Finance Bill - continued        House of Lords
SCHEDULE 22, TONNAGE TAX - continued

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  PART XI
  SPECIAL RULES FOR OFFSHORE ACTIVITIES
 
Introduction
     103. - (1) This Part of this Schedule sets out special rules that apply where a qualifying ship operated by a tonnage tax company is engaged in offshore activities.
 
      (2) The rules in this Part of this Schedule do not apply in an accounting period unless the total number of days in that period on which qualifying ships operated by that company are engaged in offshore activities exceeds 30.
 
 
Meaning of "offshore activities"
     104. - (1) In this Part of this Schedule "offshore activities" means activities in connection with the exploration or exploitation of so much of the seabed or subsoil or their natural resources as is situated in the UK sector of the continental shelf.
 
      (2) The "UK sector of the continental shelf" means-
 
 
    (a) any area designated by Order in Council under section 1(7) of the Continental Shelf Act 1964, and
 
    (b) any waters within the seaward limits of the territorial sea of the United Kingdom.
 
Vessels to which special provisions do not apply
     105. - (1) The provisions of this Part of this Schedule do not apply to-
 
 
    (a) offshore supply vessels,
 
    (b) tugs,
 
    (c) anchor-handling vessels, or
 
    (d) tankers.
      (2) The Treasury may make provision by order excluding other kinds of vessel from the application of the provisions of this Part of this Schedule.
 
 
Treatment of periods of inactivity
     106. A period between contracts when a qualifying ship is not working shall not be taken to be a period during which the ship is engaged in offshore activities unless-
 
 
    (a) the period of inactivity is specifically related to a forthcoming offshore activity, and
 
    (b) it is impractical for the vessel to undertake other work in the meantime.
 
Profits from offshore activities to be computed according to ordinary rules
     107. - (1) The profits of a tonnage tax company from a qualifying ship in respect of periods during which the ship is engaged in offshore activities (its "offshore profits") are computed and charged to tax in accordance with ordinary corporation tax principles as if they were not part of the company's relevant shipping profits.
 
      (2) Accordingly, the number of days in an accounting period during which a qualifying ship is so engaged shall be left out of account for the purposes of paragraph 4 (calculation of tonnage tax profits by reference to daily profit).
 
 
Application of ring fence provisions
     108. - (1) The provisions of Part VII (the ring fence: general provisions) apply in relation to a company's offshore activities as if they were not tonnage tax activities.
 
      (2) The provisions of this Schedule apply in relation to a company's offshore profits as they apply to profits other than relevant shipping profits.
 
 
Chargeable gains from assets used for offshore activities
     109. A period during which an asset is used for the purposes of offshore activities is treated for the purposes of paragraph 65 (chargeable gains on disposal of tonnage tax asset) as if it were a period during which the asset was not a tonnage tax asset.
 
 
Capital allowances: general
     110. - (1) A tonnage tax company may claim capital allowances for capital expenditure incurred in providing plant or machinery for the purposes of its offshore activities.
 
      (2) In such a case the provisions of Part II of the Capital Allowances Act 1990 apply as if-
 
 
    (a) an asset used for the purposes of the company's offshore activities were provided by the company for those purposes on the first occasion after entry into tonnage tax on which it is brought into use for those purposes, and
 
    (b) an amount of capital expenditure (the "notional qualifying expenditure") had been incurred at that time on its provision.
      (3) The amount of the notional qualifying expenditure is given by paragraph 112 (existing assets) or paragraph 113 (new assets).
 
      (4) Where an asset to which this paragraph applies ceases permanently to be used for the purposes of the company's offshore activities, it is treated for the purposes of Part II of the Capital Allowances Act 1990 as it applies by virtue of this paragraph as if it had been disposed of at market value.
 
  This does not apply if a disposal value is required to be brought into account under section 24(6)(c) of that Act apart from this sub-paragraph.
 
 
Capital allowances: proportionate reduction of allowances
     111. - (1) This paragraph applies where in an accounting period of the company an asset to which paragraph 110 applies is used for the purposes of the company's offshore activities on some only of the days in the period.
 
      (2) The amount of any writing-down allowance for that period in respect of expenditure incurred on the provision of the asset is restricted to the relevant proportion of the full allowance.
 
      (3) Any writing-down allowance for a subsequent accounting period of the company in respect of such expenditure shall be calculated as if an allowance had been made of an amount equal to the full allowance, whether or not that amount (or any amount) was in fact claimed.
 
      (4) For the purposes of this paragraph the full allowance means the allowance (if any) that would have been available apart from this paragraph.
 
      (5) For the purposes of this paragraph the relevant proportion of the full allowance is given by:

OSD / APD
 

       where-
 
 
    OSD is the number of days in the accounting period on which the asset was used for the purposes of the company's offshore activities; and
 
    APD is the number of days in that period.
 
Capital allowances: notional qualifying expenditure: existing assets
     112. - (1) This paragraph applies to determine the amount of notional qualifying expenditure for the purposes of paragraph 110 where the company was entitled before entry into tonnage tax to capital allowances in respect of expenditure on providing the asset.
 
      (2) If the asset was brought into use for the purposes of the company's offshore activities immediately on entry into tonnage tax, the notional qualifying expenditure is equal to any unrelieved qualifying expenditure attributable to the asset.
 
      (3) For the purposes of this paragraph "unrelieved qualifying expenditure" means the balance that would otherwise have been carried forward under Part II of the Capital Allowances Act 1990.
 
      (4) The amount of unrelieved qualifying expenditure attributable to plant or machinery in a class pool, or the main pool, is the proportion of the whole given by:

AV / PV
 

       where:
 
 
    AV is the market value of the asset concerned immediately before entry into tonnage tax, and
 
    PV is the aggregate market value at that time of all the assets in the pool.
      (5) References in this paragraph to unrelieved qualifying expenditure include qualifying expenditure to the extent to which it is unrelieved by virtue of notice having been given under-
 
 
    (a) section 30(1) of the Capital Allowances Act 1990 (postponement or reduction of first year allowances), or
 
    (b) section 31(3) of that Act (postponement of writing-down allowance in respect of expenditure in single ship pool).
      (6) If the asset was not brought into use for the purposes of the company's offshore activities immediately on entry into tonnage tax, the notional qualifying expenditure is the amount given by sub-paragraph (2) but written down in respect of the period between the company's entry into tonnage tax and the asset being brought into use for those purposes.
 
      (7) The Inland Revenue shall make provision by regulations as to the basis on which the writing down mentioned in sub-paragraph (6) is to be done.
 
  The regulations may make different provision for different descriptions of asset.
 
 
Capital allowances: notional qualifying expenditure: new assets
     113. - (1) This paragraph applies to determine the amount of notional qualifying expenditure for the purposes of paragraph 110 where the company was not entitled before entry into tonnage tax to capital allowances in respect of expenditure on providing the asset.
 
      (2) If the asset was brought into use for the purposes of the company's offshore activities immediately on being acquired by the company, the notional qualifying expenditure is equal to the amount that would fall to be brought into account as qualifying expenditure under Part II of the Capital Allowances Act 1990 apart from this Schedule.
 
      (3) If the asset was not brought into use for the purposes of the company's offshore activities immediately on being acquired by the company, the notional qualifying expenditure is the amount referred to in sub-paragraph (2) written down in respect of the period between its acquisition by the company and its being brought into use for those purposes.
 
      (4) The Inland Revenue shall make provision by regulations as to the basis on which the writing down mentioned in sub-paragraph (3) is to be done.
 
  The regulations may make different provision for different descriptions of asset.
 
 
The training requirement
     114. - (1) The fact that a qualifying ship is used for the purposes of offshore activities does not affect the training requirement but an allowance is made under this paragraph.
 
      (2) The amount of the allowance in an accounting period is equal to the aggregate of-
 
 
    (a) the cash equivalent of the training provided that would not have had to be provided, and
 
    (b) any payments in lieu of training made that would not have had to be made,
       if the days on which the ship was engaged in offshore activities had been days on which it was not engaged in tonnage tax activities.
 
  For the purposes of paragraph (a) the cash equivalent of training shall be calculated by reference to the current rate of payments in lieu of training.
 
      (3) The amount of the allowance may be deducted by the company in computing the amount of corporation tax payable for that accounting period, so far as that is attributable to offshore activities.
 
      (4) If in any accounting period the company is unable to deduct the full amount of-
 
 
    (a) any allowance to which it is entitled under this paragraph for that period, and
 
    (b) any amount brought forward under this sub-paragraph,
       the balance may be carried forward and set against the amount of corporation tax payable in the next accounting period, so far as that is attributable to offshore activities.
 
      (5) No deduction may be made by a company in computing its profits from offshore activities in respect of expenditure incurred in meeting the training requirement.
 
 
Interpretation
     115. Expressions used in this Part of this Schedule that are defined for the purposes of Part VIII or IX of this Schedule have the same meaning in this Part.
 
  PART XII
  GROUPS, MERGERS AND RELATED MATTERS
 
Meaning of "group" and "member of group"
     116. In this Schedule a "group" means-
 
 
    (a) all the companies controlled by an individual, or
 
    (b) where a company that is not controlled by another person controls one or more other companies, that company and all the companies controlled by it.
  References to membership of a group shall be construed accordingly.
 
 
Companies treated as controlled by an individual
     117. - (1) For the purposes of this Schedule an individual is treated as controlling any company that is controlled-
 
 
    (a) by him alone, or
 
    (b) by him together with one or more associates of his, or
 
    (c) subject to sub-paragraph (2), by any associate of his, with or without any other such associates.
      (2) An individual shall not be treated as controlling a company by virtue of sub-paragraph (1)(c) if he does not have any significant influence over the affairs of the company in question.
 
 
Meaning of "control"
     118. - (1) In this Schedule "control", in relation to a company, means the power of a person to secure-
 
 
    (a) by means of the holding of shares or the possession of voting power in or in relation to that or any other company, or
 
    (b) by virtue of any powers conferred by the articles of association or other document regulating that or any other company,
       that the affairs of the company are conducted in accordance with his wishes.
 
      (2) For the purposes of this paragraph there shall be attributed to a person-
 
 
    (a) any rights or powers which another person holds on his behalf or may be required to exercise at his direction or on his behalf,
 
    (b) any rights or powers-
 
      (i) of a company of which he has, or he and his associates have, control, or
 
      (ii) of any two or more such companies, and
 
    (c) any rights or powers of any associate of his, or of any two or more associates of his.
      (3) The references in paragraphs (b) and (c) of sub-paragraph (2) to rights or powers of a company or associate include rights or powers attributed to the company or associate under paragraph (a) of that sub-paragraph.
 
      (4) The references in paragraphs (b) and (c) of sub-paragraph (2) to rights or powers of an associate do not include rights or powers attributed to the associate under those paragraphs.
 
 
Company not to be treated as member of more than one group
     119. - (1) For the purposes of this Schedule a company may not, at the same time, be a member-
 
 
    (a) of a tonnage tax group and a qualifying non-tonnage tax group, or
 
    (b) of more than one tonnage tax group.
      (2) If the rules in paragraphs 116 to 118 would produce that result in relation to a company, the following rules apply.
 
      (3) As between a tonnage tax group and a qualifying non-tonnage tax group, the company shall be treated as a member of the tonnage tax group and not of the non-tonnage tax group.
 
      (4) As between two tonnage tax groups, the company shall be treated as a member of the group whose tonnage tax election was made first and not of the other tonnage tax group.
 
      (5) In the case of group elections made at the same time, the company may choose which election it joins in.
 
  It is treated for the purposes of this Schedule as a member of the group in respect of which that election is made and not of any other tonnage tax group.
 
 
Arrangements for dealing with group matters
     120. - (1) The Inland Revenue may enter into arrangements with the qualifying companies in a group for one of those companies to deal on behalf of the group in relation to matters arising under this Schedule that may conveniently be dealt with on a group basis.
 
      (2) Any such arrangements-
 
 
    (a) may make provision in relation to cases where companies become or cease to be members of a group;
 
    (b) may make provision for or in connection with the termination of the arrangements; and
 
    (c) may make such supplementary, incidental, consequential or transitional provision as is necessary or expedient for the purposes of the arrangements.
      (3) Any such arrangements do not affect-
 
 
    (a) any requirement under this Schedule that an election be made jointly by all the qualifying companies in the group; or
 
    (b) any liability under this Schedule or any other provision of the Tax Acts of a company to which the arrangements relate.
      (4) The Secretary of State may also make such arrangements in relation to matters arising under this Schedule in relation to which he has functions.
 
 
Meaning of "merger" and "demerger"
     121. - (1) In this Schedule-
 
 
    "merger" means a transaction by which one or more companies become members of a group, and
 
    "demerger" means a transaction by which one or more companies cease to be members of a group.
      (2) References to a merger to which a group is a party include any merger affecting a member of the group.
 
 
Merger: between tonnage tax groups or companies
     122. - (1) This paragraph applies where there is a merger-
 
 
    (a) between two or more tonnage tax groups,
 
    (b) between one or more tonnage tax groups and one or more tonnage tax companies, or
 
    (c) between two or more tonnage tax companies.
      (2) In all those cases the group resulting from the merger is a tonnage tax group as if a group election had been made.
 
      (3) That deemed election continues in force, subject to the provisions of this Schedule-
 
 
    (a) if there is a dominant party to the merger, until that party's tonnage tax election would have expired;
 
    (b) if there is no dominant party, until whichever of the existing tonnage tax elections had the longest period left to run would have expired.
 
Merger: tonnage tax group or company and qualifying non-tonnage tax group or company
     123. - (1) This paragraph applies where there is a merger between a tonnage tax group or company ("T") and a qualifying non-tonnage tax group or company ("QNT").
 
      (2) If T is the dominant party, the group resulting from the merger is a tonnage tax group as if a group election had been made.
 
  That deemed election continues in force, subject to the provisions of this Schedule, until T's election would have expired.
 
      (3) If QNT is the dominant party, T's tonnage tax election ceases to be in force as from the date of the merger.
 
      (4) If there is no dominant party-
 
 
    (a) the group resulting from the merger may elect that T shall be treated as the dominant party (with the result that sub-paragraph (2) applies), and
 
    (b) if it does not do so, T's tonnage tax election ceases to be in force as from the date of the merger.
      (5) Any election under sub-paragraph (4)(a) must be made-
 
 
    (a) jointly by all the qualifying companies in the group resulting from the merger,
 
    (b) by notice to the Inland Revenue,
 
    (c) within twelve months of the merger.
 
Merger: tonnage tax group or company and non-qualifying group or company
     124. - (1) This paragraph applies where there is a merger between a tonnage tax group or company ("T") and a non-qualifying group or company.
 
      (2) In that case the group resulting from the merger is a tonnage tax group by virtue of T's election.
 
 
Merger: non-qualifying group or company and qualifying non-tonnage tax group or company
     125. - (1) This paragraph applies where there is a merger between a non-qualifying group or company ("NQ") and a qualifying non-tonnage tax group or company.
 
      (2) In that case, if NQ is the dominant party the group resulting from the merger may make a tonnage tax election having effect as from the date of the merger.
 
      (3) Any such election must be made-
 
 
    (a) jointly by all the qualifying companies in the group resulting from the merger,
 
    (b) by notice to the Inland Revenue,
 
    (c) within twelve months of the merger.
 
Meaning of "dominant party" in relation to merger
     126. - (1) This paragraph explains what is meant by the references in this Schedule to the "dominant party" in relation to a merger.
 
      (2) The "dominant party" is determined as follows-
 
 
    (a) if the turnover generated by the relevant activities of one of the parties to the merger is more than twice that of the other, that one is the dominant party;
 
    (b) if not, there is no dominant party.
      (3) The relevant activities of a party to a merger are-
 
 
    (a) for the purposes of-
 
      (i) paragraph 122 (merger between tonnage tax groups or companies), or
 
      (ii) paragraph 123 (merger between tonnage tax group or company and qualifying non-tonnage tax group or company),
 
    the tonnage tax activities of that party;
 
    (b) for the purposes of paragraph 125 (merger between non-qualifying group or company and qualifying non-tonnage tax group or company), all the activities of that party.
      (4) The basis on which (and the periods by reference to which) the turnover from relevant activities is to be determined for the purposes of those paragraphs shall be such as may be agreed between the parties and the Inland Revenue.
 
      (5) In default of such agreement-
 
 
    (a) the Inland Revenue shall decide, and
 
    (b) an appeal lies to the Special Commissioners against their decision.
      (6) Notice of appeal must be given to the Inland Revenue within 30 days of their decision being notified to the parties.
 
 
Demerger: single company
     127. - (1) This paragraph applies where a tonnage tax company ceases to be a member of a tonnage tax group and does not become a member of another group.
 
      (2) In that case-
 
 
    (a) the company in question remains a tonnage tax company as if a single company election had been made, and
 
    (b) that deemed election continues in force, subject to the provisions of this Schedule, until the group election would have expired.
      (3) If two or more members of the previous group remain, and any of them is a qualifying company, the group consisting of those companies is a tonnage tax group by virtue of the previous group election.
 
 
Demerger: group
     128. - (1) This paragraph applies where a tonnage tax group splits into two or more groups.
 
      (2) In that case each new group that contains a qualifying company that was a tonnage tax company before the demerger is a tonnage tax group as if a group election had been made.
 
      (3) That deemed election continues in force, subject to the provisions of this Schedule, until the group election would have expired.
 
 
Duty to notify Inland Revenue of group changes
     129. - (1) A tonnage tax company that becomes or ceases to be a member of a group, or of a particular group, must give notice to the Inland Revenue of that fact.
 
      (2) The notice must be given within the period of twelve months beginning with the date on which the company became or ceased to be a member of the group.
 
      (3) In the second column of the Table in section 98 of the Taxes Management Act 1970 (penalties for failure to provide information etc.), after the final entry insert-
 
 
 
"
 
"Paragraph 129 of Schedule 22 to the Finance Act 2000."."
  PART XIII
  APPLICATION OF PROVISIONS TO PARTNERSHIPS
 
Introduction
     130. - (1) The Inland Revenue may make provision by regulations as to the application of this Schedule in relation to activities carried on by a company in partnership.
 
      (2) Nothing in the following provisions of this Part of this Schedule shall be read as restricting the generality of this power.
 
 
Calculation of partnership profits
     131. The regulations may provide that-
 
 
    (a) for the purpose of calculating the profits of a partner which is a tonnage tax company, the profits of the partnership shall be calculated as if the partnership were a tonnage tax company, and
 
    (b) for the purpose of calculating the profits of a partner which is not a tonnage tax company, the profits of the partnership shall be calculated as if the partnership were not a tonnage tax company.
 
Qualifying partnerships
     132. - (1) The regulations may provide that activities carried on by a company in partnership are not to be regarded as qualifying activities of that company unless the partnership is a qualifying partnership.
 
  "Qualifying activities" here means core qualifying activities, qualifying secondary activities or qualifying incidental activities.
 
      (2) Subject to any provision made by the regulations, a "qualifying partnership" means a partnership that if it were a company would meet the requirements in paragraph 16(1) (qualifying companies).
 
 
Ships owned by or chartered to partners
     133. The regulations may provide that a ship which is not partnership property but which-
 
 
    (a) is owned by or chartered to a member (or two or more members) of a partnership, and
 
    (b) is a ship in relation to which activities of the partnership business are carried on,
       shall be treated as if it were owned by or chartered to every member of the partnership and as if everything done by or to any of the partners in relation to it had been done by or to all the partners.
 
 
Transactions not at arm's length
     134. The regulations may provide that for the purposes of paragraphs 58 and 59 (transactions not at arm's length) the partnership shall be treated-
 
 
    (a) as an entity separate and distinct from the persons that are its members, and
 
    (b) as if it were a tonnage tax company.
 
Adjustments for capital allowance purposes
     135. The regulations may provide that where a partner leaves tonnage tax, such adjustments shall be made for capital allowance purposes, in relation to that partner and all or any of the other partners, with respect to-
 
 
    (a) the amount of qualifying expenditure under Part II of the Capital Allowances Act 1990 (plant and machinery), and
 
    (b) the amount of unrelieved qualifying expenditure under Part I of that Act (industrial buildings),
       as may be specified in the regulations.
 
 
General
     136. Regulations under this Part of this Schedule-
 
 
    (a) may make different provision for different cases, and
 
    (b) may contain such supplementary, incidental and transitional provision as appears to the Inland Revenue to be appropriate.
  PART XIV
  WITHDRAWAL OF RELIEF ETC. ON COMPANY LEAVING TONNAGE TAX
 
Introduction
     137. - (1) This Part of this Schedule applies where a company ceases to be a tonnage tax company.
 
      (2) The provisions of paragraphs 138 and 139 (exit charges: chargeable gains and balancing charges) apply where a company ceases to be a tonnage tax company-
 
 
    (a) on ceasing to be a qualifying company for reasons relating wholly or mainly to tax, or
 
    (b) under paragraph 42 (exclusion from tonnage tax where tax avoidance arrangements entered into).
      (3) Paragraph 140 (ten year disqualification from re-entry into tonnage tax) applies in every case where a company ceases to be a tonnage tax company otherwise than on the expiry of a tonnage tax election.
 
 
Exit charge: chargeable gains
     138. - (1) Paragraph 65(1)(a) (chargeable gain: disposal of tonnage tax assets) has effect in relation to gains (but not losses) on all relevant disposals as if the company had never been a tonnage tax company.
 
      (2) For this purpose a "relevant disposal" means a disposal-
 
 
    (a) on or after the day on which the company ceases to be a tonnage tax company, or
 
    (b) at any time during the period of six years immediately preceding that day when the company was a tonnage tax company.
      (3) Where sub-paragraph (1) operates to increase the amount of the chargeable gain on a disposal made at a time within the period mentioned in sub-paragraph (2)(b), the gain is treated to the extent of the increase-
 
 
    (a) as arising immediately before the company ceased to be a tonnage tax company, and
 
    (b) as not being relevant shipping profits of the company.
      (4) No relief, deduction or set-off of any description is allowed against the amount of that increase or the corporation tax on that amount.
 
 
Exit charge: balancing charges
     139. - (1) This paragraph applies if in a relevant accounting period during which the company was a tonnage tax company it was liable to a balancing charge in relation to which paragraph 78 (phasing-out of balancing charges) applied to reduce the amount of the charge.
 
      (2) For this purpose a "relevant accounting period" means an accounting period ending not more than six years before the day on which the company ceased to be a tonnage tax company.
 
      (3) The company is treated as having received an additional amount of profits chargeable to corporation tax equal to the aggregate of the amounts by which those balancing charges were reduced.
 
      (4) Those additional profits are treated-
 
 
    (a) as arising immediately before the company ceased to be a tonnage tax company, and
 
    (b) as not being relevant shipping profits of the company.
      (5) No relief, deduction or set-off of any description is allowed against those profits or against corporation tax on them.
 
 
Ten year disqualification from re-entry into tonnage tax
     140. - (1) A company election made by a former tonnage tax company is ineffective if made before the end of the period of ten years beginning with the date on which the company ceased to be a tonnage tax company.
 
      (2) A group election that-
 
 
    (a) is made in respect of a group whose members include a former tonnage tax company, and
 
    (b) would result in that company becoming a tonnage tax company,
       is ineffective if made before the end of the period of ten years beginning with the date on which that company ceased to be a tonnage tax company.
 
      (3) Sub-paragraphs (1) and (2) do not prevent a company becoming a tonnage tax company under and in accordance with the rules in Part XII of this Schedule (groups, mergers and related matters).
 
      (4) In this paragraph "former tonnage tax company" means a company that is not a tonnage tax company but has previously been a tonnage tax company.
 
 
Second or subsequent application of this Part
     141. Where this Part of this Schedule applies on a second or subsequent occasion on which a company ceases to be a tonnage tax company (whether or not this Part applied on any of the previous occasions)-
 
 
    (a) the references to the company ceasing to be a tonnage tax company shall be read as references to the last occasion on which it did so, and
 
    (b) the references to the period during which the company was a tonnage tax company do not include any period before its most recent entry into tonnage tax.
  PART XV
  SUPPLEMENTARY PROVISIONS
 
Meaning of "ship"
     142. In this Schedule "ship" means any vessel used in navigation, and includes a hovercraft.
 
 
Meaning of "on bareboat charter terms"
     143. In this Schedule a charter "on bareboat charter terms" means a hiring of a ship for a stipulated period on terms which give the charterer possession and control of the ship, including the right to appoint the master and crew.
 
 
Meaning of "associate"
     144. - (1) In this Schedule "associate", in relation to an individual, means-
 
 
    (a) a relative of that individual;
 
    (b) a partner of that individual;
 
    (c) the trustee or trustees of any settlement in relation to which-
 
      (i) that individual, or
 
      (ii) any relative (whether living or dead) of that individual,
 
    is or was a settlor;
 
    (d) where that individual is interested in any shares or obligations of a company that are subject to a trust, the trustee or trustees of the settlement concerned;
 
    (e) where that individual is interested in any shares or obligations of a company that are part of the estate of a deceased person, the personal representatives of the deceased.
      (2) In sub-paragraph (1)(a) and (c)(ii) "relative" means husband or wife, parent or remoter forebear, child or remoter issue, or brother or sister.
 
  Section 831(4) of the Taxes Act 1988 applies for the purposes of this paragraph as it applies for the purposes of that Act.
 
      (3) In sub-paragraph (1)(c) and (d) "settlement" and "settlor" have the same meaning as in Chapter IA of Part XV of the Taxes Act 1988 (see section 660G(1) and (2) of that Act).
 
 
Exercise of functions conferred on "the Inland Revenue"
     145. - (1) Any power to make regulations conferred by this Schedule on "the Inland Revenue" is exercisable only by the Board.
 
      (2) Subject to that, references in this Schedule to "the Inland Revenue" are to any officer of the Board.
 
 
Meaning of "company" and related expressions
     146. In this Schedule-
 
 
    "company" means a body corporate or unincorporated association, but does not include a partnership;
 
    "controlled foreign company" has the same meaning as in Chapter IV of Part XVII of the Taxes Act 1988 (tax avoidance: controlled foreign companies);
 
    "single company" means a company that is not a member of a group.
 
Index of defined expressions
     147. In this Schedule the following expressions are defined or otherwise explained by the provisions indicated:
 
 
 
associate (of an individual)
 
paragraph 144
 
bareboat charter terms
 
paragraph 143
 
capital allowances (in Part IX)
 
paragraph 88(1)
 
certificate of non-compliance (with training requirement)
 
paragraph 32
 
company
 
paragraph 146
 
company election
 
paragraph 7(1)(a)
 
control
 
paragraph 118 (and see paragraph 117)
 
controlled foreign company
 
paragraph 146
 
core qualifying activities
 
paragraph 46
 
cost of providing the ship (in Part X)
 
paragraph 96
 
demerger
 
paragraph 121(1)
 
dominant party (in relation to a merger)
 
paragraph 126
 
entering (or leaving) tonnage tax
 
paragraph 2(2)
 
finance costs (in paragraphs 61 and 62)
 
paragraph 63
 
finance lease (and lessor and lessee) (in Part X)
 
paragraph 89(2)
 
group
 
paragraph 116
 
group election
 
paragraph 7(1)(b)
 
initial period
 
paragraph 10(1) (and see paragraph 11(2))
 
Inland Revenue
 
paragraph 145
 
leaving (or entering) tonnage tax
 
paragraph 2(2)
 
member of group
 
paragraph 116
 
merger
 
paragraph 121(1)
 
minimum training obligation
 
paragraph 24
 
offshore activities (in Part XI)
 
paragraph 104
 
offshore profits (in Part XI)
 
paragraph 107(1)
 
payments in lieu of training
 
paragraph 29
 
pooling and related expressions (in Parts IX, X and XI)
 
paragraph 88(2) and (3)
 
operating (a ship)
 
paragraph 18
 
qualifying activity and qualifying expenditure (in Parts IX, X and XI)
 
paragraph 88(1)
 
qualifying company
 
paragraph 16(1) (and see paragraph 17)
 
qualifying group
 
paragraph 16(2)
 
qualifying incidental activities
 
paragraph 48
 
qualifying secondary activities
 
paragraph 47
 
qualifying ship
 
paragraphs 19 to 22
 
relevant shipping income
 
paragraph 44(2)
 
relevant shipping profits
 
paragraph 44(1) (and see paragraph 108(2))
 
renewal election
 
paragraph 15(1)
 
the 75
  limit (on chartered-in tonnage) 
paragraph 37
 
ship
 
paragraph 142
 
single company
 
paragraph 146
 
subject to tonnage tax
 
paragraph 2(2)
 
tonnage
 
paragraph 6(1)
 
tonnage tax
 
paragraph 1(1)
 
tonnage tax activities
 
paragraph 45 (and see paragraph 108(1))
 
tonnage tax asset (in Parts VIII and XI)
 
paragraph 64
 
tonnage tax company
 
paragraph 2(1)
 
tonnage tax election
 
paragraph 1(2) (and see Part II)
 
tonnage tax group
 
paragraph 2(1)
 
tonnage tax pool (in Part IX)
 
paragraph 69
 
tonnage tax profits
 
paragraphs 3 to 5 (and see Part XI)
 
tonnage tax trade
 
paragraph 53(1)
 
training commitment
 
paragraph 25 (and see paragraphs 27(4) and (5) and 28(2))
     
 
 
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