b) below); and
(e) as increased by the aggregate amount of any payments made—
(i) by the trustees to the member or his personal representatives or assigns,
(ii) out of his special reserve fund under paragraph 7(1) above (except where they are also made under paragraph 6(2) above), or otherwise than out of his special reserve fund, and
(iii) before the end of that year,
and for this purpose the amount of any payment which is made by way of the transfer of an asset shall be taken to be the market value of the asset at the date of the transfer and “market value” shall be construed in accordance with section 272 of the Taxation of Chargeable Gains Act 1992 .
(4) Where an asset is transferred to the member or his personal representatives or assigns under paragraph 7(1) above or otherwise than out of his special reserve fund, the transfer shall be treated, for the purposes of the Gains Tax Acts —
in a case where the asset was held by the trustees at the end of the penultimate underwriting year, as an acquisition of the asset by the member or his personal representatives or assigns at the end of that year for a consideration equal to its market value at that time;
in a case where the asset was acquired by the trustees after the end of the penultimate underwriting year, as an acquisition of the asset by the member or his personal representatives or assigns, at the date on which, and for the consideration for which, the asset was acquired by the trustees; and
in a case where the asset was both acquired by the trustees and transferred by them to the member or his personal representatives or assigns before the end of the penultimate underwriting year, as an acquisition of the asset by the member or his personal representatives or assigns at the date of the transfer and for a consideration equal to its market value at that time.
(5) In this paragraph, subject to the provisions of any regulations made by the Board—
“the penultimate underwriting year” means the underwriting year corresponding to the year of assessment immediately preceding the member’s final year of assessment;
“the relevant underwriting year” means—
where a member dies before the occurrence of any of the events specified in sub–paragraph (6) below, the underwriting year immediately preceding that corresponding to the relevant year of assessment; and
in any other case, the underwriting year corresponding to the year of assessment immediately preceding the member’s final year of assessment.
“the relevant year of assessment” means—
where a member dies before the occurrence of any of the events specified in sub-paragraph (6) below, the year of assessment at the end of which he is treated, by virtue of section 179A(2) of this Act , as having died;
in any other case, his final year of assessment.
(6) For the purposes of the definitions of “the relevant underwriting year” and “the relevant year of assessment” in sub–paragraph (5) above the events specified before the occurrence of which a member dies are the following—
(a) the member’s deposit at Lloyd’s is paid over to him or his assigns, or to a person other than the member or his assigns;
(b) the member or another person is released from any arrangement entered into by the member or that person in order to satisfy the requirement on the part of the member to provide a deposit at Lloyd’s;
(c) the last open year of account of any syndicate of which he was a member is closed.
(7) For the purposes of sub–paragraph (6)(c) above, the last open year of account of any syndicate of which a person was a member shall be regarded as having closed either—
(a) when the member is treated under the rules or practice of Lloyd’s as having been discharged of all his liabilities in relation to that syndicate, whether by the syndicate closing its accounts or by the member or his personal representatives or assigns entering into a quota share contract, or
(b) in a case where the member entered, or his personal representatives or assigns have entered, into a quota share contract before the end of the closing year of the syndicate, at the end of the underwriting year in which the contract was made.
Part II Winding up of old-style funds
Preliminary
12 (1) In this Part of this Schedule—
“new-style fund” means a special reserve fund set up under the arrangements mentioned in section 175(1) of this Act;
“old-style fund” means a special reserve fund set up under the arrangements mentioned in section 452(1) of the Taxes Act 1988;
“the relevant period”, in relation to an old-style fund, means the period of three months beginning with the closing date.
(2) For the purposes of sub-paragraph (1) above, the closing date for an old-style fund shall be the earliest date on which each of the following has occurred as respects the year 1991-92 and earlier years of assessments, namely—
(a) the time for making any payments into the fund under section 452(5) of the Taxes Act 1988 has expired, or the member has given notice to the inspector that he will not be making any (or any further) such payments; and
(b) any payments required by section 453(1) of that Act to be made out of the fund have been so made.
Winding up of old-style funds
13 (1) A member may, at any time before the end of the relevant period, direct that so much of the capital of any old-style fund of his as represents sums paid into it under section 452(5) of the Taxes Act 1988 shall be transferred, at the end of that period, into his new-style fund; . . .
(2) Where an amount of capital is transferred into a member’s new-style fund under sub-paragraph (1) above, there shall be paid into that fund by the Board an amount equal to the amount of tax which, if the amount transferred were a net amount corresponding to a gross amount from which income tax had been duly deducted at the basic rate for the year 1992-93, would have been so deducted.
(3) If a member does not give a direction under sub-paragraph (1) above in relation to any old-style fund of his, so much of the capital of that fund as represents sums paid into it under section 452(5) of the Taxes Act 1988 shall be paid over, at the end of the relevant period, to the member or his personal representatives or assigns.
(4) In either event, the remaining capital of any old-style fund of a member shall be paid over, at the end of the relevant period, to the member or his personal representatives or assigns.
(5) For the purposes of sub-paragraphs (1) and (3) above, any payments made out of an old-style fund under section 453(1) of the Taxes Act 1988 shall be treated as having been met, so far as possible, out of payments made into the fund under section 452(5) of that Act.
(6) A transfer or payment under this paragraph of an amount of capital shall be in money or in assets forming part of the fund or both, as the member may direct.
Tax consequences of winding up
14 (1) Where an asset is transferred into a member’s new-style fund under paragraph 13(1) above, the transfer shall be treated, for the purposes of the Gains Tax Acts, to be a disposal of the asset by the member for a consideration equal to its market value.
(2) Sub-paragraph (3) below applies where an amount is paid over to the member or his personal representatives or assigns under paragraph 13(3) above.
(3) In computing for the purposes of income tax the profits of the member’s underwriting business for the year 1992-93, it shall be assumed—
(a) that the amount paid were a net amount corresponding to a gross amount from which income tax had been duly deducted at the basic rate for that year; and
(b) that the corresponding gross amount were a trading receipt for that year.
SCHEDULE 20A Lloyd’s underwriters: conversion to underwriting through partnership or company
Section 179B
Part 1 Conversion to underwriting through successor companies
Introduction
1 (1) This Part of this Schedule applies if the following conditions are satisfied.
(2) Condition 1 is that—
(a) a member gives notice of his resignation from membership of Lloyd’s in accordance with the rules or practice of Lloyd's,
(b) in accordance with such rules or practice, the member does not undertake any new insurance business at Lloyd’s after the end of the member’s last underwriting year, and
(c) the member does not withdraw that notice.
(3) Condition 2 is that all of the member’s outstanding syndicate capacity is disposed of by the member under a conversion arrangement to a successor company (“the syndicate capacity disposal”) with effect from the beginning of the underwriting year next following the member’s last underwriting year.
(4) Condition 3 is that, immediately before the syndicate capacity disposal,—
(a) the member controls the successor company, and
(b) more than 50% of the ordinary share capital of the successor company is beneficially owned by the member.
(5) Condition 4 is that the syndicate capacity disposal is made in consideration solely of the issue to the member of shares in the successor company.
(6) Condition 5 is that the successor company starts to carry on its underwriting business in the underwriting year ... next following the member’s last underwriting year.
(7) In this paragraph “the member’s last underwriting year”, in relation to a member who gives notice of his resignation from membership of Lloyd's, means the underwriting year during which, or at the end of which, he ceases to be an underwriting member and becomes a non-underwriting member in accordance with the rules or practice of Lloyd's.
(8) In this paragraph “outstanding syndicate capacity”, in relation to a member, means the syndicate capacity of the member other than any which—
(a) the member disposes of to a person other than a successor member at or before the end of the member’s last underwriting year, or
(b) ceases to exist with effect from the end of that year.
Income tax: carry forward of loss relief following conversion
2 (1) This paragraph applies if—
(a) the member’s total income for a year of assessment includes any income derived by the member from the successor company (whether by way of dividends on the shares issued to the member or otherwise), and
(b) throughout the period beginning with the time of the syndicate capacity disposal and ending with the end of that year of assessment,—
(i) the member controls the successor company, and
(ii) more than 50% of the ordinary share capital of the successor company is beneficially owned by the member.
(2) Section 83 of ITA 2007 shall apply as if the income so derived were profits on which the member was assessed under Part 2 of the Income Tax (Trading and Other Income) Act 2005 in respect of the member’s underwriting business for that year.
(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Capital gains tax: roll-over relief on disposal of syndicate capacity
3 (1) This paragraph applies if—
(a) the aggregate of any chargeable gains accruing to the member on the syndicate capacity disposal exceeds the aggregate of any allowable losses accruing to him on that disposal, and
(b) the member makes a claim under this paragraph to an officer of the Board.
(2) The amount of the excess mentioned in sub-paragraph (1)(a) above (“the amount of the syndicate capacity gain”) shall for the purposes of capital gains tax be reduced by the amount of the rolled-over gain.
(3) For the purpose of computing any chargeable gain accruing to the member on a disposal by him of any issued share or any asset directly or indirectly derived from any issued share—
(a) the amount of the rolled-over gain shall be apportioned between the issued shares as a whole, and
(b) the sums allowable as a deduction under section 38(1)(a) of the Gains Tax Act shall be reduced by the amount apportioned to the issued share under paragraph (a) above; but, in the case of a derived asset, the reduction shall be by an appropriate proportion of that amount;
and if the issued shares are not all of the same class, the apportionment between the shares under paragraph (a) above shall be in accordance with their market values at the time they were acquired by the member.
(4) In this paragraph “the amount of the rolled-over gain” means the lesser of—
(a) the amount of the syndicate capacity gain, and
(b) the aggregate amount of any sums which would be allowable as a deduction under section 38(1)(a) of the Gains Tax Act if the issued shares were disposed of as a whole by the member in circumstances giving rise to a chargeable gain.
(5) In this paragraph the “issued shares” means the shares in the successor company issued to the member in consideration for the syndicate capacity disposal.
Capital gains tax: roll-over relief on disposal of assets of ancillary trust fund
4 (1) This paragraph applies if—
(a) at the time of, or after, the syndicate capacity disposal, assets forming some or all of the member’s ancillary trust fund are—
(i) withdrawn from the fund, and
(ii) without unreasonable delay, disposed of by him to the successor company (the “ATF disposal”),
(b) the aggregate of any chargeable gains accruing to the member on the ATF disposal exceeds the aggregate of any allowable losses accruing to him on that disposal,
(c) throughout the period beginning with the time of the syndicate capacity disposal and ending with the time of the ATF disposal,—
(i) the member controls the successor company, and
(ii) more than 50% of the ordinary share capital of the successor company is beneficially owned by the member,
(d) the ATF disposal is made in consideration solely of the issue to the member of shares (the “issued shares”) in the successor company, and
(e) the member makes a claim under this paragraph to an officer of the Board.
(2) But this paragraph does not apply if—
(a) the member could have made a claim under paragraph 3 above, and
(b) at the time the member makes a claim under this paragraph, no claim under paragraph 3 above is or has been made by him.
(3) The amount of the excess mentioned in sub-paragraph (1)(b) above (“the amount of the ATF assets gain”) shall for the purposes of capital gains tax be reduced by the amount of the rolled-over gain.
(4) For the purpose of computing any chargeable gain accruing to the member on a disposal by him of any issued share or any asset directly or indirectly derived from any issued share—
(a) the amount of the rolled-over gain shall be apportioned between the issued shares as a whole, and
(b) the sums allowable as a deduction under section 38(1)(a) of the Gains Tax Act shall be reduced by the amount apportioned to the issued share under paragraph (a) above; but, in the case of a derived asset, the reduction shall be by an appropriate proportion of that amount;
and if the issued shares are not all of the same class, the apportionment between the shares under paragraph (a) above shall be in accordance with their market values at the time they were acquired by the member.
(5) In this paragraph “the amount of the rolled-over gain” means the lesser of—
(a) subject to sub-paragraph (6) below, the amount of the ATF assets gain, and
(b) the aggregate amount of any sums which would be allowable as a deduction under section 38(1)(a) of the Gains Tax Act if the issued shares were disposed of as a whole by the member in circumstances giving rise to a chargeable gain.
(6) If the market value, immediately before the ATF disposal, of the assets disposed of under that disposal exceeds 120% of the amount of the ATF assets required, the amount of the ATF assets gain shall for the purposes of sub-paragraph (5)(a) above be reduced by multiplying it by—
RT
where—
R is the amount of the ATF assets required, and
T is the market value, immediately before the ATF disposal, of the assets disposed of under that disposal.
(7) In sub-paragraph (6) above “the amount of the ATF assets required” means the appropriate percentage of the amount of security required to be provided by the successor company in respect of its underwriting business in the underwriting year in which the ATF disposal is made.
(7A) In sub-paragraph (7) above “the appropriate percentage” means the percentage that equates to the percentage of the ordinary share capital of the successor company that is beneficially owned by the member immediately before the ATF disposal.
(8) This paragraph applies only on the first occasion on or after 6th April 2004 on which the member makes an ATF disposal.
(9) If a claim made by the member under paragraph 3 above is revoked, this paragraph shall apply as if the claim had never been made.
Interpretation of this Part of this Schedule
5 (1) In this Part of this Schedule—
“control” shall be construed in accordance with sections 450 and 451 of the Corporation Tax Act 2010;
“ordinary share capital” has the meaning given by section 989 of ITA 2007;
“successor company” means a corporate member (within the meaning of Chapter 5 of Part 4 of the Finance Act 1994) which is a successor member;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
“the syndicate capacity disposal” has the meaning given by paragraph 1(3) above;
“underwriting business”, in relation to a successor company, has the same meaning as in Chapter 5 of Part 4 of the Finance Act 1994.
(2) For the purposes of this Part of this Schedule, shares comprised in any letter of allotment or similar instrument shall be treated as issued unless—
(a) the right to the shares conferred by it remains provisional until accepted, and
(b) there has been no acceptance.
(3) Paragraphs 3 and 4 above (and paragraph 1 above so far as relating to those paragraphs) are to be construed as one with the Gains Tax Act.
PART1A CONVERSION OF PARTNERSHIPS TO UNDERWRITING THROUGH SUCCESSOR COMPANIES
Introduction
5A. (1) This Part of this Schedule applies if the following conditions are satisfied.
(2) Condition 1 is that—
(a) a Lloyd’s partnership gives notice of its resignation from membership of Lloyd’s in accordance with the rules or practice of Lloyd’s,
(b) in accordance with the rules or practice, the partnership does not undertake any new insurance business at Lloyd’s after the end of the partnership’s last underwriting year, and
(c) the partnership does not withdraw that notice.
(3) Condition 2 is that all of the partnership’s outstanding syndicate capacity is disposed of by the partnership under a conversion arrangement to a successor company (the “syndicate capacity disposal”) with effect from the beginning of the underwriting year next following the partnership’s last underwriting year.
(4) Condition 3 is that, immediately before the syndicate capacity disposal,—
(a) the converting partners together control the successor company, and
(b) the ordinary share capital of the successor company is beneficially owned by the converting partners in the same, or as nearly as may be the same, proportions as those in which pursuant to the partnership agreement the converting partners are at that time treated as having interests in the partnership’s syndicate capacity.
(5) For the purposes of sub-paragraph (4)(b), ignore any interest of a person other than a converting partner in the partnership’s syndicate capacity.
(6) Condition 4 is that the syndicate capacity disposal is made in consideration solely of the issue to the converting partners of shares in the successor company.
(7) Condition 5 is that the successor company starts to carry on its underwriting business in the underwriting year ... next following the partnership’s last underwriting year.
(8) In this paragraph “the partnership’s last underwriting year”, in relation to a partnership which gives notice of its resignation from Lloyd’s, means the underwriting year during which, or at the end of which, the partnership ceases to be an underwriting member and becomes a non-underwriting member in accordance with the rules or practice of Lloyd’s.
(9) In this paragraph “outstanding syndicate capacity”, in relation to a partnership, means the syndicate capacity of the partnership other than any which—
(a) the partnership disposes of to a person other than a successor member at or before the end of the partnership’s last underwriting year, or
(b) ceases to exist with effect from the end of that year.
Capital gains tax: roll-over relief on disposal of syndicate capacity
5B. (1) This paragraph applies if—
(a) the aggregate of any chargeable gains accruing to a converting partner on the syndicate capacity disposal exceeds the aggregate of any allowable losses accruing to the partner on that disposal, and
(b) the partner makes a claim under this paragraph to an officer of Revenue and Customs.
(2) The amount of the excess mentioned in sub-paragraph (1)(a) above (“the amount of the syndicate capacity gain”) shall for the purposes of capital gains tax be reduced by the amount of the rolled-over gain.
(3) For the purpose of computing any chargeable gain accruing to the partner on a disposal by the partner of any issued share or any asset directly or indirectly derived from any issued share—
(a) the amount of the rolled-over gain shall be apportioned between the issued shares as a whole, and
(b) the sums allowable as a deduction under section 38(1)(a) of the Gains Tax Act shall be reduced by the amount apportioned to the issued share under paragraph (a) above; but, in the case of a derived asset, the reduction shall be by an appropriate proportion of that amount;
and if the issued shares are not all of the same class, the apportionment between the shares under paragraph (a) above shall be in accordance with their market values at the time they were acquired by the partner.
(4) In this paragraph “the amount of the rolled-over gain” means the lesser of—
(a) the amount of the syndicate capacity gain, and
(b) the aggregate of any sums which would be allowable as a deduction under section 38(1)(a) of the Gains Tax Act if the issued shares were disposed of as a whole by the partner in circumstances giving rise to a chargeable gain.
(5) In this paragraph the “issued shares” means the shares in the successor company issued to the partner in consideration for the syndicate capacity disposal.
Capital gains tax: roll-over relief on disposal of assets of ancillary trust fund
5C. (1) This paragraph applies if—
(a) at the time of, or after, the syndicate capacity disposal, assets forming some or all of the ancillary trust fund of the Lloyd’s partnership or of a converting partner are—
(i) withdrawn from the fund, and
(ii) without unreasonable delay, disposed of by the partnership or partner to the successor company (the “ATF disposal”),
(b) the aggregate of any chargeable gains accruing to a converting partner (the “relevant partner”) on the ATF disposal exceeds the aggregate of any allowable losses available to the relevant partner on that disposal,
(c) throughout the period beginning with the time of the syndicate capacity disposal and ending with the time of the ATF disposal—
(i) the converting partners together control the successor company, and
(ii) the proportion of the successor company’s ordinary share capital beneficially owned by the relevant partner is more than 50% of the proportion of that share capital that was beneficially owned by the relevant partner at the time of the syndicate capacity disposal,
(d) the consideration received by the relevant partner on the ATF disposal consists solely of the issue to the relevant partner of shares (the “issued shares”) in the successor company, and
(e) the relevant partner makes a claim under this paragraph to an officer of Revenue and Customs.
(2) But this paragraph does not apply if—
(a) the relevant partner could have made a claim under paragraph 5B above, and
(b) at the time the relevant partner makes a claim under this paragraph, no claim under paragraph 5B above is or has been made by the relevant partner.
(3) The amount of the excess mentioned in sub-paragraph (1)(b) above (“the amount of the ATF assets gain”) shall for the purposes of capital gains tax be reduced by the amount of the rolled-over gain.
(4) For the purpose of computing any chargeable gain accruing to the relevant partner on a disposal by the relevant partner of any issued share or any asset directly or indirectly derived from any issued share—
(a) the amount of the rolled-over gain shall be apportioned between the issued shares as a whole, and
(b) the sums allowable as a deduction under section 38(1)(a) of the Gains Tax Act are reduced by the amount apportioned to the issued share under paragraph (a) above; but, in the case of a derived asset, the reduction shall be by an appropriate proportion of that amount;
and if the issued shares are not all of the same class, the apportionment between the shares under paragraph (a) above shall be in accordance with their market values at the time they were acquired by the relevant partner.
(5) In this paragraph “the amount of the rolled-over gain” means the lesser of—
(a) subject to sub-paragraph (6), the amount of the ATF assets gain, and
(b) the aggregate amount of any sums which would be allowable as a deduction under section 38(1)(a) of the Gains Tax Act if the issued shares were disposed of as a whole by the relevant partner in circumstances giving rise to a chargeable gain.
(6) If the market value, immediately before the ATF disposal, of the assets disposed of under that disposal exceeds 120% of the amount of the ATF assets required, the amount of the ATF assets gain shall for the purposes of sub-paragraph (5)(a) be reduced by multiplying it by—
RT
where—
R is the amount of the ATF assets required, and
T is the market value, immediately before the ATF disposal, of the assets disposed of under that disposal.
(7) In sub-paragraph (6) above “the amount of the ATF assets required” means the appropriate percentage of the amount of security required to be provided by the successor company in respect of its underwriting business in the underwriting year in which the ATF disposal is made.
(7A) In sub-paragraph (7) above “the appropriate percentage” means the percentage that equates to the percentage of the ordinary share capital of the successor company that is beneficially owned by the relevant partner immediately before the ATF disposal.
(8) This paragraph applies—
(a) in relation to assets forming some or all of the Lloyd’s partnership’s ancillary trust fund, only on the first occasion on or after 19th December 2014 on which the partnership makes an ATF disposal, and
(b) in relation to assets forming some or all of a converting partner’s ancillary trust fund, only on the first occasion on or after 19th December 2014 on which the partner makes an ATF disposal.
(9) If a claim made under paragraph 5B is revoked, this paragraph applies as if the claim had never been made.
Interpretation of this Part of this Schedule
5D. (1) In this Part of this Schedule—
“ancillary trust fund”—
in relation to a Lloyd’s partnership, does not include a premium trust fund but, subject to that, means any trust fund required or authorised by the rules of Lloyd’s, or required by a member’s agent, and
in relation to a converting partner, means any trust fund required or authorised by the rules of Lloyd’s in connection with being a partner in, or member of, the partnership, or required by a member’s agent in that connection;
“control” is to be construed in accordance with sections 450 and 451 of the Corporation Tax Act 2010;
“converting partner”, in relation to a syndicate capacity disposal by a Lloyd’s partnership,—
means any person who, immediately before the disposal, is a partner in, or member of, the partnership and pursuant to the partnership agreement is treated at that time as having an interest in the partnership’s syndicate capacity, but
does not include any partner or member whose resignation from the partnership takes effect on the day of the disposal;
“ordinary share capital” has the meaning given by section 989 of ITA 2007;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
“successor company” means a corporate member (within the meaning of Chapter 5 of Part 4 of the Finance Act 1994) which is a successor member;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
“syndicate capacity disposal” has the meaning given by paragraph 5A(3);
“underwriting business”—
in relation to a Lloyd’s partnership, means the partnership’s underwriting business as a member of Lloyd’s, and
in relation to a successor company, has the same meaning as in Chapter 5 of Part 4 of the Finance Act 1994.
(2) For the purposes of this Part of this Schedule, shares comprised in any letter of allotment or similar instrument shall be treated as issued unless—
(a) the right to the shares conferred by it remains provisional until accepted, and
(b) there has been no acceptance.
(3) Paragraphs 5B and 5C above (and paragraph 5A above so far as relating to those paragraphs) are to be construed as one with the Gains Tax Act.
Part 2 Conversion to underwriting through successor partnerships
Introduction
6 (1) This Part of this Schedule applies if the following conditions are satisfied.
(2) Condition 1 is that—
(a) a member gives notice of his resignation from membership of Lloyd’s in accordance with the rules or practice of Lloyd's,
(b) in accordance with such rules or practice, the member does not undertake any new insurance business at Lloyd’s after the end of the member’s last underwriting year, and
(c) the member does not withdraw that notice.
(3) Condition 2 is that all of the member’s outstanding syndicate capacity is disposed of by the member under a conversion arrangement to a successor partnership (“the syndicate capacity disposal”) with effect from the beginning of the underwriting year next following the member’s last underwriting year.
(4) Condition 3 is that the member is the only person who disposes of syndicate capacity under a conversion arrangement to the successor partnership.
(5) Condition 4 is that the successor partnership starts to carry on its underwriting business in the underwriting year next following the member’s last underwriting year.
(6) In this paragraph “the member’s last underwriting year”, in relation to a member who gives notice of his resignation from membership of Lloyd's, means the underwriting year during which, or at the end of which, he ceases to be an underwriting member and becomes a non-underwriting member in accordance with the rules or practice of Lloyd's.
(7) In this paragraph “outstanding syndicate capacity”, in relation to a member, means the syndicate capacity of the member other than any which—
(a) the member disposes of to a person other than a successor member at or before the end of the member’s last underwriting year, or
(b) ceases to exist with effect from the end of that year.
Income tax: carry forward of loss relief following conversion
7 (1) This paragraph applies if—
(a) the member’s total income for a year of assessment includes profits of the successor partnership’s underwriting business, and
(b) throughout the period beginning with the time of the syndicate capacity disposal and ending with the end of that year of assessment, the member is beneficially entitled to more than 50% of the profits of that business.
(2) Section 83 of ITA 2007 (carry-forward of trading losses against subsequent profits) shall have effect, in its application in relation to the losses of the old underwriting business, as if the profits of the successor partnership’s underwriting business to which the member is beneficially entitled for that year were profits on which the member was assessed under Part 2 of the Income Tax (Trading and Other Income) Act 2005 in respect of the old underwriting business for that year.
(3) In sub-paragraph (2) above “the old underwriting business” means the member’s underwriting business carried on otherwise than through the successor partnership.
Interpretation of this Part of this Schedule
8 In this Part of this Schedule—
“ successor partnership” means—
a limited partnership formed under the law of Scotland which is a successor member, or
a limited liability partnership formed under the law of any part of the United Kingdom which is a successor member.
“the syndicate capacity disposal” has the meaning given by paragraph 6(3) above.
Part 3 Supplementary provisions
Withdrawal of resignation notice
9 (1) This paragraph applies if a member—
(a) makes a claim for relief under or by virtue of Part 1 or 2 of this Schedule, and
(b) subsequently withdraws the notice of his resignation from membership of Lloyd's.
(2) The member must give written notice of such withdrawal to an officer of the Board.
(3) Such a notice must be given no later than six months from the date of the withdrawal of the notice of resignation.
(4) All such adjustments shall be made, whether by discharge or repayment of tax, the making of assessments or otherwise, as are required as a result of the withdrawal of the notice of resignation (notwithstanding any limitation on the time within which any adjustment may be made).
(5) If a member fails, fraudulently or negligently, to comply with sub-paragraphs (2) and (3) above, section 95 of the Taxes Management Act 1970 shall apply to him as if he had fraudulently or negligently made an incorrect return, statement or declaration in connection with the claim for relief made by him under or by virtue of this Schedule.
(6) In this paragraph “tax” means income tax, capital gains tax or inheritance tax.
9A. (1) This paragraph applies if—
(a) a person makes a claim for relief under or by virtue of Part 1A of this Schedule, and
(b) the Lloyd’s partnership in respect of which the claim is made withdraws the notice of its resignation from Lloyd’s.
(2) The person must give written notice of such withdrawal to an officer of Revenue and Customs.
(3) Such a notice must be given no later than 6 months from the date on which the person first became aware of the withdrawal of the notice of resignation.
(4) Unless the person proves otherwise, it shall be assumed that the person became aware of the withdrawal of the notice on the day on which it was withdrawn.
(5) All such adjustments shall be made, whether by discharge or repayment of tax, the making of assessments or otherwise, as are required as a result of the withdrawal of the notice of resignation (notwithstanding any limitation on the time within which any adjustment may be made).
(6) If a person fails, carelessly or deliberately, to comply with sub-paragraph (2) or (3) above, Schedule 24 to the Finance Act 2007 shall apply as if—
(a) the person had given HMRC a document of a kind listed in the Table in paragraph 1 of that Schedule, and
(b) the document contained an inaccuracy which was careless or deliberate on the person’s part and amounted to an understatement of a liability to tax equivalent to the amount of the adjustments required by sub-paragraph (5) to be made.
(7) In this paragraph “tax” means income tax, capital gains tax or inheritance tax.
Interpretation of this Schedule
10 In this Schedule—
“conversion arrangement” means a conversion arrangement made under the rules or practice of Lloyd's;
“successor member” has the meaning given by the rules or practice of Lloyd's;
“syndicate capacity”, in relation to a member or Lloyd’s partnership, means an asset comprising the rights of the member or partnership under a syndicate in which the member or partnership participates.
Application of this Schedule
11 (1) Paragraphs 2 and 3 above (and the other provisions of this Schedule so far as relating to those paragraphs) have effect in relation to syndicate capacity disposals (within the meaning of Part 1 of this Schedule) made on or after 6th April 2004.
(2) Paragraph 4 above (and the other provisions of this Schedule so far as relating to that paragraph) have effect in relation to ATF disposals (within the meaning of that paragraph) made on or after 6th April 2004 (even if the syndicate capacity disposal mentioned in that paragraph was made before that date).
(2A) Paragraph 5B above (and the other provisions of this Schedule so far as relating to that paragraph) have effect in relation to syndicate capacity disposals (within the meaning of Part 1A of this Schedule) made on or after 19th December 2014.
(2B) Paragraph 5C above (and the other provisions of this Schedule so far as relating to that paragraph) have effect in relation to ATF disposals (within the meaning of that paragraph) made on or after 19th December 2014 (even if the syndicate capacity disposal was made before that date).
(3) Paragraph 7 above (and the other provisions of this Schedule so far as relating to that paragraph) have effect in relation to syndicate capacity disposals (within the meaning of Part 2 of this Schedule) made on or after 6th April 2004.
SCHEDULE 20B PRT: elections for oil fields to become non-taxable
Election by responsible person
1 (1) The responsible person for a taxable field may make an election that the field is to be non-taxable.
(2) An election is irrevocable.
(3) The responsible person may not make an election unless each person who is a participator at the time the election is made agrees to the election being made.
(4) If the responsible person makes an election, the Commissioners may assume that each participator agrees to the election being made (unless it appears to the Commissioners that a participator does not agree).
Method of election
2 An election must be made in writing.
3 An election must be notified to the Commissioners.
4 An election is deemed to have been made on the date on which notification of the election was sent to the Commissioners.
Effect of election
5 If an election is made, the field ceases to be taxable with effect from the start of the first chargeable period to begin after the election is made.
No unrelievable field losses from field
6 From the start of the first chargeable period to begin after an election is made, no allowable loss that accrues from the oil field is an allowable unrelievable field loss for the purposes of petroleum revenue tax.
Interpretation
7 (1) In this Schedule—
“Commissioners” means the Commissioners for Her Majesty‘s Revenue and Customs;
“participator”, in relation to a particular time, means a person who is a participator in the chargeable period which includes that time.
(2) Expressions used in this Schedule and in Part 1 of the Oil Taxation Act 1975 have the same meaning in this Schedule as in Part 1 of that Act.
Section 210.
Introduction
1 The Government Trading Funds Act 1973 shall be amended as follows.
Reserves
2 (1) The following section shall be inserted after section 2—
Initial reserves.
2AA (1) An order providing for any assets and liabilities to be appropriated as assets and liabilities of a trading fund may make—
(a) provision for any part of the amount by which the values of the assets exceed the amounts of the liabilities to be treated as reserves in the accounts of the trading fund, and
(b) provision about the maintenance of such reserves.
(2) For the purposes of subsection (1) above “reserves” means reserves whether general, capital or otherwise; and an order may provide for different kinds of reserves.
(3) Nothing in subsection (1) above shall prejudice the operation of section 4(2) of this Act in relation to a trading fund; and nothing in section 4(2) of this Act shall prejudice the operation of subsection (1) above in relation to a trading fund.
(4) This section applies in relation to an order made after the day on which the Finance Act 1993 was passed.
(2) In section 2(3) (originating debt where fund established) in paragraph (b) after “capital” there shall be inserted “ or any amount treated by virtue of the order as reserves or (where the order provides for both public dividend capital and reserves) the aggregate of those amounts ”.
(3) In section 2(4) (addition to originating debt where additional assets and liabilities appropriated to fund) in paragraph (b) after “capital” there shall be inserted “ for any amount treated by virtue of the order as reserves or (where the order provides for both public dividend capital and reserves) the aggregate of those amounts ”.
Public dividend capital etc.
3 In section 2A (public dividend capital) the following subsection shall be inserted after subsection (2) (limited power of Minister to issue public dividend capital to fund)—
(2A) If the responsible Minister considers it appropriate to do so, he may with Treasury concurrence issue out of money provided by Parliament an amount to the fund as public dividend capital; and this subsection shall have effect instead of subsection (2) above after the day on which the Finance Act 1993 was passed.
Maximum borrowing etc.
4 (1) The following section shall be inserted after section 2B—
Maximum borrowing etc.
2C (1) Where an order made after the day on which the Finance Act 1993 was passed establishes a trading fund, the order shall provide that the aggregate of the following shall not exceed the maximum specified in the order—
(a) the total outstanding at any given time in respect of amounts issued to the fund under section 2B of this Act (other than as originating debt), and
(b) the total at that time constituting public dividend capital issued to the fund under section 2A(2A) of this Act;
and that maximum (or that maximum as varied by a subsequent order) shall be observed accordingly.
(2) Where an order made on or before the day on which the Finance Act 1993 was passed establishes a trading fund, and the order specifies the maximum amount that may be issued to the fund under section 2B of this Act, the order shall be taken to provide that the aggregate of the following shall not exceed that maximum—
(a) the total outstanding at any given time in respect of amounts issued to the fund under section 2B of this Act (other than as originating debt), and
(b) the total at that time constituting public dividend capital issued to the fund under section 2A(2A) of this Act;
and that maximum (or that maximum as varied by a subsequent order) shall be observed accordingly.
(3) The sum of the maxima in force in respect of all trading funds at any time shall not exceed £2,000 million.
(4) The Treasury may by order made by statutory instrument increase or further increase the limit in subsection (3) above by any amount, not exceeding £1,000 million, specified in the order but not so as to make the limit exceed £4,000 million.
(5) No order under subsection (4) above shall be made unless a draft of a statutory instrument containing it has been laid before the House of Commons and approved by a resolution of that House.
(2) In section 2B (borrowing by funds) subsections (6) to (9) (which are superseded by the new section 2C) shall be omitted.
Section 213.
Part I Excise duties
(1) Beer duty
Chapter | Short title | Extent of repeal
1979 c. 4. | The Alcoholic Liquor Duties Act 1979. | In section 42, in subsection (2) paragraph (a) and in paragraph (b) the words “or removal to the Isle of Man”, and in subsections (3) and (4) the word “remove,” in each place where it occurs. Section 43. Section 45(1)(b). Section 51.
1979 c. 58. | The Isle of Man Act 1979. | In Schedule 1, paragraph 30.
1991 c. 31. | The Finance Act 1991. | In Schedule 2, paragraph 10.
These repeals have effect in accordance with section 4 of this Act
(2) Blending of alcoholic liquors
Chapter | Short title | Extent of repeal
1979 c. 4. | The Alcoholic Liquor Duties Act 1979. | In section 55, paragraph (e) of subsection (5) and the word “and” immediately preceding that paragraph, and subsection (5A).
These repeals have effect in accordance with section 5 of this Act.
(3) Mixing of wine and spirits
Chapter | Short title | Extent of repeal
1979 c. 4. | The Alcoholic Liquor Duties Act 1979. | Section 58(2).
This repeal has effect in accordance with section 6 of this Act.
(4) Hydrocarbon oil duty: fuel substitutes
Chapter | Short title | Extent of repeal
1979 c. 5. | The Hydrocarbon Oil Duties Act 1979. | Section 4. Section 7. Section 16. Section 19(6). In section 20AA(1)(a), the words “petrol substitute, spirits used for making power methylated spirits”. Section 21(1)(b). In section 27(1), the definitions of “petrol substitute” and “power methylated spirits”. Part II of Schedule 3.
1979 c. 8. | The Excise Duties (Surcharges or Rebates) Act 1979. | In section 1(1)(a), the words “(other than power methylated spirits)”.
1986 c. 41. | The Finance Act 1986. | In paragraph 4 of Schedule 5, “13”.
The power in section 11(5) of this Act applies to these repeals as it applies to that section.
(5) Hydrocarbon oil duty: fuel measurement
Chapter | Short title | Extent of repeal
1979 c. 5. | The Hydrocarbon Oil Duties Act 1979. | Section 2(5). In section 15(1), the words “shown to the satisfaction of the Commissioners to have been”.
The power in section 12(8) of this Act applies to these repeals as it applies to that section.
(6) Vehicles excise duty
Chapter | Short title | Extent of repeal
1985 c. 54. | The Finance Act 1985. | In Schedule 2, paragraph 6.
1988 c. 39. | The Finance Act 1988. | Section 4(2).
1989 c. 26. | The Finance Act 1989. | Section 6(6).
1990 c. 29. | The Finance Act 1990. | Section 5(7).
1991 c. 31. | The Finance Act 1991. | Section 4(4).
1992 c. 20. | The Finance Act 1992. | Section 4(3) and (4).
These repeals have effect in relation to licences taken out after 16th March 1993.
(7) Repeals connected with lottery duty
Chapter | Short title | Extent of repeal
1979 c. 2. | The Customs and Excise Management Act 1979. | In section 1(1), in the definition of “the revenue trade provisions of the customs and excise Acts”, the word “and” at the end of paragraph (b) and, in the definition of “revenue trader”, the word “or” at the end of paragraph (a)(i).
1981 c. 63. | The Betting and Gaming Duties Act 1981. | Section 6(4).
1986 c. 41. | The Finance Act 1986. | In Schedule 4, paragraph 2(2).
These repeals come into force in accordance with section 41 of this Act.
Part II Value added tax
(1) Fuel and power
Chapter | Short title | Extent of repeal
1983 c. 55. | The Value Added Tax Act 1983. | In Schedule 5, Group 7.
This repeal comes into force in accordance with section 42 of this Act.
(2) Fuel scales
Chapter | Short title | Extent of repeal
1986 c. 41. | The Finance Act 1986. | In Schedule 6— (a) in paragraph 2(1) and (2), the words “Subject to paragraph 3 below,”, in each place where they occur; and (b) paragraph 3 and the Table B set out after that paragraph.
These repeals have effect in relation to any case where the prescribed accounting period begins after 5th April 1993.
(3) Acquisitions
Chapter | Short title | Extent of repeal
1983 c. 55. | The Value Added Tax Act 1983. | In section 5(9), in the words after paragraph (b), the words from “a supply of goods” to “below or there is”. Section 32B. In section 48(1), in the definition of “taxable person”, the words “(subject to section 32B(3) above)”.
1992 c. 48. | The Finance (No. 2) Act 1992. | In paragraph 6(2) of Schedule 3, paragraph (b) and the word “and” immediately preceding it.
These repeals come into force in accordance with section 44(4) of this Act.
(4) Penalties
Chapter | Short title | Extent of repeal
1985 c. 54. | The Finance Act 1985. | Section 13(4). Section 19(2)(b).
The repeal of section 13(4) of the Finance Act 1985 has effect in accordance with paragraph 3(3) of Schedule 2 to this Act and the repeal of section 19(2)(b) of that Act has effect in accordance with paragraph 5(3) of that Schedule.
(5) Repeals connected with abolition of car tax
Chapter | Short title | Extent of repeal
1983 c. 55. | The Value Added Tax Act 1983. | In Schedule 4, in paragraph 3A(1) the words “or with car tax” and the word “tax” in the second place where it occurs. In Schedule 4A, in paragraph 2(1) the words “or with car tax” and the word “tax” in the second place where it occurs. In Schedule 7, in paragraph 2(3B) the words “or of a chargeable vehicle within the meaning of the Car Tax Act 1983” and the words “or of such a vehicle”.
Part III Income tax, corporation tax and capital gains tax
(1) Temporary relief for interest payments
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | Section 354(5) and (6). Section 356D(9). Section 357(4). Section 371. In paragraph 10(1) and (2) of Schedule 7, the words “354(5) and (6)”, in each place.
These repeals come into force in accordance with section 57 of this Act.
(2) Charities
Chapter | Short title | Extent of repeal
1990 c. 29. | The Finance Act 1990. | Section 24.
1992 c. 48. | The Finance (No. 2) Act 1992. | Section 26.
1 The repeal of section 24 of the Finance Act 1990 has effect for the year 1993-94 and subsequent years of assessment.
(3) Car benefits
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | Section 157(4) and (5).
These repeals have effect for the year 1994-95 and subsequent years of assessment.
(4) Car fuel
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | In section 158(5), the words “or 3”.
This repeal has effect for the year 1993-94.
(5) Heavier commercial vehicles (consequential repeal)
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | In section 159A(8)(a), the word “but” at the end of sub-paragraph (i).
This repeal has effect for the year 1993-94 and subsequent years of assessment.
(6) Taxation of distributions
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | In section 233(1)(c), the words “as income which is not chargeable at the lower rate and”.
1992 c. 12. | The Taxation of Chargeable Gains Act 1992. | In section 5(2)(a), the words “(liability to income tax at the additional rate)”.
1992 c. 48. | The Finance (No. 2) Act 1992. | In section 19, in subsection (3), the words “233(2)” and, in subsection (4), the words “233(1)(c)”.
These repeals have effect for the year 1993-94 and subsequent years of assessment.
(7) Retirement relief etc.
Chapter | Short title | Extent of repeal
1992 c. 12. | The Taxation of Chargeable Gains Act 1992. | In paragraph 1 of Schedule 6, in sub-paragraph (2), the definitions of “family company”, “family” and “relative”, and sub-paragraphs (3) and (4).
These repeals come into force in accordance with section 87(2) of this Act.
(8) Insurance companies
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | Section 432A(10).
1992 c. 12. | The Taxation of Chargeable Gains Act 1992. | In section 212— (a) in subsection (2), the words from “and in relation to” onwards; (b) subsections (3), (4), (6) and (8). Section 213(9). Section 214(3) to (5).
The repeal of section 212(8) of the Taxation of Chargeable Gains Act 1992 has effect, in accordance with section 91(1) of this Act, in relation to the accounting periods mentioned in section 212(8), and the other repeals have effect in relation to accounting periods beginning on or after 1st January 1993.
(9) Overseas life insurance companies
Chapter | Short title | Extent of repeal
1970 c. 9. | The Taxes Management Act 1970. | In section 31(3), the word “445”.
1988 c. 1. | The Income and Corporation Taxes Act 1988. | In section 11(3), the words “Subject to section 447,”. Section 445. Section 446(1). Section 447(1), (2) and (4). Section 448. Section 449. Section 724(5) to (8). In section 811(2), paragraph (c) and the word “and” immediately preceding it. In Schedule 19AB, paragraph 1(9).
1991 c. 31. | The Finance Act 1991. | In Schedule 7, paragraph 7(1)(a), (2), (4) and (5).
These repeals have effect in accordance with section 103 of this Act.
(10) Indexation
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | Section 1(5). Section 257C(2).
1990 c. 29. | The Finance Act 1990. | Section 17(2).
These repeals have effect in accordance with section 107 of this Act.
(11) Pay and file
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | In section 343(3), the word “claim”, in the second place where it occurs. In section 395, in the words after paragraph (c) of subsection (1) and in subsection (4), the words “to claim relief”. In section 400(2)(a), the words “or, if a claim had been made under that subsection, would be”.
1991 c. 31. | The Finance Act 1991. | In Schedule 15, paragraphs 2 and 9.
The repeals in the Income and Corporation Taxes Act 1988 and the repeal of paragraph 9 of Schedule 15 to the Finance Act 1991 have effect in relation to accounting periods ending after the day appointed for the purposes of section 10 of the Income and Corporation Taxes Act 1988.
(12) Lloyd’s underwriters etc.
Chapter | Short title | Extent of repeal
1988 c. 1. | The Income and Corporation Taxes Act 1988. | Sections 450 to 457. Section 710(14). In section 711(8), the words “or section 725(9)” and the words “or straddling”, in both places where they occur. Section 720(3). In section 721, subsections (5) and (6). Section 725. In Schedule 4, paragraph 18. Schedule 19A.
1989 c. 26. | The Finance Act 1989. | In section 43, subsections (6) and (7). In section 92, subsections (4) to (7). In Schedule 11, paragraph 10.
1990 c. 29. | The Finance Act 1990. | In Schedule 10, paragraph 18.
1992 c. 12. | The Taxation of Chargeable Gains Act 1992. | Sections 206 to 209.
1993 c. 34. | The Finance Act 1993. | In section 183, subsections (4) to (8).
1 The repeal of section 450(6) of the Income and Corporation Taxes Act 1988 has effect in relation to acquisitions or disposals made, or treated as made, after 31st December 1993.
2 The following repeals, namely—
the repeals in sections 710, 711, 720 and 721 of and Schedule 4 to the Income and Corporation Taxes Act 1988 and the repeal of section 725 of that Act;
the repeal in Schedule 11 to the Finance Act 1989;
the repeal in Schedule 10 to the Finance Act 1990;
the repeals of sections 207 and 208 of the Taxation of Chargeable Gains Act 1992; and
the repeals of subsections (4) to (6) of section 183 of this Act,
have effect for the year 1994 and subsequent underwriting years.
3 The repeals in section 43 of the Finance Act 1989 have effect in relation to periods of account ending on or after 30th June 1993.
4 The following repeals, namely—
the repeals of subsections (2) to (5) of section 206 and subsections (1), (2) and (6) of section 209 of the Taxation of Chargeable Gains Act 1992; and
the repeals of subsections (7) and (8) of section 183 of this Act,
have effect for the year of assessment 1994-95 and subsequent years of assessment.
5 The other repeals have effect for the year 1992-93 and subsequent years of assessment.
Part IV Oil taxation
Chapter | Short title | Extent of repeal
1975 c. 22. | The Oil Taxation Act 1975. | In Schedule 2, in the Table in paragraph 1, in the modification relating to section 98 of the Taxes Management Act 1970, the words “or to paragraph 7 of this Schedule”; and paragraph 7.
Part V Inheritance tax
Chapter | Short title | Extent of repeal
1984 c. 51. | The Inheritance Tax Act 1984. | In section 267(4), the words “but without regard to any dwelling-house available in the United Kingdom for his use”.
This repeal has effect in accordance with section 208 of this Act.
Part VI Statutory effect of resolutions etc.
Chapter | Short title | Extent of repeal
1968 c. 2. | The Provisional Collection of Taxes Act 1968. | In section 1, in subsection (1) the words “car tax”.... In section 5(1), paragraph (c) and the word “or” immediately preceding it.
1988 c. 1. | The Income and Corporation Taxes Act 1988. | In section 8, subsections (4) to (6).
The repeals in the Provisional Collection of Taxes Act 1968 have effect in accordance with section 205 of this Act.
Part VII Trading funds
Chapter | Short title | Extent of repeal
1973 c. 63. | The Government Trading Funds Act 1973. | In section 2B, subsections (6) to (9).