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Finance Bill


Finance Bill
Part 5 — Stamp duty

    80

 

 128   Exemption of certain leases granted by registered social landlords

     (1)    No stamp duty is chargeable under Part 2 of Schedule 13 to the Finance Act

1999 (c. 16) on a lease of a dwelling granted by a registered social landlord to

one or more individuals in accordance with arrangements to which this section

applies if the lease is for an indefinite term or is terminable by notice of a month

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or less.

     (2)    “Registered social landlord” means—

           (a)           in relation to England and Wales, a body registered in the register

maintained under section 1(1) of the Housing Act 1996 (c. 52);

           (b)           in relation to Scotland, a body registered in the register maintained

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under section 57 of the Housing (Scotland) Act 2001 (asp 10);

           (c)           in relation to Northern Ireland, a housing association registered in the

register maintained under Article 14 of the Housing (Northern Ireland)

Order 1992 (S.I. 1992/1725 (N.I. 15)).

     (3)    This section applies to arrangements between a registered social landlord and

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a housing authority under which the landlord provides, for individuals

nominated by the authority in pursuance of its statutory housing functions,

temporary rented accommodation which the landlord itself has obtained on a

short-term basis.

            The reference above to accommodation obtained by the landlord “on a short-

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term basis” is to accommodation leased to the landlord for a term of five years

or less.

     (4)    A “housing authority” means—

           (a)           in relation to England and Wales—

                  (i)                 a principal council within the meaning of the Local Government

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Act 1972 (c. 70), or

                  (ii)                the Common Council of the City of London;

           (b)           in relation to Scotland, a council constituted under section 2 of the Local

Government etc. (Scotland) Act 1994 (c. 39);

           (c)           in relation to Northern Ireland—

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                  (i)                 the Department for Social Development in Northern Ireland, or

                  (ii)                the Northern Ireland Housing Executive.

     (5)    An instrument on which stamp duty is not chargeable by virtue only of this

section shall not be taken to be duly stamped unless—

           (a)           it is stamped with the duty to which it would be liable but for this

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section, or

           (b)           it has, in accordance with section 12 of the Stamp Act 1891 (c. 39), been

stamped with a particular stamp denoting that it is not chargeable with

any duty.

     (6)    This section shall be construed as one with the Stamp Act 1891.

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     (7)    This section applies to instruments executed after the day on which this Act is

passed.

 129   Relief for certain leases granted before section 128 has effect

     (1)    This section applies to instruments that—

           (a)           are executed in the period beginning with 1 January 2000 and ending

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with the day on which this Act is passed, and

 

 

Finance Bill
Part 5 — Stamp duty

    81

 

           (b)           are instruments to which section 128 (exemption of certain leases

granted by registered social landlords) would have applied if that

provision had been in force when the instrument was executed.

     (2)    If the instrument is not stamped until after the day on which this Act is passed,

the law in force at the time of its execution shall be deemed for stamp duty

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purposes to be what it would have been if section 128 had been in force at that

time.

     (3)    If the Commissioners are satisfied that—

           (a)           the instrument was stamped on or before the day on which this Act is

passed,

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           (b)           stamp duty was chargeable in respect of it, and

           (c)           had it been stamped after that day stamp duty would, by virtue of

section 128, not have been chargeable,

            they shall pay to such person as they consider appropriate an amount equal to

the duty (and any interest or penalty) that would not have been payable if that

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section had been in force at the time the instrument was executed.

     (4)    Any such payment must be claimed before 1st January 2004.

     (5)    Entitlement to a payment is subject to compliance with such conditions as the

Commissioners may determine with respect to the production of the

instrument, to its being stamped so as to indicate that it has been produced

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under this section or to other matters.

     (6)    For the purposes of section 10 of the Exchequer and Audit Departments Act

1866 (c. 39) (Commissioners to deduct repayments from gross revenues) any

amount paid under this section is a repayment.

     (7)    This section shall be construed as one with the Stamp Act 1891.

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     (8)    For the purposes of this section as it applies in relation to instruments executed

before the coming into force of section 57 of the Housing (Scotland) Act 2001

(asp 10), the references in section 128 to a registered social landlord shall be

read in relation to Scotland as references to—

           (a)           a housing association registered in the register maintained under

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section 3(1) of the Housing Associations Act 1985 (c. 69) by Scottish

Homes, or

           (b)           a body corporate whose objects corresponded to those of a housing

association and which, pursuant to a contract with Scottish Homes, was

registered in a register kept for the purpose by Scottish Homes.

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 130   Registered social landlords: treatment of certain leases granted between 1st

January 1990 and 27 March 2000

     (1)    This section applies to a lease in relation to which the following conditions are

met—

           (a)           it is a lease of a dwelling to one or more individuals;

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           (b)           it is for an indefinite term or is terminable by notice of a month or less;

           (c)           it was executed on or after 1st January 1990 and before 28th March 2000;

           (d)           at the time it was executed the rate or average rate of the rent (whether

reserved as a yearly rent or not) was £5,000 a year or less; and

           (e)           the landlord’s interest has at any time before 26th June 2003 been held

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by a registered social landlord.

 

 

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Part 5 — Stamp duty

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     (2)    A lease to which this section applies (whether or not presented for stamping)

shall be treated—

           (a)           for the purposes of section 14 of the Stamp Act 1891 (c. 39) (production

of instrument in evidence) as it applies in relation to proceedings begun

after the day on which this Act is passed, and

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           (b)           for the purposes of section 17 of that Act (enrolment etc of instrument)

as it applies to any act done after that day,

            as if it had been duly stamped in accordance with the law in force at the time

when it was executed.

     (3)    If in the case of a lease to which this section applies the Commissioners are

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satisfied—

           (a)           that the instrument was stamped on or before the day on which this Act

is passed, and

           (b)           that stamp duty was charged in respect of it,

            they shall pay to such person as they consider appropriate an amount equal to

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the duty (and any interest or penalty) so charged.

     (4)    Any such payment must be claimed before 1st January 2004.

     (5)    Entitlement to a payment under subsection (3) is subject to compliance with

such conditions as the Commissioners may determine with respect to the

production of the instrument, to its being stamped so as to indicate that it has

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been produced under this section or to other matters.

     (6)    For the purposes of section 10 of the Exchequer and Audit Departments Act

1866 (c. 39) (Commissioners to deduct repayments from gross revenues) any

amount paid under subsection (3) above is a repayment.

     (7)    This section shall be construed as one with the Stamp Act 1891.

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     (8)    The reference in subsection (1) above to the landlord’s interest being held by a

“registered social landlord” is to its being held by a body that—

           (a)           is registered in a register maintained under—

                  (i)                 Article 124 of the Housing (Northern Ireland) Order 1981

(S.I. 1981/156 (N.I. 3)),

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                  (ii)                section 3(1) of the Housing Associations Act 1985 (c. 69),

                  (iii)               Article 14 of the Housing (Northern Ireland) Order 1992

(S.I. 1992/1725 (N.I. 15)),

                  (iv)                section 1(1) of the Housing Act 1996 (c. 52), or

                  (v)                 section 57 of the Housing (Scotland) Act 2001 (asp 10), or

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           (b)           is a body corporate whose objects correspond to those of a housing

association and which, pursuant to a contract with Scottish Homes, is

registered in a register kept for the purposes by Scottish Homes.

     (9)    Section 129 of this Act (relief for certain leases granted on or after 1st January

2000) does not apply to a lease to which this section applies.

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Finance Bill
Part 7 — Income tax, corporation tax and capital gains tax: general

    83

 

Part 6

Income tax and corporation tax: charge and rate bands

Income tax

 131   Charge and rates for 2003-04

Income tax shall be charged for the year 2003-04, and for that year—

5

           (a)           the starting rate shall be 10%;

           (b)           the basic rate shall be 22%;

           (c)           the higher rate shall be 40%.

 132   Indexed rate bands for 2003-04: PAYE deductions etc

For the year 2003-04, section 1(5A) of the Taxes Act 1988 (which provides that

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statutory inflation-linked changes to income tax rate bands for a year of

assessment do not require changes to be made to PAYE deductions or

repayments until 18th May in that year) shall have effect as if “14th June” were

substituted for “17th May”.

Corporation tax

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 133   Charge and main rate for financial year 2004

Corporation tax shall be charged for the financial year 2004 at the rate of 30%.

 134   Small companies’ rate and fraction for financial year 2003

For the financial year 2003—

           (a)           the small companies’ rate shall be 19%, and

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           (b)           the fraction mentioned in section 13(2) of the Taxes Act 1988 (marginal

relief for small companies) shall be 11/400ths.

 135   Corporation tax starting rate and fraction for financial year 2003

For the financial year 2003—

           (a)           the corporation tax starting rate shall be 0%, and

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           (b)           the fraction mentioned in section 13AA of the Taxes Act 1988 (marginal

relief for small companies) shall be 19/400ths.

Part 7

Income tax, corporation tax and capital gains tax: general

Employment income and related matters

30

 136   Provision of services through intermediary

     (1)    Chapter 8 of Part 2 of the Income Tax (Earnings and Pensions) Act 2003 (c. 1)

(provision of services through an intermediary) is amended as follows.

 

 

Finance Bill
Part 7 — Income tax, corporation tax and capital gains tax: general

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     (2)    In section 49(1)(a) (services to which the Chapter applies), for “for the purposes

of a business carried on by another person” substitute “for another person”.

     (3)    In consequence of the above amendment—

           (a)           omit section 49(2) of that Act, and

           (b)           in section 56(7) of that Act—

5

                  (i)                 at the end of paragraph (a) insert “, and”, and

                  (ii)                omit paragraph (c) and the word “and” preceding it.

     (4)    This section applies in relation to services performed or due to be performed

on or after 10th April 2003.

 137   Exemption where homeworker’s additional expenses met by employer

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     (1)    In Part 4 of the Income Tax (Earnings and Pensions) Act 2003 (employment

income: exemptions), after section 316 insert—

       “316A                           Homeworker’s additional household expenses

           (1)           This section applies where an employer makes a payment to an

employee in respect of reasonable additional household expenses

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which the employee incurs in carrying out duties of the employment at

home under homeworking arrangements.

           (2)           No liability to income tax arises in respect of the payment.

           (3)           In this section, in relation to an employee—

                                  “homeworking arrangements” means arrangements between the

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employee and the employer under which the employee

regularly performs some or all of the duties of the employment

at home; and

                                  “household expenses” means expenses connected with the day to

day running of the employee’s home.”.

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     (2)    This section applies to payments which the employer makes on or after 6th

April 2003 in respect of expenses which the employee incurs on or after that

date.

 138   Taxable benefits: lower threshold for cars with a CO2 emissions figure

     (1)    In section 139 of the Income Tax (Earnings and Pensions) Act 2003 (cash

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equivalent of the benefit of a car: calculation of the appropriate percentage for

a year for cars with a CO2 emissions figure) the table in subsection (4) (which

specifies the lower threshold for each year for the purposes of that calculation)

is amended as follows.

     (2)    In the entry relating to 2004-05 and subsequent tax years omit “and subsequent

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tax years”.

     (3)    After that entry insert—

 

“2005-06 and subsequent tax

140”.

 
 

years

  
 

 

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Part 7 — Income tax, corporation tax and capital gains tax: general

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     (4)    In section 170(3) of that Act (power to provide by order for a lower threshold

different from that specified in the table in section 139(4) to apply for tax years

beginning on or after 6th April 2005) for “6th April 2005” substitute “6th April

2006”.

 139   Approved share plans and schemes

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Schedule 21 to this Act (which contains amendments relating to share incentive

plans, SAYE option schemes and CSOP schemes) has effect.

 140   Employee securities and options

Schedule 22 to this Act (which makes provision about securities, and options

to acquire securities, acquired by reason of employment) has effect.

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 141   Corporation tax relief for employee share acquisitions

Schedule 23 to this Act has effect with respect to deductions allowable for

corporation tax purposes in respect of employee share acquisitions.

 142   Ending of relief for contributions to QUESTS

     (1)    Section 67 of the Finance Act 1989 (c. 26) (tax relief for contributions to trustees

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of qualifying employee share ownership trust) does not apply in relation to

sums expended by a company in an accounting period of the company

beginning on or after 1st January 2003.

     (2)    In section 69 of that Act (chargeable events)—

           (a)           the definitions in subsections (3AC) and (3AD) (by virtue of which

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certain transfers of shares by trustees of an employee share ownership

trust to a SIP trust are not chargeable events) have effect in relation to

26th November 2002 as they had effect in relation to 20th March 2000;

           (b)           in relation to shares that are relevant shares by virtue of paragraph (a)

above, subsection (3AB) (deemed order of disposal of shares) has effect

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as if the reference there to 21st March 2000 were to 27th November

2002; and

           (c)           the other provisions of that section have effect accordingly.

     (3)    In consequence of subsection (2), in paragraph 78(2)(b) of Schedule 2 to the

Income Tax (Earnings and Pensions) Act 2003 (c. 1) (reference to section

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69(3AA) of the Finance Act 1989) after “21st March 2000” insert “or, by virtue

of section 142(2) of the Finance Act 2003, 27th November 2002”.

 143   Restriction of deductions for employee benefit contributions

Schedule 24 to this Act (which makes provision restricting deductions for

contributions by employers to third parties for the benefit of employees) has

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effect.

 144   PAYE on notional payments: reimbursement period

     (1)    In section 222(1)(c) of the Income Tax (Earnings and Pensions) Act 2003 (c. 1)

(period within which employee must reimburse employer for amount to be

 

 

Finance Bill
Part 7 — Income tax, corporation tax and capital gains tax: general

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accounted for to Inland Revenue in respect of income tax on notional

payment), for “30 days” substitute “90 days”.

     (2)    This section has effect in relation to payments of income treated as made on or

after 9th April 2003.

 145   PAYE: regulations and notional payments

5

     (1)    In the list in subsection (2) of section 684 of the Income Tax (Earnings and

Pensions) Act 2003 (PAYE regulations)—

           (a)           for item 2 substitute—

                                    “1A.                                            Provision—

                           (a)                          for deductions to be made, if and to the extent that the

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payee does not object, with a view to securing that

income tax payable in respect of any income of a

payee for a tax year which is not PAYE income is

deducted from PAYE income of the payee paid

during that year; and

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                           (b)                          as to the circumstances and manner in which a payee

may object to the making of deductions.

                                    2.                                            Provision—

                           (a)                          for repayments or deductions to be made, if and to the

extent that the payee does not object, in respect of any

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amounts overpaid or remaining unpaid (or treated as

overpaid or remaining unpaid) on account of—

                                 (i)                                income tax in respect of income for a previous

tax year, or

                                 (ii)                               capital gains tax in respect of chargeable gains

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for such a year; and

                           (b)                          as to the circumstances in which repayments or

deductions may be made, and the circumstances and

manner in which a payee may object to the making of

repayments or deductions.”;

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           (b)           after item 4 insert —

                                    “4A.                      Provision authorising the recovery from the payee rather

than the payer of any amount that the Inland Revenue

considers should have been deducted by the payer.”;

           (c)           for item 8 substitute as items 7A and 8—              

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                                    “7A.                      Provision for excluding payments of such description as may

be specified from the operation of the regulations in such

circumstances as may be specified.

                                    8.                      Provision for the making of decisions by the Board or the

Inland Revenue as to any matter required to be decided for

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the purposes of the regulations and for appeals against such

decisions.”.

     (2)    After subsection (7) of that section insert—

           “(7A)              Nothing in PAYE regulations may be read—

                  (a)                 as preventing the making of arrangements for the collection of

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tax in such manner as may be agreed by, or on behalf of, the

payer and the Inland Revenue, or

 

 

 
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