Finance Act 2005

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Finance Act 2005

Rates of tobacco products duty

Charge and rates for 2005-06

Childcare vouchers: exempt amount

Research institution spin-out companies

Introduction

Alternative finance arrangements

Relief for production and acquisition expenditure on limited-budget films

Removal of restrictions on interest relief

Accounting practice and related matters

Dividends by reference to which a deduction is allowed: no underlying tax

Capital allowances: renovation of business premises in disadvantaged areas

Alternative property finance

Rates and rate bands for the next three years

Pension schemes etc.

Civil partnerships etc

Repeals

Non-UK resident vulnerable persons: interpretation

Alternative finance arrangements: further provisions

Films: restrictions on relief for production and acquisition expenditure

Part 2

Part 3

Part 4

Accounting practice and related matters

Part 2

Section 804ZA: prescribed schemes and arrangements

Capital allowances: renovation of business premises in disadvantaged areas

Part 2

Tonnage tax

Part 2

Stamp duty land tax: alternative property finance

Stamp duty land tax and stamp duty: removal of disadvantaged areas relief for non-residential property

Pension schemes etc.

Repeals

Part 2

Part 3

Part 4

Finance Act 2005
2005 Chapter 7

© Crown Copyright 2005
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Finance Act 2005
2005 Chapter 7

CONTENTS

PART 1
EXCISE DUTIES
Tobacco products duty
Section
1 Rates of tobacco products duty

Alcoholic liquor duties
2 Rate of duty on beer
3 Rates of duty on wine and made-wine

Hydrocarbon oil etc duties
4 Consolidation of current rates of hydrocarbon oil duties etc.
5 Rates of hydrocarbon oil duties etc. from 1st September 2005

Gaming duty
6 Rates of gaming duty

Vehicle excise duty
7 Rates

PART 2
INCOME TAX, CORPORATION TAX AND CAPITAL GAINS TAX
CHAPTER 1
INCOME TAX AND CORPORATION TAX CHARGE AND RATE BANDS
Income tax
8 Charge and rates for 2005-06
9 Personal allowances for those aged 65 or more

Corporation tax
10 Charge and main rate for financial year 2006
11 Small companies' rate and fraction for financial year 2005
12 Corporation tax starting rate and fraction for financial year 2005
13 Non-corporate distribution rate for financial year 2005

Trusts
14 Special trust rates not to apply to first slice of trust income

CHAPTER 2
PERSONAL TAXATION
Taxable benefits
15 Childcare vouchers: exempt amount
16 Extension of exemptions for childcare, workplace parking, cycles etc
17 Transfer of previously loaned computer or cycle etc
18 Extension of outplacement services etc exemption: part-time employees

Armed forces
19 Armed forces pensions and compensation schemes

CHAPTER 3
EMPLOYMENT-RELATED SECURITIES
20 Research institution spin-out companies
21 Research institution spin-out companies: pre-2nd December 2004 cases
22 Capital gains

CHAPTER 4
TRUSTS WITH VULNERABLE BENEFICIARY
Introductory
23 Introduction
24 Entitlement to make claim for special tax treatment

Income tax
25 Qualifying trusts income: special income tax treatment
26 Amount of relief
27 Trustees' liability: TQTI
28 Vulnerable person's liability: VQTI
29 Part years

Capital gains tax
30 Qualifying trusts gains: special capital gains tax treatment
31 UK resident vulnerable persons: section 77 treatment
32 Non-UK resident vulnerable persons: amount of relief
33 Vulnerable person's liability: VQTG

Qualifying trusts
34 Disabled persons
35 Relevant minors
36 Parts of assets

Vulnerable persons
37 Vulnerable person election
38 Meaning of "disabled person"
39 Meaning of "relevant minor"

Miscellaneous and supplementary
40 Power to make enquiries
41 Interpretation etc.
42 Application in relation to Scotland
43 Penalties under TMA 1970
44 Consequential amendments
45 Commencement

CHAPTER 5
ALTERNATIVE FINANCE ARRANGEMENTS
Introductory
46 Alternative finance arrangements

Arrangements giving rise to alternative finance return
47 Alternative finance arrangements: alternative finance return
48 Arrangements within section 47: foreign currency and non-residents

Arrangements giving rise to profit share return
49 Alternative finance arrangements: profit share return

Treatment of alternative finance arrangements
50 Treatment of alternative finance arrangements: companies
51 Treatment of alternative finance arrangements: persons other than companies
52 Provision not at arm's length
53 Treatment of section 47 arrangements: sale and purchase of asset
54 Section 49 arrangements: profit share return not to be treated as distribution

Supplementary
55 Further provisions
56 Application of Chapter
57 Interpretation of Chapter

CHAPTER 6
FILM RELIEF
Tax relief for limited-budget films
58 Relief for production and acquisition expenditure on limited-budget films

Restrictions on relief
59 Restrictions on relief for production and acquisition expenditure

Deferred income agreements
60 Deferred income agreements which exist when relief claimed
61 Meaning of "deferred income agreement in respect of a film"
62 Deferred income agreements entered into after relief claimed
63 Sections 60 to 62: supplementary
64 Transitional provision for years of assessment before the year 2005-06
65 Corresponding provision in ITTOIA 2005

Companies benefited by film relief: exit charges
66 When a chargeable event occurs
67 Consequences of a chargeable event: exit event X or Y
68 Exit event Z: a relevant disposal at an undervalue
69 Consequences of a chargeable event: exit event Z
70 Valuation of the "rights to guaranteed income" and "disposed rights"
71 Meaning of "company" and related terms

CHAPTER 7
AVOIDANCE INVOLVING PARTNERSHIP
Partners: restrictions on relief
72 Removal of restrictions on interest relief
73 Meaning of "contribution to the trade"

Partners: recovery of excess relief
74 Recovery of excess relief given under section 380 or 381 of ICTA
75 Computing the chargeable amount
76 Meaning of "relevant loss"
77 Transitional provision for years of assessment before the year 2005-06
78 Consequential amendments

Partners benefited by film relief
79 Meaning of "capital contribution to the trade"

CHAPTER 8
ACCOUNTING PRACTICE AND RELATED MATTERS
80 Accounting practice and related matters
81 Computation of profits: change of accounting basis
82 Change of accounting practice: deferment of transitional adjustments
83 Application of accounting standards to securitisation companies
84 Taxation of securitisation companies

CHAPTER 9
INTERNATIONAL MATTERS
Double taxation relief: general
85 Dividends by reference to which a deduction is allowed: no underlying tax

Double taxation relief: restrictions
86 Limits on credit: income tax and corporation tax: trading profits
87 Schemes and arrangements designed to increase relief
88 Self-assessment amendments

Controlled foreign companies
89 ADP dividends and double taxation relief
90 Foreign taxation of group as single entity: exclusion of ADP CFCs

Annual payments and double taxation relief
91 Tax avoidance involving annual payments and double taxation relief

CHAPTER 10
MISCELLANEOUS
Capital allowances
92 Capital allowances: renovation of business premises in disadvantaged areas

Tonnage tax
93 Tonnage tax

PART 3
STAMP TAXES
Stamp duty land tax
94 Alternative property finance

Stamp duty land tax and stamp duty
95 Raising of thresholds
96 Removal of disadvantaged areas relief for non-residential property

Stamp duty and stamp duty reserve tax
97 Demutualisation of insurance companies

PART 4
OTHER TAXES
Inheritance tax
98 Rates and rate bands for the next three years

Landfill tax
99 Rate of landfill tax

Lorry road-user charge
100 Lorry road-user charge

PART 5
PENSIONS ETC
101 Pension schemes etc.
102 Pension Protection Fund etc.

PART 6
MISCELLANEOUS
103 Civil partnerships etc

PART 7
SUPPLEMENTARY PROVISIONS
104 Repeals
105 Interpretation
106 Short title

    Schedule 1 - Non-UK resident vulnerable persons: interpretation
    Schedule 2 - Alternative finance arrangements: further provisions
    Schedule 3 - Films: restrictions on relief for production and acquisition expenditure
    Part 1 - Restrictions on circumstances in which relief may be obtained
    Part 2 - Restrictions on amount of relief which may be obtained
    Part 3 - Minor and consequential amendments
    Part 4 - Interpretation
    Schedule 4 - Accounting practice and related matters
    Part 1 - Bad debts and related matters
    Part 2 - Other provisions connected with accounting practice
    Schedule 5 - Section 804ZA: prescribed schemes and arrangements
    Schedule 6 - Capital allowances: renovation of business premises in disadvantaged areas
    Part 1 - New Part 3A of the Capital Allowances Act 2001
    Part 2 - Consequential amendments
    Schedule 7 - Tonnage tax
    Part 1 - Amendments of Schedule 22 to FA 2000
    Part 2 - Commencement and transitional provision
    Schedule 8 - Stamp duty land tax: alternative property finance
    Schedule 9 - Stamp duty land tax and stamp duty: removal of disadvantaged areas relief for non-residential property
    Schedule 10 - Pension schemes etc.
    Schedule 11 - Repeals
    Part 1 - Excise duties
    Part 2 - Income tax, corporation tax and capital gains tax
    Part 3 - Stamp taxes
    Part 4 - Pensions etc

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© Crown copyright 2005
Prepared 11 April 2005
Publishing Rights: Coddan CPM Core Licence (HMSO) number is C02W0007897 issued on 25 November 2005 by HMSO Licensing Division (Core Licence.pdf Licence to reproduce public sector information).
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