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Finance (No. 3) Bill Finance (No. 3) Bill EUROPEAN CONVENTION ON HUMAN RIGHTS The Chancellor of the Exchequer has made the following statement under section 19(1)(a) of the Human Rights Act 1998: In my view the provisions of the Finance (No. 3) Bill are compatible with the Convention rights. Bill 282 57/1 Finance (No. 3) Bill CONTENTS PART 1 DIRECT TAXES Charge to tax 1 Income tax charge for tax year 2019-20 2 Corporation tax charge for financial year 2020 Income tax rates, allowances and limits 3 Main rates of income tax for tax year 2019-20 4 Default and savings rates of income tax for tax year 2019-20 5 Basic rate limit and personal allowance 6 Starting rate limit for savings for tax year 2019-20 Employment and social security income 7 Optional remuneration arrangements: arrangements for cars and vans 8 Exemption for benefit in form of vehicle-battery charging at workplace 9 Exemptions relating to emergency vehicles 10 Exemption for expenses related to travel 11 Beneficiaries of tax-exempt employer-provided pension benefits 12 Tax treatment of social security income Chargeable gains: interests in UK land etc 13 Disposals by non-UK residents etc 14 Disposals of UK land etc: payments on account of capital gains tax International matters 15 Offshore receipts in respect of intangible property 16 Avoidance involving profit fragmentation arrangements 17 Non-UK resident companies carrying on UK property businesses etc 18 Diverted profits tax 19 Hybrid and other mismatches: scope of Chapter 8 and “financial instrument” 20 Controlled foreign companies: finance company exemption and control Bill 282 57/1 ii Finance (No. 3) Bill 21 Permanent establishments: preparatory or auxiliary activities 22 Payment of CGT exit charges 23 Corporation tax exit charges 24 Group relief etc: meaning of “UK related” company Corporation tax: miscellaneous 25 Intangible fixed assets: exceptions to degrouping charges etc 26 Corporation tax relief for carried-forward losses 27 Corporate interest restriction 28 Debtor relationships of company where money lent to connected companies Capital allowances 29 Construction expenditure on buildings and structures 30 Special rate expenditure on plant and machinery 31 Temporary increase in annual investment allowance 32 First-year allowances and first-year tax credits 33 First-year allowance: expenditure on electric vehicle charge points 34 Qualifying expenditure: buildings, structures and land Leases 35 Changes to accounting standards etc Oil activities and petroleum revenue tax 36 Oil activities: transferable tax history 37 Petroleum revenue tax: post-transfer decommissioning expenditure Miscellaneous reliefs 38 Entrepreneurs’ relief 39 Gift aid etc: restrictions on associated benefits 40 Charities: exemption for small trades etc PART 2 OTHER TAXES Stamp duty land tax 41 Relief for first-time buyers in cases of shared ownership 42 Repayment to first-time buyers in cases of shared ownership 43 Higher rates of tax for additional dwellings etc 44 Exemption for financial institutions in resolution 45 Changes to periods for delivering returns and paying tax Stamp duty and SDRT 46 Stamp duty: transfers of listed securities and connected persons 47 SDRT: listed securities and connected persons 48 Stamp duty: exemption for financial institutions in resolution 49 Stamp duty and SDRT: exemptions for share incentive plans Finance (No. 3) Bill iii Value added tax 50 Duty of customers to account for tax on supplies 51 Treatment of vouchers 52 Groups: eligibility Alcohol 53 Rates of duty on cider, wine and made-wine 54 Excise duty on mid-strength cider Tobacco 55 Rates 56 Tobacco for heating Vehicle duties 57 VED: rates for light passenger vehicles, light goods vehicles, motorcycles etc 58 VED: taxis capable of zero emissions 59 HGV road user levy Air passenger duty 60 Rates of duty from 1 April 2020 Gaming 61 Remote gaming duty: rate 62 Gaming duty Environmental taxes 63 Climate change levy: exemption for mineralogical and metallurgical processes 64 Landfill tax rates Inheritance tax 65 Residence nil-rate band Soft drinks industry levy 66 Application of penalty provisions 67 Isle of Man PART 3 CARBON EMISSIONS TAX Introductory 68 Carbon emissions tax iv Finance (No. 3) Bill Charge to tax 69 Charge to carbon emissions tax 70 “Reported carbon emissions” 71 “Emissions report” and “reporting period” 72 “Emissions allowance” 73 Liability to pay carbon emissions tax Administration etc. 74 Power to make further provision about carbon emissions tax 75 Consequential provision General 76 Interpretation 77 Regulations 78 Commencement and transitional provision PART 4 ADMINISTRATION AND ENFORCEMENT Time limits for assessments etc 79 Offshore matters or transfers: income tax and capital gains tax 80 Offshore matters or transfers: inheritance tax Security deposits 81 Construction industry scheme and corporation tax etc International agreements 82 Resolution of double taxation disputes 83 International tax enforcement: disclosable arrangements Payment of unlawful advance corporation tax 84 Interest in respect of unlawful ACT 85 Section 84: supplementary Voluntary returns 86 Voluntary returns Interest 87 Interest under section 178 of FA 1989 and section 101 of FA 2009 Finance (No. 3) Bill v PART 5 MISCELLANEOUS AND FINAL Regulatory capital securities 88 Regulatory capital securities and hybrid capital instruments EU withdrawal 89 Minor amendments in consequence of EU withdrawal Preparatory expenditure 90 Emissions reduction trading scheme: preparatory expenditure Other 91 Interpretation 92 Short title Schedule 1 — Chargeable gains accruing to non-residents etc Part 1 — Extending cases in which non-residents are charged to tax etc Part 2 — Consequential amendments Part 3 — Commencement and transitional provisions etc Schedule 2 — Returns for disposals of UK land etc Part 1 — Returns and payments on account: disposals of UK land etc Part 2 — Notification of chargeable amounts, amendments of returns, enquiries etc Part 3 — Consequential amendments Schedule 3 — Offshore receipts in respect of intangible property Schedule 4 — Avoidance involving profit fragmentation arrangements Schedule 5— Non-UK resident companies carrying on UK property businesses etc Part 1 — Extension of scope of charge Part 2 — Supplementary & Consequential amendments Part 3 — Commencement and transitional provisions Schedule 6 — Diverted profits tax Schedule 7 — Payment of CGT exit charges Schedule 8 — Corporation tax exit charges Part 1 — CT exit charge payment plans Part 2 — Repeal of certain postponement provisions Part 3 — Treatment of assets subject to EU exit charges Schedule 9 — Corporation tax relief for carried-forward losses Schedule 10 — Corporate interest restriction Schedule 11 — Eliminating tax mismatch for certain debt Schedule 12 — Annual investment allowance: periods straddling 1 January 2019 or 1 January 2021 Schedule 13 — Leases: changes to accounting standards etc Part 1— Finance leases: amendments as a result of changes to accounting standards vi Finance (No. 3) Bill Part 2 — Long funding leases Part 3 — Changes to accounting standards and tax adjustments Schedule 14 — Oil activities: transferable tax history Part 1 — Election to transfer tax history Part 2 — The total TTH amount Part 3 — Effect of a TTH election on the seller Part 4 — Effect of a TTH election on the purchaser Part 5 — TTH activation Part 6 — Allocation of activated TTH amount Part 7 — Supplementary charge: recalculation of adjusted ring fence profits Part 8 — TTH elections: conditions and procedure Part 9 — TTH elections: approval Part 10 — TTH elections: effective date and withdrawal Part 11 — TTH elections: inaccuracies Part 12 — Chargeable gains Part 13 — Onward sale Part 14 — Supplementary Part 15 — Interpretation Schedule 15 — Entrepreneurs’ relief Schedule 16 — VAT treatment of vouchers Schedule 17 — VAT groups: eligibility Part 1 — Eligibility of individuals and partnerships Part 2 — Consequential amendments Schedule 18 — Gaming duty Schedule 19 — Taxation of hybrid capital instruments Part 1 — Revocation of special rules for regulatory capital securities Part 2 — Corporation tax, income tax and capital gains tax Part 3 — Stamp duty and stamp duty reserve tax Finance (No. 3) Bill 1 Part 1 — Direct taxes A BILL TO Grant certain duties, to alter other duties, and to amend the law relating to the national debt and the public revenue, and to make further provision in connection with finance. Most Gracious Sovereign E, Your Majesty’s most dutiful and loyal subjects, the Commons of the United Kingdom in Parliament assembled, towards raising the necessary Wsupplies to defray Your Majesty’s public expenses, and making an addition to the public revenue, have freely and voluntarily resolved to give and to grant unto Your Majesty the several duties hereinafter mentioned; and do therefore most humbly beseech Your Majesty that it may be enacted, and 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:— PART 1 DIRECT TAXES Charge to tax 1 Income tax charge for tax year 2019-20 Income tax is charged for the tax year 2019-20. 5 2 Corporation tax charge for financial year 2020 Corporation tax is charged for the financial year 2020. Bill 282 57/1 2 Finance (No. 3) Bill Part 1 — Direct taxes Income tax rates, allowances and limits 3 Main rates of income tax for tax year 2019-20 For the tax year 2019-20 the main rates of income tax are as follows— (a) the basic rate is 20%; (b) the higher rate is 40%; 5 (c) the additional rate is 45%. 4 Default and savings rates of income tax for tax year 2019-20 (1) For the tax year 2019-20 the default rates of income tax are as follows— (a) the default basic rate is 20%; (b) the default higher rate is 40%; 10 (c) the default additional rate is 45%. (2) For the tax year 2019-20 the savings rates of income tax are as follows— (a) the savings basic rate is 20%; (b) the savings higher rate is 40%; (c) the savings additional rate is 45%.
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