Finance Act 2000

2000 c. 17

An Act to grant certain duties, to alter other duties, and to amend the law relating to the National Debt and the Public Revenue, and to make further provision in connection with Finance.

Enacted[28th July 2000]

Most Gracious Sovereign,

WE, Your Majesty’s most dutiful and loyal subjects, the Commons of the United Kingdom in Parliament assembled, towards raising the necessary supplies to defray Your Majesty’s public expenses, and making an addition to the public revenue, have freely and voluntarily resolved to give and grant unto Your Majesty the several duties hereinafter mentioned; and do therefore most humbly beseech Your Majesty that it may be enacted, and be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—^C6^C8^C21

Part I Excise duties¶

Alcoholic liquor duties¶

1 Rate of duty on beer.¶

1 In section 36(1) of the ^M1Alcoholic Liquor Duties Act 1979 (rate of duty on beer), for “£11.50" substitute “ £11.89 ”.

2 This section shall be deemed to have come into force on 1st April 2000.

2 Rates of duty on cider.¶

1 In section 62(1A) of the ^M2Alcoholic Liquor Duties Act 1979 (rates of duty on cider)—

a in paragraph (a) (rate of duty per hectolitre in the case of sparkling cider of a strength exceeding 5.5 per cent.), for “£161.20" substitute “ £166.70 ”;

b in paragraph (b) (rate of duty per hectolitre in the case of cider of a strength exceeding 7.5 per cent. which is not sparkling cider), for “£37.92" substitute “ £39.21 ”; and

c in paragraph (c) (rate of duty per hectolitre in any other case), for “£25.27" substitute “ £26.13 ”.

2 This section shall be deemed to have come into force on 1st April 2000.

3 Rates of duty on wine and made-wine.¶

1 For Part I of the Table of rates of duty in Schedule 1 to the ^M3Alcoholic Liquor Duties Act 1979 (wine and made-wine) substitute—

Part I Wine or made-wine of a strength not exceeding 22 per cent.

Description of wine or made-wine	Rates of duty per hectolitre
	£
Wine or made-wine of a strength not exceeding 4 per cent.	47.58
Wine or made-wine of a strength exceeding 4 per cent. but not exceeding 5.5 per cent.	65.42
Wine or made-wine of a strength exceeding 5.5 per cent. but not exceeding 15 per cent. and not being sparkling	154.37
Sparkling wine or sparkling made-wine of a strength exceeding 5.5 per cent. but less than 8.5 per cent.	166.70
Sparkling wine or sparkling made-wine of a strength of 8.5 per cent. or of a strength exceeding 8.5 per cent. but not exceeding 15 per cent.	220.54
Wine or made-wine of a strength exceeding 15 per cent. but not exceeding 22 per cent.	205.82

2 This section shall be deemed to have come into force on 1st April 2000.

Hydrocarbon oil duties¶

4 Rates of duty and rebate on hydrocarbon oil.¶

1 In section 6(1A) of the ^M4Hydrocarbon Oil Duties Act 1979 (rates of duty on hydrocarbon oil)—

a in paragraph (a) (light oil), for “£0.5288" substitute “ £0.5468 ”;

b in paragraph (b) (ultra low sulphur diesel), for “£0.4721" substitute “ £0.4882 ”; and

c in paragraph (c) (heavy oil which is not ultra low sulphur diesel), for “£0.5021" substitute “ £0.5182 ”.

2 In section 11(1) of that Act (rebate on heavy oil)—

a in paragraph (a) (fuel oil), for “£0.0265" substitute “ £0.0274 ”; and

b in each of paragraphs (b) and (ba) (gas oil which is not ultra low sulphur diesel and ultra low sulphur diesel), for “£0.0303" substitute “ £0.0313 ”.

3 In section 13A(1A) of that Act (rebate on unleaded petrol)—

a in paragraph (a) (higher octane unleaded petrol), for “£0.0367" substitute “ £0.0379 ”; and

b in paragraph (b) (other unleaded petrol), for “£0.0567" substitute “ £0.0586 ”.

4 In section 14(1) of that Act (rebate on light oil for use as furnace fuel), for “£0.0265" substitute “ £0.0274 ”.

5 This section shall be deemed to have come into force at 6 o’clock in the evening of 21st March 2000.

5 Ultra low sulphur petrol.¶

1 In section 1 of the ^M5Hydrocarbon Oil Duties Act 1979 (definitions of oil), after subsection (3) insert—

3A “Ultra low sulphur petrol” means unleaded petrol (other than higher octane unleaded petrol)—

a the sulphur content of which does not exceed 0.005 per cent. by weight or is nil, and

b the aromatics content of which does not exceed 35 per cent. by volume.

3B “Unleaded petrol” means petrol that contains not more than 0.013 grams of lead per litre of petrol; and petrol is “leaded petrol” if it is not unleaded.

3C “Higher octane unleaded petrol” means unleaded petrol—

a whose research octane number is not less than 96 and whose motor octane number is not less than 86; or

b which is delivered for home use as petrol that satisfies the condition in paragraph (a) above; or

c which is delivered for home use as petrol that is suitable to be used as fuel for engines for which leaded petrol is suitable by virtue of being leaded; or

d which is delivered for home use under such a description, or in such a manner, as tends, in the circumstances, to suggest that it is—

i petrol satisfying the condition in paragraph (a) above, or

ii petrol that is suitable to be used as fuel for engines for which leaded petrol is suitable by virtue of being leaded.

^F12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F4393 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5 In section 27(1) of that Act (interpretation), at the appropriate places insert—

;

and

^P16 This section shall come into force on such day as the Commissioners of Customs and Excise may appoint by order made by statutory instrument.

6 Mixing of rebated light oils.¶

1 Schedule 2A to the ^M6Hydrocarbon Oil Duties Act 1979 (mixing of rebated oils) is amended in accordance with Schedule 1 to this Act.

2 The amendments in that Schedule come into force on the day appointed under section 5(6).

7 Power to amend definitions of types of hydrocarbon oil.¶

In the ^M7Hydrocarbon Oil Duties Act 1979, after section 2 insert—

8 Penalties for misuse of rebated heavy oil.¶

1 Section 13 of the ^M8Hydrocarbon Oil Duties Act 1979 (penalties for misuse of rebated heavy oil) is amended as follows.

2 In subsection (1)—

a for “or, as the case may be, his becoming so liable" substitute “ or his becoming so liable (or, where his conduct includes both, each of them) ”, and

b omit the words from “; and the Commissioners" to the end.

3 After subsection (1) insert—

4 This section shall have effect in relation to liability arising on or after 1st May 2000.

9 Use of rebated heavy oil as fuel.¶

1 Schedule 1 to the ^M9Hydrocarbon Oil Duties Act 1979 (which sets out the categories of excepted vehicle which may use rebated heavy oil as fuel) is amended as follows.

2 Omit the following provisions—

a paragraph 2(1)(b) (which provides that off-road tractors are excepted vehicles) and the word “or" immediately preceding it, and

b paragraph 2(4) (which defines off-road tractors).

3 This section shall have effect in relation to the use of rebated heavy oil as fuel on or after 1st May 2000.

10 Rebates, marking and reliefs.¶

1 The ^M10Hydrocarbon Oil Duties Act 1979 is amended in accordance with subsections (2) to (4).

2 In section 11 (rebate on heavy oil), after subsection (2) insert—

3 This subsection applies in any case where—

a oil is delivered for home use,

b regulations under section 24 below require, as a condition of allowing a rebate on the oil under subsection (1) above, that a marker prescribed by regulations under that section shall have been added to the oil, and

c the marker is present at the time of delivery for home use but in such a proportion that its presence falls to be disregarded by virtue of provision made by regulations under that section.

4 In any case where subsection (3) above applies, a rebate may be allowed on the oil at the time it is delivered for home use if it appears to the Commissioners to be appropriate to allow it.

5 Where a rebate is allowed under subsection (4) above, the rate at which the rebate is allowed—

a shall be such rate as appears to the Commissioners to be appropriate, but

b shall not be less than 95 per cent. of, and shall not exceed, the rate of rebate specified in the relevant paragraph of subsection (1) above.

3 In section 20AA(2) (provision in connection with allowing reliefs)—

a in paragraph (a) (relief may take form of repayment or remission), after “repayment or remission" insert “ or an allowance to be set off against duty payable to the Commissioners by the person claiming relief ”; and

b after paragraph (g) insert—

4 In section 24 (regulations controlling use of duty-free and rebated oil), after subsection (4B) insert—

4C In a case where subsection (4D) below applies, the power of the Commissioners under subsection (4A) above includes power, if it appears to them to be appropriate, to assess (and notify) an amount less than the amount of the rebate concerned.

4D This subsection applies in any case where—

a the Commissioners have power to assess (and notify) an amount under subsection (4A) above by virtue of a contravention of, or failure to comply with, a requirement such as is mentioned in paragraph 5 of Schedule 4 to this Act, and

b the marker whose addition is required by the requirement is present at the time of the contravention or failure but in such a proportion that its presence falls to be disregarded by virtue of provision made by regulations under this section for the purpose mentioned in paragraph 7 of that Schedule.

5 In paragraph 4 of Schedule 5 to the ^M11Finance Act 1994 (decisions under the ^M12Hydrocarbon Oil Duties Act 1979 of which a review may be required), after sub-paragraph (1) insert—

11 Emulsions of water in gas oil.¶

1 In section 6A of the ^M14Hydrocarbon Oil Duties Act 1979 (duty on fuel substitutes), after subsection (2) (definition of chargeable use) insert—

2 This section shall have effect in relation to duty charged on or after the day on which this Act is passed.

Tobacco products duty¶

12 Rates of tobacco products duty.¶

1 For the Table of rates of duty in Schedule 1 to the ^M15Tobacco Products Duty Act 1979 substitute—

2 This section shall be deemed to have come into force at 6 o’clock in the evening of 21st March 2000.

13 Basis of calculation ofad valorem element of duty on cigarettes.¶

1 Section 5 of the ^M16Tobacco Products Duty Act 1979 (retail price of cigarettes) is amended as follows.

2 In subsection (1) (meaning of retail price) for the words from “shall be taken to be" to the end substitute

3 In subsection (3) (determination of price by Commissioners), for “paragraph (a) of subsection (1)" substitute “ paragraph (b) of subsection (1) ”.

4 In subsection (4) (reference to arbitration of Commissioners’ determination), for “subsection (1)(a)" substitute “ subsection (1)(b) ”.

14 Fiscal marks on tobacco products.¶

After section 8 of the ^M17Tobacco Products Duty Act 1979 insert the following sections—

8A Fiscal marks: introductory.

Fiscal marking applies to tobacco products that are—

a cigarettes, or

b hand-rolling tobacco.

8B Power to alter range of products to which fiscal marking applies.

1 The Commissioners may by order made by statutory instrument amend section 8A above for the purpose of causing fiscal marking—

a to apply to any description of tobacco products to which it does not apply, or

b to cease to apply to any description of tobacco products to which it does apply.

2 Where fiscal marking applies to any description of tobacco products, the Commissioners may by regulations provide that fiscal marking does not apply to such products of that description as are of a description specified in the regulations.

3 A statutory instrument containing (whether alone or with other provisions) an order under subsection (1)(a) above shall not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.

4 A statutory instrument that—

a contains (whether alone or with other provisions) an order under subsection (1) above, and

b is not subject to any requirement that a draft of the instrument be laid before and approved by a resolution of each House of Parliament,

shall be subject to annulment in pursuance of a resolution of either House of Parliament.

8C Fiscal mark regulations.

1 The Commissioners may make provision by regulations—

a requiring the carrying of fiscal marks by tobacco products to which fiscal marking applies, and

b as to such matters relating to fiscal marks as appear to the Commissioners to be necessary or expedient.

2 In this Act “fiscal mark” means a mark carried by tobacco products indicating all or any of the following—

a that excise duty has been paid on the products;

b the rate at which excise duty was paid on the products;

c the amount of excise duty paid on the products;

d when excise duty was paid on the products;

e that sale of the products—

i is only permissible on dates ascertainable from the mark;

ii is not permissible after (or on or after) a date so ascertainable;

iii is not permissible before (or before or on) a date so ascertainable.

3 Regulations under this section may, in particular, make provision about—

a the contents of a fiscal mark;

b the appearance of a fiscal mark;

c in the case of tobacco products that have more than one layer of packaging, which of the layers is (or are) to carry a fiscal mark;

d the positioning of a fiscal mark on the packaging of any tobacco products;

e when tobacco products are required to carry a fiscal mark.

4 Regulations under this section may make different provision for different cases.

8D Fiscal marks: public notices.

1 The Commissioners may by notices published by them regulate any of the matters mentioned in paragraphs (a) to (d) of section 8C(3) above.

2 A notice under this section may provide for provision made by regulations under section 8C above to have effect subject to provisions of the notice.

3 A notice under this section may make different provision for different cases.

8E Failure to comply with fiscal mark regulations and public notices.

1 This section applies if a person fails to comply with any requirement imposed by or under—

a regulations made under section 8C above, or

b a notice published under section 8D above.

2 Any article in respect of which the person fails to comply with the requirement shall be liable to forfeiture.

3 The person’s failure to comply shall attract a penalty under section 9 of the ^M18Finance Act 1994 (civil penalties).

4 The Commissioners may by regulations make such provision as is mentioned in subsection (5) below about the calculation of the penalty in a case where the failure involves post-dating of any tobacco products.For this purpose “post-dating” means that the products carry a fiscal mark (“the later period mark”) that—

a is not one they are required to carry by virtue of this Act, and

b is one they would be required to carry by virtue of this Act if the requirement to pay the duty charged on them under section 2 above took effect at a time later than that at which it in fact takes effect.

5 The provision that may be made by regulations under subsection (4) above is for the penalty to be calculated by reference to the duty currently charged on the products.For this purpose “the duty currently charged" on the products is the amount of the duty charged under section 2 above that would be payable on the products if the requirement to pay the duty took effect at the time of the failure.

8F Sale of marked tobacco when not permitted: penalties.

1 This section applies if provision made by or under—

a regulations made under section 8C above, or

b a notice published under section 8D above,

provides for any tobacco products to carry a period of sale mark.

2 In this section—

“a period of sale mark” means a fiscal mark indicating any of the matters mentioned in subsection (2)(e) of section 8C above; and
“prohibited time”, in relation to tobacco products that carry a period of sale mark, means a time when, according to the mark, sale of the products is not permissible.

3 If—

a a person sells by way of retail sale, or exposes for retail sale, any tobacco products that carry a period of sale mark, and

b he so sells or exposes the products at a prohibited time,

his so selling or exposing the products shall attract a penalty under section 9 of the ^M19Finance Act 1994 (civil penalties) and the products are liable to forfeiture.

8G Offences: possession and sale etc. of unmarked tobacco.

1 In this section “unmarked products" means tobacco products that are subject to fiscal marking but do not carry a compliant duty-paid fiscal mark.

2 For the purposes of this section “duty-paid fiscal mark” means a fiscal mark carried by tobacco products indicating that excise duty has been paid on the products.

3 For the purposes of this section a duty-paid fiscal mark carried by tobacco products of any description is “compliant” if it complies with all relevant requirements for any duty-paid fiscal mark that by virtue of this Act is required to be carried by such tobacco products of that description as are by virtue of this Act required to carry such a mark.For this purpose “relevant requirement” means a requirement, imposed by virtue of this Act, as to any of the matters mentioned in paragraphs (a) to (d) of section 8C(3) above (contents, appearance and positioning etc. of fiscal marks).

4 If a person—

a is in possession of, transports or displays, or

b sells, offers for sale or otherwise deals in,

unmarked products then, except in such cases as may be prescribed in regulations made by the Commissioners, that person commits an offence and the products are liable to forfeiture.

5 It is a defence for a person charged with an offence under subsection (4) above to prove that the unmarked products were not required by virtue of this Act to carry a duty paid fiscal mark.

6 A person guilty of an offence under subsection (4) above shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.

8H Offences: use of premises for sale of unmarked tobacco.

1 A manager of premises commits an offence if he suffers the premises to be used for the sale of unmarked products.In this section “unmarked products” has the same meaning as in section 8G above.

2 It is a defence for a person charged with an offence under subsection (1) above to prove that the unmarked products were not required by virtue of this Act to carry a duty-paid fiscal mark.For this purpose “duty-paid fiscal mark” has the same meaning as in section 8G above.

3 A person guilty of an offence under subsection (1) above shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.

4 A court by or before which a person is convicted of an offence under subsection (1) above may make an order prohibiting the use of the premises in question for the sale of tobacco products during a period specified in the order.

5 The period specified in an order under subsection (4) above shall not exceed six months; and the first day of the period shall be the day specified as such in the order.

6 A manager of premises commits an offence if he suffers the premises to be used in breach of an order under subsection (4) above.

7 A person guilty of an offence under subsection (6) above shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.

8 For the purposes of this section a person is a manager of premises if he—

a is entitled to control their use,

b is entrusted with their management, or

c is in charge of them.

8J Interfering with fiscal marks: penalties.

1 This section applies where a person—

a alters or overprints any fiscal mark carried by any tobacco products in compliance with any provision made under this Act, or

b causes any such mark to be altered or overprinted.

2 His altering or overprinting of the mark, or his causing it to be altered or overprinted, shall attract a penalty under section 9 of the ^M20Finance Act 1994 (civil penalties).

3 The products that carried the mark shall be liable to forfeiture.

4 The penalty under subsection (2) above shall be calculated by reference to the duty currently charged on the products.For this purpose “the duty currently charged" on the products is the amount of the duty charged under section 2 above that would be payable on the products if the requirement to pay the duty took effect at the time of the conduct attracting the penalty.

15 Management of excise duty on tobacco products.¶

1 The ^M21Tobacco Products Duty Act 1979 has effect subject to the following amendments.

2 In section 2(2) (remission or repayment of duty where tobacco products exported, shipped as stores or used for research or experiment), for the words from “that" to the end of paragraph (b) substitute—

3 Section 7 (regulations for management of duty) is amended as follows.

4 After paragraph (a) of subsection (1) (method of charging duty and securing and collecting duty) insert—

5 In paragraph (b) of subsection (1) (registration of premises for storage of tobacco), after “regulating their" insert “ storage and ”.

6 After that paragraph insert—

7 In paragraph (c) of subsection (1), omit sub-paragraph (i) (which is superseded by the amendment made by subsection (6) above).

8 In paragraph (d) of subsection (1), for “and the making of such returns, as may be specified in the regulations" substitute “ the notification of such information, and the making of such returns, as may be specified in the regulations or required by the Commissioners ”.

9 After subsection (1) insert—

Gaming duty¶

16 Rates of gaming duty.¶

1 For the table in section 11(2) of the ^M22Finance Act 1997 (rates of gaming duty) substitute—

2 This section has effect in relation to accounting periods beginning on or after 1st April 2000.

Amusement machine licence duty¶

17 Amusement machine licence duty.¶

Schedule 2 to this Act (which amends the ^M23Betting and Gaming Duties Act 1981) shall have effect.

Air passenger duty¶

18 Rates of duty.¶

^F5151 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F5152 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F5153 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F5154 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F5155 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6 At the end of the section add—

^F5167 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8 This section applies to any carriage of a passenger on an aircraft which begins on or after 1st April 2001.

19 Changes in exemption from duty.¶

1 Section 31 of the ^M24Finance Act 1994 is amended as follows.

2 Omit subsections (1) and (2) (exemption in relation to passengers making return journeys within the United Kingdom).

3 After subsection (4A) insert—

4 Omit subsection (6) (provision by regulations for subsection (1) to have effect in relation to journeys begun in the Isle of Man).

5 In consequence of the provision made by subsection (2) above, in section 43 of the ^M25Finance Act 1994 (interpretation)—

a in subsection (2) (meaning of “journey” etc), omit “Subject to subsection (3) below”, and

b omit subsection (3) (interpretation of references to a return ticket).

6 This section applies to any carriage of a passenger on an aircraft which begins on or after 1st April 2001.

Vehicle excise duty¶

20 Threshold for reduced general rate.¶

1 In paragraph 1 of Schedule 1 to the ^M26Vehicle Excise and Registration Act 1994 (rate of duty applicable where no other rate specified), in sub-paragraphs (2) and (2A) for “1,100 cubic centimetres" (the reduced rate threshold) substitute “ 1,200 cubic centimetres ”.This amendment applies to licences issued on or after 1st March 2001.

2 Refunds shall be made by the Secretary of State, in accordance with the following provisions of this section, in respect of licences—

a issued in the period beginning with 1st March 2000 and ending with 28th February 2001, and

b not surrendered before the end of that period,

where the amount of vehicle excise duty chargeable on the licence would have been less if the amendment in subsection (1) had applied.

3 The amount of the refund is—

a £55 for a 12 month licence, and

b £27.50 for a 6 month licence.

4 The person entitled to the refund is—

a in the case of a licence in force on 28th February 2001, the keeper of the vehicle on that date;

b in the case of a licence that has ceased to be in force before that date, the keeper of the vehicle when the licence expired.

5 For the purposes of subsection (4) the keeper of the vehicle shall be taken to be—

a the person registered as keeper of the vehicle on the date in question, or

b if the Secretary of State has received notification of a change of ownership of the vehicle as a result of which another person is on that date entitled to be registered as the new keeper of the vehicle, that person.

6 A refund shall only be made if an application is made for it in such form, and containing such particulars and supported by such documents, as the Secretary of State may require.

7 The Secretary of State shall give notice in writing to any person appearing to him to be entitled to a refund—

a informing him that he appears to be entitled to a refund,

b enclosing an application form, and

c specifying the particulars and supporting documents to be provided.

8 An application for, or the making of, a refund under this section in respect of a licence does not affect the validity of the licence.

9 For the purposes of section 19 of the ^M27Vehicle Excise and Registration Act 1994 (surrender of licences) as it applies to the surrender on or after 1st March 2001 of a licence in respect of which a refund under this section has been made, or applied for, the annual rate of duty chargeable on the licence shall be taken to be that which would have been chargeable if the amendment in subsection (1) above had applied.

10 Section 45 of that Act (offence of false or misleading declaration) applies to a declaration in connection with an application for a refund under this section as it applies to a declaration in connection with an application for a vehicle licence.

11 In the application of this section to Northern Ireland, references to registration as the keeper of a vehicle shall be read as references to registration as the owner of the vehicle.

21 Increase in general rate.¶

1 In paragraph 1 of Schedule 1 to the ^M28Vehicle Excise and Registration Act 1994 (rate of duty applicable where no other rate specified)—

a in sub-paragraph (2) (the standard rate), for “£155" substitute “ £160 ”; and

b in sub-paragraph (2A) (the reduced rate), for “£100" substitute “ £105 ”.

2 This section applies to licences issued on or after 1st March 2001.

22 Rates of duty for new cars and vans.¶

Schedule 3 to this Act has effect with respect to vehicle excise duty on light passenger vehicles and light goods vehicles first registered on or after 1st March 2001.

23 Enforcement provisions for graduated rates.¶

Schedule 4 to this Act has effect with respect to vehicle licences for vehicles in respect of which vehicle excise duty is chargeable at different rates.

24 Rates of duty for goods vehicles.¶

1 Schedule 5 to this Act (which makes provision for new rates of vehicle excise duty for goods vehicles etc.) has effect.

2 The provisions of that Schedule apply in relation to licences issued after 21st March 2000.

Enforcement of duties¶

25 Power to search premises.¶

In Part XII of the ^M29Customs and Excise Management Act 1979 (general supplementary provisions), for section 161 (power to search premises) substitute—

161 Power to search premises: writ of assistance.

1 The powers conferred by this section are exercisable by an officer having a writ of assistance if there are reasonable grounds to suspect that anything liable to forfeiture under the customs and excise Acts—

a is kept or concealed in any building or place, and

b is likely to be removed, destroyed or lost before a search warrant can be obtained and executed.

2 The powers are—

a to enter the building or place at any time, whether by day or night, on any day, and search for, seize, and detain or remove any such thing, and

b so far as is necessary for the purpose of such entry, search, seizure, detention or removal, to break open any door, window or container and force and remove any other impediment or obstruction.

3 An officer shall not exercise the power of entry conferred by this section by night unless accompanied by a constable.

4 A writ of assistance shall continue in force during the reign in which it is issued and for six months thereafter.

161A Power to search premises: search warrant.

1 If a justice of the peace is satisfied by information upon oath given by an officer that there are reasonable grounds to suspect that anything liable to forfeiture under the customs and excise Acts is kept or concealed in any building or place, he may by warrant under his hand authorise any officer, and any person accompanying an officer, to enter and search the building or place named in the warrant.

2 An officer or other person so authorised has power—

a to enter the building or place at any time, whether by day or night, on any day, and search for, seize, and detain or remove any such thing, and

b so far as is necessary for the purpose of such entry, search, seizure, detention or removal, to break open any door, window or container and force and remove any other impediment or obstruction.

3 Where there are reasonable grounds to suspect that any still, vessel, utensil, spirits or materials for the manufacture of spirits is or are unlawfully kept or deposited in any building or place, subsections (1) and (2) above apply in relation to any constable as they would apply in relation to an officer.

4 The powers conferred by a warrant under this section are exercisable until the end of the period of one month beginning with the day on which the warrant is issued.

5 A person other than a constable shall not exercise the power of entry conferred by this section by night unless accompanied by a constable.

26 Power to search articles.¶

In Part XII of the ^M30Customs and Excise Management Act 1979 (general supplementary provisions), after section 163 (power to search vehicles or vessels) insert—

163A Power to search articles.

1 Without prejudice to any other power conferred by the Customs and Excise Acts 1979, where there are reasonable grounds to suspect that a person in the United Kingdom (referred to in this section as “the suspect”) has with him, or at the place where he is, any goods to which this section applies, an officer may—

a require the suspect to permit a search of any article that he has with him or at that place, and

b if the suspect is not under arrest, detain him (and any such article) for so long as may be necessary to carry out the search.

2 The goods to which this section applies are dutiable alcoholic liquor, or tobacco products, which are—

a chargeable with any duty of excise, and

b liable to forfeiture under the customs and excise Acts.

3 Notwithstanding anything in subsection (4) of section 24 of the ^M31Criminal Law (Consolidation) (Scotland) Act 1995 (detention and questioning by customs officers), detention of the suspect under subsection (1) above shall not prevent his subsequent detention under subsection (1) of that section.

27 Security for customs and excise duties.¶

1 Section 157 of the ^M32Customs and Excise Management Act 1979 (bonds and security) is amended as follows.

2 In subsection (1) (power to require security), for “by bond" substitute “ (or further security) by bond, guarantee ”.

^F8093 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4 In subsection (2) (bonds for the purposes of assigned matters), after “Any bond" insert “ , guarantee or other security ”.

^F8115 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F8106 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

28 Civil penalties for breach of excise duty requirements.¶

In section 9(2)(a) of the ^M33Finance Act 1994 (how to calculate the penalty in cases where provision is made by any enactment for conduct to attract a penalty calculated by reference to an amount of excise duty), for “or any other enactment" substitute “ , or by or under any other enactment, ”.

29 Correction of reference.¶

In section 127 of the ^M34Finance Act 1999 (interest on repayments of customs duty), in subsection (1)(b) for “Council Regulation 2454/93" substitute “ Commission Regulation 2454/93 ”.This amendment shall be deemed always to have had effect.

Part II Climate change levy¶

30 Climate change levy.¶

1 Schedule 6 to this Act (which makes provision for a new tax that is to be known as climate change levy) shall have effect.

2 Schedule 7 to this Act (climate change levy: consequential amendments) shall have effect.

3 Part V of Schedule 6 to this Act (registration for the purposes of climate change levy) shall not come into force until such date as the Treasury may appoint by order made by statutory instrument; and different days may be appointed under this subsection for different purposes.

Part III Income Tax, Corporation Tax and Capital Gains Tax¶

Chapter I Charge and rates¶

Income tax¶

^F35231 Charge and rates for 2000-01.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F35332 Extension of starting rate to savings income of individuals.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F27333 Deduction of income tax from foreign dividends.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

34 Children’s tax credit.¶

^F2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Corporation tax¶

35 Charge and main rate for financial year 2001.¶

Corporation tax shall be charged for the financial year 2001 at the rate of 30%.

^F54436 Small companies’ rate for financial year 2000.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Capital gains tax¶

^F45037 Application of starting rate to capital gains tax.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Chapter II Other provisions¶

Giving to charity¶

^F63038 Payroll deduction scheme.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

39 Gift aid payments by individuals.¶

^F3541 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3542 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3543 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3544 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3545 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3546 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7 In subsection (12), paragraphs (b) and (e) and the word “and" immediately preceding paragraph (e) shall cease to have effect.

^F5178 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F5179 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10 This section has effect in relation to—

a gifts made on or after 6th April 2000 which are not covenanted payments; and

b covenanted payments falling to be made on or after that date;

and any regulations made under subsection (3) of section 25 of the ^M35Finance Act 1990 (as substituted by subsection (4) above) within three months of the passing of this Act may be so made as to apply to any payments in relation to which this section has effect.

^F54540 Gift aid payments by companies.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

41 Covenanted payments to charities.¶

^F5461 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2 In section 347A of that Act (annual payments and interest: general rule), subsections (2)(b), (7) and (8) shall cease to have effect.

^F3553 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3554 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5 In subsection (6) of section 505 of that Act (charities: general), the words “and, for this purpose, all covenanted payments to charity (within the meaning of section 347A(7)) shall be treated as a single item” shall cease to have effect.

^F2746 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7 Section 59 of the ^M36Finance Act 1989 (covenanted subscriptions) shall cease to have effect.

8 Where a deed of covenant executed by an individual before 6th April 2000 provides for the payment of specified amounts, any amount payable under the deed on or after that date shall be determined as if the individual were entitled to deduct tax from that amount at the basic rate.

9 This section shall have effect in relation to covenanted payments—

a falling to be made by individuals on or after 6th April 2000; or

b made by companies on or after 1st April 2000.

^F63142 Millennium gift aid.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F54743 Gifts of shares and securities to charities etc.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

44 Gifts to charity from certain trusts.¶

^F2751 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F2752 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F2753 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5A This section applies if—

a in a year of assessment qualifying income arises under a UK settlement,

b the qualifying income consists of charitable income and non-charitable income, and

c expenses of the trustees are to be used to reduce the charitable income for the purpose of calculating a beneficiary's liability to corporation tax.

5B The amount of those expenses which can used for that purpose is limited to the amount allocated to the charitable income.

5C The amount of the expenses allocated to the charitable income is determined by apportioning them rateably between the charitable income and the non-charitable income.

5D In this section—

“charitable income” means income within section 628(1) or 630(1) of ITTOIA 2005,
“non-charitable income” means income which is not charitable income, and
“qualifying income” and “UK settlement” have the same meaning as in section 628 of ITTOIA 2005.

6 This section has effect in relation to qualifying income arising to a UK trust on or after 6th April 2000.

^F27645 Loans to charities.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F54846 Exemption for small trades etc.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Other provisions about employment¶

57 Benefits in kind: deregulatory amendments.¶

^F5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

58 Education and Training.¶

^F6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

59 Cars available for private use.¶

^F7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

60 Provision of services through intermediary.¶

^F8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Pension schemes¶

^F22961 Occupational and personal pension schemes.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Enterprise incentives¶

62 Enterprise management incentives.¶

^F9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

63 Corporate venturing scheme.¶

1 Schedule 15 to this Act (which makes provision for the corporate venturing scheme) has effect.

2 Schedule 16 to this Act (which makes consequential amendments) has effect.

^F5493 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4 Subject to that, Schedules 15 and 16 apply in relation to shares issued on or after 1st April 2000 but before 1st April 2010.

64 Enterprise investment scheme: amendments.¶

The provisions relating to the enterprise investment scheme are amended in accordance with Schedule 17 to this Act.In that Schedule—Part I makes amendments reducing various periods which apply in relation to the provisions which determine the reliefs under the scheme;Part II makes amendments about qualifying companies;Part III makes other minor amendments.

65 Venture capital trusts: amendments.¶

The provisions relating to venture capital trusts are amended in accordance with Schedule 18 to this Act.In that Schedule—Part I makes amendments reducing various periods which apply in relation to the provisions which determine the reliefs; ^F357...

^F45166 Taper relief: taper for business assets.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F45267 Taper relief: assets qualifying as business assets.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Research and development¶

68 Meaning of “research and development".¶

1 Schedule 19 to this Act (meaning of “research and development”) has effect.In that Schedule—Part I contains a new definition of “research and development” for the purposes of the Tax Acts, andPart II contains consequential amendments.

2 The amendments in Part II of that Schedule have effect—

a for the purposes of income tax and capital gains tax, in relation to the year 2000-01 and subsequent years of assessment, and

b for the purposes of corporation tax, for accounting periods ending on or after 1st April 2000.

69 Tax relief for expenditure on research and development.¶

^F4681 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2 Schedule 21 to this Act (which contains consequential amendments) has effect accordingly.

Capital allowances¶

^F1070 First year allowances for small or medium-sized enterprises.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F1171 First year allowances for ICT expenditure by small enterprises.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F1272 Expenditure of a small enterprise.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

73 Repeal of notification requirements.¶

1 In section 118 of the ^M41Finance Act 1994 (notification requirements)—

a subsections (1) to (5) and (7) to (9) shall cease to have effect; and

b in subsection (6), for “the provisions mentioned in subsection (2) above" there shall be substituted—

2 This section has effect for chargeable periods as respects which the period specified in subsection (3A) of that section ends on or after 1st April 2000.

74 Pool for certain leased assets and inexpensive cars.¶

1 In section 41 of the ^M42Capital Allowances Act 1990 (writing-down allowances etc for leased assets and inexpensive cars)—

a in subsection (1), paragraphs (b) and (c) and the word “ or ” at the end of paragraph (a); and

b in subsection (4), paragraph (a) and, in paragraph (b), the words from “or within (1)(b) or (c)" to “subsection (1)(c)" and the words “or subsection (1)(b) or (c)",

shall cease to have effect for chargeable periods ending on or after the relevant date.

2 Subsection (3) below applies where—

a immediately before the end of the relevant chargeable period, a person was treated for the purposes of sections 24, 25 and 26 of the ^M43Capital Allowances Act 1990 as having incurred expenditure on the provision of machinery or plant wholly and exclusively for the purposes of a separate trade carried on by him;

b the expenditure fell within subsection (1)(b) or (c) of section 41 of that Act; and

c qualifying expenditure in respect of the separate trade for the relevant chargeable period exceeded any disposal value brought into account in respect of that trade for that period.

3 The balance of the excess (after the deduction of any writing-down allowances made by reference to it) shall be treated for the purposes of sections 24, 25 and 26 of the ^M44Capital Allowances Act 1990 as capital expenditure which—

a was incurred by that person in the relevant chargeable period on the provision of the machinery or plant for the purposes of the trade which is the actual trade for the purposes of section 41 of that Act; and

b does not form part of his qualifying expenditure for that period.

4 In this section—

“the relevant chargeable period” means the chargeable period immediately preceding that which begins on or before and ends on or after the relevant date;
“the relevant date” means, subject to subsection (5) below, 6th April 2000 for the purposes of income tax and 1st April 2000 for the purposes of corporation tax.

5 A person may, by a notice given to an officer of the Board, elect that this section shall have effect in relation to any trade carried on by him as if the relevant date were 6th April 2001 or, as the case may be, 1st April 2001.

75 Machinery and plant allowances for non-residents etc.¶

^F131 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F132 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F133 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3484 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F135 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6 ^F350. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F349a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F13b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F13c . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

76 Production animals.¶

^F141 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2 In paragraph 9(4) of Schedule 5 to the Taxes Act 1988 (treatment of farm animals etc for purposes of Case I of Schedule D), for the words from “in relation to animals" to the end there shall be substituted—

3 The enactments amended by subsections (1) and (2) above shall be deemed always to have had effect with the amendments made by those subsections.

^F1577 Sale and leaseback.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F55078 Meaning of “fixture".¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F1679 Leased assets under the Affordable Warmth Programme.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F1780 Fixtures and machinery and plant on hire-purchase etc.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F1881 Production sharing contracts.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Tonnage tax¶

82 Tonnage tax.¶

Schedule 22 to this Act (tonnage tax) has effect.

Other relieving provisions¶

83 Relief for interest on loans to buy annuities.¶

1 In section 365(3) of the Taxes Act 1988 (loans to buy annuities)—

a for the words “the qualifying maximum for the year of assessment", in the first place where they occur, there shall be substituted the words “ the sum of £30,000 ”; and

b for those words, in the second place where they occur, there shall be substituted the words “ that sum ”.

^F3582 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3 In section 369(1A) of that Act (deductible percentage where interest payable under deduction of tax), for the words from “the percentage" to the end there shall be substituted “ 23 per cent. ”.

4 This section has effect in relation to payments of interest made on or after 6th April 2000.

^F27784 Exemption of payments under New Deal 50plus.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F27885 Exemption of payments under Employment Zones programme.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F55186 Loan where return bears inverse relationship to results.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F27987 Tax treatment of acquisition, disposal or revaluation of certain rights.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

88 Contributions to local enterprise agencies, etc.¶

In sections 79(11) and 79A(7) of the Taxes Act 1988 (relief for contributions to local enterprise agencies, business links and similar organisations: time limits), the words “and before 1st April 2000" shall cease to have effect.

89 Waste disposal: entitlement of successor to allowances.¶

In Chapter V of Part IV of the Taxes Act 1988 (provisions relating to the Schedule D charge: deductions), after section 91B (waste disposal: site preparation), insert—

91BA Waste disposal: entitlement of successor to allowances.

1 This section applies where—

a site preparation expenditure has been incurred in relation to a waste disposal site,

b that expenditure was incurred by a person in the course of carrying on a trade, and

c on or after 21st March 2000—

i that person (“the predecessor”) ceases to carry on that trade, or ceases to carry it on so far as it relates to that site, and

ii another person (“the successor”) begins to carry on that trade, or to carry on in the course of a trade the activities formerly carried on by the predecessor in relation to that site.

2 If the conditions specified in the following provisions of this section are met, then, for the purposes of section 91B above—

a the trade carried on by the successor shall be treated as the same trade as that carried on by the predecessor, and

b allowances shall be made to the successor (and not to the predecessor) as if everything done to or by the predecessor had been done to or by the successor.

3 The first condition is that the whole of the site in question is transferred to the successor.Provided the successor holds an estate or interest in the whole of the site, it need not be the same as that held by the predecessor.

4 The second condition is that the successor, at the time he first deposits waste material at the site, holds a relevant licence in respect of the site which is then in force.

5 Expressions used in this section have the same meaning as in section 91B.

Capital gains tax: gifts and trusts¶

90 Restriction of gifts relief.¶

1 In section 165(1) of the ^M45Taxation of Chargeable Gains Act 1992 (relief for gifts of business assets), in the closing words (which list the provisions restricting relief), for “sections 166 and 167" substitute “ sections 166, 167 and 169 ”.

2 In section 260(1) of that Act (gifts on which inheritance tax is chargeable etc.), in the closing words (which list the provisions restricting relief), for “section 261" substitute “ sections 169 and 261 ”.

3 In section 165(2)(b)(i) of, and paragraph 2(2)(b)(i) of Schedule 7 to, that Act (shares or securities in respect of which gifts relief may be claimed), for “neither listed on a recognised stock exchange nor dealt in on the Unlisted Securities Market" substitute “ not listed on a recognised stock exchange ”.

4 In section 165(3)(b) of that Act (disposals of shares or securities excepted from gifts relief), after “shares or securities," insert “ the transferee is a company or ”.

5 This section has effect in relation to disposals made on or after 9th November 1999.

91 Disposal of interest in settled property: deemed disposal of underlying assets.¶

1 After section 76 of the ^M46Taxation of Chargeable Gains Act 1992, insert—

2 After Schedule 4 to that Act insert the Schedule 4A set out in Schedule 24 to this Act.

3 This section applies to any disposal of an interest in settled property made, or the effective completion of which falls, on or after 21st March 2000.Expressions used in this subsection have the same meaning as in Schedule 4A to the ^M47Taxation of Chargeable Gains Act 1992.

92 Transfers of value by trustees linked with trustee borrowing.¶

1 After section 76A of the ^M48Taxation of Chargeable Gains Act 1992 (inserted by section 91(1) above), insert—

2 After Schedule 4A to that Act (inserted by section 91(2) above), insert the Schedule 4B set out in Schedule 25 to this Act.

3 After section 85 of that Act, insert—

4 After Schedule 4B to the ^M49Taxation of Chargeable Gains Act 1992 (inserted by subsection (2) above), insert the Schedule 4C set out in Part I of Schedule 26 to this Act.The consequential amendments in Part II of Schedule 26 to this Act have effect.

5 The provisions of this section have effect in relation to any transfer of value in relation to which the material time is on or after 21st March 2000.The expressions “transfer of value” and “material time” have the same meaning in this subsection as in Schedule 4B to the ^M50Taxation of Chargeable Gains Act 1992.

93 Restriction on set-off of trust losses.¶

1 After section 79 of the ^M51Taxation of Chargeable Gains Act 1992, insert—

79A Restriction on set-off of trust losses.

1 This section applies to a chargeable gain accruing to the trustees of a settlement where—

a in computing the gain, the allowable expenditure is reduced in consequence, directly or indirectly, of a claim to gifts relief in relation to an earlier disposal to the trustees;

b the transferor on that earlier disposal, or any person connected with the transferor, has at any time—

i acquired an interest in the settled property, or

ii entered into an arrangement to acquire such an interest; and

c in connection with that acquisition or arrangement any person has at any time received, or become entitled to receive, any consideration.

2 Where this section applies to a chargeable gain, no allowable losses accruing to the trustees (in the year in which the gain accrues or any earlier year) may be set against the gain.This applies to the whole of the chargeable gain (and not just the element deferred as a result of the claim to gifts relief).

3 In this section—

a “gifts relief” means relief under section 165 or 260; and

b references to losses not being allowed to be set against a chargeable gain are to the losses not being allowed as a deduction against chargeable gains to the extent that they include that gain.

4 The references in subsection (1)(b) above to an interest in settled property have the same meaning as in Schedule 4A.

2 This section applies to gains accruing on or after 21st March 2000.

94 Attribution to trustees of gains of non-resident companies.¶

1 After section 79A of the ^M52Taxation of Chargeable Gains Act 1992 (inserted by section 93 above), insert—

79B Attribution to trustees of gains of non-resident companies.

1 This section applies where trustees of a settlement are participators—

a in a close company, or

b in a company that is not resident in the United Kingdom but would be a close company if it were resident in the United Kingdom.For this purpose “participator” has the same meaning as in section 13.

2 Where this section applies, nothing in any double taxation relief arrangements shall be read as preventing a charge to tax arising by virtue of the attribution to the trustees under section 13, by reason of their participation in the company mentioned in subsection (1) above, of any part of a chargeable gain accruing to a company that is not resident in the United Kingdom.

3 Where this section applies and—

a a chargeable gain accrues to a company that is not resident in the United Kingdom but would be a close company if it were resident in the United Kingdom, and

b all or part of the chargeable gain is treated under section 13(2) as accruing to a close company which is not chargeable to corporation tax in respect of the gain by reason of double taxation relief arrangements, and

c had the company mentioned in paragraph (b) (and any other relevant company) not been resident in the United Kingdom, all or part of the chargeable gain would have been attributed to the trustees by reason of their participation in the company mentioned in subsection (1) above,

section 13(9) shall apply as if the company mentioned in paragraph (b) above (and any other relevant company) were not resident in the United Kingdom.

4 The references in subsection (3) above to “any other relevant company" are to any other company which if it were not resident in the United Kingdom would be a company in relation to which section 13(9) applied with the result that all or part of the chargeable gain was attributed to the trustees as mentioned in that subsection.

2 This section applies where a chargeable gain accrues on or after 21st March 2000 to a company that is not resident in the United Kingdom.

95 Disposal of interest in non-resident settlement.¶

1 Section 85 of the ^M53Taxation of Chargeable Gains Act 1992 (disposal of interest in non-resident settlements) is amended as follows.

2 In subsection (2) (market value uplift for interest where trustees become non-resident) for “Subject to subsections (4) and (9) below," substitute “ Subject to subsections (4), (9) and (10) below, ”.

3 In subsection (5) (market value uplift for interest where trustees become treaty non-resident), at the beginning insert “ Subject to subsection (10) below, ”.

4 After subsection (9) add—

5 This section applies where the material time (within the meaning of section 85(10) of the ^M54Taxation of Chargeable Gains Act 1992, inserted by subsection (4) above) falls on or after 21st March 2000.

96 Payments by trustees to non-resident companies.¶

1 In section 96(5) of the ^M55Taxation of Chargeable Gains Act 1992 (capital payments by trustees to non-resident company), in the opening words (which refer to the persons by whom the company is controlled), omit “and each of them is then resident or ordinarily resident in the United Kingdom".

2 This section applies to payments received on or after 21st March 2000.

Groups and group relief¶

97 Group relief for non-resident companies etc.¶

Schedule 27 to this Act has effect.In that Schedule—Part I makes amendments of Chapter IV of Part X of the Taxes Act 1988 (group relief), andPart II contains consequential amendments.

^F55298 Recovery of tax payable by non-resident company.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

99 Joint arrangements for claims.¶

In paragraph 77 of Schedule 18 to the ^M56Finance Act 1998 (power to make provision by regulations about joint arrangements for group relief), in sub-paragraph (1)(a) (arrangements permitting claim for relief without copy of notice of consent to surrender), after “the surrendering company" insert “ , provided authority for the claim being so made is given by a company which is authorised in relation to the claimant company as mentioned in paragraph (b) ”.

^F553100 Limit on amount of group relief in case of consortium claim.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F518101 Civil penalties: incorrect certificates¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

102 Chargeable gains: non-resident companies and groups etc.¶

Schedule 29 to this Act has effect.In that Schedule—Part I makes provision with respect to the application of the ^M57Taxation of Chargeable Gains Act 1992 to companies not resident in the United Kingdom and groups of companies etc,Part II contains minor and consequential amendments, andPart III contains transitional provisions.

International matters¶

103 Double taxation relief.¶

Schedule 30 to this Act (double taxation relief) shall have effect.

104 Controlled foreign companies.¶

Schedule 31 to this Act (which makes provision in relation to controlled foreign companies) shall have effect.

105 Corporation tax: use of currencies other than sterling.¶

1 For sections 92 to 95 of the ^M58Finance Act 1993 there shall be substituted—

92 The basic rule: sterling to be used.

1 Where a company carries on a business, the profits or losses of the business for an accounting period shall for the purposes of corporation tax be computed and expressed in sterling; but this is subject to section 93 below.

2 In this section—

“losses” includes management expenses and any allowances falling to be made under section 28 or 61(1) of the ^M59Capital Allowances Act 1990;
“profits” includes gains, income and any charges falling to be made under section 28 or 61(1) of that Act.

93 Use of currency other than sterling.

1 This section applies where in an accounting period a company carries on a business and either the first condition or the second condition is fulfilled.

2 The first condition is that—

a the accounts of the company as a whole are prepared in a currency other than sterling in accordance with normal accounting practice; and

b in the case of a company which is not resident in the United Kingdom, the company makes a return of accounts for its branch in the United Kingdom prepared in such a currency in accordance with such practice.

3 The second condition is that—

a the accounts of the company as a whole are prepared in sterling but, so far as relating to the business, they are prepared, using the closing rate/net investment method, from financial statements prepared in a currency other than sterling; or

b in the case of a company which is not resident in the United Kingdom, the company makes a return of accounts for its branch in the United Kingdom prepared in sterling but, so far as relating to the business, it is prepared, using that method, from financial statements prepared in such a currency.

4 The profits or losses of the business for an accounting period shall for the purposes of corporation tax be found by—

a taking the amount of all the profits and losses of the business for the period computed and expressed in the relevant foreign currency;

b taking account of any of the following which are so computed and expressed—

i any management expenses brought forward under section 75(3) of the Taxes Act 1988 from an earlier accounting period;

ii any losses of the business brought forward under section 392B or 393 of that Act from such a period; and

iii any non-trading deficits on loan relationships brought forward under section 83 of the ^M60Finance Act 1996 from the previous accounting period; and

c taking the sterling equivalent of the amount found by applying paragraphs (a) and (b) above.

5 In the application of section 22B, 34, 35, 38C, 38D or 79A of the ^M61Capital Allowances Act 1990 for the purposes of subsection (4)(a) or (b) above, it shall be assumed that any sterling amount mentioned in any of those sections is its equivalent expressed in the relevant foreign currency.

6 Where in an accounting period—

a a company carries on different parts of a business through different branches (whether within or outside the United Kingdom); and

b this section would apply differently in relation to different parts if they were separate businesses,

those parts shall be treated for the purposes of this section as if they were separate businesses for that period.

7 In this section, unless the context otherwise requires—

“accounts”, in relation to a company, means—
1. the annual accounts of the company prepared in accordance with Part VII of the ^M62Companies Act 1985 or Part VIII of the ^M63Companies (Northern Ireland) Order 1986; or
2. if the company is not required to prepare such accounts, the accounts which it is required to keep under the law of its home State; or
3. if the company is not so required to keep accounts, such of its accounts as most closely correspond to accounts which it would have been required to prepare if the provisions of that Part applied to it;
“branch” includes any collection of assets and liabilities;
“the closing rate/net investment method” means the method so called as described under the title “Foreign currency translation” in the Statement of Standard Accounting Practice issued in April 1983 by the Institute of Chartered Accountants in England and Wales;
“home State”, in relation to a company, means the country or territory under whose laws the company is incorporated;
“losses” has the same meaning as in section 92 above except that it does not include allowable losses within the meaning of the ^M64Taxation of Chargeable Gains Act 1992;
“profits” has the same meaning as in section 92 above except that it does not include chargeable gains within the meaning of that Act;
“the relevant foreign currency” means the currency other than sterling or, where the first condition is fulfilled and two different such currencies are involved, the currency in which the return of accounts is prepared;
“return of accounts”, in relation to a branch in the United Kingdom, means a return of such accounts of the branch as may be required by the Inland Revenue under paragraph 3 of Schedule 18 to the Finance Act 1998 (company tax returns, assessments and related matters).

94 Rules for ascertaining currency equivalents.

1 Any receipt or expense which is to be taken into account in making a computation under subsection (1) of section 92 above for an accounting period, and is denominated in a currency other than sterling, shall be translated into its sterling equivalent—

a if either of the conditions mentioned in subsection (2) below is fulfilled, by reference to the rate used in the preparation of the accounts of the company as a whole for that period;

b if neither of those conditions is fulfilled, by reference to the London closing exchange rate for the relevant day.

2 The conditions are—

a that the rate is an arm’s length exchange rate for the relevant day;

b that the rate is an average arm’s length exchange rate for a period ending with that day, or for a period not exceeding three months which includes that day, and the arm’s length exchange rate for any day in that period (except the first) is not significantly different from that for the preceding day.

3 Subject to subsections (5) and (7) below, any amount found by applying paragraphs (a) and (b) of subsection (4) of section 93 above shall be translated into its sterling equivalent by reference to the London closing exchange rate for the relevant day.

4 The following—

a any receipt or expense which is to be taken into account in making a calculation for the purposes of subsection (4)(a) or (b) of section 93 above, and is denominated in a currency other than the relevant foreign currency; and

b any such sterling amount as is referred to in subsection (5) of that section,

shall be translated into its equivalent expressed in the relevant foreign currency by reference to the London closing exchange rate for the relevant day.

5 Where section 93 above applies by virtue of the first condition mentioned in that section, then, as regards the business or part of the business, the company—

a may elect, by a notice given to an officer of the Board, that as from the first day of the accounting period in which the notice is given, an average arm’s length exchange rate shall be used for the purposes of subsection (3) above instead of the rate there mentioned; and

b may withdraw such an election, by a notice so given, as from the first day of the first accounting period beginning on or after the date of the notice.

6 Where an election under subsection (5) above is withdrawn, no further election may be made under that subsection so as to take effect before the third anniversary of the day on which the withdrawal takes effect.

7 Where—

a section 93 above applies by virtue of the second condition mentioned in that section; and

b the accounts of the company, so far as relating to the business or part of the business, are prepared by reference to an average arm’s length exchange rate,

that exchange rate shall be used for the purposes of subsection (3) above instead of the rate there mentioned.

8 In this section—

“accounts” has the same meaning as in section 93 above;
“arm’s length exchange rate” means such exchange rate as might reasonably be expected to be agreed between persons dealing at arm’s length;
“average arm’s length exchange rate”, in relation to a period, means the rate which represents an appropriate average of arm’s length exchange rates for the period;
“the relevant day” means—
1. for the purposes of subsections (1), (2) and (4)(a) above, the day on which the company becomes entitled to the receipt or incurs (or is treated as incurring) the expense;
2. for the purposes of subsection (3) above, the last day of the accounting period in question;
3. for the purposes of subsection (4)(b) above, the day on which the company incurs the capital expenditure.

9 Nothing in this section affects the operation of Chapter IV of Part VII of the Taxes Act 1988 (controlled foreign companies) or Chapter II of this Part.

10 Nothing in paragraph 88 of Schedule 18 to the ^M65Finance Act 1998 (company tax returns, assessments and related matters) shall be taken to prevent any amount which is taken to be conclusively determined for the purposes of the Corporation Tax Acts from being translated under this section by reference to an exchange rate which was not used to determine the amount which can no longer be altered.

2 Where any of the items referred to in section 93(4)(b) of the ^M66Finance Act 1993 (as substituted by subsection (1) above) fall to be taken into account in the first accounting period in relation to which this section has effect, the amounts of those items shall be computed and expressed in the relevant currency by reference to the London closing exchange rate for the last day of the immediately preceding accounting period.

3 Where any amount falls to be taken into account under Chapter 5 of Part 2 of the Capital Allowances Act as available qualifying expenditure for the first accounting period in relation to which this section has effect relate to expenditure which was incurred before the beginning of that period, the amounts of those items shall be computed and expressed in the relevant currency by reference to the London closing exchange rate for the last day of the immediately preceding accounting period.

4 Subject to subsection (5) below, this section has effect for accounting periods beginning on or after 1st January 2000 and ending on or after 21st March 2000.

5 Any company which did not, for the accounting period immediately preceding the first accounting period falling within subsection (4) above, make an election in respect of a trade or part of a trade under the Local Currency Elections Regulations 1994 may, by notice given to an officer of the Board on or before 31st August 2000, elect that this section shall not have effect in relation to it until the first accounting period beginning on or after 1st July 2000.

^F20106 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .¶

Insurance¶

^F384107 General insurance reserves.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F655108 Overseas life assurance business.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F656109 Insurance business: apportionment rules.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Miscellaneous¶

^F332110 Rent factoring.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

111 Payments under deduction of tax.¶

1 Chapter VIIA of Part IV of the Taxes Act 1988 (paying and collecting agents) shall cease to have effect.

^F3602 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3603 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3604 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F3605 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6 In this section—

a subsections (1) and (5) apply to relevant payments or receipts in relation to which the chargeable date for the purposes of Chapter VIIA of Part IV is on or after 1st April 2001;

^F359b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F359c . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F361112 UK public revenue dividends: deduction of tax.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F21113 Tax treatment of expenditure on production or acquisition of films.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part IV Stamp duty and Stamp duty reserve tax¶

Stamp duty¶

114 Rates: conveyance or transfer on sale.¶

1 In Schedule 13 to the ^M67Finance Act 1999 (instruments chargeable and rates of duty), in Part I (conveyance or transfer on sale), in the third column of the table in paragraph 4—

a in the third entry, for “2.5%" substitute “ 3% ”; and

b in the fourth entry, for “3.5%" substitute “ 4% ”.

2 This section applies to instruments executed on or after 28th March 2000.

3 But this section does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

a the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

b the instrument transfers the property in question to, or vests it in, a person other than the purchaser under the contract, because of an assignment (or, in Scotland, assignation) or further contract made after that date.

4 This section shall be deemed to have come into force on 28th March 2000.

115 Rates: duty on lease chargeable by reference to rent.¶

1 In Schedule 13 to the ^M68Finance Act 1999 (instruments chargeable and rates of duty), in Part II (lease)—

a in paragraph 11, in paragraph 1 of the table, and

b in paragraph 12(3), in paragraph 1(a) and (b) of the table,

for “£500" substitute “ £5,000 ”.

2 This section has effect in relation to instruments executed on or after 28th March 2000.

3 This section shall be deemed to have come into force on 28th March 2000.

116 Rate of duty on seven year leases.¶

1 In paragraph 12(3) of Schedule 13 to the ^M69Finance Act 1999 (rates of stamp duty on leases where part of consideration is rent), in paragraph 1 of the table, for “less than 7 years" substitute “ not more than 7 years ”.

2 This section applies to instruments executed on or after 1st October 1999, subject to Schedule 32 to this Act (which makes transitional provision for instruments executed on or after 1st October 1999 but before 28th March 2000).

3 This section shall be deemed to have come into force on 28th March 2000.

117 Power to vary stamp duties.¶

Schedule 33 to this Act (power to vary stamp duties) has effect.

118 Land transferred etc for other property.¶

1 Subsection (2) applies where—

a an instrument transferring or vesting an estate or interest in land would not, apart from this section, be or fall to be treated as a conveyance or transfer on sale for the purposes of stamp duty; but

b the transfer or vesting of the estate or interest is for consideration; and

c the consideration is or includes any property (“the other property”).

2 For the purposes of Part I of Schedule 13 to the Finance Act 1999 (stamp duty on conveyance or transfer on sale) the instrument transferring or vesting the estate or interest shall be taken to be a transfer on sale of the estate or interest.

3 If—

a the other property is or includes one or more estates or interests in land, and

b ad valorem duty is chargeable on the conveyance or transfer of all or any of those estates or interests,

the amount of duty that would (apart from this subsection) be chargeable in consequence of subsection (2) on the transfer on sale there mentioned shall be reduced (but not below nil) by the total of thead valorem duty chargeable as mentioned in paragraph (b).

4 If, for the purposes of Part I of Schedule 13 to the Finance Act 1999, the amount or value of the consideration for the transfer on sale mentioned in subsection (2) would (apart from this subsection) exceed the market value of the estate or interest immediately before the execution of the instrument transferring or vesting it, the amount or value of the consideration shall be taken for those purposes to be equal to that market value.

5 For the purposes of this section, the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.

6 Subsection (2) has effect even though—

a the transfer or vesting of the estate or interest is the whole or part of the consideration for a sale of the other property; or

b the transaction is by way of exchange.

7 Subsection (2) does not affect any charge to stamp duty in respect of the same or any other instrument so far as it relates to the transfer of the other property.

8 This section is subject to subsection (5) of section 119.

9 This section shall be construed as one with the ^M70Stamp Act 1891.

10 This section applies to instruments executed on or after 28th March 2000.

11 But this section does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

a the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

12 This section shall be deemed to have come into force on 28th March 2000.

119 Transfer of land to connected company.¶

1 This section applies where an estate or interest in land is transferred to or vested in a company (“A”) and—

a the person transferring or vesting the estate or interest (“B”) is connected with A; or

b some or all of the consideration for the transfer or vesting consists of the issue or transfer of shares in a company with which B is connected.

2 For the purposes of Part I of Schedule 13 to the Finance Act 1999 (stamp duty on conveyance or transfer on sale) an instrument transferring or vesting the estate or interest shall be taken to be a transfer on sale of the estate or interest.

3 If for those purposes the amount or value of the consideration for the transfer on sale of the estate or interest would, apart from this subsection, be less than the value determined under subsection (4), the consideration shall be taken for those purposes to be the value determined under subsection (4).

4 That value is—

a the market value of the estate or interest immediately before the execution of the instrument transferring or vesting it; but

b reduced by the value of so much of any actual consideration as does not consist of property.

5 Where—

a apart from this section, an instrument would be chargeable to stamp duty in accordance with section 118, and

b apart from that section, the instrument would be chargeable to stamp duty in accordance with this section,

the stamp duty chargeable on the instrument shall be determined in accordance with this section (instead of that section).

6 This section applies only if, in consequence of its application, the instrument transferring or vesting the estate or interest is chargeable with a greater amount of stamp duty than it would be apart from this section and section 118.

7 For the purposes of this section, the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.

8 In this section—

“company” means any body corporate;
“shares” includes stock and the reference to shares in a company includes a reference to securities issued by a company.

9 For the purposes of this section, the question whether any person is connected with another shall be determined in accordance with the provisions of section 1122 of the Corporation Tax Act 2010.

10 This section shall be construed as one with the ^M71Stamp Act 1891.

11 This section applies to instruments executed on or after 28th March 2000.

12 But this section does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

a the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

13 This section shall be deemed to have come into force on 28th March 2000.

120 Exceptions from section 119.¶

1 Section 119 does not apply by virtue of paragraph (a) of subsection (1) of that section in any of the following cases (any reference in this section to A or B being taken as a reference to the person referred to as A or B, as the case may be, in that subsection).

2 Case 1 is where B holds the estate or interest as nominee or bare trustee for A.

3 Case 2 is where A is to hold the estate or interest as nominee or bare trustee for B.

4 Case 3 is where B holds the estate or interest as nominee or bare trustee for some other person and A is to hold it as nominee or bare trustee for that other person.

5 Case 4 is where (in a case not falling within subsection (2) or (4) above)—

a the transfer or vesting is a conveyance or transfer out of a settlement in or towards satisfaction of a beneficiary’s interest;

b the beneficiary’s interest is not an interest acquired for money or money’s worth; and

c the conveyance or transfer is a distribution of property in accordance with the provisions of the settlement.

6 Case 5 is where (in a case not falling within subsection (3) above) A—

a is a person carrying on a business which consists of or includes the management of trusts; and

b is to hold the estate or interest as trustee acting in the course of that business.

7 Case 6 is where (in a case not falling within subsection (3) above) A is to hold the estate or interest as trustee and, apart from section 1122(6) of the Corporation Tax Act 2010 (trustees as connected persons), would not be connected with B.

8 Case 7 is where—

a B is a company;

b the transfer or vesting is, or is part of, a distribution of assets (whether or not in connection with the winding up of the company); and

c the estate or interest was acquired by B by virtue of an instrument which is duly stamped.

9 This section shall be construed as one with the ^M72Stamp Act 1891.

10 This section applies to instruments executed after the day on which this Act is passed.

121 Grant of lease to connected company.¶

1 This section applies where a lease is granted to a company (“A”) and—

a the person granting the lease (“B”) is connected with A; or

b some or all of the consideration for the grant of the lease consists of the issue or transfer of shares in a company with which B is connected.

2 Subsection (3) has effect for the purposes of stamp duty chargeable under Part II of Schedule 13 to the ^M73Finance Act 1999 (stamp duty on a lease) by reference to Part I of that Schedule (conveyance or transfer on sale).

3 If, apart from this subsection, the amount or value of the consideration for the grant would be less than the value determined under subsection (4), the consideration shall be taken to be the value determined under subsection (4).

4 That value is—

a the market value, immediately before the instrument granting the lease is executed, of the lease granted; but

b reduced by the value of so much of any actual consideration as does not consist of property.

5 This section applies only if, in consequence of its application, the lease is chargeable with a greater amount of stamp duty than it would be apart from this section.

6 For the purposes of this section, the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.

7 In this section—

“company” means any body corporate;
“shares” includes stock and the reference to shares in a company includes a reference to securities issued by a company.

8 For the purposes of this section, the question whether any person is connected with another shall be determined in accordance with the provisions of section 1122 of the Corporation Tax Act 2010.

9 This section shall be construed as one with the ^M74Stamp Act 1891.

10 This section applies to instruments executed on or after 28th March 2000.

11 But this section does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

a the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

12 This section shall be deemed to have come into force on 28th March 2000.

122 Marketable securities transferred etc for exempt property.¶

1 Subsection (2) applies where—

a an instrument transferring marketable securities would not, apart from this section, be or fall to be treated as a transfer on sale for the purposes of stamp duty; but

b the transfer of the marketable securities is for consideration; and

c the consideration is or includes any qualifying property (“the other property”).

2 For the purposes of Part I of Schedule 13 to the Finance Act 1999 (stamp duty on conveyance or transfer on sale) the instrument transferring the marketable securities shall be taken to be a transfer on sale of those securities.

3 If the amount or value of the consideration for that transfer on sale would (apart from this subsection) exceed the market value of the marketable securities immediately before the execution of the instrument transferring them, the amount or value of the consideration shall be taken to be equal to that market value.For this purpose the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.

4 Subsection (2) has effect even though—

a the transfer of the marketable securities is the whole or part of the consideration for a sale of the other property; or

b the transaction is by way of exchange.

5 Subsection (2) does not affect any charge to stamp duty in respect of the same or any other instrument so far as it relates to the transfer of the other property.

6 In this section “qualifying property” means any debt due, stock or securities, to the extent that the debt, stock or securities are not chargeable securities, within the meaning of Part IV of the ^M75Finance Act 1986 (stamp duty reserve tax).

7 This section shall be construed as one with the ^M76Stamp Act 1891.

8 This section applies to instruments executed on or after 28th March 2000.

9 But this section does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—

a the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or

10 This section shall be deemed to have come into force on 28th March 2000.

123 Transfer of property between associated companies: Great Britain.¶

1 Amend section 42 of the ^M77Finance Act 1930 as follows.

2 In subsection (2) (instruments on which stamp duty not chargeable) in paragraph (a) for “to another" substitute “ (“the transferor”) to another (“the transferee”) ”.

3 In that subsection, after paragraph (b) insert— “ unless at the time the instrument is executed arrangements are in existence by virtue of which at that or some later time any person has or could obtain, or any persons together have or could obtain, control of the transferee but not of the transferor. ”.

4 In subsection (2B) (body to be parent of another if beneficial owner of 75% of ordinary share capital) after “if at that time the first body" insert “ (a) ” and at the end of the subsection add—

5 In subsection (3)—

a after “The ownership referred to in" insert “ paragraph (a) of ”; and

b for “this section" substitute “ that paragraph ”.

6 At the end of the section add—

7 This section has effect in relation to instruments executed after the day on which this Act is passed.

124 Transfer of property between associated companies: Northern Ireland.¶

1 Amend section 11 of the ^M80Finance Act (Northern Ireland) 1954 as follows.

2 After subsection (2) (instruments on which stamp duty not chargeable) insert—

3 In subsection (3AA) (body to be parent of another if beneficial owner of 75% of ordinary share capital) after “if at that time the first body" insert “ (a) ” and at the end of the subsection add—

4 In subsection (3A)—

a after “The ownership referred to in" insert “ paragraph (a) of ”; and

b for “this section" substitute “ that paragraph ”.

5 At the end of the section add—

6 This section has effect in relation to instruments executed after the day on which this Act is passed.

125 Grant of leases etc between associated companies.¶

1 Amend section 151 of the ^M83Finance Act 1995 as follows.

2 In subsection (1) (stamp duty not chargeable on leases etc) at the end insert the following paragraph—

3 After subsection (4) insert—

4 In subsection (8) (body to be parent of another if beneficial owner of 75% of ordinary share capital) after “if at that time the first body" insert “ (a) ” and at the end of the subsection add—

5 In subsection (10)—

a after “The ownership referred to in" insert “ paragraph (a) of ”; and

b for “this section" substitute “ that paragraph ”.

6 After subsection (10) insert—

7 This section has effect in relation to instruments executed after the day on which this Act is passed.

126 Future issues of stock.¶

1 Amend section 55 of the ^M86Stamp Act 1891 (calculation of ad valorem duty in respect of stock and securities) as follows.

2 After subsection (1) insert—

3 This section has effect in relation to instruments executed after the day on which this Act is passed.

127 Company acquisition reliefs: redeemable shares.¶

1 Amend section 75 of the ^M87Finance Act 1986 (acquisitions: reliefs) in accordance with subsections (2) and (3).

2 In subsection (4), in paragraph (a) (which requires that the consideration for the acquisition consists of or includes the issue of shares) after “the issue of" insert “ non-redeemable ”.

3 In subsection (4), after paragraph (b) add—

^F6574 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5 This section has effect in relation to instruments executed after the day on which this Act is passed.

128 Surrender of leases.¶

1 Where a lease is or has been surrendered or, in Scotland, renounced at any time, a document evidencing the surrender or renunciation shall be treated for the purposes of stamp duty as if it were a deed executed at that time effecting the surrender or renunciation.

2 Stamp duty shall be chargeable by virtue of subsection (1) on a document containing a statutory declaration, notwithstanding anything in land registration rules under the Land Registration Act 2002.

3 Stamp duty shall not be chargeable by virtue of subsection (1) on any lease or agreement for a lease or with respect to any letting if the lease or agreement—

a is made in consideration of the surrender or renunciation; and

b relates to the same subject matter as the lease surrendered or renounced.

4 Stamp duty shall not be chargeable by virtue of subsection (1) on any document if a document falling within subsection (5) has been duly stamped.

5 The documents that fall within this subsection are—

a a deed effecting the surrender or renunciation;

b an agreement which falls to be treated for the purposes of stamp duty as if it were such a deed;

c any document which falls to be so treated by virtue of subsection (1); and

d any lease or agreement falling within subsection (3).

6 A land registrar shall regard a document which by virtue of subsection (4) is not chargeable to stamp duty by virtue of subsection (1) as not duly stamped unless—

a it is stamped as if it were a deed effecting the surrender or renunciation; or

b it appears by some stamp ^F804... on it that the full and proper duty chargeable on such a deed has been paid on another document; or

c it appears by some stamp ^F804... on it that a lease or agreement falling within subsection (3) has been duly stamped; or

d the land registrar is aware of a document falling within subsection (5) which has been duly stamped.

7 The documents which evidence the surrender or renunciation of a lease shall be taken to include an application, in consequence of the surrender or renunciation of the lease, for—

a the making in a land register, or

b the removal from a land register,

of an entry relating to the lease.

8 In this section—“land register"—

a in relation to England and Wales, means the register kept under section 1 of the Land Registration Act 2002;

b in relation to Scotland, means the Land Register of Scotland or the General Register of Sasines;

c in relation to Northern Ireland, means the register maintained under section 10 of the ^M88Land Registration Act (Northern Ireland) 1970;“land registrar"—

a in relation to England and Wales, means the Chief Land Registrar or any other officer of Her Majesty’s Land Registry exercising functions of the Chief Land Registrar;

b in relation to Scotland, means the Keeper of the Registers of Scotland;

c in relation to Northern Ireland, means the Registrar of Titles or any other official of the Land Registry exercising functions of the Registrar of Titles.

9 This section shall be construed as one with the ^M89Stamp Act 1891.

10 This section applies to documents relating to the surrender or renunciation of a lease after the day on which this Act is passed.

129 Abolition of duty on instruments relating to intellectual property.¶

1 No stamp duty is chargeable on an instrument for the sale, transfer or other disposition of intellectual property.

2 In subsection (1) “intellectual property” means—

a any patent, trade mark, registered design, copyright or design right,

b any plant breeders’ rights and rights under section 7 of the ^M90Plant Varieties Act 1997,

c any licence or other right in respect of anything within paragraph (a) or (b), and

d any rights under the law of a country or territory outside the United Kingdom that correspond or are similar to those within paragraph (a), (b) or (c).

3 Schedule 34 to this Act (which contains provisions supplementing this section) has effect.

4 This section and Schedule 34 shall be construed as one with the ^M91Stamp Act 1891.

5 This section applies to instruments executed on or after 28th March 2000.

6 This section shall be deemed to have come into force on that date.

^F658130 Transfers to registered social landlords etc.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

131 Relief for certain instruments executed before this Act has effect.¶

1 This section applies to an instrument of any of the following descriptions executed in the period beginning with 22nd March 2000 and ending with the day on which this Act is passed—

a an instrument transferring or vesting an estate or interest in land in such circumstances as are mentioned in section 119 (transfer of land to connected company), in a case specified in section 120 (excepted cases);

^F659b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2 If the instrument is not stamped until after the day on which this Act is passed, the law in force at the time of its execution shall be deemed for stamp duty purposes to be that which would have applied if it had been executed after that day.

3 If the Commissioners are satisfied that—

a the instrument was stamped on or before the day on which this Act is passed,

b stamp duty was chargeable in respect of it, and

c had it been stamped after that day no stamp duty, or less stamp duty, would have been chargeable,

they shall pay to such person as they consider appropriate an amount equal to the duty (and any interest or penalty) that would not have been payable if the law in force at the time of execution of the instrument had been that which would have applied had it been executed after that day.

4 Any such payment must be claimed before 1st April 2001.

5 Entitlement to a payment is subject to compliance with such conditions as the Commissioners may determine with respect to the production of the instrument, to its being stamped so as to indicate that it has been produced under this section or to other matters.

6 For the purposes of section 10 of the ^M92Exchequer and Audit Departments Act 1866 (Commissioners to deduct repayments from gross revenues) any amount paid under this section shall be treated as a repayment.

7 This section shall be construed as one with the ^M93Stamp Act 1891.

132 The Northern Ireland Assembly Commission.¶

1 Amend section 55 of the ^M94Finance Act 1987 (Crown exemption from stamp duty) as follows.

2 In subsection (1) (which specifies the bodies relieved from stamp duty)—

a after “agreed to be made" insert “ (a) ”;

b after “Minister of the Crown or" insert “ (b) ”; and

c after “Treasury, or" insert “ (c) ”.

3 In subsection (1), after “National Assembly for Wales," insert

4 Subsection (3) has effect in relation to instruments executed on or after 28th March 2000.

5 This section shall be deemed to have come into force on 28th March 2000.

Stamp duty and Stamp duty reserve tax¶

133 Loan capital where return bears inverse relationship to results.¶

1 In section 79 of the ^M95Finance Act 1986 (loan capital), after subsection (7) insert—

2 For the purposes of stamp duty, subsection (1) above has effect where the instrument is executed on or after 21st March 2000.

3 For the purposes of stamp duty reserve tax, subsection (1) above has effect—

a in relation to the charge to tax under section 87 of the Finance Act 1986, where—

i the agreement to transfer is conditional and the condition is satisfied on or after 21st March 2000, or

ii the agreement is not conditional and is made on or after that date;

b in relation to the charge to tax under section 93(1) of that Act, where securities are transferred, issued or appropriated on or after 21st March 2000 (whenever the arrangement was made);

c in relation to the charge to tax under section 96(1) of that Act, where securities are transferred or issued on or after 21st March 2000 (whenever the arrangement was made);

d in relation to the charge to tax under section 93(10) of that Act, where securities are issued or transferred on sale, under terms there mentioned, on or after 21st March 2000;

e in relation to the charge to tax under section 96(8) of that Act, where securities are issued or transferred on sale, under terms there mentioned, on or after 21st March 2000.

134 Transfers between depositary receipt systems and clearance systems.¶

1 In Part III of the ^M96Finance Act 1986 (stamp duty), after section 72 insert—

Transfers between depositary receipt system and clearance system

72A Transfers between depositary receipt system and clearance system.

1 Where an instrument transfers relevant securities of a company incorporated in the United Kingdom between a depositary receipt system and a clearance system—

a the provisions of section 67(2) to (5) or, as the case may be, section 70(2) to (5) above shall not apply, and

b the stamp duty chargeable on the instrument is £5.

2 A transfer between a depositary receipt system and a clearance system means a transfer—

a from (or to) a company that at the time of the transfer falls within section 67(6) above, and

b to (or from) a company that at that time falls within section 70(6) above.

3 This section does not apply to a transfer from a clearance system (that is, from such a company as is mentioned in subsection (2)(b) above) if at the time of the transfer an election is in force under section 97A below in relation to the clearance services for the purposes of which the securities are held immediately before the transfer.

2 In Part IV of the ^M97Finance Act 1986 (stamp duty reserve tax), after section 97A insert—

97B Transfer between depositary receipt system and clearance system.

1 There shall be no charge to tax under section 93 or 96 above where securities are transferred between a depositary receipt system and a clearance system.

2 A transfer between a depositary receipt system and a clearance system means a transfer—

a from (or to) a company which at the time of the transfer falls within section 67(6) above, and

b to (or from) a company which at that time falls within section 70(6) above.

3 This section does not apply to a transfer from a clearance system (that is, from such a company as is mentioned in subsection (2)(b) above) if at the time of the transfer an election is in force under section 97A above in relation to the clearance services for the purposes of which the securities are held immediately before the transfer.

3 In sections 67(9), 70(9), 95(1) and 97(1) of the ^M98Finance Act 1986 (transfers between depositary receipt systems or between clearance systems), the words “and is resident in the United Kingdom" and “and is so resident" shall cease to have effect.

4 In section 97A of that Act (clearance services: election for alternative system of charge), after subsection (12) add—

5 The amendments in this section have effect as follows—

a subsection (1), and subsections (3) and (4) as they apply for stamp duty purposes, apply in relation to instruments executed after the day on which this Act is passed;

b subsection (2), and subsections (3) and (4) as they apply for the purposes of stamp duty reserve tax, apply where the securities are transferred after that day.

Part V Other taxes¶

Value added tax¶

^F24135 Supplies to which reduced rate applies.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

136 Disposals of assets for which a VAT repayment is claimed.¶

1 In section 3(2) of the ^M99Value Added Tax Act 1994 (taxable persons and registration), for “Schedules 1 to 3" there shall be substituted “ Schedules 1 to 3A ”.

^F5572 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3 In section 69(1)(a) of that Act (breaches of regulatory provisions), for “or paragraph 5 of Schedule 3" there shall be substituted “ , paragraph 5 of Schedule 3 or paragraph 5 of Schedule 3A ”.

4 In section 73(3)(b) of that Act (failure to make returns etc.), for “or paragraph 6(2) or (3) of Schedule 3" there shall be substituted “ , paragraph 6(2) or (3) of Schedule 3 or paragraph 6(1) or (2) of Schedule 3A ”.

5 In section 74(1)(c) of that Act (interest on VAT recovered or recoverable by assessment), for “under paragraph 8 of Schedule 3" there shall be substituted “ , under paragraph 8 of Schedule 3 or under paragraph 7 of Schedule 3A ”.

6 In the following provisions of that Act—

a paragraph 1(4)(a) and (5) of Schedule 1 (registration in respect of taxable supplies); and

b paragraph 1(4) of Schedule 2 (registration in respect of supplies from other member States),

for “or paragraph 6(3) of Schedule 3" there shall be substituted “ , paragraph 6(3) of Schedule 3 or paragraph 6(2) of Schedule 3A ”.

7 In paragraph 1(3) of Schedule 3 to that Act (registration in respect of acquisitions from other member States), for “or paragraph 6(2) of Schedule 2" there shall be substituted “ , paragraph 6(2) of Schedule 2 or paragraph 6(2) of Schedule 3A ”.

8 After Schedule 3 to that Act there shall be inserted the Schedule 3A set out in Schedule 36 to this Act.

9 In paragraph 5(5) of Schedule 4 to that Act (matters to be treated as a supply of goods or services), for the words from “under sections 25 and 26" to the end there shall be substituted—

10 Subsections (1) to (7) and (9) above have effect in relation to supplies made on or after 21st March 2000; and subsection (8) above and Schedule 36 to this Act have effect in relation to relevant supplies (within the meaning of Schedule 3A to that Act) made on or after that date.

137 Gold: penalty for failure to comply with record-keeping requirements etc.¶

1 Part IV of the ^M100Value Added Tax Act 1994 (administration, collection and enforcement) is amended as follows.

2 After section 69 (breaches of regulatory provisions) insert—

69A Breach of record-keeping requirements etc. in relation to transactions in gold.

1 This section applies where a person fails to comply with a requirement of regulations under section 13(5)(a) or (b) of the ^M101Finance Act 1999 (gold: duties to keep records or provide information).Where this section applies, the provisions of section 69 do not apply.

2 A person who fails to comply with any such requirement is liable to a penalty not exceeding 17.5% of the value of the transactions to which the failure relates.

3 For the purposes of assessing the amount of any such penalty, the value of the transactions to which the failure relates shall be determined by the Commissioners to the best of their judgement and notified by them to the person liable.

4 No assessment of a penalty under this section shall be made more than 2 years after evidence of facts sufficient in the opinion of the Commissioners to justify the making of the assessment comes to their knowledge.

5 The reference in subsection (4) above to facts sufficient to justify the making of the assessment is to facts sufficient—

a to indicate that there had been a failure to comply with any such requirement as is referred to in subsection (1) above, and

b to determine the value of the transactions to which the failure relates.

6 A failure by any person to comply with any such requirement as is mentioned in subsection (1) above shall not give rise to a liability to a penalty under this section if the person concerned satisfies the Commissioners or, on appeal, a tribunal, that there is a reasonable excuse for the failure.

7 Where by reason of conduct falling within subsection (1) above a person—

a is assessed to a penalty under section 60, or

b is convicted of an offence (whether under this Act or otherwise),

that conduct shall not also give rise to a penalty under this section.

3 In section 70(1) of that Act (mitigation of penalties), for “or 67" substitute “ , 67 or 69A ”.

4 In section 76(1) of that Act (assessment of amount due by way of penalty etc.), for “to 69" (in both places) substitute “ to 69A ”.

5 In section 83 of that Act (appeals), in paragraph (n) for “59 to 69" substitute “ 59 to 69A ”.

Inheritance tax¶

138 Treatment of employee share ownership trusts.¶

1 The ^M102Inheritance Tax Act 1984 is amended as follows.

2 In section 13 (dispositions by close companies for benefit of employees), in subsection (4), after paragraph (b) insert

3 In section 72 (property leaving employee trusts and newspaper trusts)—

a in subsection (2) after “subsection (4)" insert “ , (4A) ”, and

b after subsection (4) insert—

4 In section 86 (trusts for benefit of employees), in subsection (3), after paragraph (b) insert

Petroleum revenue tax¶

139 Operating expenditure incurred while safeguard relief applies.¶

1 After section 9 of the ^M103Oil Taxation Act 1975 insert—

9A Operating expenditure incurred while section 9 applies.

1 Subsections (2) and (3) below apply where—

a operating expenditure is incurred by a participator in an oil field during a chargeable period to which section 9(1) of this Act applies (“the relevant chargeable period”);

b a claim for the allowance of the expenditure is made under Schedule 5 or 6 for the claim period which coincides with the relevant chargeable period (“the relevant claim period”); and

c the claim is made more than four months after the end of the relevant claim period.

2 The Board shall not allow the expenditure except to such extent (if any) as they consider necessary to secure that the participator’s overall liability to tax is no greater than it would have been if the claim had been allowed before the Board had made an assessment to tax or a determination on or in relation to the participator in respect of the field for the relevant chargeable period.

3 Any amounts of oil allowance which, if the claim had been allowed before the Board had made an assessment to tax or a determination on or in relation to the participator in respect of the field for the relevant chargeable period, would not have been utilised by him in that period, or any subsequent chargeable period, shall be disregarded for the purposes of section 8(6) of this Act.

4 Where—

a the participator transfers the whole or part of his interest in the oil field to another person; and

b Parts II and III of Schedule 17 to the ^M104Finance Act 1980 apply to the transfer,

subsections (2) and (3) above shall have effect as if references to the participator included references to that other person.

5 In this section—

“acquisition”, in relation to an asset, includes acquisition of an interest in the asset;
“capital expenditure” means expenditure on the acquisition or construction of an asset which is to be used for any of the following purposes—
1. for ascertaining the extent or characteristics of any oil-bearing area wholly or partly included in the field, or what the reserves of oil of any such oil-bearing area are;
2. for winning oil from the field;
3. for transporting oil won from the field, whether to a place in the United Kingdom or to a place in another country; or
4. for the initial treatment or initial storage of oil won from the field;
“operating expenditure” means any expenditure other than capital expenditure.

6 Where a claim period is a period of twelve months, this section shall have effect as if—

a that period were two separate claim periods of six months each;

b any claim for that period under Schedule 5 or 6 were two separate claims, one for each of those separate periods; and

c the operating expenditure to which that claim relates were apportioned between those separate periods and those separate claims in such manner as may be just and reasonable.

2 This section has effect in relation to expenditure incurred on or after 21st March 2000.

Landfill tax¶

140 Rate.¶

1 In section 42 of the ^M105Finance Act 1996 (amount of landfill tax), in subsections (1)(a) and (2) for “£10" substitute “ £11 ”.

2 This section has effect in relation to taxable disposals made, or treated as made, on or after 1st April 2000.

141 Disposals which are not taxable.¶

1 In section 62 of the ^M106Finance Act 1996 (regulations about taxable disposals) amend subsection (7) (limit on power to make regulations providing that a disposal is not taxable) as follows.

2 For paragraph (a) substitute—

3 In paragraph (b) for “the temporary disposal is made" substitute “ the material in question is held temporarily ”.

142 Secondary liability.¶

1 In section 60 of the ^M107Finance Act 1996 (which gives effect to Schedule 5 to the Act), after “penalties" insert “ , secondary liability ”.

2 Accordingly the sidenote to that section becomes “Information, powers, penalties, secondary liability, etc".

3 At the end of Schedule 5 to that Act (supplementary provisions relating to landfill tax) add the Part VIII set out in Schedule 37 to this Act.

4 Subsection (3) has effect in relation to taxable disposals made on or after the day on which this Act is passed.

Part VI Miscellaneous and supplementary provisions¶

Incentives for electronic communications¶

143 Power to provide incentives to use electronic communications.¶

1 Regulations may be made in accordance with Schedule 38 to this Act for providing incentives to use electronic communications.

^F4692 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Compliance¶

^F558144 Offence of fraudulent evasion of income tax¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

145 Information about interest etc paid, credited or received.¶

1 In section 17 of the ^M108Taxes Management Act 1970 (interest paid or credited by banks etc without or after deduction of tax), subsections (4B) and (4C) shall cease to have effect.

2 In subsection (5) of that section—

a for paragraph (c) there shall be substituted—

;

and

b at the end there shall be inserted—

3 After paragraph (a) of subsection (6) of that section there shall be inserted—

4 In subsection (1) of section 18 of that Act (interest paid without or after deduction of tax)—

a for “by whom" there shall be substituted “ by or through whom ”; and

b for “who receives any such interest" there shall be substituted “ by whom any such interest is received ”.

5 Subsections (3) and (3AA) of that section shall cease to have effect.

6 In subsection (3A) of that section, after “interest paid" there shall be inserted “ or received ”.

7 At the end of subsection (3B) of that section there shall be inserted—

8 After paragraph (a) of subsection (3C) of that section there shall be inserted—

9 For subsection (3D) of that section there shall be substituted—

3D For the purposes of this section interest shall be treated as received by any person if it is received by another person at his direction or with his consent.

3E For the purposes of this section the following shall be treated as interest—

a any dividend in respect of a share in a building society;

b any amount to which a person holding a relevant discounted security is entitled on the redemption of that security; and

c any foreign dividend.

3F In subsection (3E)(b) above “relevant discounted security” has the meaning given by paragraph 3 of Schedule 13 to the ^M109Finance Act 1996.

3G In subsection (3E)(c) above “foreign dividend” means any annual payment, interest or dividend payable out of, or in respect of the stocks, funds, shares or securities of—

a a body of persons that is not resident in the United Kingdom, or

b a government or public or local authority in a country outside the United Kingdom.

10 Section 482A of Taxes Act 1988 (audit powers in relation to non-residents) shall cease to have effect.

11 This section has effect in relation to amounts paid, credited or received on or after 6th April 2001.

^F333146 International exchange of information: general.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F334147 International exchange of information: inheritance tax.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F855148 Use of minimum wage information.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

149 Orders for the delivery of documents.¶

1 After section 20B of the ^M110Taxes Management Act 1970 insert—

20BA Orders for the delivery of documents.

1 The appropriate judicial authority may make an order under this section if satisfied on information on oath given by an authorised officer of the Board—

a that there is reasonable ground for suspecting that an offence involving serious fraud in connection with, or in relation to, tax is being, has been or is about to be committed, and

b that documents which may be required as evidence for the purposes of any proceedings in respect of such an offence are or may be in the power or possession of any person.

2 An order under this section is an order requiring the person who appears to the authority to have in his possession or power the documents specified or described in the order to deliver them to an officer of the Board within—

a ten working days after the day on which notice of the order is served on him, or

b such shorter or longer period as may be specified in the order.For this purpose a “working day” means any day other than a Saturday, Sunday or public holiday.

3 Where in Scotland the information mentioned in subsection (1) above relates to persons residing or having places of business at addresses situated in different sheriffdoms—

a an application for an order may be made to the sheriff for the sheriffdom in which any of the addresses is situated, and

b where the sheriff makes an order in respect of a person residing or having a place of business in his own sheriffdom, he may also make orders in respect of all or any of the other persons to whom the information relates (whether or not they have an address within the sheriffdom).

4 Schedule 1AA to this Act contains provisions supplementing this section.

2 After Schedule 1 to the ^M111Taxes Management Act 1970, insert the Schedule 1AA set out in Schedule 39 to this Act.

3 In section 20BB of that Act (falsification etc. of documents)—

a in subsection (1)(a), after “above" insert “ or an order under section 20BA above ”;

b in subsection (3), after “notice is given" insert “ or the order is made ”; and

c after “notice", in the second place where it occurs in that subsection, insert “ or order ”.

^F4354 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F436150 Search warrants: miscellaneous amendments.¶

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Provisions relating to government finance¶

151 Debt Management Account.¶

In Schedule 5A to the ^M112National Loans Act 1968 (the Debt Management Account), in paragraph 11, after sub-paragraph (1) (excess of Account’s liabilities over its assets to be liability of National Loans Fund) insert—

152 National Savings Bank.¶

1 In section 4 of the ^M113National Savings Bank Act 1971 (deposits: limits and minimum balances), after subsection (3) insert—

2 In section 26 of that Act (regulations and orders etc.), for subsections (2) and (3) (parliamentary control of regulations under section 2 and orders under section 4) substitute—

3 If a draft of a statutory instrument containing an order under section 4 of that Act has been laid before Parliament, but the instrument has not been made, before the day on which this Act is passed, the instrument may be made either—

a as if section 26 of that Act had not been amended by this section, or

b in reliance on section 26(2) as substituted by this section.The instrument shall be taken to be made as mentioned in paragraph (a) unless it states that it is made in reliance on section 26(2) as substituted by this section.

153 National savings certificates.¶

1 This section applies to a national savings certificate issued under section 12 of the ^M114National Loans Act 1968 if—

a it was purchased on or before 7th October 1999, and

b the fifth anniversary of its purchase falls after the day on which this Act is passed.

2 The power of the Treasury (under the prospectus under which the certificate was issued) to alter or end the extension terms for the certificate shall have effect as if it included power for the Treasury to decide before the fifth anniversary of the certificate’s purchase that the extension terms for the certificate are to involve it (so far as not cashed in) undergoing automatic roll-over on that anniversary.

3 Where a certificate undergoes automatic roll-over on any occasion, the Treasury has power to decide before the fifth anniversary of that occasion that the extension terms for the certificate are to involve it (so far as not cashed in) undergoing automatic roll-over on that anniversary.

4 For the purposes of this section a certificate undergoes “automatic roll-over” on an occasion if during the period of 5 years beginning with that occasion the certificate (so far as not cashed in) will earn interest as though it were a national savings certificate—

a purchased on that occasion for a term of 5 years at a price equal to the value (rounded, if necessary, to the nearest penny) of the certificate on that occasion, and

b earning such interest (whether at fixed rates or at rates that give effect to index-linking or partly one and partly the other) as has been decided by the Treasury before that occasion.

5 Subject to subsections (2) and (3), a certificate to which this section applies continues (so far as not cashed in) to be held on the terms of the prospectus under which it was issued.However, any obligation of the Director of Savings to take steps to inform the holder of the certificate before the fifth anniversary of its purchase of what is to happen to the certificate after that anniversary extends to taking the corresponding steps in relation to the fifth anniversary of each occasion on which the certificate has undergone automatic roll-over.

6 Nothing in this section shall be taken as prejudicing the rights of the holder of a certificate to which this section applies to apply at any time to cash in the certificate.

7 References in this section to cashing in a certificate include reinvesting it.

154 Exchange Equalisation Account.¶

1 For section 4 of the ^M115Exchange Equalisation Account Act 1979 (examination and certification of the Account) substitute—

4 Annual accounts.

1 For each financial year in which the Account operates the Treasury shall prepare, in such form and on such basis as they may prescribe, accounts in relation to the transactions, assets and liabilities of the Account.

2 The Treasury shall send the accounts to the Comptroller and Auditor General not later than 30th November of the financial year following that to which the accounts relate.

3 The Comptroller and Auditor General shall examine and certify the accounts, issue a report on them and send the certified accounts and the report to the Treasury not later than 15th January of that year.

4 The Treasury shall lay the certified accounts and the report before each House of Parliament not later than 31st January of that year.

5 In certifying accounts under subsection (3) above the Comptroller and Auditor General shall state whether or not it is his opinion, having regard to his examination of the accounts, that—

a the resources of the Account have been used in accordance with the provisions of this Act;

b the transactions of the Account are in accordance with any relevant authority; and

c the accounts have been prepared in the form, and on the basis, prescribed under subsection (1) above.

6 The Treasury may by order made by statutory instrument amend the date for the time being specified in any of subsections (2) to (4) above.

7 Before making an order under subsection (6) above the Treasury shall consult the Comptroller and Auditor General.

8 A statutory instrument containing an order under subsection (6) above shall be subject to annulment in pursuance of a resolution of the House of Commons.

9 In this section a reference to the use of resources is a reference to their expenditure, consumption or reduction in value.

2 This section applies in relation to the operation of the Exchange Equalisation Account in the financial year ending 31st March 2001 and subsequent financial years.

Supplementary provisions¶

155 Interpretation.¶

In this Act “the Taxes Act 1988” means the ^M116Income and Corporation Taxes Act 1988 and “ITTOIA 2005” means the Income Tax (Trading and Other Income) Act 2005 and “ITA 2007” means the Income Tax Act 2007.

156 Repeals.¶

1 The enactments mentioned in Schedule 40 to this Act (which include provisions that are spent or of no practical utility) are repealed to the extent specified in the third column of that Schedule.

2 The repeals specified in that Schedule have effect subject to the commencement provisions and savings contained or referred to in the notes set out in that Schedule.

157 Short title.¶

This Act may be cited as the Finance Act 2000.

SCHEDULES

SCHEDULE 1 ¶

Mixing of rebated light oils

Section 6.

Converting unleaded petrol into leaded petrol¶

1 In paragraph 1(1) of Schedule 2A to the ^M117Hydrocarbon Oil Duties Act 1979 (converting unleaded petrol into leaded petrol), before paragraph (a) insert—

2 In paragraph 8 of that Schedule (rate for mixtures of light oil), for sub-paragraph (2) substitute—

Converting unleaded petrol into higher octane unleaded petrol¶

^F252. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Mixing different kinds of unleaded petrol¶

1 After paragraph 2 of that Schedule insert—

Mixing different kinds of unleaded petrol

1 A mixture which is unleaded petrol is produced in contravention of this paragraph if the mixture is produced by mixing unleaded petrol of any two or more of the following descriptions—

a petrol on which duty has been paid at the rate specified in section 6(1A)(a),

b petrol in respect of which a rebate has been allowed under section 13A(1A)(b),

c petrol in respect of which a rebate has been allowed under section 13A(1A)(a),

where the mixture produced is petrol of a description subject to a higher effective rate of duty than one or more of the ingredients of the mixture.

2 The comparison required by sub-paragraph (1) shall be made by reference to the effective rates of duty in force at the time the mixture is produced.

3 This paragraph is subject to any direction given under paragraph 3.

2 In paragraph 3 of that Schedule, for “paragraph 1 above or (as the case may be) paragraph 2 above" substitute “ paragraph 1, 2 or 2A above ”.

3 In paragraph 8 of that Schedule, after sub-paragraph (3) insert—

^F264 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Interpretation¶

^F274. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE 2 ¶

Amusement machine licence duty

Section 17.

Introduction¶

1The ^M118Betting and Gaming Duties Act 1981 is amended as follows.

Exceptions from requirement to be licensed¶

2In section 21(3A) (types of amusement machine excepted from requirement to be licensed) in paragraph (b) (five-penny machine which is a small-prize machine) for “five-penny machine" substitute “ ten-penny machine ”.

Amusement machine licence duty¶

1 In section 22(2) (definition of small-prize machines)—

a after “Act" insert “ (a) ”;

^F513b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

c at the end insert—

2 In section 22(3) (power of Commissioners to amend the sum mentioned in the definition of prize machines), for “the sum" substitute “ a sum ”.

Amount of duty¶

1 In section 23(2) (amount of duty)—

a in paragraph (b) for “column 2, column 3 or column 4 of the Table" substitute “ Category A, Category B, Category C, Category D or Category E ”;

b for “the rate in column 2, the rate in column 3, or the rate in column 4" substitute “ the rate for the category of machine in question in column 2, 3, 4, 5 or 6 of the Table ”;

c for the Table substitute—

TABLE

(1)	(2)	(3)	(4)	(5)	(6)
Period (in months) for which licence granted	Category A	Category B	Category C	Category D	Category E
	£	£	£	£	£
1	30	80	80	165	220
2	50	150	160	320	425
3	75	220	230	470	615
4	95	285	300	605	800
5	120	345	360	735	970
6	140	400	420	855	1,125
7	160	450	475	965	1,270
8	185	500	525	1,065	1,405
9	205	540	570	1,155	1,525
10	225	580	610	1,240	1,635
11	240	615	650	1,310	1,730
12	250	645	680	1,375	1,815

2 At the end of section 23 insert—

Meaning of amusement machine¶

1 In section 25 (meaning of amusement machine), in paragraph (b) of subsection (1B) (meaning of video machine) omit “, other than one consisting only in a blank surface onto which light is projected”.

2 In that section, in subsection (7) (application of provisions to a machine that falls to be treated as more than one machine) omit the word “or" at the end of paragraph (c) and after that paragraph insert—

Supplementary provisions¶

6In section 26(2) (definitions), after the definition of “five-penny machine" insert—

Paragraphs 2 to 6: commencement¶

1 Paragraphs 2 to 4, 5(2) and 6 shall have effect in relation to any amusement machine licence for which an application is received by the Commissioners of Customs and Excise after 4th August 2000.

2 Paragraph 5(1) shall have effect on and after the day on which this Act is passed.

Seasonal licences: duration¶

1 Amend paragraph 4 of Schedule 4 as follows.

2 In sub-paragraph (2) (which provides for a seasonal licence to remain in force during October of the year for which it is granted) for the words from “during October of that year" to the end substitute

3 In sub-paragraph (8) (meaning of “winter period”) for “November to February" substitute “ the period beginning with the first Monday in November and ending with the last day of February ”.

4 Sub-paragraph (2) applies in relation to any licence expressed to be granted for a period beginning with 1st April in 2000 or any subsequent year.

5 Sub-paragraph (3) has effect for determining what was comprised in the winter period beginning in 1999, and for determining what is comprised in any subsequent winter period.

Unlicensed amusement machines: duty chargeable¶

9After section 24 insert—

1 After Schedule 4 insert—

Schedule 4A

Unlicensed amusement machines

Application

1This Schedule applies where it appears to the Commissioners that an amusement machine is or was provided for play on premises in contravention of section 21(1) or 24(3) or (4) of this Act.

Default notice requesting production of licence

1 The Commissioners may give a notice which complies with the requirements of sub-paragraphs (3) and (4) below.

2 In this Schedule such a notice is referred to as a “default notice".

3 The notice shall state that one or more amusement machines appear to have been provided for play on specified premises (“relevant premises”) during a specified period (the “alleged default period”)—

a the first day of which falls not more than three years before the date of the notice, and

b the last day of which falls on or before the date of the notice.

4 The notice shall request the production to the Commissioners on or before a specified date (the “due date”) of every relevant amusement machine licence.

5 For the purposes of sub-paragraph (4) above an amusement machine licence is a relevant licence if, at any time during the alleged default period, it was in force in relation to an amusement machine provided for play on the relevant premises at that time.

6 A single default notice may relate to—

a different alleged default periods, or

b different relevant premises.

7 A default notice shall be deemed to have been given if it is—

a left at, or posted to, the relevant premises, or

b given to, or posted to or left at the proper address of one or more persons falling within sub-paragraph (8) below.

8 Those persons are—

a one or more of the persons who are or appear to be, or who at any time during the alleged default period were or appear to have been, responsible persons in relation to the relevant premises or an amusement machine provided for play on those premises, or

b any person who is the representative of such a person.

Failure to produce a licence: grant of default licence

1 In any case where—

a the Commissioners give a default notice,

b the due date specified in the notice passes, and

c it appears to the Commissioners that at some time during the alleged default period specified in the notice one or more amusement machines were provided for play on the relevant premises so specified without an amusement machine licence being in force in relation to the machines,

the Commissioners may grant, in accordance with this paragraph, one or more licences in relation to each of the machines.

2 In this Schedule—

“default licence” means a licence granted by the Commissioners under sub-paragraph (1) above;
“unlicensed machine” means a machine in relation to which a default licence is granted by the Commissioners.

3 The Commissioners may grant a separate default licence for each period of consecutive days—

a which falls within the alleged default period, and

b for which no amusement machine licence in force in relation to the unlicensed machine was produced.

4 The Commissioners may grant a default licence in relation to an unlicensed machine even though the period of that licence would include a day or days when the unlicensed machine was provided for play in contravention of section 21(1) or 24(3) or (4) of this Act on premises other than the relevant premises specified in the applicable default notice.

5 In a case where the Commissioners grant a default licence in accordance with sub-paragraph (4) above, references in this Schedule to the relevant premises shall be construed in relation to any particular time as references to the premises on which the machine was provided for play at that time.

6 The Commissioners may grant a default licence even though no application has been made for it.

7 A default licence may be granted for a period of any length (whether or not a licence under Schedule 4 to this Act could be granted for a period of that length).

Assessment of amount equivalent to duty

1 This paragraph applies where a default licence is granted in relation to an unlicensed machine.

2 The Commissioners may, subject to the following provisions of this paragraph, assess to the best of their judgement the amount which would have been payable under this Act as amusement machine licence duty if the default licence had been an amusement machine licence granted under Schedule 4 to this Act.

3 The Commissioners shall make the assessment using the rates of amusement machine licence duty which apply in relation to amusement machine licences granted in consequence of applications received by the Commissioners on the due date.

4 If the period of the licence is 12 months or less, the assessment shall be made as if an amusement machine licence had been granted in relation to the unlicensed machine for that period.

5 If the period of the licence is longer than 12 months, the assessment shall be made as if—

a a separate amusement machine licence had been granted in relation to the unlicensed machine for each complete period of 12 months falling wholly within the period of the licence, and

b a further amusement machine licence had been granted in relation to the unlicensed machine for any remaining part of the period of the licence.

6 Sub-paragraphs (7) and (8) below shall apply in relation to an assessment to be made in any case where—

a the period of a licence mentioned in sub-paragraph (4) above, or

b the part of the period mentioned in sub-paragraph (5)(b) above,

is not a period of complete months.

7 Any period of less than a month comprised in the period or the part of the period shall be treated as a complete month; and accordingly the period or the part of the period in question shall be treated as if it consisted of a complete month or, as the case may be, complete months.

8 The amusement machine licence treated as granted for such a period, or for such a part of a period, shall be treated as having been—

a granted for that period, or that part of the period, as extended in accordance with sub-paragraph (7) above, and

b surrendered at the end of the last day of the period mentioned in sub-paragraph (4) above or, as the case may be, of the part of the period mentioned in sub-paragraph (5)(b) above.

Liability to pay

1 Where an amount has been assessed under paragraph 4 above and notified to a responsible person or his representative, that amount—

a shall be deemed to be an amount of duty charged in accordance with section 22 of this Act on an amusement machine licence within the meaning of section 21 of this Act,

b shall be due from the responsible person, and

c may be recovered accordingly unless, or except to the extent that, the assessment has subsequently been withdrawn or reduced.

2 The responsible persons to whom an assessment may be notified are any one or more of the persons who are or appear to be, or at any time during the period to which the assessment relates were or appear to have been, responsible persons in relation to the unlicensed machine or the relevant premises.

3 An assessment shall be deemed to have been notified to a person if it is—

a given to him, or

b left at or posted to his proper address.

4 But an assessment shall not be deemed to have been notified to a person unless and until—

a the default licence in relation to which the assessment has been made, or

b a copy of that licence,

has been given to him, or left at or posted to his proper address.

5 Where an amount has been assessed and notified to more than one responsible person (or his representative), that amount shall be recoverable jointly and severally from any or all of the responsible persons.

6 Arrangements made in accordance with paragraph 7A of Schedule 4 to this Act do not apply in relation to an amount assessed and notified in accordance with this paragraph.

Reviews and time limits on recovery

1 Section 14 of the ^M119Finance Act 1994 (reviews of decisions) shall apply to so much of any decision by the Commissioners as is of any of the kinds mentioned in sub-paragraph (2) below, as it applies to the decisions mentioned in subsection (1) of that section.

2 Those decisions are—

a any decision that a default licence should be granted,

b any decision contained in an assessment under paragraph 4 above that a person is liable to pay an amount of duty, and

c any decision contained in an assessment under paragraph 4 above as to the amount of a person’s liability.

3 Sub-paragraph (4) below applies where the Commissioners—

a have given a default notice, and

b in consequence of so doing have granted a default licence.

4 An assessment made under paragraph 4 above in relation to the default licence may not be notified to a responsible person (or his representative) at any time after the end of the period of one year beginning with the due date specified in the default notice.

5 The reference to three years in paragraph 2(3)(a) above shall have effect as if it were a reference to twenty years in any case where sub-paragraph (6) or (7) below applies.

6 This sub-paragraph applies where an amusement machine has been provided for play in circumstances where a person—

a has, by virtue of conduct engaged in for the purpose of evading any amount of amusement machine licence duty, become liable to a penalty under section 8 of the Finance Act 1994, or

b has been convicted of an offence under section 24(6) of this Act.

7 This sub-paragraph applies where an amusement machine has been provided for play in circumstances where proceedings for an offence under section 24(6) of this Act would have been commenced or continued against a person (whether or not the person assessed), but for their having been compounded under section 152(a) of the ^M120Customs and Excise Management Act 1979.

General interpretation

1 The following provisions of this paragraph apply for the purposes of this Schedule.

2 A person is a responsible person in relation to an amusement machine at a particular time if, at that time, he is or was—

a the owner or hirer of the machine, or

b a party to any contract under which the machine may be, or may have been, or is or was required to be, on the relevant premises at that time.

3 A person is a responsible person in relation to relevant premises at a particular time if, at that time, he is or was—

a the owner, lessee or occupier of the premises, or

b responsible to the owner, lessee or occupier for the management of the premises, or

c responsible for issuing or exchanging coins or tokens for use in playing any amusement machine on the premises, or otherwise for controlling the use of any such machine, or

d responsible for controlling the admission of persons to the premises or for providing persons resorting to the premises with any goods or services.

4 A person’s representative is—

a his personal representative,

b his trustee in bankruptcy,

c any receiver or liquidator appointed in relation to him or any of his property, or

d any other person acting in a representative capacity in relation to him.

5 The proper address of a person is—

a in the case of a body corporate, its registered office or principal office, and

b in any other case—

i his last known place of abode or business, or

ii any vessel or aircraft to which he may belong or have lately belonged.

6 An item is only to be treated as posted to an address or place if it has been sent there by registered post or the recorded delivery service.

Saving for liability

8The grant of a default licence in relation to an unlicensed machine shall be without prejudice to any liability arising under section 24 of this Act in relation to the machine.

2 This paragraph has effect in relation to amusement machines which appear to the Commissioners of Customs and Excise to have been provided for play on premises in contravention of section 21(1) or 24(3) or (4) of the ^M121Betting and Gaming Duties Act 1981 on or after the day falling three years before the day on which this Act is passed.

SCHEDULE 3 ¶

Vehicle excise duty on new cars and vans

Section 22.

After Part I of Schedule 1 to the ^M122Vehicle Excise and Registration Act 1994, insert—

Part IA Light passenger vehicles: graduated rates of duty

Vehicles to which this Part applies

1 This Part of this Schedule applies to a vehicle which—

a is first registered on or after 1st March 2001, and

b is so registered on the basis of an EC certificate of conformity or UK approval certificate that—

i identifies the vehicle as having been approved as a light passenger vehicle, and

ii specifies a CO₂ emissions figure in terms of grams per kilometre driven.

2 In sub-paragraph (1)(b)(i) a “light passenger vehicle” means a vehicle within Category M1 of Annex II to Council Directive 70/156/EEC (vehicle with at least four wheels used for carriage of passengers and comprising no more than 8 seats in addition to the driver’s seat).

3 For the purposes of this Part of this Schedule “the applicable CO₂ emissions figure” is—

a where the EC certificate of conformity or UK approval certificate specifies only one CO₂ emissions figure, that figure, and

b where it specifies more than one, the figure specified as the CO₂ emissions (combined) figure.

4 Where the car is registered on the basis of an EC certificate of conformity, or UK approval certificate, that specifies separate CO₂ emissions figures in terms of grams per kilometre driven for different fuels, “the applicable CO₂ emissions figure" is the lowest figure specified or, in a case within sub-paragraph (3)(b), the lowest CO₂ emissions (combined) figure specified.

5 If a vehicle is on first registration a vehicle to which this Part of this Schedule applies—

a its status as such a vehicle, and

b the applicable CO₂ emissions figure,

are not affected by any subsequent modification of the vehicle.

Graduated rates of duty

1BThe annual rate of vehicle excise duty applicable to a vehicle to which this Part of this Schedule applies shall be determined in accordance with the following table by reference to—

a the applicable CO₂ emissions figure, and

b whether the vehicle qualifies for the reduced rate of duty, or is liable to the standard rate or the premium rate of duty.

CO₂ emissions figure		Rate
(1)	(2)	(3)	(4)	(5)
Exceeding	Not Exceeding	Reduced rate	Standard rate	Premium rate
g/km	g/km	£	£	£
	150	90	100	110
150	165	110	120	130
165	185	130	140	150
185		150	155	160

The reduced rate

1 A vehicle qualifies for the reduced rate of duty if condition A, B or C below is met.

2 Condition A is that the vehicle is constructed or modified—

a so as to be propelled by a prescribed type of fuel, or

b so as to be capable of being propelled by any of a number of prescribed types of fuel,

and complies with any other requirements prescribed for the purposes of this condition.

3 Condition B is that the vehicle—

a incorporates before its first registration equipment enabling it to meet such vehicle emission standards as may be prescribed for the purposes of this condition, and

b has incorporated such equipment since its first registration.

4 Condition C is that the vehicle is of a description certified by the Secretary of State, before the vehicle’s first registration, as meeting such vehicle emission standards as may be prescribed for the purposes of this condition.

5 The Secretary of State may make provision by regulations—

a for the making of an application to the Secretary of State for the issue of a certificate under sub-paragraph (4);

b for the manner in which any determination of whether to issue such a certificate on such an application is to be made;

c for the examination of one or more vehicles of the description to which the application relates, for the purposes of the determination mentioned in paragraph (b), by such persons, and in such manner, as may be prescribed;

d for a fee to be paid for such an examination;

e for the form and content of such a certificate;

f for the revocation, cancellation or surrender of such a certificate;

g for the fact that such a certificate is, or is not, in force in respect of a description of vehicle to be treated as having conclusive effect for the purposes of this Act as to such matters as may be prescribed; and

h for appeals against any determination not to issue such a certificate.

The standard rate

1DA vehicle is liable to the standard rate of duty if it does not qualify for the reduced rate and is not liable to the premium rate.

The premium rate

1 A vehicle is liable to the premium rate of duty if—

a it is constructed or modified so as to be propelled solely by diesel, and

b it is not of a prescribed description.

2 In sub-paragraph (1)(a) “diesel” means any diesel fuel within the definition in Article 2 of Directive 98/70/EC of the European Parliament and of the Council.

Meaning of “prescribed"

1FIn this Part of this Schedule “prescribed” means prescribed by regulations made by the Secretary of State with the consent of the Treasury.

Meaning of “EC certificate of conformity" and “UK approval certificate"

1 References in this Part of this Schedule to an “EC certificate of conformity" are to a certificate of conformity issued by a manufacturer under any provision of the law of a Member State implementing Article 6 of Council Directive 70/156/EEC, as amended.

2 References in this Part of this Schedule to a “UK approval certificate" are to a certificate issued under—

a section 58(1) or (4) of the ^M123Road Traffic Act 1988, or

b Article 31A(4) or (5) of the ^M124Road Traffic (Northern Ireland) Order 1981.

Part IB Light goods vehicles

Vehicles to which this Part applies

1 This Part of this Schedule applies to a vehicle which—

a is first registered on or after 1st March 2001, and

b is so registered on the basis of an EC certificate of conformity or UK approval certificate that identifies the vehicle as having been approved as a light goods vehicle.

2 In sub-paragraph (1)(b) a “light goods vehicle” means a vehicle within Category N1 of Annex II to Council Directive 70/156/EEC (vehicle with four or more wheels used for carriage of goods and having a maximum mass not exceeding 3.5 tonnes).

3 If a vehicle is on first registration a vehicle to which this Part of this Schedule applies its status as such a vehicle is not affected by a subsequent modification of the vehicle.

4 In this paragraph “EC certificate of conformity” and “UK approval certificate” have the same meaning as in Part IA of this Schedule.

Annual rate of duty

1JThe annual rate of vehicle excise duty applicable to a vehicle to which this Part of this Schedule applies is £160.

SCHEDULE 4 ¶

Vehicle excise duty: enforcement provisions for graduated rates

Section 23.

Introduction¶

1 This Schedule applies to vehicles in respect of which different rates of vehicle excise duty are, under the provisions listed below, chargeable in respect of vehicles by reference to characteristics of the vehicle.

2 The provisions referred to in sub-paragraph (1) are—Part I of Schedule 1 to the ^M125Vehicle Excise and Registration Act 1994 (the general rate),Part IA of that Schedule (graduated rates for light passenger vehicles first registered on or after 1st March 2001), orPart II of that Schedule (motorcycles).

Particulars to be furnished on application for licence¶

1 The Secretary of State may make provision by regulations as to the particulars to be furnished on an application for a vehicle licence in respect of a vehicle to which this Schedule applies.

2 The regulations may make different provision for different descriptions of vehicle and different descriptions of licence.

3 The prescribed particulars may include—

a particulars other than those required for the purposes of vehicle excise duty, and

b particulars other than with respect to the vehicle in respect of which the licence is to be taken out.

4 Every person making an application with respect to which regulations under this paragraph are in force shall—

a furnish such particulars as may be prescribed by the regulations, and

b make such a declaration as may be specified by the Secretary of State.

5 A person applying for a licence need not make the declaration specified for the purposes of sub-paragraph (4)(b) if he agrees to comply with such conditions as may be specified in relation to him by the Secretary of State.The conditions which may be specified include—

a a condition that the prescribed particulars are furnished by being transmitted to the Secretary of State by such electronic means as he may specify; and

b a condition requiring such payments as may be specified by the Secretary of State to be made to him in respect of—

i steps taken by him for facilitating compliance by any person with any condition falling within paragraph (a); and

ii in such circumstances as may be so specified, the processing of applications for vehicle licences where particulars are transmitted in accordance with that paragraph.

6 In relation to applications with respect to which regulations under this paragraph are in force, the preceding provisions of this paragraph have effect in place of the provisions of subsections (1) to (3B) of section 7 of the ^M126Vehicle Excise and Registration Act 1994.

Power to require evidence in support of application¶

3The Secretary of State may make provision by regulations—

a requiring an application for a vehicle licence in respect of a vehicle to which this Schedule applies to be supported by such documentary or other evidence as may be specified in the regulations, and

b authorising him to refuse to issue the licence applied for if such evidence is not provided.

Powers exercisable where licence issued on basis of incorrect application¶

4The powers conferred by paragraphs 5 to 11 below are exercisable in a case where—

a a vehicle licence is issued to a person on the basis of an application stating that the vehicle—

i is a vehicle to which this Schedule applies, or

ii is a vehicle to which this Schedule applies in respect of which a particular amount of vehicle excise duty falls to be paid, and

b the vehicle is not such a vehicle or, as the case may be, is one in respect of which duty falls to be paid at a higher rate.

Power to declare licence void¶

5The Secretary of State may by notice sent by post to the person inform him that the licence is void as from the time when it was granted.If he does so, the licence shall be void as from the time when it was granted.

Power to require payment of balance of duty¶

1 The Secretary of State may by notice sent by post to the person require him to secure that the additional duty payable is paid within such reasonable period as is specified in the notice.

2 If that requirement is not complied with, the Secretary of State may by notice sent by post to the person inform him that the licence is void as from the time when it was granted.If he does so, the licence shall be void as from the time when it was granted.

Power to require delivery up of licence¶

7The Secretary of State may in a notice under paragraph 5 or 6(2) require the person to whom it is sent to deliver up the licence within such reasonable period as is specified in the notice.

Power to require delivery up of licence and payment in respect of duty¶

1 The Secretary of State may in a notice under paragraph 5 or 6(2) require the person to whom it is sent—

a to deliver up the licence within such reasonable period as is specified in the notice, and

b on doing so to pay an amount equal to the monthly duty shortfall for each month, or part of a month, in the relevant period.

2 The “monthly duty shortfall” means one-twelfth of the difference between—

a the duty that would have been payable for a licence for a period of twelve months if the vehicle had been correctly described in the application, and

b that duty payable in respect of such a licence on the basis of the description in the application as made.For this purpose the amount of the duty payable shall be ascertained by reference to the rates in force at the beginning of the relevant period.

Failure to deliver up licence¶

1 A person who—

a is required by notice under paragraph 7 or 8(1)(a) above to deliver up a licence, and

b fails to comply with the requirement contained in the notice,

commits an offence.

2 A person committing such an offence is liable on summary conviction to a penalty not exceeding whichever is the greater of—

a level 3 on the standard scale, and

b five times the annual duty shortfall.

3 The “annual duty shortfall” means the difference between—

a the duty that would have been payable for a licence for a period of twelve months if the vehicle had been correctly described in the application, and

b that duty payable in respect of a licence for a period of twelve months in respect of the vehicle as described in the application.For this purpose the amount of the duty payable shall be ascertained by reference to the rates in force at the beginning of the relevant period.

Failure to deliver up licence: additional liability¶

1 Where a person has been convicted of an offence under paragraph 9, the court shall (in addition to any penalty which it may impose under that paragraph) order him to pay an amount equal to the monthly duty shortfall for each month, or part of a month, in the relevant period (or so much of the relevant period as falls before the making of the order).

2 In sub-paragraph (1) the “monthly duty shortfall” has the meaning given by paragraph 8(2).

3 Where—

a a person has been convicted of an offence under paragraph 9, and

b a requirement to pay an amount with respect to that licence has been imposed on that person by virtue of paragraph 8(1)(b),

the order to pay an amount under this paragraph has effect instead of that requirement and the amount to be paid under the order shall be reduced by any amount actually paid in pursuance of the requirement.

Meaning of the “relevant period"¶

11References in this Schedule to the “relevant period" are to the period—

a beginning with the first day of the period for which the licence was applied for or, if later, the day on which the licence first was to have effect, and

b ending with whichever is the earliest of the following times—

i the end of the month during which the licence was required to be delivered up;

ii the end of the month during which the licence was actually delivered up;

iii the date on which the licence was due to expire;

iv the end of the month preceding that in which there first had effect a new vehicle licence for the vehicle in question.

Construction and effect¶

1 This Schedule and the ^M127Vehicle and Excise Registration Act 1994 shall be construed and have effect as if this Schedule were contained in that Act.

2 References in any other enactment to that Act shall be construed and have effect accordingly as including references to this Schedule.

SCHEDULE 5 ¶

Rates of vehicle excise duty on goods vehicles

Section 24.

1Part VIII of Schedule 1 to the Vehicle Excise and Registration Act 1994 (annual rates of vehicle excise duty: goods vehicles) is amended as follows.

2For the Table in paragraph 9(1) (rigid goods vehicles not satisfying reduced pollution requirements and with a revenue weight exceeding 3,500 kilograms but not exceeding 44,000 kilograms) substitute—

Revenue weight of vehicle		Rate
(1)	(2)	(3)	(4)	(5)
Exceeding	Not Exceeding	Two axle vehicle	Three axle vehicle	Four or more axle vehicle
kgs	kgs	£	£	£
3,500	7,500	165	165	165
7,500	12,000	300	300	300
12,000	13,000	470	490	350
13,000	14,000	650	490	350
14,000	15,000	840	490	350
15,000	17,000	1,320	490	350
17,000	19,000	1,600	850	350
19,000	21,000	1,600	1,020	350
21,000	23,000	1,600	1,470	510
23,000	25,000	1,600	2,230	830
25,000	27,000	1,600	2,340	1,470
27,000	29,000	1,600	2,340	2,320
29,000	31,000	1,600	2,340	3,360
31,000	44,000	1,600	2,340	4,400

3For the Table in paragraph 9B (rigid goods vehicles satisfying reduced pollution requirements and with a revenue weight exceeding 3,500 kilograms but not exceeding 44,000 kilograms) substitute—

Revenue weight of vehicle		Rate
(1)	(2)	(3)	(4)	(5)
Exceeding	Not Exceeding	Two axle vehicle	Three axle vehicle	Four or more axle vehicle
kgs	kgs	£	£	£
3,500	7,500	160	160	160
7,500	12,000	160	160	160
12,000	13,000	160	160	160
13,000	14,000	160	160	160
14,000	15,000	160	160	160
15,000	17,000	320	160	160
17,000	19,000	600	160	160
19,000	21,000	600	160	160
21,000	23,000	600	470	160
23,000	25,000	600	1,230	160
25,000	27,000	600	1,340	470
27,000	29,000	600	1,340	1,320
29,000	31,000	600	1,340	2,360
31,000	44,000	600	1,340	3,400

4For the Table in paragraph 11(1) (tractive units not satisfying reduced pollution requirements and with a revenue weight exceeding 3,500 kilograms but not exceeding 44,000 kilograms) substitute—

Revenue weight of tractive unit		Rate for tractive unit with two axles			Rate for tractive unit with three or more axles
(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)
Exceeding	Not exceeding	Any no. of semi-trailer axles	2 or more semi-trailer axles	3 or more semi-trailer axles	Any no. of semi-trailer axles	2 or more semi-trailer axles	3 or more semi-trailer axles
kgs	kgs	£	£	£	£	£	£
3,500	7,500	165	165	165	165	165	165
7,500	12,000	300	300	300	300	300	300
12,000	16,000	460	460	460	460	460	460
16,000	20,000	520	460	460	460	460	460
20,000	23,000	810	460	460	460	460	460
23,000	26,000	1,190	590	460	590	460	460
26,000	28,000	1,190	1,130	460	1,130	460	460
28,000	31,000	1,740	1,740	1,090	1,740	660	460
31,000	33,000	2,530	2,530	1,740	2,530	1,000	460
33,000	34,000	5,170	5,170	1,740	2,530	1,470	570
34,000	35,000	5,170	5,170	2,340	2,530	2,100	860
35,000	36,000	6,750	6,750	2,340	2,530	2,100	860
36,000	38,000	9,250	9,250	2,710	2,820	2,820	1,280
38,000	41,000	9,250	9,250	3,950	3,750	4,250	2,500
41,000	44,000	9,250	9,250	3,950	7,250	7,250	2,950

5For the Table in paragraph 11B (tractive units satisfying reduced pollution requirements and with a revenue weight exceeding 3,500 kilograms but not exceeding 44,000 kilograms) substitute—

Revenue weight of tractive unit		Rate for tractive unit with two axles			Rate for tractive unit with three or more axles
(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)
Exceeding	Not exceeding	Any no. of semi-trailer axles	2 or more semi-trailer axles	3 or more semi-trailer axles	Any no. of semi-trailer axles	2 or more semi-trailer axles	3 or more semi-trailer axles
kgs	kgs	£	£	£	£	£	£
3,500	7,500	160	160	160	160	160	160
7,500	12,000	160	160	160	160	160	160
12,000	16,000	160	160	160	160	160	160
16,000	20,000	160	160	160	160	160	160
20,000	23,000	160	160	160	160	160	160
23,000	26,000	190	160	160	160	160	160
26,000	28,000	190	160	160	160	160	160
28,000	31,000	740	740	160	740	160	160
31,000	33,000	1,530	1,530	740	1,530	160	160
33,000	34,000	4,170	4,170	740	1,530	470	160
34,000	35,000	4,170	4,170	1,340	1,530	1,100	160
35,000	36,000	5,750	5,750	1,340	1,530	1,100	160
36,000	38,000	8,250	8,250	1,710	1,820	1,820	280
38,000	41,000	8,250	8,250	2,950	2,750	3,250	1,500
41,000	44,000	8,250	8,250	2,950	6,250	6,250	1,950

1 In the following provisions—

a in paragraph 11(1), after “Subject to sub-paragraphs (2) and (3)", and

b in paragraph 11A(2), after “Subject to sub-paragraph (3)",

insert “ and paragraph 11C ”.

2 After paragraph 11B insert—

^C10^C20SCHEDULE 6 ¶

Climate change levy

Section 30.

Part I The levy¶

Climate change levy¶

1 A tax to be known as climate change levy (“the levy”) shall be charged in accordance with this Schedule.

2 The levy is under the care and management of the Commissioners of Customs and Excise.

Levy charged on taxable supplies¶

1 The levy is charged on taxable supplies.

2 Any supply of a taxable commodity is a taxable supply, subject to the provisions of Part II of this Schedule.

Meaning of “taxable commodity"¶

1 The following are taxable commodities for the purposes of this Schedule, subject to sub-paragraph (2) and to any regulations under sub-paragraph (3)—

a electricity;

b any gas in a gaseous state that is of a kind supplied by a gas utility;

c any petroleum gas, or other gaseous hydrocarbon, in a liquid state;

d coal and lignite;

e coke, and semi-coke, of coal or lignite;

f petroleum coke.

2 The following are not taxable commodities—

a hydrocarbon oil or road fuel gas within the meaning of the ^M128Hydrocarbon Oil Duties Act 1979;

b waste within the meaning of Part II of the ^M129Environmental Protection Act 1990 or the meaning given by Article 2(2) of the ^M130Waste and Contaminated Land (Northern Ireland) Order 1997.

3 The Treasury may by regulations provide that a commodity of a description specified in the regulations is, or is not, a taxable commodity for the purposes of this Schedule.

^C10Part II Taxable supplies¶

Introduction¶

1 A supply of a taxable commodity (or part of such a supply) is a taxable supply for the purposes of the levy if levy is chargeable on the supply under—

paragraph 5 (supplies of electricity),
paragraph 6 (supplies of gas), or
paragraph 7 (other supplies in course or furtherance of business),

and the supply (or part) is not excluded under paragraphs 8 to 10 or exempt under paragraphs 11 to 22.

2 In this Schedule—

a references to a supply of a taxable commodity include a supply that is deemed to be made under paragraph 23, and

b references to a taxable supply include a supply that is deemed to be made under paragraph 24 , 24A, 24B, 24C, 42D or 43B,

but paragraphs 23 and 24 have effect subject to any exceptions provided for under paragraph 21.

Supplies of electricity¶

1 Levy is chargeable on a supply of electricity if—

a the supply is made by an electricity utility, and

b the person to whom the supply is made—

i is not an electricity utility, or

ii is the utility itself.

2 Levy is chargeable on a supply made from a combined heat and power station of electricity produced in the station if—

a the station is a partly exempt combined heat and power station,

b the supply is not one that is deemed to be made under paragraph 23(3) (self-supply by producer), and

c the person to whom the supply is made is not an electricity utility.

2A Levy is chargeable on a supply of electricity if—

a the supply is made by an exempt unlicensed electricity supplier who is an auto-generator or who is of a description prescribed by regulations made by the Treasury,

b the electricity was produced in a generating station owned by the supplier using commodities which were the subject of a deemed supply under paragraph 24A or which would have been the subject of such a supply had the reference in paragraph 24A(1)(a) to Great Britain been a reference to the United Kingdom instead,

c the supply is not a deemed supply under paragraph 23(3), and

d the person to whom the supply is made is not an electricity utility.

3 Levy is chargeable on a supply of electricity that is deemed to be made under paragraph 20(6)(a), 20B(6)(a), 23(3) , 24 or 43B.

4 Except as provided by sub-paragraphs (1) to (3), levy is not chargeable on a supply of electricity.

Supplies of gas¶

1 Levy is chargeable on a supply of any gas if—

a the supply is made by a gas utility, and

b the person to whom the supply is made—

i is not a gas utility, or

ii is the utility itself.

2 Levy is chargeable on a supply of gas that is deemed to be made under paragraph 23(3) (self-supply by producer) if the gas—

a is held in a gaseous state immediately prior to being released for burning, and

b is of a kind supplied by a gas utility.

2A Levy is chargeable on a supply of gas that is deemed to be made under paragraph 24 , 24A, 24B, 24C, 42D or 43B.

3 Except as provided by sub-paragraph (1), (2) or (2A), levy is not chargeable on a supply of any gas that is supplied in a gaseous state.

Other supplies made in course or furtherance of business¶

1 This paragraph applies to a supply of a taxable commodity other than—

a electricity, or

b gas in a gaseous state.

2 Levy is chargeable on any such supply if the supply is made in the course or furtherance of a business.

Excluded supplies: supply for domestic or charity use¶

1 A supply is excluded from the levy if it is—

a for domestic use (see paragraph 9), or

b for charity use.

2 For the purposes of this paragraph, a supply is for charity use if the commodity supplied is for use by a charity otherwise than in the course or furtherance of a business.

3 If a supply is partly for domestic or charity use and partly not, the part of the supply that is for domestic or charity use is excluded from the levy.

4 Where a supply of a commodity is partly for domestic or charity use and partly not—

a if at least 60 per cent. of the commodity is supplied for domestic or charity use, the whole supply is treated as a supply for domestic or charity use, and

b in any other case, an apportionment shall be made to determine the extent to which the supply is for domestic or charity use.

Excluded supplies: meaning of “for domestic use"¶

1 For the purposes of paragraph 8 the following supplies are always for domestic use—

a a supply of not more than one tonne of coal or coke held out for sale as domestic fuel;

b a supply to a person at any premises of—

i any gas in a gaseous state that is provided through pipes and is of a kind supplied by a gas utility, or

ii petroleum gas in a gaseous state provided through pipes,

where the gas or petroleum gas (together with any other gas or petroleum gas provided through pipes to him at the premises by the same supplier) was not provided at a rate exceeding 4397 kilowatt hours a month;

c a supply of petroleum gas in a liquid state where the petroleum gas is supplied in cylinders the net weight of each of which is less than 50 kilogrammes and either the number of cylinders supplied is 20 or fewer or the petroleum gas is not intended for sale by the recipient;

d a supply of petroleum gas in a liquid state, otherwise than in cylinders, to a person at any premises at which he is not able to store more than two tonnes of such petroleum gas;

e a metered supply of electricity to a person at any premises where the electricity (together with any other electricity provided to him at the premises by the same supplier) was not provided at a rate exceeding 1000 kilowatt hours a month;

f an unmetered supply of electricity to a person where the electricity (together with any other unmetered electricity provided to him by the same supplier) was not provided at a rate exceeding 1000 kilowatt hours a month.

2 For the purposes of paragraph 8, supplies not within sub-paragraph (1) are for domestic use if and only if the commodity supplied is for use in—

a a building, or part of a building, which consists of a dwelling or number of dwellings,

b a building, or part of a building, used for a relevant residential purpose,

c self-catering holiday accommodation (including any accommodation advertised or held out as such),

d a caravan,

e a houseboat (that is to say, a boat or other floating decked structure designed or adapted for use solely as a place of permanent habitation and not having means of, or capable of being readily adapted for, self-propulsion), or

f an appliance that—

i is not part of a combined heat and power station,

ii is located otherwise than in premises of a description mentioned in any of paragraphs (a) to (e), and

iii is used to heat air or water that, when heated, is supplied to premises of, or each of, such a description.

3 For the purposes of this paragraph use for a relevant residential purpose means use as—

a a home or other institution providing residential accommodation for children,

b a home or other institution providing residential accommodation with personal care for persons in need of personal care by reason of old age, disablement, past or present dependence on alcohol or drugs or past or present mental disorder,

c a hospice,

d residential accommodation for students or school pupils,

e residential accommodation for members of any of the armed forces,

f a monastery, nunnery or similar establishment, or

g an institution which is the sole or main residence of at least 90 per cent. of its residents,

except use as a hospital, a prison or similar institution or an hotel or inn or similar establishment.

^F284 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5 The power to make provision under section 29A(3) of the Value Added Tax Act 1994 varying Schedule 7A to that Act (charge at reduced rate) includes power to make provision for any appropriate corresponding variation of this paragraph.

Excluded supplies: supply before 1st April 2001¶

10Any supply made before 1st April 2001 is excluded from the levy.

Exemption: supply not for burning in the UK¶

1 A supply of a taxable commodity to which this sub-paragraph applies is exempt from the levy if the person to whom the supply is made ^F385...—

a ^F386... intends to use the commodity in making supplies of it to any other person, or

b ^F386... intends to cause the commodity to be exported from the United Kingdom and has no intention to cause it to be thereafter brought back into the United Kingdom.

2 Sub-paragraph (1) applies to supplies of a taxable commodity other than—

a electricity, or

b any gas in a gaseous state.

3 A supply of electricity, or of gas in a gaseous state, is exempt from the levy if the person to whom the supply is made ^F387...—

a ^F388... intends to cause the commodity to be exported from the United Kingdom, and

b has no intention to cause it to be thereafter brought back into the United Kingdom.

4 Regulations under paragraph 22 may, in particular, include provision as to the application of sub-paragraph (3) in cases where a person who is both an exporter and an importer of a commodity intends to be a net exporter of the commodity.

Exemption: Northern Ireland gas supplies¶

^F63211A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exemption: supply used in transport¶

^C9^C1012

1 A supply of a taxable commodity is exempt from levy if the commodity is to be burned (or, in the case of electricity, consumed)—

a in order to propel a train,

b in order to propel a non-railway vehicle while it is being used for, or for purposes connected with, transporting passengers,

c in a railway vehicle, or a non-railway vehicle, while it is being used for, or for purposes connected with, transporting passengers,

d in a railway vehicle while it is being used for, or for purposes connected with, transporting goods, or

e in a ship while it is engaged on a journey any part of which is beyond the seaward limit of the territorial sea.Paragraphs (a) to (c) are subject to the exception in sub-paragraph (3).

2 In this paragraph—

“railway vehicle” and “train” have the meaning given by section 83 of the ^M131Railways Act 1993;
“non-railway vehicle” means—
1. any vehicle other than a railway vehicle, or
2. any ship,
that is designed or adapted to carry not less than 12 passengers.

3 Sub-paragraph (1)(a) to (c) does not apply in relation to the transporting of passengers to, from or within—

a a place of entertainment, recreation or amusement, or

b a place of cultural, scientific, historical or similar interest,

that is a place to which rights of admission, or where rights to use facilities at it, are supplied by the person to whom the commodity is supplied or by a person connected with him within the meaning of section 1122 of the Corporation Tax Act 2010.

Exemption: mineralogical and metallurgical processes¶

12A

1 A supply of a taxable commodity ^F799... is exempt from the levy if the commodity is to be used ^F800... in a mineralogical or metallurgical process.

2 “Mineralogical process” means a process falling within Division 23 of NACE Rev 2.

3 “Metallurgical process” means a process of any of the following descriptions.

4 The descriptions are—

a a process falling within Division 24 of NACE Rev 2, excluding Class 24.46;

b a process falling within Group 25.5 of NACE Rev 2;

c a process falling within Class 25.61 of NACE Rev 2 which is—

i plating, anodising etc of metals;

ii heat treatment of metals;

iii deburring, sandblasting, tumbling and cleaning of metals where carried out in conjunction with a process mentioned in paragraph (a) or (b).

4A In this paragraph “NACE Rev 2” is as set out in Annex I to Regulation (EC) No 1893/2006 of the European Parliament and of the Council of 20 December 2006 (relating to the statistical classification of economic activities).

5 The Treasury may by regulations amend this paragraph so as to amend the definition of “mineralogical process”.

6 The Treasury may by regulations amend sub-paragraph (4) so as to add, remove or modify a description.

Exemption: supplies to producers of commodities other than electricity¶

13A supply of a taxable commodity to a person is exempt from the levy if—

a the supply is not a supply of electricity that is deemed to be made under paragraph 23(3), and

b the commodity is to be used by that person—

i in producing taxable commodities other than electricity,

ii in producing hydrocarbon oil or road fuel gas,

iia in producing biodiesel for chargeable use within the meaning of section 6AA of the Hydrocarbon Oil Duties Act 1979 (excise duty on biodiesel),

iib in producing bioblend for delivery for home use from any place mentioned in section 6AB(1)(b) of that Act (excise duty on bioblend),

iic in producing bioethanol for chargeable use within the meaning of section 6AD of that Act (excise duty on bioethanol),

iid in producing bioethanol blend for delivery for home use from any place mentioned in section 6AE(1)(b) of that Act (excise duty on bioethanol blend),

iii in producing, for chargeable use within the meaning of section 6A of the ^M132Hydrocarbon Oil Duties Act 1979 (fuel substitutes), liquids (within the meaning of that section) in respect of which a charge is capable of arising under that section, or

iv in producing uranium for use in an electricity generating station.

Expressions which are used in this paragraph and the Hydrocarbon Oil Duties Act 1979 have the same meaning in this paragraph as they have in that Act.

13A

1 The Commissioners may by regulations make provision amending paragraph 13 for the purpose of—

a extending the circumstances in which a supply of a taxable commodity is exempt from the levy, or

b restricting the circumstances in which a supply of a taxable commodity is exempt from the levy.

2 Regulations under this paragraph that include provision made for the purpose mentioned in sub-paragraph (1)(a) may provide for the provision to have retrospective effect.

3 A statutory instrument that contains (whether alone or with other provisions) regulations under this paragraph made for the purpose mentioned in sub-paragraph (1)(b) shall not be made unless a draft of the instrument has been laid before ^F763... and approved by a resolution of the House of Commons.

Exemption: supplies (other than self-supplies) to electricity producers¶

1 A supply of a taxable commodity to a person is exempt from the levy if—(a) the commodity is to be used by that person in producing electricity in a generating station that is neither—

i a fully exempt combined heat and power station, nor

ii a partly exempt combined heat and power station,

and

b the supply is not a supply of electricity that is deemed to be made under paragraph 23(3).

2 Sub-paragraph (1) does not exempt a supply where the person to whom the supply is made—

a is an exempt unlicensed electricity supplier of a description prescribed by regulations made by the Treasury, ^F31...

b uses the commodity supplied in producing electricity in a small generating station, and

c uses the electricity produced otherwise than in exemption-retaining ways.

3 Sub-paragraph (1) does not exempt a supply where the person to whom the supply is made—

a is an auto-generator,

b uses the commodity supplied in producing electricity in a small generating station, and

c uses the electricity produced otherwise than in exemption-retaining ways.

3ZA Sub-paragraph (1) does not exempt a supply where the person to whom the supply is made—

a uses the commodity supplied in producing electricity in a stand-by generator, and

b uses the electricity produced otherwise than in exemption-retaining ways.

3A For the purposes of this paragraph, electricity is used in an “exemption-retaining” way if it is used—

a in making supplies that are excluded under paragraphs 8 to 10 or exempt under any of paragraphs 11, 12 and 18, or

b in any of the ways mentioned in sub-paragraphs (i) to (iv) of paragraph 13(b).

3B Paragraph 24A makes provision under which carbon price support rate commodities intended to be used in a generating station may be the subject of a deemed taxable supply (and, accordingly, this paragraph needs to be read subject to that paragraph).

^F7394 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F7395 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exemption: supplies (other than self-supplies) to combined heat and power stations¶

1 A supply of a taxable commodity to a person is exempt from the levy if—

a that person intends to cause the commodity to be used in—

i a fully exempt combined heat and power station, or

ii a partly exempt combined heat and power station,

in producing any outputs of the station, and

b the supply is not a supply of electricity that is deemed to be made under paragraph 23(3).For this purpose “outputs” has the meaning given by paragraph 148(9).

2 Where—

a a supply of a taxable commodity to a person would (apart from this sub-paragraph) be exempted in full by sub-paragraph (1), and

b at the time the supply is made, the efficiency percentage for the combined heat and power station in which the commodity is to be used ^F36... is less than the threshold efficiency percentage for the station,

sub-paragraph (1) only exempts the relevant fraction of the supply.

3 For the purposes of sub-paragraph (2), the “relevant fraction” of a supply of a taxable commodity that is to be used in a combined heat and power station is the fraction—

a whose numerator is the efficiency percentage for the station at the time the supply is made, and

b whose denominator is the threshold efficiency percentage for the station at that time.

4 For the purposes of this paragraph—

a the “threshold efficiency percentage" for a combined heat and power station is the percentage set as the threshold efficiency percentage for the station by regulations made by the Treasury;

b the “efficiency percentage” for a combined heat and power station shall be determined in accordance with regulations under paragraph 149.

4A Paragraph 24B makes provision under which carbon price support rate commodities intended to be used in a combined heat and power station may be the subject of a deemed taxable supply (and, accordingly, this paragraph needs to be read subject to that paragraph).

^F3105 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exemption: supplies (other than self-supplies) of electricity from partly exempt combined heat and power stations¶

1 This paragraph applies to a supply that—

a is a supply made from a partly exempt combined heat and power station of electricity produced in the station, and

b is not a supply that is deemed to be made under paragraph 23(3).

2 The supply is exempt from the levy if the quantity of electricity supplied by the supply is not such as causes the exceeding of any specified limit that, by virtue of regulations made by the Treasury, applies in relation to the station for any specified period.

3 In this paragraph “specified” means prescribed by, or determined in accordance with, regulations made by the Treasury.

Exemption: self-supplies by electricity producers¶

1 This paragraph applies to a supply of electricity that is deemed to be made under paragraph 23(3) by a person (“the producer”) to himself.

1A The supply is exempt from levy if it is a supply of electricity produced in—

a a fully exempt combined heat and power station,

b a partly exempt combined heat and power station,

c a stand-by generator, or

d a small generating station.

1B Sub-paragraph (1A)(d) applies only if the producer is—

a an auto-generator, or

b an exempt unlicensed electricity supplier of a description prescribed by regulations made by the Treasury.

2 This paragraph does not exempt the supply if—

a it is a supply from a partly-exempt combined heat and power station of electricity produced in the station, and

b the quantity of electricity supplied by the supply is such as causes the exceeding of any such limit as is mentioned in paragraph 16(2) that applies in relation to the station.

^F7293 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F7294 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exemption: supply not used as fuel¶

1 A supply of a taxable commodity is exempt from the levy if the person to whom the supply is made intends to cause the commodity to be used otherwise than as fuel.

2 The Treasury may by regulations specify, in relation to any commodity, uses of that commodity that, for the purposes of sub-paragraph (1), are to be taken as being, or as not being, uses of that commodity as fuel.

3 The uses of a commodity that may be specified under sub-paragraph (2) as being uses of that commodity as, or otherwise than as, fuel include uses (“mixed uses”) of the commodity that involve it being used partly as fuel and partly not; but the Treasury must have regard to the object of securing that a mixed use is not specified as being a use of the commodity otherwise than as fuel if it involves the use of the commodity otherwise than as fuel in a way that is merely incidental to its use as fuel.

Exemption: supply for use in recycling processes¶

^F66218A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exemption: electricity from renewable sources¶

1 A supply of electricity is exempt from the levy if—

a the supply is not one that is deemed to be made under paragraph 23(3),

b the supply is made under a contract that contains a renewable source declaration given by the supplier,

c prescribed conditions are fulfilled, ^F790...

d the supplier, and each other person (if any) who is a generator of any renewable source electricity allocated by the supplier to supplies under the contract, has in a written notice given to the Commissioners agreed that he will fulfil those conditions so far as they may apply to him , and

e the electricity is actually supplied before 1 April 2018.

2 In this paragraph “renewable source declaration” means a declaration that, in each averaging period, the amount of electricity supplied by exempt renewable supplies made by the supplier in the period will not exceed the difference between—

a the total amount of renewable source electricity that during that period is either acquired or generated by the supplier, and

b so much of that total amount as is allocated by the supplier otherwise than to exempt renewable supplies made by him in the period.In this sub-paragraph “averaging period” has the same meaning as in paragraph 20 and “exempt renewable supplies” means supplies made on the basis that they are exempt under this paragraph.

3 For the purposes of this paragraph and paragraph 20, electricity is “renewable source electricity” if—

za it is generated before 1 August 2015,

a it is generated in a prescribed manner, and

b prescribed conditions are fulfilled.A manner of generating electricity may be prescribed by reference to the means by which the electricity is generated or the materials from which it is generated (or both).

4 In prescribing a manner of generating electricity under sub-paragraph (3), the Commissioners must have regard to the object of securing that exemption under this paragraph is only available for supplies of electricity that has a renewable source.

^F4534A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5 The conditions that may be prescribed under sub-paragraph (1)(c) include, in particular, conditions in connection with—

a the giving of effect to renewable source declarations;

b the supply of information;

c the inspection of records and, for that purpose, the production of records in legible form and entry into premises;

d monitoring by the Gas and Electricity Markets Authority, or the Director General of Electricity Supply for Northern Ireland, of the application of provisions of, or made under, this paragraph;

e the doing of things to or by a person authorised by the Authority or the Director General (as well as to or by the Authority or the Director General);

f things being done at times or in ways specified by the Authority, the Director General or such an authorised person.

6 A condition prescribed under sub-paragraph (1)(c) may be one that is required to be fulfilled throughout a period, including a period ending after the time when a supply whose exemption turns on the fulfilment of the condition is treated as being made.

7 The conditions that may be prescribed under sub-paragraph (3)(b) include, in particular, conditions in connection with—

a the generation of the electricity;

b the materials from which the electricity is generated;

c any of the matters mentioned in paragraphs (b) to (f) of sub-paragraph (5).

8 Each of—

a the Gas and Electricity Markets Authority, and

b the Director General of Electricity Supply for Northern Ireland,

shall supply the Commissioners with such information (whether or not obtained under this paragraph), and otherwise give the Commissioners such co-operation, as the Commissioners may require in connection with the application (whether generally or in relation to any particular case) of any relevant provisions.

9 In sub-paragraph (8) “relevant provisions” means provisions of or made under—

a this paragraph or paragraph 20, or

b paragraph 23(3) so far as relating to electricity, or paragraph 23(4).

10 None of—

a section 57(1) of the ^M133Electricity Act 1989,

b section 42(1) of the ^M134Gas Act 1986, and

c Article 61(1) of the ^M135Electricity (Northern Ireland) Order 1992,

(provisions restricting disclosure of information) applies to any disclosure of information made in pursuance of sub-paragraph (8).

Exemption under paragraph 19: averaging periods¶

1 This paragraph applies where a person (“the supplier”) makes supplies of electricity on the basis that they are exempt under paragraph 19 (“exempt renewable supplies”).

2 The rules about balancing and averaging periods are—

a a balancing period is a period of 3 months;

b when a balancing period ends, a new one begins;

c the first balancing period and the first averaging period begin at the same time;

d unless the supplier specifies an earlier time, that time is the time when he is treated as making the first of the exempt renewable supplies;

e when an averaging period ends, a new one begins;

f an averaging period ends once it has run for 2 years (but may end sooner under paragraph (g) or sub-paragraph (4)(a) or (5)(a));

g if the supplier stops making exempt renewable supplies, the end of the balancing period in which he makes the last exempt renewable supply is also the end of the averaging period in which that balancing period falls.

3 At the end of each balancing period calculate—

a the total of—

i the quantity of renewable source electricity that the supplier acquired or generated in that period, and

ii any balancing credit carried forward to that balancing period; and

b the total of—

i the quantity of electricity supplied by exempt renewable supplies made by him in that period, and

ii any balancing debit carried forward to that balancing period.

4 If the total mentioned in sub-paragraph (3)(a) exceeds that mentioned in sub-paragraph (3)(b)—

a the averaging period within which the balancing period fell ends at the end of the balancing period, and

b a balancing credit equal to the difference between the two totals is carried forward to the next balancing period.

5 If the totals mentioned in paragraphs (a) and (b) of sub-paragraph (3) are the same—

a the averaging period within which the balancing period fell ends at the end of the balancing period, and

b no balancing credit or debit is carried forward to the next balancing period.

6 If the total mentioned in sub-paragraph (3)(b) exceeds that mentioned in sub-paragraph (3)(a), then—

a in a case where, at the time when the balancing period ends, an averaging period also ends because of sub-paragraph (2)(f) or (g), the supplier is for the purposes of this Schedule deemed to make at that time a taxable supply of a quantity of electricity equal to the excess;

b in any other case, a balancing debit equal to the excess is carried forward to the next balancing period.

Exemption: electricity produced in combined heat and power stations¶

20A

1 A supply of electricity is exempt from the levy chargeable under paragraph 5(1) if—

a the supply is not one that is deemed to be made under paragraph 23(3),

b the supply is made under a contract that contains a CHP declaration given by the supplier,

c prescribed conditions are fulfilled, ^F663...

d the supplier, and each other person (if any) who is a generator of any CHP electricity allocated by the supplier to supplies under the contract, has in a written notice given to the Commissioners agreed that he will fulfil those conditions so far as they may apply to him ; and

e the electricity is actually supplied before 1 April 2018.

2 Sub-paragraph (1) does not apply in relation to a supply to a person of electricity produced in a wholly or partly exempt combined heat and power station where the supply is made to that person from the station.

3 In this paragraph “CHP declaration” means a declaration that, in each averaging period, the amount of electricity supplied by exempt CHP supplies made by the supplier in the period will not exceed the difference between—

a the total amount of CHP electricity that during that period is either acquired or generated by the supplier, and

b so much of that total amount as is allocated by the supplier otherwise than to exempt CHP supplies made by him in the period.In this sub-paragraph “averaging period” has the same meaning as in paragraph 20B; and “exempt CHP supplies” means supplies made on the basis that they are exempt under this paragraph.

4 For the purposes of this paragraph and paragraph 20B, electricity is “CHP electricity” if—

a the electricity was—

i produced in a fully exempt combined heat and power station before 1 April 2013, or

ii produced in a partly exempt combined heat and power station before 1 April 2013 and originally supplied from the station without causing the limit referred to in paragraph 16(2) to be exceeded,

b the electricity is not renewable source electricity (within the meaning of paragraph 19), and

c prescribed conditions are fulfilled.

5 The conditions that may be prescribed under sub-paragraph (1)(c) include, in particular, conditions in connection with—

a the giving of effect to CHP declarations;

b the supply of information;

c the inspection of records and, for that purpose, the production of records in legible form and entry into premises;

d monitoring by the Gas and Electricity Markets Authority, or the Director General of Electricity Supply for Northern Ireland, of the application of provisions of, or made under, this paragraph;

e the doing of things to or by a person authorised by the Authority or the Director General (as well as the doing of things to or by the Authority or the Director General);

f things being done at times or in ways specified by the Authority, the Director General or such an authorised person.

7 The conditions that may be prescribed under sub-paragraph (4)(c) include in particular conditions in connection with any of the matters mentioned in paragraphs (b) to (f) of sub-paragraph (5).

8 Each of—

a the Gas and Electricity Markets Authority, and

b the Director General of Electricity Supply for Northern Ireland,

shall supply the Commissioners with such information (whether or not obtained under this paragraph), and otherwise give the Commissioners such co-operation, as the Commissioners may require in connection with the application of this paragraph (whether generally or in relation to any particular case).

9 Paragraph 19(10) (disclosure of information) applies in relation to sub-paragraph (8) above as it applies in relation to paragraph 19(8).

Exemption under paragraph 20A: averaging periods¶

20B

1 This paragraph applies where a person (“the supplier”) makes supplies of electricity on the basis that they are exempt under paragraph 20A (“exempt CHP supplies”).

2 The rules about balancing and averaging periods are—

a a balancing period is a period of three months;

b when a balancing period ends, a new one begins;

c the first balancing period and the first averaging period begin at the same time;

d unless the supplier specifies an earlier time, that time is the time when he is treated as making the first of the exempt CHP supplies;

e when an averaging period ends, a new one begins;

f an averaging period ends once it has run for two years (but may end sooner under paragraph (g) or sub-paragraph (4)(a) or (5)(a));

g if the supplier stops making exempt CHP supplies, the end of the balancing period in which he makes the last exempt CHP supply is also the end of the averaging period in which the balancing period falls.

3 At the end of each balancing period calculate—

a the total of—

i the quantity of CHP electricity that the supplier acquired or generated in that period, and

ii any balancing credit carried forward to that balancing period; and

b the total of—

i the quantity of electricity supplied by exempt CHP supplies made by him in that period, and