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The Tax Law Rewrite Acts (Amendment) Order 2013

S.I. 2013/463 · Made 4 March 2013

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.

Capital Gains Tax

Corporation Tax

Income Tax

Inheritance Tax

Made 4th March 2013

Laid before the House of Commons 5th March 2013

Coming into force 1st April 2013

The Treasury make the following Order in exercise of the powers conferred by sections 1178 and 1179 of the Corporation Tax Act 2010f1 and by section 375 of the Taxation (International and Other Provisions) Act 2010f2.

Annotations to the whole text

Footnotes

f1

2010 c. 4.

f2

2010 c. 8.

Contents

  1. 1Citation, commencement and effect
  2. 2Inheritance Tax Act 1984
  3. 3Local Government Finance Act 1988
  4. 4Taxation of the Chargeable Gains Act 1992
  5. 5Taxation of the Chargeable Gains Act 1992
  6. 6Taxation of the Chargeable Gains Act 1992
  7. 7Finance Act 1994
  8. 8Income Tax (Trading and Other Income) Act 2005
  9. 9Corporation Tax Act 2010
  10. 10Corporation Tax Act 2010
  11. 11Corporation Tax Act 2010
  12. 12Corporation Tax Act 2010
  13. Signature
  14. Explanatory note

1Citation, commencement and effect

(1)

This Order may be cited as the Tax Law Rewrite Acts (Amendment) Order 2013.

(2)

This Order comes into force on 1st April 2013.

(3)

The amendments made by articles 11 and 12 have effect for accounting periods beginning on or after that date.

2Inheritance Tax Act 1984

(1)

In the definition of “local authority” in section 272 of the Inheritance Tax Act 1984f1 (general interpretation), for “section 842A of the Taxes Act 1988f2” substitute “section 1130 of the Corporation Tax Act 2010”.

(2)

In consequence of the amendment made by paragraph (1), omit paragraph 4 of Schedule 18 to the Finance Act 1990f3.

3Local Government Finance Act 1988

In section 45A(3)(a) of the Local Government Finance Act 1988f1 (unoccupied hereditaments: zero-rating), for “Schedule 18 to the Finance Act 2002f2” substitute “Chapter 9 of Part 13 of the Corporation Tax Act 2010”.

4Taxation of the Chargeable Gains Act 1992

The Taxation of Chargeable Gains Act 1992f1 is amended as follows.

5Taxation of the Chargeable Gains Act 1992

In section 140C(5) (transfer or division of non-UK business) for “section 815A of the Taxes Act” substitute “section 122 of TIOPA 2010 (tax treated as chargeable in respect of gains on transfer of non-UK business)”.

6Taxation of the Chargeable Gains Act 1992

In section 140F(4) (merger: assets outside UK tax charge) for “section 815A of the Taxes Act (transfer of a non-UK trade)” substitute “section 122 of TIOPA 2010 (tax treated as chargeable in respect of gains on transfer of non-UK business)”.

7Finance Act 1994

(1)

Section 227B of the Finance Act 1994f1 (transfer of underwriting business without change of ownership) is amended as follows.

(2)

In subsection (2)—

(a)

for “Section 343 of the Taxes Act 1988 (company reconstructions without a change of ownership)” substitute “Chapter 1 of Part 22 of the Corporation Tax Act 2010 (transfers of trade without a change of ownership)”,

(b)

in paragraph (a), for “the trade mentioned in that section” substitute “the transferred trade referred to in that Chapterf2”, and

(c)

in paragraph (c), for “subsections (8) to (10) and (12)” substitute “sections 951 and 952”.

8Income Tax (Trading and Other Income) Act 2005

In section 415(5) of the Income Tax (Trading and Other Income) Act 2005f1 (charge to tax under Chapter 6), for “as if they were in section 419 of ICTA” substitute “as they have for the purposes of section 455 of CTA 2010”.

9Corporation Tax Act 2010

The Corporation Tax Act 2010 is amended as follows.

10Corporation Tax Act 2010

In section 144(2) (condition 1: claimant company owned by consortium), for “total profits” (in both places) substitute “available total profits”f1.

11Corporation Tax Act 2010

In section 148 (conditions 1 and 2: surrendering company in group of companies), for subsections (3) and (4) substitute—

“(3)

In the case of the claim (“the current claim”) the surrendering company’s surrenderable amountsf1 for the surrender period are to be treated as reduced (but not below nil) by the group’s potential relieff2.”

12Corporation Tax Act 2010

In section 149 (conditions 1 and 3: claimant company in group of companies), for subsections (3) and (4) substitute—

“(3)

In the case of the claim (“the current claim”) the claimant company’s available total profits of the claim period are to be treated as reduced (but not below nil) by the group’s potential relieff1.”

Signature

Desmond Swayne

Mark Lancaster

Two of the Lords Commissioners of Her Majesty’s Treasury

4th March 2013

Explanatory note

(This note is not part of the Order)

This Order exercises the powers conferred by the Corporation Tax Act 2010 (c. 4) (“CTA 2010”) and the Taxation (International and Other Provisions) Act 2010 (c. 8) (“TIOPA 2010”) to make consequential amendments and undo unintended changes resulting from the work of the Tax Law Re-write project.

Articles 2 to 8 make consequential amendments to update references to provisions which were rewritten in CTA 2010 or TIOPA 2010. The Acts affected are the Inheritance Tax Act 1984 (c. 51) and the Finance Act 1990 (c. 29) (article 2), the Local Government Finance Act 1988 (c. 41) (article 3), the Taxation of Chargeable Gains Act 1992 (c. 12) (articles 5 and 6), the Finance Act 1994 (c. 9) (article 7), and the Income Tax (Trading and Other Income) Act 2005 (c. 5) (article 8).

Article 10 aligns the wording used to refer to available total profits in sections 144 of CTA 2010 with that used in section 140 of that Act and in section 149(3) (as substituted by article 12 of this Order).

Article 11 amends section 148 of CTA 2010 and article 12 amends section 149 of CTA 2010 to undo unintended changes to the operation of group relief from corporation tax. The changes concern limitations on what is known as consortium relief. Article 11 amends section 148 to restore the intended interaction between two restrictions on the amount eligible for surrender by a company in certain circumstances, one imposed by section 148 and the other by section 143 of CTA 2010 (known as the ownership restriction). The result is that the restriction in section 148 is applied before the restriction in section 143.

Article 12 amends section 149 to undo an unintended change to the operation of two limitations on the available total profits of a company against which relief can be claimed so that the limit imposed by section 149 is applied to reduce the available total profits before that amount is further reduced by section 144 of CTA 2010.

A Tax Information and Impact Note has not been prepared for this Instrument as it contains no substantive changes to tax policy.