Amendments proposed to the Finance Bill - continued House of Commons

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Mr Michael Howard
Mr John Bercow
Mr Howard Flight
Mr Christopher Chope
Mr Peter Luff
Sir Robert Smith

Malcolm Bruce

109

Schedule     21,     page     252,     line     4,     at end insert—

    'First-year allowances on mothballing costs    6A.—(1)   Omit section 161C(2) and insert—

          "(2)   The decommissioning expenditure is to be treated as first-year qualifying expenditure under section 45F above.".

    (2)   Omit section 163(2)(b) and insert—

"(b) on decommissioning plant and machinery which has been brought into use for the purposes of a ring fence trade.".

    (3)   In section 163(3), leave out "The" and insert "Where the plant and machinery forms part of an offshore installation or a submarine pipeline, the"

    (4)   In section 163(5), after "1998" insert "except that an offshore installation partly in relevant waters and partly not shall not be excluded from the definition of offshore installation for these purposes only.".'.

   

Mr Michael Howard [R]
Mr John Bercow
Mr Howard Flight [R]
Mr Christopher Chope
Mr Peter Luff
Sir Robert Smith

Malcolm Bruce

104

Schedule     21,     page     255,     line     30,     at end insert—

    '14   In section 418, subsection (1) shall be replaced with—

          "(1)   The amount of the writing-down allowance to which a person is entitled for a chargeable period in respect of qualifying expenditure is a percentage of the amount by which UQE exceeds TDR, as shown in the Table—


AMOUNT OF WRITING-DOWN ALLOWANCES
Type of UQE
Amount
UQE on the acquisition of a mineral asset10%
UQE for use wholly for the purposes of a ring fence trade50%
All other UQE25%"

    15   In section 418 after subsection (6), add—

          "(7)   The increased writing-down allowance for ring fence trades will only be available for chargeable periods beginning on or after 1st January 2003.

          (8)   In this section "ring fence trade" has the same meaning as in section 45F.".'.


   

Mr Michael Howard
Mr John Bercow
Mr Howard Flight
Mr Christopher Chope
Mr Peter Luff

112

Clause     64,     page     41,     line     43,     leave out '2002' and insert '2003'.


   

Mr Michael Howard
Mr John Bercow
Mr Howard Flight
Mr Christopher Chope
Mr Peter Luff

179

Clause     101,     page     78,     line     45,     at end insert 'and'.

   

Mr Michael Howard
Mr John Bercow
Mr Howard Flight
Mr Christopher Chope
Mr Peter Luff

180

Clause     101,     page     79,     line     1,     leave out from 'companies' to end of line 2.

   

Mr Michael Howard
Mr John Bercow
Mr Howard Flight
Mr Christopher Chope
Mr Peter Luff

181

Clause     101,     page     79,     line     3,     at end insert—

'(c) means generally accepted accounting practice with respect to accounts of non-UK companies that are intended to give a true and fair view, or equivalent, as applied in their country of incorporation.'.


   

Mr Michael Howard
Mr John Bercow
Mr Howard Flight
Mr Christopher Chope
Mr Peter Luff

114

Clause     68,     page     45,     line     41,     at end insert—

    '(8A)   A qualifying contract shall not be regarded as having an unallowable purpose in regard to a company where, on the application of that company, the Board have notified the company that the Board are satisfied that the contract does not have an unallowable purpose.

    (8B)   Any application under subsection (8) shall be in writing and shall contain particulars of the contract to be entered into by the applicant and the Board may, within 30 days of the receipt of the application or of any further particulars previously required under this subsection, by notice require the applicant to furnish further particulars for the purpose of enabling the Board to make their decision; and if any such notice is not complied with within 30 days or such longer period as the Board may allow, the Board need not proceed further on the application.

    (8C)   The Board shall notify their decision to the applicant within 30 days of receiving the application or, if they give a notice under subsection (8A) above, within 30 days of the notice being complied with.

    (8D)   If the Board notify the applicant that they are not satisfied as mentioned in subsection (8) or do not notify their decision to the applicant within the time required by subsection (8B), the applicant may within 30 days of the notification or of that time require the Board to transmit the application, together with any notice given and further particulars furnished under subsection (8A), to the Special Commissioners; and in that event any notification by the Special Commissioners shall have effect for the purposes of subsection (8) as if it were a notification by the Board.

    (8E)   If any particulars furnished under this section do not fully and accurately disclose all facts and considerations material for the decisions of the Board or the Special Commissioners, any resulting notification that the Board or Commissioners are satisfied as mentioned in subsection (8) shall be void.'.


   

Mr Andrew Smith

157

Schedule     23,     page     264,     line     34,     after 'business' insert 'and falls within subsection (4) below'.

   

Mr Andrew Smith

158

Schedule     23,     page     265,     line     1,     after '(3)(a)' insert 'or (c)'.

   

Mr Andrew Smith

159

Schedule     23,     page     270,     line     5,     leave out 'or Schedule A business' and insert ', a Schedule A business or an overseas property business (within the meaning of section 70A of the Taxes Act 1988)'.

   

Mr Andrew Smith

160

Schedule     23,     page     270,     line     7,     leave out 'or Schedule A business' and insert ', Schedule A business or overseas property business'.

   

Mr Andrew Smith

161

Schedule     23,     page     271,     line     27,     leave out from 'any' to end of line 31 and insert 'exchange gains or losses.".'.

   

Mr Andrew Smith

162

Schedule     23,     page     272,     line     43,     after 'would' insert ', or would apart from section 84A(2) to (10) of this Act,'.

   

Mr Andrew Smith

163

Schedule     23,     page     273,     line     41,     at end insert—

      'Life assurance business

    13A (1) Paragraph 1 of Schedule 11 is amended as follows.

(2) Before sub-paragraph (2) (effect on debits and credits of applying I minus E basis to profits and gains from loan relationships of insurance companies referable to life assurance business) insert—

     "(1B) In applying the I minus E basis for any accounting period in respect of any life assurance business carried on by an insurance company, no exchange gains or losses shall be taken to arise for the purposes of section 100 of this Act except to the extent that the money debt for the purposes of that section—

            (a)   arises as a result of an amount of income or expenses which falls to be taken into account in applying the I minus E basis not being paid when it is due and payable; or

            (b)   is one that is treated as a money debt for the purposes of that section by virtue of subsection (11)(a) of that section in accordance with subsection (12) of that section by reference to a Schedule A business or an overseas property business.

    This sub-paragraph has effect notwithstanding sub-paragraph (1) above.".'.

   

Mr Andrew Smith

164

Schedule     23,     page     273,     line     43,     leave out sub-paragraph (1).

   

Mr Andrew Smith

165

Schedule     23,     page     274,     line     1,     after '3A' insert 'of Schedule 11'


   

Mr Andrew Smith

127

Schedule     25,     page     286,     line     7,     leave out sub-paragraph (4).

   

Mr Andrew Smith

128

Schedule     25,     page     289,     line     14,     at end insert 'and the shares are not, within the meaning of Chapter 1 of Part 12 of the Taxes Act 1988, assets of an insurance company's long-term insurance fund (see section 431(2) of that Act)'.

   

Mr Andrew Smith

129

Schedule     25,     page     292,     leave out lines 1 to 11 and insert—

    ' "(6)   Where—

(a) a company ceases to be a party to a loan relationship in an accounting period (the "cessation period"),

(b) profits, gains or losses arise to the company from the loan relationship or a related transaction in that accounting period, and

(c) the credits or debits brought into account for the purposes of this Chapter for that accounting period do not include credits or debits which represent the whole of those profits, gains or losses,

    credits or debits in respect of so much of those profits, gains or losses as are not represented by credits or debits brought into account for the cessation period shall continue to be brought into account under this Chapter over one or more subsequent accounting periods ("post-cessation periods") as in the case of a loan relationship to which the company is a party in those periods and subsections (7) and (8) below shall apply.

    (7)   In any case falling within subsection (6) above, any question—

(a) whether, in a post-cessation period, the company is to any extent a party to the loan relationship—

(i) for the purposes of a trade carried on by it, or

(ii) for any other particular purpose or purposes, or

(b) whether, in a post-cessation period, the loan relationship is to any extent referable to a particular business, or a particular class, category or description of business, carried on by the company,

    shall be determined by reference to the circumstances immediately before the company ceased to be a party to the loan relationship instead of the circumstances in the post-cessation period.

    (8)   In any case falling within subsection (6) above, any question—

(a) whether the loan relationship has to any extent a particular purpose in a post-cessation period, or

(b) whether there is a connection between the company and any other person for a post-cessation period,

    shall be determined by reference to the circumstances in the cessation period instead of the circumstances in the post-cessation period.".'.

 
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Prepared 11 Jun 2002