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Royal arms

Income Tax Act 2007

2007 CHAPTER 3

CONTENTS

Go to Preamble

  1. Part 1

    Overview

    1. 1. Overview of Income Tax Acts

    2. 2. Overview of Act

  2. Part 2

    Basic provisions

    1. Chapter 1

      Charges to income tax

      1. 3. Overview of charges to income tax

      2. 4. Income tax an annual tax

      3. 5. Income tax and companies

    2. Chapter 2

      Rates at which income tax is charged

      1. The rates

        1. 6. The starting rate, basic rate and higher rate

        2. 7. The savings rate

        3. 8. The dividend ordinary rate and dividend upper rate

        4. 9. The trust rate and dividend trust rate

      2. Income charged at particular rates

        1. 10. Income charged at the starting, basic and higher rates: individuals

        2. 11. Income charged at the basic rate: other persons

        3. 12. Income charged at the savings rate

        4. 13. Income charged at the dividend ordinary and dividend upper rates: individuals

        5. 14. Income charged at the dividend ordinary rate: other persons

        6. 15. Income charged at the trust rate and the dividend trust rate

        7. 16. Savings and dividend income to be treated as highest part of total income

        8. 17. Repayment: tax paid at basic rate instead of starting or savings rate

        9. 18. Meaning of “savings income”

        10. 19. Meaning of “dividend income”

      3. Starting rate limit and basic rate limit

        1. 20. The starting rate limit and the basic rate limit

        2. 21. Indexation of the starting rate limit and the basic rate limit

    3. Chapter 3

      Calculation of income tax liability

      1. 22. Overview of Chapter

      2. 23. The calculation of income tax liability

      3. 24. Reliefs deductible at Step 2

      4. 25. Reliefs and allowances deductible at Steps 2 and 3: supplementary

      5. 26. Tax reductions

      6. 27. Order of deducting tax reductions: individuals

      7. 28. Order of deducting tax reductions: other persons

      8. 29. Tax reductions: supplementary

      9. 30. Additional tax

      10. 31. Total income: supplementary

      11. 32. Liability not dealt with in the calculation

  3. Part 3

    Personal reliefs

    1. Chapter 1

      Introduction

      1. 33. Overview of Part

    2. Chapter 2

      Personal allowance and blind person’s allowance

      1. Introduction

        1. 34. Allowances under Chapter

      2. Personal allowances

        1. 35. Personal allowance for those aged under 65

        2. 36. Personal allowance for those aged 65 to 74

        3. 37. Personal allowance for those aged 75 and over

      3. Blind person’s allowance

        1. 38. Blind person’s allowance

        2. 39. Transfer of part of blind person’s allowance to a spouse or civil partner

        3. 40. Election for transfer of allowance under section 39

      4. Supplementary

        1. 41. Allowances in year of death

    3. Chapter 3

      Tax reductions for married couples and civil partners

      1. Introduction

        1. 42. Tax reductions under Chapter

        2. 43. Meaning of “the minimum amount”

        3. 44. Election for new rules to apply

      2. Married couple’s allowance

        1. 45. Marriages before 5 December 2005

        2. 46. Marriages and civil partnerships on or after 5 December 2005

      3. Elections to transfer relief

        1. 47. Election by individual to transfer relief under section 45 or 46

        2. 48. Joint election to transfer relief under section 45 or 46

        3. 49. Election for partial transfer back of relief

        4. 50. Procedure for making and withdrawing elections under sections 47 to 49

      4. Transfer of unused relief

        1. 51. Transfer of unused relief

        2. 52. Transfer back of unused relief

        3. 53. Transfer of unused relief: general

      5. Supplementary

        1. 54. Tax reductions in the year of marriage or entry into civil partnership

        2. 55. Sections 45 to 53: supplementary

    4. Chapter 4

      General

      1. 56. Residence etc of claimants

      2. 57. Indexation of allowances

      3. 58. Meaning of “adjusted net income”

  4. Part 4

    Loss relief

    1. Chapter 1

      Introduction

      1. 59. Overview of Part

    2. Chapter 2

      Trade losses

      1. Introduction

        1. 60. Overview of Chapter

        2. 61. Non-partners: losses of a tax year

        3. 62. Partners: losses of a tax year etc

        4. 63. Prohibition against double counting

      2. Trade loss relief against general income

        1. 64. Deduction of losses from general income

        2. 65. How relief works

      3. Restriction on relief for uncommercial trades

        1. 66. Restriction on relief unless trade is commercial

      4. Restriction on relief for “hobby” farming or market gardening

        1. 67. Restriction on relief in case of farming or market gardening

        2. 68. Reasonable expectation of profit

        3. 69. Whether trade is the same trade

        4. 70. Determining losses in previous tax years

      5. Use of trading loss as CGT loss

        1. 71. Treating trade losses as CGT losses

      6. Early trade losses relief

        1. 72. Relief for individuals for losses in first 4 years of trade

        2. 73. How relief works

        3. 74. Restrictions on relief unless trade is commercial etc

      7. Restrictions on sideways relief for certain capital allowances

        1. 75. Trade leasing allowances given to individuals

        2. 76. First-year allowances: introduction

        3. 77. First-year allowances: partnerships with companies

        4. 78. First-year allowances: arrangements to reduce tax liabilities

        5. 79. Capital allowances restrictions: supplementary

      8. Restriction on sideways relief for specific trades

        1. 80. Ring fence income

        2. 81. Dealings in commodity futures

        3. 82. Exploitation of films

      9. Carry-forward trade loss relief

        1. 83. Carry forward against subsequent trade profits

        2. 84. How relief works

        3. 85. Use of trade-related interest and dividends if trade profits insufficient

        4. 86. Trade transferred to a company

        5. 87. Ring fence trades

        6. 88. Carry forward of certain interest as loss

      10. Terminal trade loss relief

        1. 89. Carry back of losses on a permanent cessation of a trade

        2. 90. Losses that are “terminal losses”

        3. 91. How relief works

        4. 92. Use of trade-related interest and dividends if trade profits insufficient

        5. 93. Mineral extraction trade and carry back of balancing allowances

        6. 94. Carry back of certain interest as loss

      11. Wholly foreign trades

        1. 95. Foreign trades etc: reliefs only against foreign income

      12. Post-cessation trade relief

        1. 96. Post-cessation trade relief

        2. 97. Meaning of “qualifying payment”

        3. 98. Meaning of “qualifying event” etc

        4. 99. Reduction of relief for unpaid trade expenses

        5. 100. Prohibition against double counting

        6. 101. Treating excess post-cessation trade relief as CGT loss

    3. Chapter 3

      Restrictions on trade loss relief for certain partners

      1. Introduction

        1. 102. Overview of Chapter

        2. 103. Meaning of “sideways relief”, “capital gains relief” and “firm”

      2. Limited partners

        1. 104. Restriction on reliefs for limited partners

        2. 105. Meaning of “contribution to the firm”

        3. 106. Meaning of “limited partner”

      3. Members of LLPs

        1. 107. Restriction on reliefs for members of LLPs

        2. 108. Meaning of “contribution to the LLP”

        3. 109. Unrelieved losses brought forward

      4. Non-active members of LLPs or other partnerships (apart from limited partnerships)

        1. 110. Restriction on reliefs for non-active partners in early tax years

        2. 111. Meaning of “contribution to the firm”

        3. 112. Meaning of “non-active partner” and “early tax year” etc

        4. 113. Unrelieved losses brought forward

      5. Regulations

        1. 114. Exclusion of amounts in calculating contribution to the firm or LLP

      6. Restrictions for film trades carried on in partnership

        1. 115. Restrictions on reliefs for firms exploiting films

        2. 116. Exclusion from restrictions under section 115: certain film expenditure

    4. Chapter 4

      Losses from property businesses

      1. Introduction

        1. 117. Overview of Chapter

      2. Carry-forward property loss relief

        1. 118. Carry forward against subsequent property business profits

        2. 119. How relief works

      3. Property loss relief against general income

        1. 120. Deduction of property losses from general income

        2. 121. How relief works

        3. 122. Meaning of “the applicable amount of the loss”

        4. 123. Meaning of “the loss has a capital allowances connection” and “the business has a relevant agricultural connection”

        5. 124. Supplementary

      4. Post-cessation property relief

        1. 125. Post-cessation property relief

        2. 126. Treating excess post-cessation property relief as CGT loss

      5. Furnished holiday accommodation

        1. 127. UK furnished holiday lettings business treated as trade

    5. Chapter 5

      Losses in an employment or office

      1. 128. Employment loss relief against general income

      2. 129. How relief works

      3. 130. Treating loss in employment or office as CGT loss

    6. Chapter 6

      Losses on disposal of shares

      1. Share loss relief against general income

        1. 131. Share loss relief

        2. 132. Entitlement to claim

        3. 133. How relief works

      2. Shares to which EIS relief is not attributable

        1. 134. Qualifying trading companies

        2. 135. Subscriptions for shares

        3. 136. Disposals of new shares

      3. Qualifying trading companies: the requirements

        1. 137. The trading requirement

        2. 138. Ceasing to meet trading requirement because of administration or receivership

        3. 139. The control and independence requirement

        4. 140. The qualifying subsidiaries requirement

        5. 141. The property managing subsidiaries requirement

        6. 142. The gross assets requirement

        7. 143. The unquoted status requirement

        8. 144. Power to amend requirements by Treasury order

      4. Qualifying trading companies: supplementary

        1. 145. Relief after an exchange of shares for shares in another company

        2. 146. Substitution of new shares for old shares

      5. Limits on share loss relief and mixed holdings

        1. 147. Limits on share loss relief

        2. 148. Disposal of shares forming part of mixed holding

        3. 149. Section 148: supplementary

      6. Miscellaneous and supplementary

        1. 150. Deemed time of issue for certain shares

        2. 151. Interpretation of Chapter

    7. Chapter 7

      Losses from miscellaneous transactions

      1. Loss relief against miscellaneous income

        1. 152. Losses from miscellaneous transactions

        2. 153. How relief works

      2. Deposit rights

        1. 154. Transactions in deposit rights

      3. Supplementary

        1. 155. Time limit for claiming relief

  5. Part 5

    Enterprise investment scheme

    1. Chapter 1

      Introduction

      1. EIS relief

        1. 156. Meaning of “EIS relief” and commencement

        2. 157. Eligibility for EIS relief

        3. 158. Form and amount of EIS relief

      2. Miscellaneous

        1. 159. Periods A, B and C

        2. 160. Overview of other Chapters of Part

        3. 161. Other tax reliefs relating to EIS

    2. Chapter 2

      The investor

      1. Introduction

        1. 162. Overview of Chapter

      2. The requirements

        1. 163. The no connection with the issuing company requirement

        2. 164. The no linked loans requirement

        3. 165. The no tax avoidance requirement

      3. Meaning of connection with issuing company

        1. 166. Connection with issuing company

        2. 167. Employees, directors and partners

        3. 168. Directors excluded from connection

        4. 169. Directors qualifying for relief despite connection

        5. 170. Persons interested in capital etc of company

        6. 171. Persons subscribing for shares under certain arrangements

    3. Chapter 3

      General requirements

      1. Introduction

        1. 172. Overview of Chapter

      2. The requirements

        1. 173. The shares requirement

        2. 174. The purpose of the issue requirement

        3. 175. The use of the money raised requirement

        4. 176. The minimum period requirement

        5. 177. The no pre-arranged exits requirement

        6. 178. The no tax avoidance requirement

      3. Meaning of “qualifying business activity”

        1. 179. Meaning of “qualifying business activity”

    4. Chapter 4

      The issuing company

      1. Introduction

        1. 180. Overview of Chapter

      2. The requirements

        1. 181. The trading requirement

        2. 182. Ceasing to meet trading requirement because of administration or receivership

        3. 183. The issuing company to carry on the qualifying business activity requirement

        4. 184. The unquoted status requirement

        5. 185. The control and independence requirement

        6. 186. The gross assets requirement

        7. 187. The qualifying subsidiaries requirement

        8. 188. The property managing subsidiaries requirement

      3. Definitions

        1. 189. Meaning of “qualifying trade”

        2. 190. Meaning of “qualifying 90% subsidiary”

        3. 191. Meaning of “qualifying subsidiary”

      4. Excluded activities

        1. 192. Meaning of “excluded activities”

        2. 193. Excluded activities: wholesale and retail distribution

        3. 194. Excluded activities: leasing of ships

        4. 195. Excluded activities: receipt of royalties and licence fees

        5. 196. Excluded activities: property development

        6. 197. Excluded activities: hotels and comparable establishments

        7. 198. Excluded activities: nursing homes and residential care homes

        8. 199. Excluded activities: provision of services or facilities for another business

      5. Supplementary

        1. 200. Power to amend by Treasury order

    5. Chapter 5

      Attribution of and claims for EIS relief

      1. Attribution

        1. 201. Attribution of EIS relief to shares

      2. Claims: general

        1. 202. Time for making claims for EIS relief

        2. 203. Entitlement to claim

      3. Claims: supporting documents

        1. 204. Compliance certificates

        2. 205. Compliance statements

        3. 206. Appeal against refusal to authorise compliance certificate

        4. 207. Penalties for fraudulent certificate or statement etc

    6. Chapter 6

      Withdrawal or reduction of EIS relief

      1. Introduction

        1. 208. Overview of Chapter

      2. Disposals

        1. 209. Disposal of shares

        2. 210. Cases where maximum EIS relief not obtained

        3. 211. Call options

        4. 212. Put options

      3. Value received by investor

        1. 213. Value received by the investor

        2. 214. Value received: receipts of insignificant value

        3. 215. Meaning of “receipts of insignificant value”

        4. 216. When value is received

        5. 217. The amount of value received

        6. 218. Value received where there is more than one issue of shares

        7. 219. Value received where part of share issue treated as made in previous tax year

        8. 220. Cases where maximum EIS relief not obtained

        9. 221. Receipts of value by and from connected persons etc

        10. 222. Receipt of replacement value

        11. 223. Section 222: supplementary

      4. Repayments etc of share capital to other persons

        1. 224. Repayments etc of share capital to other persons

        2. 225. Insignificant repayments ignored for purposes of section 224

        3. 226. Amount of repayments etc where there is more than one issue of shares

        4. 227. Single issue affecting more than one individual

        5. 228. Single issue treated as made partly in previous tax year

        6. 229. Maximum relief not obtained for share issue

        7. 230. Repayment of authorised minimum within 12 months

        8. 231. Restriction on withdrawal of relief under section 224

      5. Miscellaneous

        1. 232. Acquisition of a trade or trading assets

        2. 233. Acquisition of share capital

        3. 234. Relief subsequently found not to have been due

    7. Chapter 7

      Withdrawal or reduction of EIS relief: procedure

      1. Assessments and appeals

        1. 235. Assessments for the withdrawal or reduction of EIS relief

        2. 236. Appeals against section 234(3)(b) notices

        3. 237. Time limits for assessments

        4. 238. Cases where assessment not to be made

      2. Interest

        1. 239. Date from which interest is chargeable

      3. Information

        1. 240. Information to be provided by the investor

        2. 241. Information to be provided by the issuing company etc

        3. 242. Power to require information where section 240 or 241 applies or could have applied

        4. 243. Power to require information in other cases

        5. 244. Obligations of secrecy

    8. Chapter 8

      Supplementary and general

      1. Disposals of shares

        1. 245. Transfers between spouses or civil partners

        2. 246. Identification of shares on a disposal

      2. Acquisition of issuing company

        1. 247. Continuity of EIS relief where issuing company is acquired by new company

        2. 248. Carry over of obligations etc where EIS relief attributed to new shares

        3. 249. Substitution of new shares for old shares

      3. Nominees etc

        1. 250. Nominees and bare trustees

        2. 251. Approved investment fund as nominee

      4. Interpretation

        1. 252. Meaning of a company being “in administration” or “in receivership”

        2. 253. Meaning of “associate”

        3. 254. Meaning of “disposal of shares”

        4. 255. Meaning of “issue of shares”

        5. 256. Meaning of “the termination date”

        6. 257. Minor definitions etc

  6. Part 6

    Venture capital trusts

    1. Chapter 1

      Introduction

      1. 258. Overview of Part

      2. 259. Venture capital trusts and VCT approvals

      3. 260. Other tax reliefs relating to VCTs

    2. Chapter 2

      VCT relief

      1. Entitlement to relief

        1. 261. Eligibility for relief

        2. 262. Entitlement to claim relief

        3. 263. Form and amount of relief

        4. 264. No entitlement to relief if there is a linked loan

        5. 265. No entitlement to relief which would have been lost if it had already been obtained

      2. Loss of relief

        1. 266. Loss of relief if shares disposed of within 5 years

        2. 267. Transfers of shares between spouses or civil partners

        3. 268. Loss of relief if VCT approval withdrawn

        4. 269. Loss of relief which is subsequently found not to have been due

        5. 270. Assessment on withdrawal or reduction of relief

      3. Supplementary

        1. 271. Provision of information

        2. 272. Regulations as to procedure etc

        3. 273. Interpretation of Chapter

    3. Chapter 3

      VCT approvals

      1. Giving of approval

        1. 274. Requirements for the giving of approval

        2. 275. Alternative requirements for the giving of approval

        3. 276. Conditions relating to income

        4. 277. The 15% holding limit condition

        5. 278. Conditions relating to value of investments: general

        6. 279. Conditions relating to value of investments: qualifying holdings

        7. 280. Conditions relating to qualifying holdings and eligible shares

      2. Withdrawal of approval

        1. 281. Withdrawal of VCT approval of a company

        2. 282. Withdrawal of VCT approval in cases for which provision made under section 280(3)

      3. Supplementary

        1. 283. Time as from which VCT approval has effect

        2. 284. Power to make regulations as to procedure

        3. 285. Interpretation of Chapter

    4. Chapter 4

      Qualifying holdings

      1. Introduction

        1. 286. Qualifying holdings: introduction

      2. The requirements

        1. 287. The maximum qualifying investment requirement

        2. 288. The no guaranteed loan requirement

        3. 289. The proportion of eligible shares requirement

        4. 290. The trading requirement

        5. 291. The carrying on of a qualifying activity requirement

        6. 292. Ceasing to meet requirements because of administration or receivership

        7. 293. The use of the money raised requirement

        8. 294. The relevant company to carry on the relevant qualifying activity requirement

        9. 295. The unquoted status requirement

        10. 296. The control and independence requirement

        11. 297. The gross assets requirement

        12. 298. The qualifying subsidiaries requirement

        13. 299. The property managing subsidiaries requirement

      3. Definitions

        1. 300. Meaning of “qualifying trade”

        2. 301. Meaning of “qualifying 90% subsidiary”

        3. 302. Meaning of “qualifying subsidiary”

      4. Excluded activities

        1. 303. Meaning of “excluded activities”

        2. 304. Excluded activities: wholesale and retail distribution

        3. 305. Excluded activities: leasing of ships

        4. 306. Excluded activities: receipt of royalties and licence fees

        5. 307. Excluded activities: property development

        6. 308. Excluded activities: hotels and comparable establishments

        7. 309. Excluded activities: nursing homes and residential care homes

        8. 310. Excluded activities: provision of services or facilities for another business

      5. Supplementary

        1. 311. Power to amend Chapter

        2. 312. Winding up of the relevant company

        3. 313. Interpretation of Chapter

    5. Chapter 5

      Powers: winding up and mergers of VCTs

      1. Winding up

        1. 314. Power to treat VCT-in-liquidation as VCT

        2. 315. Power to treat conditions for VCT approval as met with respect to VCT-in-liquidation

        3. 316. Power to make provision about distributions by VCT-in-liquidation

        4. 317. Power to facilitate disposal to VCT by VCT-in-liquidation

        5. 318. Power in respect of periods before and after winding up

        6. 319. Sections 314 to 318: supplementary

        7. 320. Meaning of “VCT-in-liquidation”

      2. Mergers

        1. 321. Power to facilitate mergers of VCTs

        2. 322. Provision that may be made by regulations under section 321

        3. 323. Meaning of “merger” and “successor company”

      3. Supplementary

        1. 324. Regulations under Chapter

        2. 325. Interpretation of Chapter

    6. Chapter 6

      Supplementary and general

      1. Acquisitions for restructuring purposes

        1. 326. Restructuring to which section 327 applies

        2. 327. Certain requirements of Chapter 4 to be treated as met

        3. 328. Supplementary

      2. Conversion of shares etc and company reorganisations

        1. 329. Conversion of convertible shares and securities

        2. 330. Power to facilitate company reorganisations etc involving exchange of shares

      3. Supplementary

        1. 331. Meaning of a company being “in administration” or “in receivership”

        2. 332. Minor definitions etc

  7. Part 7

    Community investment tax relief

    1. Chapter 1

      Introduction

      1. CITR

        1. 333. Meaning of “CITR”

        2. 334. Eligibility for CITR

        3. 335. Form and amount of CITR

      2. Miscellaneous

        1. 336. Meaning of “making an investment”

        2. 337. Determination of “the invested amount”

        3. 338. Meaning of “the 5 year period” and “the investment date”

        4. 339. Overview of other Chapters of Part

    2. Chapter 2

      Accredited community development finance institutions

      1. 340. Application and criteria for accreditation

      2. 341. Terms and conditions of accreditation

      3. 342. Period of accreditation

      4. 343. Delegation of Secretary of State’s functions

    3. Chapter 3

      Qualifying investments

      1. 344. Qualifying investments: introduction

      2. 345. Conditions to be met in relation to loans

      3. 346. Conditions to be met in relation to securities

      4. 347. Conditions to be met in relation to shares

      5. 348. Tax relief certificates

      6. 349. No pre-arranged protection against risks

    4. Chapter 4

      General conditions

      1. 350. No control of CDFI by investor

      2. 351. Investor must have beneficial ownership

      3. 352. No acquisition of share in partnership

      4. 353. No tax avoidance purpose

    5. Chapter 5

      Claims for and attribution of CITR

      1. Claims

        1. 354. Loans: no claim after disposal or excessive repayments or receipts of value

        2. 355. Securities or shares: no claim after disposal or excessive receipts of value

        3. 356. No claim after loss of accreditation by the CDFI

      2. Attribution

        1. 357. Attribution: general

        2. 358. Attribution: bonus shares

    6. Chapter 6

      Withdrawal or reduction of CITR

      1. Introduction

        1. 359. Overview of Chapter

      2. Disposals

        1. 360. Disposal of loan during 5 year period

        2. 361. Disposal of securities or shares during 5 year period

      3. Repayment of loans

        1. 362. Repayment of loan capital during 5 year period

      4. Receipts of value

        1. 363. Value received by investor during 6 year period: loans

        2. 364. Value received by investor during 6 year period: securities or shares

        3. 365. Receipts of insignificant value to be added together

        4. 366. When value is received

        5. 367. The amount of value received

        6. 368. Value received if there is more than one investment

        7. 369. Effect of receipt of value on future claims for CITR

        8. 370. Receipts of value by or from connected persons

      5. CITR not due

        1. 371. CITR subsequently found not to have been due

      6. Manner of withdrawal or reduction

        1. 372. Manner of withdrawal or reduction of CITR

    7. Chapter 7

      Supplementary and general

      1. Miscellaneous

        1. 373. Information to be provided by the investor

        2. 374. Disclosure

        3. 375. Nominees

        4. 376. Application for postponement of tax pending appeal

        5. 377. Identification of securities or shares on a disposal

      2. Definitions

        1. 378. Meaning of “issue of securities or shares”

        2. 379. Meaning of “disposal”

        3. 380. Construction of references to being “held continuously”

        4. 381. Meaning of “associate”

        5. 382. Minor definitions etc

  8. Part 8

    Other reliefs

    1. Chapter 1

      Interest payments

      1. The relief: introduction

        1. 383. Relief for interest payments

        2. 384. General restrictions on relief under Chapter

        3. 385. General provisions about loans

        4. 386. Loans partly meeting requirements

        5. 387. Exclusion of double relief etc

      2. Loans for plant or machinery

        1. 388. Loan to buy plant or machinery for partnership use

        2. 389. Eligibility requirements for interest on loans within section 388

        3. 390. Loan to buy plant or machinery for employment use

        4. 391. Eligibility requirements for interest on loans within section 390

      3. Loans for interests in close companies

        1. 392. Loan to buy interest in close company

        2. 393. Eligibility requirements for interest on loans within section 392

        3. 394. Meaning of “material interest” in section 393

        4. 395. Meaning of “associate” in section 394

      4. Loans for interests in employee-controlled companies

        1. 396. Loan to buy interest in employee-controlled company

        2. 397. Eligibility requirements for interest on loans within section 396

      5. Loans for investing in partnerships

        1. 398. Loan to invest in partnership

        2. 399. Eligibility requirements for interest on loans within section 398

        3. 400. Film partnerships

      6. Loans for investing in co-operatives

        1. 401. Loan to invest in co-operative

        2. 402. Eligibility requirements for interest on loans within section 401

      7. Loans for paying inheritance tax

        1. 403. Loan to pay inheritance tax

        2. 404. Eligibility requirements for interest on loans within section 403

        3. 405. Carry back and forward of relief for interest on loans within section 403

      8. General and supplementary

        1. 406. Effect of recovery of capital in the case of some loans

        2. 407. Events counting as recovery of capital for section 406

        3. 408. Replacement loans

        4. 409. Business successions between partnerships

        5. 410. Other business successions and reorganisations

        6. 411. Ineligibility of interest where business is occupation of commercial woodlands

        7. 412. Information

    2. Chapter 2

      Gift aid

      1. The relief

        1. 413. Overview of Chapter

        2. 414. Relief for gifts to charity

        3. 415. Meaning of “grossed up amount”

        4. 416. Meaning of “qualifying donation”

        5. 417. Meaning of “benefits associated with a gift”

      2. Restrictions on associated benefits

        1. 418. Restrictions on associated benefits

        2. 419. Gifts and benefits linked to periods of less than 12 months

      3. Admission rights

        1. 420. Disregard of certain admission rights

        2. 421. Admission rights: supplementary

      4. Disqualified overseas gifts

        1. 422. Disqualified overseas gifts

      5. Measures to ensure donor’s liability not less than tax treated as deducted

        1. 423. Restriction of certain reliefs

        2. 424. Charge to tax

        3. 425. Total amount of income tax to which individual charged for a tax year

      6. Election to carry back relief

        1. 426. Election by donor: gift treated as made in previous tax year

      7. Supplementary

        1. 427. Meaning of “charged amount”

        2. 428. Meaning of “gift aid declaration”

        3. 429. Giving through self-assessment return

        4. 430. “Charity” to include exempt bodies

    3. Chapter 3

      Gifts of shares, securities and real property to charities etc

      1. Entitlement to relief

        1. 431. Relief for gifts of shares, securities and real property to charities etc

        2. 432. Meaning of “qualifying investment”

        3. 433. Meaning of “qualifying interest in land”

      2. Amount of relief

        1. 434. The relievable amount

        2. 435. Incidental costs of making disposal

        3. 436. Consideration

      3. Value of net benefit to charity

        1. 437. Value of net benefit to charity

        2. 438. Market value of qualifying investments

        3. 439. Meaning of “disposal-related obligation”

        4. 440. Meaning and amount of “disposal-related liability”

      4. Special provisions about qualifying interests in land

        1. 441. Certificate required from charity

        2. 442. Qualifying interests in land held jointly

        3. 443. Calculation of relievable amount where joint disposal of interest in land

        4. 444. Disqualifying events

      5. Supplementary

        1. 445. Prohibition against double relief

        2. 446. “Charity” to include exempt bodies

    4. Chapter 4

      Annual payments and patent royalties

      1. 447. Overview of Chapter

      2. 448. Relief for individuals

      3. 449. Relief for other persons

      4. 450. Other persons: payments ineligible for relief

      5. 451. Special rule for persons affected by section 733 of ICTA

      6. 452. The gross amount of a payment

    5. Chapter 5

      Qualifying maintenance payments

      1. 453. Tax reduction for qualifying maintenance payments

      2. 454. Meaning of “qualifying maintenance payment”

      3. 455. Child support maintenance payments

      4. 456. Payments under orders for recovery of benefit etc

    6. Chapter 6

      Miscellaneous other reliefs

      1. Payments for life insurance etc

        1. 457. Payments to trade unions

        2. 458. Payments to police organisations

        3. 459. Payments for benefit of family members

        4. 460. Residence etc of claimants

      2. Patent royalty receipts

        1. 461. Spreading of patent royalty receipts

  9. Part 9

    Special rules about settlements and trustees

    1. Chapter 1

      Introduction

      1. 462. Overview of Part

      2. 463. Interpretation of Part

      3. 464. Scottish trusts

    2. Chapter 2

      General provision about settlements and trustees

      1. Overview

        1. 465. Overview of Chapter and interpretation

      2. Settled property

        1. 466. Meaning of “settled property” etc

      3. Settlors

        1. 467. Meaning of “settlor” etc

        2. 468. Meaning of “disposable property”

        3. 469. Person ceasing to be a settlor

        4. 470. Transfers between settlements

        5. 471. Identification of settlor following transfer covered by section 470

        6. 472. Settlor where property becomes settled because of variation of will etc

        7. 473. Deceased person as settlor where variation of will etc

      4. Trustees

        1. 474. Trustees of settlement to be treated as a single and distinct person

        2. 475. Residence of trustees

        3. 476. How to work out whether settlor meets condition C

      5. Sub-funds

        1. 477. Sub-fund elections under Schedule 4ZA to TCGA 1992

      6. Regulations

        1. 478. References to settled property etc in regulations

    3. Chapter 3

      Special rates for trustees' income

      1. 479. Trustees' accumulated or discretionary income to be charged at special rates

      2. 480. Meaning of “accumulated or discretionary income”

      3. 481. Other amounts to be charged at special rates for trustees

      4. 482. Types of amount to be charged at special rates for trustees

      5. 483. Sums paid by personal representatives to trustees

    4. Chapter 4

      Trustees' expenses and special rates for trustees

      1. 484. Trustees' expenses to be set against trustees' trust rate income

      2. 485. Carry forward of unused expenses

      3. 486. How allowable expenses are to be set against trust rate income

      4. 487. Non-UK resident trustees

    5. Chapter 5

      Share incentive plans

      1. 488. Application of section 479 to trustees of approved share incentive plans

      2. 489. “The applicable period” in relation to shares

      3. 490. Interpretation of Chapter

    6. Chapter 6

      Trustees' first slice of trust rate income

      1. 491. Special rates not to apply to first slice of trustees' trust rate income

      2. 492. Cases where settlor has made more than one settlement

    7. Chapter 7

      Discretionary payments

      1. 493. Discretionary payments by trustees

      2. 494. Grossing up of discretionary payment and payment of income tax

      3. 495. Statement about deduction of income tax

      4. 496. Income tax charged on trustees

      5. 497. Calculation of trustees' tax pool

      6. 498. Types of income tax for the purposes of section 497

    8. Chapter 8

      Trustees' expenses and beneficiary’s income

      1. 499. Application of Chapter

      2. 500. Restrictions on use of trustees' expenses to reduce the beneficiary’s income

      3. 501. Non-UK resident beneficiaries

      4. 502. Meaning of “untaxed income” in section 501

      5. 503. How beneficiary’s income is reduced

    9. Chapter 9

      Unauthorised unit trusts

      1. 504. Treatment of income of unauthorised unit trust

      2. 505. Relief for trustees of unauthorised unit trust

      3. 506. Special rules for trustees affected by section 733 of ICTA

    10. Chapter 10

      Heritage maintenance settlements

      1. Introduction

        1. 507. Overview of Chapter

      2. Trustees' election in respect of income etc

        1. 508. Election by trustees

        2. 509. Change of circumstances during a tax year

      3. Absence of election and income treated as income of settlor: special rules

        1. 510. Sums applied for property maintenance purposes

        2. 511. Prevention of double taxation: reimbursement of settlor

      4. Application of property for non-heritage purposes: charge to tax

        1. 512. Charge to tax on some settlements

        2. 513. Income charged

        3. 514. Persons liable

        4. 515. Rate of tax

        5. 516. Transfer of property between settlements

        6. 517. Exemption for income treated as income of settlor

  10. Part 10

    Special rules about charitable trusts etc

    1. Introduction

      1. 518. Overview of Part

      2. 519. Meaning of “charitable trust”

    2. Gifts and other payments

      1. 520. Gifts entitling donor to gift aid relief: income tax treated as paid

      2. 521. Gifts entitling donor to gift aid relief: income tax liability and exemption

      3. 522. Gifts of money from companies: income tax liability and exemption

      4. 523. Payments from other charities: income tax liability and exemption

    3. Other exemptions

      1. 524. Exemption for profits etc of charitable trades

      2. 525. Meaning of “charitable trade”

      3. 526. Exemption for profits etc of small-scale trades

      4. 527. Exemption from charges under provisions to which section 1016 applies

      5. 528. Condition as to trading and miscellaneous incoming resources

      6. 529. Exemption for profits from fund-raising events

      7. 530. Exemption for profits from lotteries

      8. 531. Exemption for property income etc

      9. 532. Exemption for savings and investment income

      10. 533. Exemption for public revenue dividends

      11. 534. Exemption for transactions in deposits

      12. 535. Exemption for offshore income gains

      13. 536. Exemption for certain miscellaneous income

      14. 537. Exemption for income from estates in administration

    4. Claims

      1. 538. Requirement to make claim

    5. Restrictions on exemptions

      1. 539. Restrictions on exemptions

      2. 540. The non-exempt amount

      3. 541. Attributing income to the non-exempt amount

      4. 542. How income is attributed to the non-exempt amount

    6. Non-charitable expenditure

      1. 543. Meaning of “non-charitable expenditure”

      2. 544. Section 543: supplementary

      3. 545. Section 543(1)(f): meaning of expenditure

      4. 546. Section 543(1)(f): tax year in which certain expenditure treated as incurred

      5. 547. Section 543(1)(f): payment to body outside the UK

      6. 548. Section 543(1)(i) and (j): investments and loans

    7. Substantial donor transactions

      1. 549. Transactions with substantial donors

      2. 550. Meaning of “relievable gift”

      3. 551. Non-charitable expenditure in substantial donor transactions

      4. 552. Adjustment if section 551(1) and (2) applied to single transaction

      5. 553. Section 551: certain payments and benefits to be ignored

      6. 554. Transactions: exceptions

      7. 555. Donors: exceptions

      8. 556. Connected charities

      9. 557. Substantial donor transactions: supplementary

    8. Approved charitable investments and loans

      1. 558. Approved charitable investments

      2. 559. Securities which are approved charitable investments

      3. 560. Conditions to be met for some securities

      4. 561. Approved charitable loans

    9. Carry back of excess non-charitable expenditure

      1. 562. Excess expenditure treated as non-charitable expenditure of earlier years

      2. 563. Rules for attributing excess expenditure to earlier years

      3. 564. Adjustments in consequence of section 562

  11. Part 11

    Manufactured payments and repos

    1. Chapter 1

      Introduction

      1. 565. Overview of Part

      2. 566. Meaning of “UK shares” and “UK securities”

      3. 567. Meaning of “overseas securities” and “overseas dividend”

      4. 568. Meaning of “stock lending arrangement”

      5. 569. Meaning of “repo”

      6. 570. Meaning of “buying back” securities etc

      7. 571. Meaning of “related” agreements

    2. Chapter 2

      Manufactured payments

      1. Introduction

        1. 572. Overview of Chapter

      2. Manufactured dividends on UK shares

        1. 573. Manufactured dividends on UK shares

        2. 574. Allowable deductions: matching

        3. 575. Allowable deductions: restriction on double-counting

        4. 576. Manufactured dividends on UK shares: Real Estate Investment Trusts

        5. 577. Statements about manufactured dividends

      3. Manufactured interest on UK securities

        1. 578. Manufactured interest on UK securities

        2. 579. Allowable deductions: matching

        3. 580. Allowable deductions: restriction on double counting

      4. Manufactured overseas dividends

        1. 581. Manufactured overseas dividends

        2. 582. Powers about manufactured overseas dividends

      5. Special cases

        1. 583. Manufactured payments exceeding underlying payments

        2. 584. Manufactured payments less than underlying payments

        3. 585. Power to deal with other special cases

      6. General regulation-making powers

        1. 586. Powers about administrative provisions

        2. 587. Power for manufactured payments to be eligible for relief

        3. 588. Regulation-making powers: general

      7. Interpretation

        1. 589. Meaning of “gross amount”: interest and manufactured overseas dividends

        2. 590. Meaning of “relevant withholding tax”

        3. 591. Interpretation of other terms used in Chapter

    3. Chapter 3

      Tax credits: stock lending arrangements and repos

      1. Stock lending arrangements

        1. 592. No tax credits for borrower under stock lending arrangement

      2. Repos

        1. 593. No tax credits for interim holder under repo

        2. 594. No tax credits for original owner under repo

      3. Interpretation

        1. 595. Meaning of “manufactured dividend”

    4. Chapter 4

      Deemed manufactured payments

      1. Stock lending arrangements

        1. 596. Deemed manufactured payments: stock lending arrangements

        2. 597. Deemed interest: cash collateral under stock lending arrangements

        3. 598. Cash collateral under stock lending arrangements: supplementary

        4. 599. Sections 597 and 598: quasi-stock lending arrangements and quasi-cash collateral

        5. 600. Meaning of “quasi-stock lending arrangements” and “quasi-cash collateral”

      2. Repos

        1. 601. Repo cases in which deeming rules apply

        2. 602. Deemed manufactured payments: repos

        3. 603. Deemed deductions of tax

        4. 604. Deemed increase in repurchase price: price differences under repos

        5. 605. Deemed increase in repurchase price: other income tax purposes

      3. Interpretation

        1. 606. Interpretation of Chapter

    5. Chapter 5

      Price differences under repos

      1. Main tax treatment

        1. 607. Treatment of price differences under repos

        2. 608. Exceptions to section 607

      2. Additional tax treatment

        1. 609. Additional income tax consequences of price differences

      3. Interpretation

        1. 610. Repurchase price in deemed manufactured payment case

      4. Power to modify

        1. 611. Power to modify Chapter in non-arm’s length case

    6. Chapter 6

      Powers to modify repo provisions

      1. 612. Non-standard repo cases

      2. 613. Redemption arrangements

      3. 614. Sections 612 and 613: supplementary

  12. Part 12

    Accrued income profits

    1. Chapter 1

      Introduction

      1. 615. Overview of Part

    2. Chapter 2

      Accrued income profits and losses

      1. Charge to tax

        1. 616. Charge to tax on accrued income profits

        2. 617. Income charged

        3. 618. Person liable

      2. Securities to which Chapter applies

        1. 619. Meaning of “securities” and when securities are of the same kind

      3. Transfers to which Chapter applies

        1. 620. Transactions which are transfers: general

        2. 621. Transferors and transferees

        3. 622. Application of Chapter to different kinds of transfer

        4. 623. Transfers with accrued interest

        5. 624. Transfers without accrued interest

        6. 625. Transfers with unrealised interest

        7. 626. Transfers of variable rate securities

        8. 627. Meaning of “variable rate securities”

      4. Calculating accrued income profits and losses

        1. 628. Making accrued income profits and losses: general rule

        2. 629. Calculating accrued income profits and losses where section 628 applies

        3. 630. Making accrued income profits: settlement day outside interest period

        4. 631. Amount of accrued income profits where section 630 applies

      5. The payments treated as made on transfers

        1. 632. Payment on transfer with accrued interest

        2. 633. Payment on transfer without accrued interest

        3. 634. Payment on transfer with unrealised interest

        4. 635. Payment on transfer of variable rate securities

      6. Exception where there is a transfer to a legatee

        1. 636. Exception where there is a transfer to a legatee

      7. Relief for losses

        1. 637. Accrued income losses treated as payments in next interest period

      8. Excluded transferors and transferees

        1. 638. Excluded persons: disregard of certain payments and transfers

        2. 639. Small holdings: individuals

        3. 640. Small holdings: personal representatives

        4. 641. Small holdings: trustees of a disabled person’s trusts

        5. 642. Traders

        6. 643. Non-residents

        7. 644. Individuals to whom the remittance basis applies

        8. 645. Charitable trusts etc

        9. 646. Pension scheme trustees

        10. 647. Makers of manufactured payments

      9. Further transactions treated as transfers

        1. 648. Strips of gilt-edged securities

        2. 649. New securities issued with extra return

        3. 650. Trading stock appropriations etc

        4. 651. Owner becoming entitled to securities as trustee

        5. 652. Securities ceasing to be held on charitable trusts

      10. Excluded transfers

        1. 653. Stock lending

        2. 654. Sale and repurchase arrangements

        3. 655. Transfers under sale and repurchase arrangements

        4. 656. Power to modify: non-standard sale and repurchase arrangements

        5. 657. Power to modify: redemption arrangements

        6. 658. Powers to modify: supplementary

      11. Special rules about some calculations

        1. 659. Transfers with or without accrued interest: interest in default

        2. 660. Transfers with unrealised interest: interest in default

        3. 661. Successive transfers with unrealised interest in default

        4. 662. New securities issued with extra return: special rules about payments

        5. 663. Transfers without accrued interest to makers of manufactured payments

        6. 664. Foreign currency securities: sterling equivalent of payments on transfers

        7. 665. Foreign currency securities: unrealised interest payable in foreign currency

      12. Nominees and trustees

        1. 666. Certain transfers by or to nominees or trustees treated as made by or to others

        2. 667. Trustees' accrued income profits treated as settlement income

      13. Relief where transfer proceeds unremittable

        1. 668. Relief for unremittable transfer proceeds: general

        2. 669. Relief for unremittable transfer proceeds: section 630 profits

        3. 670. Withdrawal of relief

      14. Interpretation

        1. 671. Meaning of “interest”

        2. 672. Meaning of “interest payment day”

        3. 673. Meaning of “interest period”

        4. 674. Meaning of “the settlement day”

        5. 675. The holding of securities

        6. 676. Nominal value of securities: general

        7. 677. Nominal value: foreign currency securities

    3. Chapter 3

      Exemptions relating to interest on securities

      1. 678. Exemptions relating to interest on securities: preliminary

      2. 679. Interest on securities involving accrued income losses: general

      3. 680. Interest on securities involving accrued income losses: foreign trustees

      4. 681. Unrealised interest received by transferee after transfer

  13. Part 13

    Tax avoidance

    1. Chapter 1

      Transactions in securities

      1. Introduction

        1. 682. Overview of Chapter

        2. 683. Meaning of “income tax advantage”

      2. Person liable to counteraction of income tax advantages

        1. 684. Person liable to counteraction of income tax advantage

        2. 685. Exception where no tax avoidance object shown

      3. Circumstances in which income tax advantages obtained or obtainable

        1. 686. Abnormal dividends used for exemptions or reliefs (circumstance A)

        2. 687. Deductions from profits obtained following distribution or dealings (circumstance B)

        3. 688. Receipt of consideration representing company’s assets, future receipts or trading stock (circumstance C)

        4. 689. Receipt of consideration in connection with relevant company distribution (circumstance D)

        5. 690. Receipt of assets of relevant company (circumstance E)

        6. 691. Meaning of “relevant company” in sections 689 and 690

        7. 692. Abnormal dividends: general

        8. 693. Abnormal dividends: the excessive return condition

        9. 694. Abnormal dividends: the excessive accrual condition

      4. Procedure for counteraction of income tax advantages

        1. 695. Preliminary notification that section 684 may apply

        2. 696. Opposed notifications: statutory declarations

        3. 697. Opposed notifications: determinations by tribunal

        4. 698. Counteraction notices

        5. 699. Limit on amount assessed in section 689 and 690 cases

        6. 700. Timing of assessments in section 690 cases

      5. Clearance procedure and information powers

        1. 701. Application for clearance of transactions

        2. 702. Effect of clearance notification under section 701

        3. 703. Power to obtain information

      6. The tribunal

        1. 704. The tribunal

      7. Appeals

        1. 705. Appeals against counteraction notices

        2. 706. Rehearing by tribunal of appeal against counteraction notice

        3. 707. Statement of case by tribunal for opinion of High Court or Court of Session

        4. 708. Cases before High Court or Court of Session

        5. 709. Effect of appeals against tribunal’s determination under section 706

        6. 710. Appeals from High Court or Court of Session

        7. 711. Proceedings in Northern Ireland

      8. Supplementary

        1. 712. Application of Chapter where individual within section 684 dies

        2. 713. Interpretation of Chapter

    2. Chapter 2

      Transfer of assets abroad

      1. Introduction

        1. 714. Overview of Chapter

        2. 715. Meaning of “relevant transaction”

        3. 716. Meaning of “relevant transfer” and “transfer”

        4. 717. Meaning of “assets” etc

        5. 718. Meaning of “person abroad” etc

        6. 719. Meaning of “associated operation”

      2. Charge where power to enjoy income

        1. 720. Charge to tax on income treated as arising under section 721

        2. 721. Individuals with power to enjoy income as a result of relevant transactions

        3. 722. When an individual has power to enjoy income of person abroad

        4. 723. The enjoyment conditions

        5. 724. Special rules where benefit provided out of income of person abroad

        6. 725. Reduction in amount charged where controlled foreign company involved

        7. 726. Non-domiciled individuals

      3. Charge where capital sums received

        1. 727. Charge to tax on income treated as arising under section 728

        2. 728. Individuals receiving capital sums as a result of relevant transactions

        3. 729. The capital receipt conditions

        4. 730. Non-domiciled individuals

      4. Charge where benefit received

        1. 731. Charge to tax on income treated as arising under section 732

        2. 732. Non-transferors receiving a benefit as a result of relevant transactions

        3. 733. Income charged under section 731

        4. 734. Reduction in amount charged: previous capital gains tax charge

        5. 735. Non-domiciled individuals

      5. Exemptions: no tax avoidance purpose or genuine commercial transaction

        1. 736. Exemptions: introduction

        2. 737. Exemption: all relevant transactions post-4 December 2005 transactions

        3. 738. Meaning of “commercial transaction”

        4. 739. Exemption: all relevant transactions pre-5 December 2005 transactions

        5. 740. Exemption: relevant transactions include both pre-5 December 2005 and post-4 December 2005 transactions

        6. 741. Application of section 742 (partial exemption)

        7. 742. Partial exemption where later associated operations fail conditions

      6. General

        1. 743. No duplication of charges

        2. 744. Meaning of taking income into account in charging income tax for section 743

        3. 745. Rates of tax applicable to income charged under sections 720 and 727 etc

        4. 746. Deductions and reliefs where individual charged under section 720 or 727

        5. 747. Amounts corresponding to accrued income profits and related interest

      7. Supplementary

        1. 748. Power to obtain information

        2. 749. Restrictions on particulars to be provided by solicitors

        3. 750. Restrictions on particulars to be provided by banks

        4. 751. Special Commissioners' jurisdiction on appeals

    3. Chapter 3

      Transactions in land

      1. Introduction

        1. 752. Overview of Chapter

        2. 753. Meaning of disposing of land

        3. 754. Priority of other income tax provisions

      2. Charge on gains from transactions in land

        1. 755. Charge to tax on gains from transactions in land

        2. 756. Income treated as arising when gains obtained from some land disposals

        3. 757. Person obtaining gain

        4. 758. Income charged

        5. 759. Person liable

        6. 760. Method of calculating gain

      3. Further provisions relevant to the charge

        1. 761. Transactions, arrangements, sales and realisations relevant for Chapter

        2. 762. Tracing value

        3. 763. Meaning of “another person”

        4. 764. Valuations and apportionments

      4. Exemptions

        1. 765. Exemption: gain attributable to period before intention to develop formed

        2. 766. Exemption: disposals of shares in companies holding land as trading stock

        3. 767. Exemption: private residences

      5. Recovery of tax

        1. 768. Recovery of tax where consideration receivable by person not assessed

        2. 769. Recovery of tax: certificates of tax paid etc

      6. Clearances and power to obtain information

        1. 770. Clearance procedure

        2. 771. Power to obtain information

      7. Interpretation

        1. 772. Interpretation of Chapter

    4. Chapter 4

      Sales of occupation income

      1. Introduction

        1. 773. Overview of Chapter

        2. 774. Meaning of “occupation”

        3. 775. Priority of other tax provisions

      2. Charge on sale of occupation income

        1. 776. Charge to tax on sale of occupation income

        2. 777. Conditions for sections 778 and 779 to apply

        3. 778. Income arising where capital amount other than derivative property or right obtained

        4. 779. Income arising where derivative property or right obtained

      3. Further provisions relevant to the charge

        1. 780. Transactions, arrangements, sales and realisations relevant for Chapter

        2. 781. Tracing value

        3. 782. Meaning of “other person”

        4. 783. Valuations and apportionments

      4. Exemption for sales of going concerns

        1. 784. Exemption for sales of going concerns

        2. 785. Restriction on exemption: sales of future earnings

      5. Recovery of tax

        1. 786. Recovery of tax where consideration receivable by person not assessed

        2. 787. Recovery of tax: certificates of tax paid etc

      6. Power to obtain information

        1. 788. Power to obtain information

      7. Interpretation

        1. 789. Minor definitions

    5. Chapter 5

      Avoidance involving trading losses

      1. Introduction

        1. 790. Overview of Chapter

      2. Individuals in partnership: recovery of excess relief

        1. 791. Charge to tax on income treated as received under section 792

        2. 792. Partners claiming excess sideways or capital gains relief

        3. 793. Calculating the amount of income treated as received

        4. 794. Meaning of “the total amount of trade losses claimed” etc

        5. 795. Meaning of “post-1 December 2004 loss”

      3. Individuals claiming relief for film-related trading losses

        1. 796. Charge to tax on income treated as received under section 797

        2. 797. Individuals claiming sideways or capital gains relief for film-related losses

        3. 798. Meaning of “non-taxable consideration” etc

        4. 799. Meaning of “disposal of a right of the individual to profits” etc

        5. 800. Meaning of “film-related losses” etc

        6. 801. Meaning of “capital contribution”

        7. 802. Exclusion of amounts in calculating capital contribution by a partner

        8. 803. Prohibition against double counting

      4. Individuals in partnership claiming relief for licence-related trading losses

        1. 804. Charge to tax on income treated as received under section 805

        2. 805. Partners claiming relief for licence-related trading losses

        3. 806. Calculation of amount of income treated as received by the individual

        4. 807. Supplementary provision relating to calculation in section 806

        5. 808. Meaning of “disposal of the licence” etc

        6. 809. Other definitions

  14. Part 14

    Income tax liability: miscellaneous rules

    1. Chapter 1

      Limits on liability to income tax of non-UK residents

      1. Introduction

        1. 810. Overview of Chapter

      2. Limit for non-UK resident individuals, trustees etc

        1. 811. Limit on liability to income tax of non-UK residents

        2. 812. Case where limit not to apply

        3. 813. Meaning of “disregarded income”

        4. 814. Meaning of “disregarded transaction income”

      3. Limit for non-UK resident companies

        1. 815. Limit on liability to income tax of non-UK resident companies

        2. 816. Meaning of “disregarded company income”

      4. The independent broker conditions

        1. 817. The independent broker conditions

      5. The independent investment manager conditions

        1. 818. The independent investment manager conditions

        2. 819. Investment managers: the 20% rule

        3. 820. Meaning of “qualifying period”

        4. 821. Meaning of “relevant disregarded income”

        5. 822. Meaning of “beneficial entitlement”

        6. 823. Treatment of transactions where requirements of 20% rule not met

        7. 824. Application of 20% rule to collective investment schemes

      6. Supplementary

        1. 825. Meaning of “disregarded savings and investment income”

        2. 826. Meaning of “disregarded annual payments”

        3. 827. Meaning of “investment manager” and “investment transaction”

        4. 828. Transactions through brokers and investment managers

    2. Chapter 2

      Residence

      1. 829. Residence of individuals temporarily abroad

      2. 830. Residence of individuals working abroad

      3. 831. Foreign income of individuals in the United Kingdom for temporary purpose

      4. 832. Employment income of individuals in the United Kingdom for temporary purpose

      5. 833. Visiting forces and staff of designated allied headquarters

      6. 834. Residence of personal representatives

      7. 835. Residence rules for trustees and companies

    3. Chapter 3

      Jointly held property

      1. 836. Jointly held property

      2. 837. Jointly held property: declarations of unequal beneficial interests

    4. Chapter 4

      Other miscellaneous rules

      1. 838. Local authorities and local authority associations

      2. 839. Issue departments of the Reserve Bank of India and the State Bank of Pakistan

      3. 840. Government securities held by non-UK resident central banks

      4. 841. Official agents of Commonwealth countries etc

      5. 842. European Economic Interest Groupings

      6. 843. Restriction of deductions for annual payments

      7. 844. Letters patent etc: exempting provisions

      8. 845. Extra return to be treated as interest etc

      9. 846. Interpretation of section 845

  15. Part 15

    Deduction of income tax at source

    1. Chapter 1

      Introduction

      1. 847. Overview of Part

      2. 848. Income tax deducted at source treated as income tax paid by recipient

      3. 849. Interaction with other Income Tax Acts provisions

    2. Chapter 2

      Deduction by deposit-takers and building societies

      1. Introduction

        1. 850. Overview of Chapter

      2. Duty to deduct sums representing income tax

        1. 851. Duty to deduct sums representing income tax

        2. 852. Power to make regulations disapplying section 851

      3. Deposit-takers and relevant investments

        1. 853. Meaning of “deposit-taker”

        2. 854. Power to prescribe persons as deposit-takers

        3. 855. Meaning of “investment” and “deposit”

        4. 856. Investments which are relevant investments

        5. 857. Investments to be treated as being or as not being relevant investments

      4. Investments which are not relevant investments: non-UK resident beneficiaries

        1. 858. Declarations of non-UK residence: individuals

        2. 859. Declarations of non-UK residence: Scottish partnerships

        3. 860. Declarations of non-UK residence: personal representatives

        4. 861. Declarations of non-UK residence: settlements

        5. 862. Inspection of declarations

      5. Other investments which are not relevant investments

        1. 863. General client account deposits

        2. 864. Qualifying uncertificated eligible debt security units

        3. 865. Qualifying certificates of deposit

        4. 866. Qualifying time deposits

        5. 867. Lloyd’s premium trust funds

        6. 868. Investments held outside the United Kingdom

        7. 869. Sale and repurchase of securities

        8. 870. Other investments

      6. Supplementary

        1. 871. Power to make regulations to give effect to Chapter

        2. 872. Power to make orders amending Chapter

        3. 873. Discretionary or accumulation settlements

    3. Chapter 3

      Deduction from certain payments of yearly interest

      1. Duty to deduct sums representing income tax

        1. 874. Duty to deduct from certain payments of yearly interest

      2. Exceptions from duty to deduct

        1. 875. Interest paid by building societies

        2. 876. Interest paid by deposit-takers

        3. 877. UK public revenue dividends

        4. 878. Interest paid by banks

        5. 879. Interest paid on advances from banks

        6. 880. Interest paid on advances from building societies

        7. 881. National Savings Bank interest

        8. 882. Quoted Eurobond interest

        9. 883. Interest on loan to buy life annuity

        10. 884. Relevant foreign income

        11. 885. Authorised persons dealing in financial instruments

        12. 886. Interest paid by recognised clearing houses etc

        13. 887. Industrial and provident society payments

        14. 888. Statutory interest

    4. Chapter 4

      Deduction from payments in respect of building society securities

      1. 889. Payments in respect of building society securities

    5. Chapter 5

      Deduction from payments of UK public revenue dividends

      1. Introduction

        1. 890. Overview of Chapter

        2. 891. Meaning of “UK public revenue dividend”

      2. Duty to deduct sums representing income tax

        1. 892. Duty to deduct from certain UK public revenue dividends

      3. Payments which are payable gross

        1. 893. Payments of UK public revenue dividends which are payable gross

        2. 894. Treasury directions

      4. Deduction at source applications

        1. 895. Deduction at source application

        2. 896. Withdrawal of application

      5. Regulations

        1. 897. Power to make regulations

    6. Chapter 6

      Deduction from annual payments and patent royalties

      1. Introduction

        1. 898. Overview of Chapter

        2. 899. Meaning of “qualifying annual payment”

      2. Duty to deduct from annual payments

        1. 900. Deduction from commercial payments made by individuals

        2. 901. Deduction from annual payments made by other persons

        3. 902. Meaning of “applicable rate” in section 901

      3. Duty to deduct from patent royalties

        1. 903. Deduction from patent royalties

      4. Supplementary

        1. 904. Annual payments for dividends or non-taxable consideration

        2. 905. Interpretation of Chapter

    7. Chapter 7

      Deduction from other payments connected with intellectual property

      1. Certain royalties etc where usual place of abode of owner is abroad

        1. 906. Certain royalties etc where usual place of abode of owner is abroad

        2. 907. Meaning of “relevant intellectual property right”

        3. 908. Royalty payments etc made through UK resident agents

        4. 909. Royalty payments: further provision

      2. Proceeds of a sale of patent rights

        1. 910. Proceeds of a sale of patent rights: payments to non-UK residents

    8. Chapter 8

      Chapters 6 and 7: special provision in relation to royalties

      1. Deduction at special rates

        1. 911. Double taxation arrangements: deduction at treaty rate

        2. 912. Power to make directions disapplying section 911

        3. 913. Interpretation of sections 911 and 912

      2. Discretion to make payments gross

        1. 914. EU companies: discretion to make payment gross

        2. 915. Power to make directions disapplying section 914

        3. 916. Duty of payee to notify if payment not exempt

        4. 917. Supplementary

    9. Chapter 9

      Manufactured payments

      1. Manufactured dividends

        1. 918. Manufactured dividends on UK shares: Real Estate Investment Trusts

      2. Manufactured interest

        1. 919. Manufactured interest on UK securities: payments by UK residents etc

        2. 920. Foreign payers of manufactured interest: the reverse charge

        3. 921. Cases where interest on underlying securities paid gross

      3. Manufactured overseas dividends

        1. 922. Manufactured overseas dividends: payments by UK residents etc

        2. 923. Foreign payers of manufactured overseas dividends: the reverse charge

        3. 924. Power to reduce section 923 liability

        4. 925. Power to provide set-off entitlement

      4. Supplementary

        1. 926. Interpretation of Chapter

        2. 927. Regulation-making powers: general

    10. Chapter 10

      Deduction from non-commercial payments by companies

      1. 928. Chargeable payments connected with exempt distributions

    11. Chapter 11

      Payments between companies etc: exception from duties to deduct

      1. Introduction

        1. 929. Overview of Chapter

      2. Exception from duties to deduct for excepted payments

        1. 930. Exception from duties to deduct sums representing income tax

        2. 931. Power to make directions disapplying section 930

        3. 932. Meaning of “qualifying partnership”

      3. Excepted payments

        1. 933. UK resident companies

        2. 934. Non-UK resident companies

        3. 935. PEP and ISA managers

        4. 936. Recipients who are to be paid gross

        5. 937. Partnerships

      4. Incorrect belief that payment is an excepted payment

        1. 938. Consequences of reasonable but incorrect belief

    12. Chapter 12

      Funding bonds

      1. 939. Duty to retain bonds where issue treated as payment of interest

      2. 940. Exception from duty to retain bonds

    13. Chapter 13

      Unauthorised unit trusts

      1. 941. Deemed payments to unit holders and deemed deductions of income tax

      2. 942. Income tax to be collected from trustees

      3. 943. Calculation of trustees' income pool

    14. Chapter 14

      Tax avoidance: directions for duty to deduct to apply

      1. 944. Directions for deduction from payments to non-UK residents

    15. Chapter 15

      Collection: deposit-takers, building societies and certain companies

      1. Introduction

        1. 945. Overview of Chapter

        2. 946. Payments within this section

        3. 947. Return periods

        4. 948. Meaning of “accounting period”

      2. Returns of income tax

        1. 949. Payments in an accounting period

        2. 950. Payments otherwise than in an accounting period

      3. Collection and payment of income tax

        1. 951. Collection and payment of income tax

      4. Set-off

        1. 952. Conditions for a set-off claim

        2. 953. How a set-off claim works

        3. 954. Proceedings begun after a set-off claim is made

        4. 955. Proceedings begun before a set-off claim is made

      5. Assessments and errors

        1. 956. Assessments where section 946 payment included in return

        2. 957. Assessments in other cases

        3. 958. Payer’s duty to deliver amended return

        4. 959. Application of Income Tax Acts provisions about time limits for assessments

        5. 960. Further provisions about assessments

      6. Supplementary

        1. 961. Relationship between Chapter and Income Tax Acts powers

        2. 962. Power to make regulations modifying Chapter

    16. Chapter 16

      Collection: certain payments by other persons

      1. 963. Collection of income tax on certain payments by other persons

    17. Chapter 17

      Collection through self-assessment return

      1. 964. Collection through self-assessment return

    18. Chapter 18

      Other regimes involving the deduction of income tax at source

      1. Visiting performers

        1. 965. Overview of sections 966 to 970

        2. 966. Duty to deduct and account for sums representing income tax

        3. 967. Calculation of sums representing income tax

        4. 968. Treatment of sums representing income tax

        5. 969. Regulations

        6. 970. Supplementary

      2. Non-resident landlords

        1. 971. Income tax due in respect of income of non-resident landlords

        2. 972. Regulations under section 971

      3. Real Estate Investment Trusts

        1. 973. Income tax due in respect of distributions

        2. 974. Regulations under section 973

    19. Chapter 19

      General

      1. Supplementary

        1. 975. Statements about deduction of income tax

        2. 976. Arrangements for payments of interest less tax or at specified net rate

        3. 977. Payments to companies

        4. 978. Application to public departments

        5. 979. Designated international organisations: exceptions from duties to deduct

        6. 980. Derivative contracts: exception from duties to deduct

        7. 981. Foreign currency securities etc: exception from duties to deduct

        8. 982. Income tax is calculated by reference to gross amounts

      2. Interpretation

        1. 983. Meaning of “deposit”

        2. 984. Meaning of “financial instrument”

        3. 985. Meaning of “qualifying certificate of deposit”

        4. 986. Meaning of “qualifying uncertificated eligible debt security unit”

        5. 987. Meaning of “quoted Eurobond”

  16. Part 16

    Income Tax Acts definitions etc

    1. Chapter 1

      Definitions

      1. 988. Overview of Chapter

      2. 989. The definitions

      3. 990. Meaning of “Act”

      4. 991. Meaning of “bank”

      5. 992. Meaning of “company”

      6. 993. Meaning of “connected” persons

      7. 994. Meaning of “connected” persons: supplementary

      8. 995. Meaning of “control”

      9. 996. Meaning of “farming” and related expressions

      10. 997. Meaning of “generally accepted accounting practice” and related expressions

      11. 998. Meaning of “grossing up”

      12. 999. Meaning of “local authority”

      13. 1000. Meaning of “local authority association”

      14. 1001. Meaning of “offshore installation”

      15. 1002. Regulations about the meaning of “offshore installation”

      16. 1003. Meaning of “oil and gas exploration and appraisal”

      17. 1004. Meaning of “property investment LLP”

      18. 1005. Meaning of “recognised stock exchange”

      19. 1006. Meaning of “research and development”

      20. 1007. Meaning of “unit trust scheme”

    2. Chapter 2

      Other Income Tax Acts provisions

      1. 1008. Scotland

      2. 1009. Sources of income within the charge to income tax or corporation tax

      3. 1010. Application of Income Tax Acts to recognised investment exchanges

      4. 1011. References to married persons, or civil partners, living together

      5. 1012. Relationship between rules on highest part of total income

      6. 1013. Territorial sea of the United Kingdom

      7. 1014. Orders and regulations

      8. 1015. Territorial scope of charges under certain provisions to which section 1016 applies

      9. 1016. Table of provisions to which this section applies

  17. Part 17

    Definitions for purposes of Act and final provisions

    1. Definitions for the purposes of Act

      1. 1017. Abbreviated references to Acts

      2. 1018. “Act” to include Scottish and Northern Ireland legislation in some cases

      3. 1019. Meaning of “certificate of deposit”

      4. 1020. Claims and elections

      5. 1021. Application of definitions of “connected” persons and “control”

      6. 1022. Meaning of “debenture”

      7. 1023. Meaning of “double taxation arrangements”

      8. 1024. Meaning of “gilt-edged securities”

      9. 1025. Meaning of “modified net income”

      10. 1026. Meaning of “non-qualifying income” for the purposes of section 1025

    2. Final provisions

      1. 1027. Minor and consequential amendments

      2. 1028. Power to make consequential provision

      3. 1029. Power to undo changes

      4. 1030. Transitional provisions and savings

      5. 1031. Repeals and revocations

      6. 1032. Index of defined expressions

      7. 1033. Extent

      8. 1034. Commencement

      9. 1035. Short title

    1. Schedule 1

      Minor and consequential amendments

      1. Part 1

        Income and Corporation Taxes Act 1988

      2. Part 2

        Other enactments

      3. Part 3

        Amendment having effect in relation to shares issued after 5 April 2007

    2. Schedule 2

      Transitionals and savings

      1. Part 1

        General provisions

      2. Part 2

        Changes in the law

      3. Part 3

        Rates at which income tax is charged

      4. Part 4

        Personal reliefs

      5. Part 5

        Losses (except losses on disposal of shares)

      6. Part 6

        Losses on disposal of shares

      7. Part 7

        Enterprise investment scheme

      8. Part 8

        Venture capital trusts

      9. Part 9

        Other reliefs

      10. Part 10

        Special rules about settlements and trustees

      11. Part 11

        Special rules about charitable trusts etc

      12. Part 12

        Manufactured payments and repos

      13. Part 13

        Accrued income profits

      14. Part 14

        Tax avoidance

      15. Part 15

        Deduction of income tax at source

      16. Part 16

        Other provisions

    3. Schedule 3

      Repeals and revocations

      1. Part 1

        Repeals and revocations: general

      2. Part 2

        Repeals having effect in relation to shares issued after 5 April 2007

    4. Schedule 4

      Index of defined expressions

An Act to restate, with minor changes, certain enactments relating to income tax; and for connected purposes.

[20th March 2007]

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:—

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