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The Friendly Societies (Modification of the Corporation Tax Acts) (Amendment) Regulations 2000

S.I. 2000/2710 · Made 3 October 2000

Original text. legislation.gov.uk does not revise statutory instruments, so later amendments are not shown here. Changes made to it are listed under each provision when known.

INCOME TAX

Made 3rd October 2000

Laid before the House of Commons 4th October 2000

Coming into force 25th October 2000

The Treasury, in exercise of the powers conferred upon them by section 463(1) and (4) of the Income and Corporation Taxes Act 1988f1, hereby make the following Regulations:

Annotations to the whole text

Footnotes

f1

1988 c. 1; section 463 was amended by section 50 of the Finance Act 1990 (c. 29), paragraph 10 of Schedule 9 to the Finance (No. 2) Act 1992 (c. 48) and section 171(5) of the Finance Act 1996 (c. 8).

Contents

  1. 1Citation and commencement
  2. 2Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997
  3. 3Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997
  4. 4Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997
  5. 5Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997
  6. 6Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997
  7. Signature
  8. Explanatory note

1Citation and commencement

These Regulations may be cited as the Friendly Societies (Modification of the Corporation Tax Acts) (Amendment) Regulations 2000 and shall come into force on 25th October 2000.

2Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997

Amend the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997f1 in accordance with the following provisions of these Regulations.

3Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997

After regulation 4 insert the following regulation—

“Modification of section 43F of the Taxes Act

4A
1)

Paragraph (2) prescribes a modification of section 43F(1) of the Taxes Actf1 so far as it applies to the life or endowment business carried on by friendly societies.

(2)

For the words from “required” to the end substitute “made up for the purposes of an investigation into the financial condition of a friendly society under section 46 or 47 of the Friendly Societies Act 1992f2.”.

(3)

This regulation shall have effect in relation to transactions entered into on or after 21st March 2000.”.

4Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997

(1)

In regulation 13(2), in the substituted subsection (6) of section 432A of the Income and Corporation Taxes Act 1988f1—

(a)

in paragraph (a) of that subsection insert “(but not below nil)” after “reduced” and insert “net” before “values”;

(b)

for paragraph (b) of that subsection substitute—

“(b)

the denominator is the aggregate of—

(i)

the numerator given by paragraph (a) above; and

(ii)

the numerators given by that paragraph in relation to the other categories of business.”.

(2)

This regulation shall have effect in relation to accounting periods beginning on or after 1st January 2000 and ending on or after 21st March 2000.

5Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997

After regulation 30Af1 insert the following regulation—

“Modification of section 587B of the Taxes Act

30AA
(1)

Paragraph (2) prescribes a modification of section 587B of the Taxes Actf2 so far as it applies to the life or endowment business carried on by friendly societies.

(2)

In subsection (8)(b)(ii) before “basic life assurance” insert “taxable”.

(3)

This regulation shall have effect in relation to disposals made by friendly societies on or after 1st April 2000.”.

6Amendments to the Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997

After regulation 30Bf1 insert the following regulations—

“Modifications of section 804B of the Taxes Act

30C
1)

Paragraphs (2) to (4) prescribe modifications of section 804B of the Taxes Actf2 so far as it applies to the life or endowment business carried on by friendly societies.

(2)

in subsection (4)—

(a)

in paragraph (a) before “basic” insert “taxable”;

(b)

for paragraph (b) substitute—

“(b)

taxable class IV business,”.

(3)

In subsection (5)—

(a)

in paragraph (a) before “basic” insert “taxable”;

(b)

for paragraph (b) substitute—

“(b)

tax exempt basic life assurance and general annuity business; nor

(c)

taxable class IV business; nor

(d)

tax exempt class IV business.”.

(4)

In subsection (9) for the words from “other than” to “credit in respect of” substitute

  • “other than—

    1. (a)

      taxable basic life assurance and general annuity business, or

    2. (b)

      tax exempt basic life assurance and general annuity business, or

    3. (c)

      taxable class IV business, or

    4. (d)

      tax exempt class IV business,

    credit in respect of”.

(5)

This regulation shall have effect in relation to accounting periods beginning on or after 1st April 2000.

Modifications of section 804D of the Taxes Act

30D
1)

Paragraphs (2) to (4) prescribe modifications of section 804D of the Taxes Actf3 so far as it applies to the life or endowment business carried on by non-directive societies.

(2)

In subsection (2) for the words from “by which” to then end substitute

  • “by which—

    1. (a)

      so much of the total of the amounts shown, in the society’s accounts for that period, in respect of Item 1 of Part I of Schedule 7 to the Friendly Societies (Accounts and Related Provisions) Regulations 1994f4 as is referable to that category of business exceeds—

    2. (b)

      so much of any commissions payable, and any expenses of management incurred, in connection with the acquisition of the business, as shown in those accounts in respect of Item 2(f) and (g) of Part I of that Schedule, as is referable to that category of business.”.

(3)

In subsection (4) for the words from “claims incurred” to the end substitute “total income of that category determined under subsection (2) above.”.

(4)

Omit subsection (5).

(5)

This regulation shall have effect in relation to periods of account beginning on or after 1st April 2000.”.

Signature

Jim Dowd

Bob Ainsworth

Two of the Lords Commissioners of Her Majesty’s Treasury

3rd October 2000

Explanatory note

(This note is not part of the Regulations)

Section 463(1) of the Income and Corporation Taxes Act 1988 (“the Taxes Act”) provides that the Corporation Tax Acts shall apply to the life or endowment business carried on by friendly societies in the same way as they apply to mutual life assurance business or other long term business carried on by insurance companies, subject to such modifications and exceptions as may be prescribed by regulations made by the Treasury. The Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997 (“the principal Regulations”) make provision for such modifications and exceptions. These Regulations amend the principal Regulations with retrospective effect in the light of provisions of the Finance Act 2000 (c. 17) that amend or insert provisions in the Taxes Act.

Regulation 1 provides for citation and commencement.

Regulation 2 introduces the remainder of the Regulations.

Regulation 3 inserts regulation 4A in the principal Regulations which modifies section 43F of the Taxes Act (rent factoring — insurance business) in relation to transactions of friendly societies entered into on or after 21st March 2000.

Regulation 4 amends regulation 13 of the principal Regulations (modifications of section 432A of the Taxes Act — apportionment of income and gains where an insurance company carries on more than one category of business) in relation to accounting periods of friendly societies beginning on or after 1st January 2000 and ending on or after 21st March 2000.

Regulation 5 inserts regulation 30AA in the principal Regulations which modifies section 587B of the Taxes Act (gifts of shares and securities by companies to charities) in relation to disposals made by friendly societies on or after 1st April 2000.

Regulation 6 inserts regulations 30C and 30D in the principal Regulations which modify sections 804B and 804D of the Taxes Act (allocation of foreign tax credit to different categories of insurance business) in relation to accounting periods or periods of account of friendly societies beginning on or after 1st April 2000.

Authority for the retrospective effect of these Regulations is given by section 463(4) of the Taxes Act.