The Enactment of Extra-Statutory Concessions Order 2017
| Jurisdiction | UK Non-devolved |
| Citation | SI 2017/495 |
2017 No. 495
Capital Gains Tax
Inheritance Tax
Value Added Tax
The Enactment of Extra-Statutory Concessions Order 2017
Made 28th March 2017
Coming into force 6th April 2017
The Treasury make the following Order in exercise of the powers conferred by section 160 of the Finance Act 20081.
In accordance with section 160(7) of that Act, a draft of this instrument was laid before the House of Commons and approved by resolution of that House.
Citation and commencement
1. This Order may be cited as the Enactment of Extra-Statutory Concessions Order 2017 and comes into force on 6th April 2017.
Transitional provisions for woodlands subject to a deferred estate duty charge
2. At the end of paragraph 46 of Schedule 19 to the Finance Act 19862insert “to the extent that the value transferred is attributable to the land concerned”.
3. The amendment made by article 2 has effect in relation to transfers of value made on or after the date on which this Order comes into force.
Non-resident or dual resident settlements: meaning of “participator”
4. In section 963of the Taxation of Chargeable Gains Act 1992 (payments by and to companies), in subsection (10) after paragraph (a) insert—
“(aa)
“(aa) a person is not to be regarded as a participator in a company controlled by the trustees of a settlement where the person has a share or interest in the capital or income of the company solely by virtue of an interest which the person has under the settlement;”.
5.—(1) Schedule 54to the Taxation of Chargeable Gains Act 1992 is amended as follows.
(2) In paragraph 2A (settlements created before 17th March 1998) after sub-paragraph (9) insert—
“9A For the purposes of sub-paragraphs (8) and (9) above a person is not to be regarded as a participator in a company controlled by the trustees of a settlement where the person has a share or interest in the capital or income of the company solely by virtue of an interest which the person has under the settlement.”.
(3) In paragraph 8 (meaning of “originating”) after sub-paragraph (8) insert—
“8A But a person is not to be regarded as a participator in a company controlled by the trustees of a settlement where the person has a share or interest in the capital or income of the company solely because of an interest which the person has under the settlement.”.
(4) In paragraph 9 (qualifying settlements, and commencement) after sub-paragraph (10) insert—
“10ZA For the purposes of sub-paragraphs (9) and (10) above a person is not to be regarded as a participator in a company controlled by the trustees of a settlement where the person has a share or interest in the capital or income of the company solely by virtue of an interest which the person has under the settlement.”.
6. The amendments made by articles 4 and 5 have effect—
(a) for corporation tax purposes, for accounting periods ending on or after the date on which this Order comes into force, and
(b) for capital gains tax purposes, for the tax year 2017-18 and subsequent tax years.
Disapplication of disallowance of input tax in insolvency where consideration not paid
7.—(1) Part 1 of the Value Added Tax Act 19945is amended as follows.
(2) After subsection (1) of section 26A (disallowance of input tax where consideration not paid) insert—
“1A Subsection (1) is subject to section 26AA (disapplication of disallowance under section 26A in insolvency).”.
(3) After section 26A insert—
“Disapplication of disallowance under section 26A in insolvency
26AA.—(1) Section 26A(1) does not apply to a person in relation to credit for input tax which relates to a supply where—
(a)
(a) at the time of the supply, no insolvency procedure had effect in relation to the person,
(b)
(b) at any time during the relevant period, an insolvency procedure had effect in relation to that person (“the insolvent person”), and
(c)
(c) the Commissioners have been notified in writing of the matter mentioned in paragraph (b) by or on behalf of a person authorised to deal with the insolvent person’s affairs.
(2) But where the insolvency procedure mentioned in subsection (1)(b) is a bankruptcy order, award of sequestration, protected trust deed or voluntary arrangement and that bankruptcy order is annulled, that award of sequestration is recalled or that protected trust deed or voluntary arrangement has come to an end prematurely—
(a)
(a) the disapplication of section 26A(1) by subsection (1) above ceases to have effect, and
(b)
(b) the person to which the bankruptcy order, award of sequestration, protected trust deed or voluntary arrangement relates is to be taken for the purposes of section 26A(1) as not being entitled to the credit for the input tax concerned as from whichever is the later of—
(i) the end of the relevant period, and
(ii) the date on which the bankruptcy order was annulled, the award of sequestration recalled or the protected trust deed or voluntary arrangement has come to an end prematurely.
(3) Where the person mentioned in section 26A(1) is entitled as a member of a partnership to credit for input tax this section has effect as if—
(a)
(a) the references in subsections (1)(a) and (b) to “the person” and “that person” were references to the partnership,
(b)
(b) the reference in subsection (1)(c) to “the insolvent person’s affairs” were a reference to the insolvent partnership’s affairs, and
(c)
(c) the reference in subsection (2)(b) to “the person”, in connection with a bankruptcy order or a voluntary arrangement, were a reference to the person who is a member of the partnership to which the bankruptcy order or voluntary arrangement relates.
(4) Subsection (1) does not apply where the insolvency procedure referred to in subsection (1)(b) has effect as part of, or as a consequence of, arrangements where the main purpose, or one of the main purposes, of those arrangements is to obtain a tax advantage by the operation of this section.
(5) Regulations may make such supplementary, incidental, consequential or transitional provisions as appear to the Commissioners to be necessary or expedient for the purposes of this section.
(6) For the purposes of this section “the relevant period”, in relation to a supply, is the period beginning immediately after the supply took place and ending six months after—
(a)
(a) the date of that supply, or
(b)
(b) if later, the date on which the relevant part of the consideration for the supply is payable.
(7) For the purposes of subsection (6) the relevant part of the consideration is the part of the consideration referable to the credit for input tax which would (ignoring the effect of this section) be disallowed under section 26A(1).
(8) For the purposes of this section an insolvency procedure has effect in relation to a person at a time when any of the following apply—
(a)
(a) a bankruptcy order has been made under Chapter 1 of Part 9 of the Insolvency Act 19866in relation to that person and has not been annulled,
(b)
(b) a warrant has been granted for a petition for sequestration to be served on that person which has resulted in the sequestration of that person’s estate or an award of sequestration has been made on an application by that person, in both cases under section 22 of the Bankruptcy (Scotland) Act 20167, and in either case the award of sequestration has not been recalled,
(c)
(c) a bankruptcy order has been made under Chapter 1 of Part 9 of the Insolvency (Northern Ireland) Order 19898in relation to that person and has not been annulled,
(d)
(d) where that person is a company registered under the Companies Act 20069in England and Wales or Scotland or an unregistered company as defined in section 220 of the Insolvency Act 1986 which is deemed to be registered in England and Wales or Scotland under section 221 of that Act, a petition has been presented to the court which has resulted in a winding-up order being made under Chapter 6 of Part 4 or Part 5 of the Insolvency Act 1986 in relation to that person and that person has not been dissolved or that winding-up order has not been stayed or sisted,
(e)
(e) where that person is a company registered under the Companies Act 2006 in Northern Ireland, or an unregistered company as defined in article 184 of the Insolvency (Northern Ireland) Order 1989 which is deemed to be registered in Northern Ireland under article 185 of that Order, a petition has been presented to the court which has resulted in a winding-up order being made under Part 5 or Part 6 of the Insolvency (Northern Ireland) Order 1989 and that person has not been dissolved or that winding-up order has not been stayed,
(f)
(f) that person is in administration for the purposes of Schedule B1 to the Insolvency Act 198610or Schedule B1 to the Insolvency (Northern Ireland) Order 1989,
(g)
(g) an appointment of an administrative receiver is in force in relation to that person disregarding any temporary vacancy in the office of receiver,
(h)
(h) an appointment of a liquidator is in force as a consequence of a creditors’ voluntary winding up under Chapter 4 of Part 4 of the Insolvency Act 1986 or Chapter 4 of Part 5 of the Insolvency (Northern Ireland) Order 1989 in relation to that person disregarding any temporary vacancy in the office of liquidator,
(i)
(i) a voluntary...
To continue reading
Request your trial