OpenLegislation

Finance Act 2018

2018 c. 3 · Enacted 15 March 2018 · Extends to United Kingdom

Up to date with all changes known to legislation.gov.uk, revised to 18 March 2026.

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.[15th March 2018]

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 to 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:—

Contents

  1. Part 1: Direct taxes
  2. Income tax and corporation tax: charge
  3. 1Income tax charge for tax year 2018-19
  4. 2Corporation tax charge for financial year 2019
  5. Income tax: rates and allowances
  6. 3Main rates of income tax for tax year 2018-19
  7. 4Default and savings rates of income tax for tax year 2018-19
  8. 5Starting rate limit for savings for tax year 2018-19
  9. 6Transfer of tax allowance after death of spouse or civil partner
  10. Employment
  11. 7Deductions from seafarers' earnings
  12. 8Exemption for armed forces' accommodation allowances
  13. 9Benefits in kind: diesel cars
  14. 10Termination payments: foreign service
  15. Disguised remuneration
  16. 11Employment income provided through third parties
  17. 12Trading income provided through third parties
  18. Pensions
  19. 13Pension schemes
  20. Investments
  21. 14EIS, SEIS and VCT reliefs: risk to capital
  22. 15EIS, SI and VCT reliefs: relevant investments
  23. 16EIS and VCT reliefs: knowledge-intensive companies
  24. 17VCTs: further amendments
  25. Partnerships
  26. 18Partnerships
  27. Corporation tax
  28. 19Research and development expenditure credit
  29. 20Intangible fixed assets: realisation involving non-monetary receipt
  30. 21Intangible fixed assets: transactions between related parties
  31. 22Oil activities: tariff receipts etc
  32. 23Hybrid and other mismatches
  33. 24Corporate interest restriction
  34. 25Education Authority of Northern Ireland
  35. Chargeable gains
  36. 26Freezing of indexation allowance for gains chargeable to corporation tax
  37. 27Assets transfer to non-resident company: reorganisations of share capital etc
  38. 28Depreciatory transactions within a group of companies
  39. Capital allowances
  40. 29First-year tax credits Repealed
  41. Double taxation relief
  42. 30Reduction of relief in cases where losses relieved sideways etc
  43. 31Countering effect of avoidance arrangements
  44. 32Double taxation arrangements specified by Order in Council
  45. Miscellaneous
  46. 33Bank levy
  47. 34Debt traded on a multilateral trading facility
  48. 35Settlements: anti-avoidance etc
  49. 36Fixed rate deduction for expenditure on vehicles etc
  50. 37Carried interest
  51. Part 2: Indirect taxes
  52. Value added tax
  53. 38Online marketplaces
  54. 39VAT refunds to public authorities
  55. Stamp duty land tax
  56. 40Higher rates for additional dwellings
  57. 41Relief for first-time buyers
  58. Landfill tax
  59. 42Landfill tax: disposals not made at landfill sites, etc
  60. Excise duties
  61. 43Air passenger duty: rates of duty from 1 April 2019
  62. 44VED: rates for light passenger vehicles, light goods vehicles, motorcycles etc
  63. 45Tobacco products duty: rates
  64. Part 3: Miscellaneous and final
  65. Customs enforcement powers
  66. 46Power to enter premises and inspect goods
  67. 47Power to search vehicles or vessels
  68. Updating of statutory references
  69. 48CO2 emissions figures etc
  70. Final
  71. 49Interpretation
  72. 50Short title
  73. Schedule 1: Employment income provided through third parties
  74. Part 1: Arrangements relating to earnings charged to tax
  75. 1Paragraph 1
  76. Part 2: Close companies
  77. Application of Chapter 2 of Part 7A to ITEPA 2003
  78. 2Paragraph 2
  79. Double taxation
  80. 3Paragraph 3
  81. 4Paragraph 4
  82. Part 3: Amendments consequential on Part 2
  83. ITEPA 2003
  84. 5Paragraph 5
  85. ITTOIA 2005
  86. 6Paragraph 6
  87. CTA 2009
  88. 7Paragraph 7
  89. F(No.2)A 2017
  90. 8Paragraph 8
  91. Part 4: Loans etc outstanding on 5 April 2019
  92. Information requirement
  93. 9Paragraph 9
  94. 10Paragraph 10
  95. 11Paragraph 11
  96. PAYE: employee of non-UK employer
  97. 12Paragraph 12
  98. Part 5: Commencement
  99. 13Paragraph 13
  100. 14Paragraph 14
  101. 15Paragraph 15
  102. 16Paragraph 16
  103. Schedule 2: Trading income provided through third parties: loans etc outstanding on 5 April 2019
  104. 1Paragraph 1
  105. Schedule 3: Pension schemes
  106. Amendments of and relating to Part 4 of the Finance Act 2004
  107. 1Paragraph 1
  108. Commencement
  109. 2Paragraph 2
  110. Meaning of “Master Trust scheme”: transitional provision
  111. 3Paragraph 3
  112. Master Trust schemes registered before the passing of this Act
  113. 4Paragraph 4
  114. Schedule 4: EIS and VCT reliefs: knowledge-intensive companies
  115. Amount of EIS relief
  116. 1Paragraph 1
  117. Maximum amount raised annually by knowledge-intensive company
  118. 2Paragraph 2
  119. 3Paragraph 3
  120. 4Paragraph 4
  121. Initial investing period: permitted age of knowledge-intensive company
  122. 5Paragraph 5
  123. 6Paragraph 6
  124. 7Paragraph 7
  125. 8Paragraph 8
  126. 9Paragraph 9
  127. Commencement
  128. 10Paragraph 10
  129. Schedule 5: Venture capital trusts: further amendments
  130. Relaxation of restriction where there is a linked sale
  131. 1Paragraph 1
  132. The 70% qualifying holdings condition
  133. 2Paragraph 2
  134. 3Paragraph 3
  135. 4Paragraph 4
  136. The minimum investment on further issue condition
  137. 5Paragraph 5
  138. 6Paragraph 6
  139. Non-qualifying loans
  140. 7Paragraph 7
  141. Qualifying holdings: exclusions
  142. 8Paragraph 8
  143. 9Paragraph 9
  144. 10Paragraph 10
  145. 11Paragraph 11
  146. Commencement
  147. 12Paragraph 12
  148. 13Paragraph 13
  149. 14Paragraph 14
  150. Schedule 6: Partnerships
  151. Part 1: Bare trusts
  152. 1Paragraph 1
  153. 2Paragraph 2
  154. 3Paragraph 3
  155. 4Paragraph 4
  156. Part 2: Notional trade and business of indirect partner
  157. 5Paragraph 5
  158. Part 3: Returns: information to be included
  159. 6Paragraph 6
  160. 7Paragraph 7
  161. Part 4: Returns: overseas partners in investment partnerships etc
  162. 8Paragraph 8
  163. 9Paragraph 9
  164. Part 5: Returns conclusive as to shares of profits and losses
  165. 10Paragraph 10
  166. 11Paragraph 11
  167. 12Paragraph 12
  168. 13Paragraph 13
  169. 14Paragraph 14
  170. 15Paragraph 15
  171. Schedule 7: Hybrid and other mismatches
  172. Introductory
  173. 1Paragraph 1
  174. Meaning of “tax” etc and treatment of cases where tax charged at a nil rate
  175. 2Paragraph 2
  176. 3Paragraph 3
  177. 4Paragraph 4
  178. 5Paragraph 5
  179. 6Paragraph 6
  180. CFCs and foreign CFCs: qualifying CFC amounts
  181. 7Paragraph 7
  182. Hybrid and other mismatches from financial instruments: qualifying capital amounts
  183. 8Paragraph 8
  184. Hybrid transfer deduction/non-inclusion mismatches: qualifying capital amounts
  185. 9Paragraph 9
  186. 10Paragraph 10
  187. Hybrid payee deduction/non-inclusion mismatches
  188. 11Paragraph 11
  189. Multinational payee deduction/non-inclusion mismatches
  190. 12Paragraph 12
  191. Hybrid entity double deduction mismatches: use of restricted deduction
  192. 13Paragraph 13
  193. 14Paragraph 14
  194. Imported mismatches: dual inclusion income
  195. 15Paragraph 15
  196. 16Paragraph 16
  197. 17Paragraph 17
  198. Adjustments in light of subsequent events: accounting treatment
  199. 18Paragraph 18
  200. Commencement
  201. 19Paragraph 19
  202. Schedule 8: Corporate interest restriction
  203. Part 1: Amendments of Part 10 of TIOPA 2010
  204. Introductory
  205. 1Paragraph 1
  206. Hedging of tax-interest expense amounts or tax-interest income amounts etc
  207. 2Paragraph 2
  208. 3Paragraph 3
  209. 4Paragraph 4
  210. 5Paragraph 5
  211. Group ratio: leaving R&D expenditure credits out of account
  212. 6Paragraph 6
  213. Public infrastructure
  214. 7Paragraph 7
  215. 8Paragraph 8
  216. 9Paragraph 9
  217. 10Paragraph 10
  218. 11Paragraph 11
  219. Identifying members of a worldwide group
  220. 12Paragraph 12
  221. 13Paragraph 13 Repealed
  222. Interest restriction returns
  223. 14Paragraph 14
  224. 15Paragraph 15
  225. 16Paragraph 16
  226. 17Paragraph 17
  227. Other amendments
  228. 18Paragraph 18
  229. 19Paragraph 19
  230. 20Paragraph 20
  231. 21Paragraph 21
  232. Commencement
  233. 22Paragraph 22
  234. 23Paragraph 23
  235. 24Paragraph 24
  236. 25Paragraph 25
  237. 26Paragraph 26
  238. Part 2: Other amendments
  239. 27Paragraph 27
  240. 28Paragraph 28
  241. Schedule 9: Bank levy
  242. Part 1: Chargeable equity and liabilities
  243. Introductory
  244. 1Paragraph 1
  245. Chargeable equity and liabilities: relevant groups and relevant entities
  246. 2Paragraph 2
  247. Definition of “UK allocated equity and liabilities”
  248. 3Paragraph 3
  249. 4Paragraph 4
  250. 5Paragraph 5
  251. 6Paragraph 6
  252. 7Paragraph 7
  253. Consequential amendments
  254. 8Paragraph 8
  255. 9Paragraph 9
  256. 10Paragraph 10
  257. 11Paragraph 11
  258. 12Paragraph 12
  259. 13Paragraph 13
  260. 14Paragraph 14
  261. 15Paragraph 15
  262. Part 2: Miscellaneous amendments
  263. Introductory
  264. 16Paragraph 16
  265. Joint ventures
  266. 17Paragraph 17
  267. Joint and several liability
  268. 18Paragraph 18
  269. 19Paragraph 19
  270. Meaning of “the responsible member”
  271. 20Paragraph 20
  272. 21Paragraph 21
  273. International accounting standards
  274. 22Paragraph 22
  275. 23Paragraph 23
  276. 24Paragraph 24
  277. 25Paragraph 25
  278. 26Paragraph 26
  279. 27Paragraph 27
  280. 28Paragraph 28
  281. 29Paragraph 29
  282. 30Paragraph 30
  283. 31Paragraph 31
  284. 32Paragraph 32
  285. 33Paragraph 33
  286. 34Paragraph 34
  287. Part 3: Commencement
  288. 35Paragraph 35
  289. 36Paragraph 36
  290. Schedule 10: Settlements: anti-avoidance etc
  291. Part 1: Capital gains tax
  292. TCGA 1992
  293. 1Paragraph 1
  294. 2Paragraph 2
  295. Part 2: Income tax
  296. ITTOIA 2005
  297. 3Paragraph 3
  298. 4Paragraph 4
  299. 5Paragraph 5
  300. 6Paragraph 6
  301. 7Paragraph 7
  302. 8Paragraph 8
  303. 9Paragraph 9
  304. 10Paragraph 10
  305. 11Paragraph 11
  306. ITA 2007
  307. 12Paragraph 12
  308. 13Paragraph 13
  309. 14Paragraph 14
  310. 15Paragraph 15
  311. 16Paragraph 16
  312. 17Paragraph 17
  313. 18Paragraph 18
  314. 19Paragraph 19
  315. Consequential amendments
  316. 20Paragraph 20
  317. Commencement etc of amendments in ITTOIA 2005 and ITA 2007
  318. 21Paragraph 21
  319. 22Paragraph 22
  320. Schedule 11: Stamp duty land tax: higher rates for additional dwellings
  321. 1Paragraph 1
  322. Previous residence required to be disposed of entirely
  323. 2Paragraph 2
  324. Exception where purchaser has prior interest in purchased dwelling
  325. 3Paragraph 3
  326. Exception where spouses and civil partners purchasing from one another
  327. 4Paragraph 4
  328. Property adjustment on divorce, dissolution of civil partnership etc
  329. 5Paragraph 5
  330. Purchase etc by person appointed under Mental Capacity Act 2005 to make decisions for a child
  331. 6Paragraph 6
  332. Minor and consequential amendments
  333. 7Paragraph 7
  334. 8Paragraph 8
  335. 9Paragraph 9
  336. 10Paragraph 10
  337. 11Paragraph 11
  338. 12Paragraph 12
  339. 13Paragraph 13
  340. 14Paragraph 14
  341. 15Paragraph 15
  342. Commencement
  343. 16Paragraph 16
  344. Schedule 12: Landfill tax: disposals not made at landfill sites, etc
  345. Part 1: Amendments of Part 3 of FA 1996
  346. Introduction
  347. 1Paragraph 1
  348. Taxable disposals
  349. 2Paragraph 2
  350. 3Paragraph 3
  351. Liability to pay landfill tax
  352. 4Paragraph 4
  353. Exemptions
  354. 5Paragraph 5
  355. 6Paragraph 6
  356. 7Paragraph 7
  357. 8Paragraph 8
  358. Taxable activities
  359. 9Paragraph 9
  360. Taxable disposals etc: supplementary and consequential amendments
  361. 10Paragraph 10
  362. 11Paragraph 11
  363. 12Paragraph 12
  364. 13Paragraph 13
  365. 14Paragraph 14
  366. 15Paragraph 15
  367. 16Paragraph 16
  368. Registration
  369. 17Paragraph 17
  370. Registration: supplementary and consequential amendments
  371. 18Paragraph 18
  372. 19Paragraph 19
  373. 20Paragraph 20
  374. 21Paragraph 21
  375. Assessment
  376. 22Paragraph 22
  377. 23Paragraph 23
  378. Assessment: supplementary and consequential amendments
  379. 24Paragraph 24
  380. 25Paragraph 25
  381. Part 2: Amendments of other Acts
  382. FA 2008
  383. 26Paragraph 26
  384. 27Paragraph 27
  385. FA 2011
  386. 28Paragraph 28
  387. Part 3: Commencement and transitional provisions
  388. Commencement
  389. 29Paragraph 29
  390. Registration
  391. 30Paragraph 30
  392. Disposals before April 2018 at places other than landfill sites
  393. 31Paragraph 31
  394. 32Paragraph 32
  395. 33Paragraph 33
  396. 34Paragraph 34
  397. Interpretation
  398. 35Paragraph 35