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Income and Corporation Taxes Act 1988

1988 CHAPTER 1

ARRANGEMENT OF SECTIONS

Go to Preamble

  1. Part I

    The Charge to Tax

    1. Income tax

      1. 1. The charge to income tax.

      2. 2. Fractions of a pound, and yearly assessments.

      3. 3. Certain income charged at basic rate.

      4. 4. Construction of references in Income Tax Acts to deduction of tax.

      5. 5. Date for payment.

    2. Corporation tax

      1. 6. The charge to corporation tax and exclusion of income tax and capital gains tax.

      2. 7. Treatment of certain payments and repayment of income tax.

      3. 8. General scheme of corporation tax.

      4. 9. Computation of income: application of income tax principles.

      5. 10. Time for payment of tax.

      6. 11. Companies not resident in United Kingdom.

      7. 12. Basis of, and periods for, assessment.

    3. Small companies' rate

      1. 13. Small companies' relief.

    4. Advance corporation tax

      1. 14. Advance corporation tax and qualifying distributions.

    5. The six Schedules

      1. 15. Schedule A.

      2. 16. Schedule B.

      3. 17. Schedule C.

      4. 18. Schedule D.

      5. 19. Schedule E.

      6. 20. Schedule F.

  2. Part II

    Provisions Relating to the Schedule A Charge and the Associated Schedule D Charges

    1. General

      1. 21. Persons chargeable.

      2. 22. Assessments.

      3. 23. Collection from lessees and agents.

      4. 24. Construction of Part II.

    2. Deductions and other allowances

      1. 25. Deductions from rent: general rules.

      2. 26. Deductions from rent: land managed as one estate.

      3. 27. Deductions from rent: maintenance funds for historic buildings.

      4. 28. Deductions from receipts other than rent.

      5. 29. Sporting rights.

      6. 30. Expenditure on making sea walls.

      7. 31. Provisions supplementary to sections 25 to 30.

      8. 32. Capital allowances for machinery and plant used in estate management.

      9. 33. Agricultural land: allowance for excess expenditure on maintenance.

    3. Premiums, leases at undervalue etc

      1. 34. Treatment of premiums etc. as rent or Schedule D profits.

      2. 35. Schedule D charge on assignment of lease granted at an undervalue.

      3. 36. Schedule D charge on sale of land with right to reconveyance.

      4. 37. Premiums paid etc: deductions from premiums and rent received.

      5. 38. Rules for ascertaining duration of leases.

      6. 39. Saving for pre-1963 leases, and special relief for individuals.

    4. Supplemental: Schedules A and D

      1. 40. Tax treatment of receipts and outgoings on sale of land.

      2. 41. Relief for rent etc. not paid.

      3. 42. Appeals against determinations under sections 34 to 36.

      4. 43. Non-residents.

  3. Part III

    Provisions Relating to the Schedule C Charge and General Provisions about Government Securities

    1. General

      1. 44. Income tax: mode of charge.

      2. 45. Interpretation of Part III.

    2. Government securities: exemptions from tax

      1. 46. Savings certificates and tax reserve certificates.

      2. 47. United Kingdom government securities held by non-residents.

      3. 48. Securities of foreign states.

      4. 49. Stock and dividends in name of Treasury etc.

    3. Government securities: interest payable without deduction of tax

      1. 50. United Kingdom securities: Treasury directions for payment without deduction of tax.

      2. 51. Treasury directions as respects Northern Ireland securities.

      3. 52. Taxation of interest on converted government securities and interest which becomes subject to deduction.

  4. Part IV

    Provisions Relating to the Schedule D Charge

    1. Chapter I

      Supplementary Charging Provisions

      1. 53. Farming and other commercial occupation of land (except woodlands).

      2. 54. Woodlands managed on a commercial basis.

      3. 55. Mines, quarries and other concerns.

      4. 56. Transactions in deposits with and without certificates or in debts.

      5. 57. Deep discount securities.

      6. 58. Foreign pensions.

      7. 59. Persons chargeable.

    2. Chapter II

      Income Tax: Basis of Assessment etc.

      1. Cases I and II

        1. 60. Assessment on preceding year basis.

        2. 61. Special basis at commencement of trade, profession or vocation.

        3. 62. Special basis for early years following commencement.

        4. 63. Special basis on discontinuance.

      2. Cases III, IV and V

        1. 64. Case III assessments: general.

        2. 65. Cases IV and V assessments: general.

        3. 66. Special rules for fresh income.

        4. 67. Special rules where source of income disposed of or yield ceases.

        5. 68. Special rules where property etc. situated in Republic of Ireland.

      3. Case VI

        1. 69. Assessment on current year basis unless otherwise directed.

    3. Chapter III

      Corporation Tax: Basis of Assessment etc.

      1. 70. Basis of assessment etc.

    4. Chapter IV

      Provisions Supplementary to Chapters II and III

      1. 71. Computation of income tax where no profits in year of assessment.

      2. 72. Apportionments etc. for purposes of Cases I, II and VI.

      3. 73. Single assessments for purposes of Cases III, IV and V.

    5. Chapter V

      Computational Provisions

      1. Deductions

        1. 74. General rules as to deductions not allowable.

        2. 75. Expenses of management: investment companies.

        3. 76. Expenses of management: insurance companies.

        4. 77. Incidental costs of obtaining loan finance.

        5. 78. Discounted bills of exchange.

        6. 79. Contributions to local enterprise agencies.

        7. 80. Expenses connected with foreign trades etc.

        8. 81. Travel between trades etc.

        9. 82. Interest paid to non-residents.

        10. 83. Patent fees etc. and expenses.

        11. 84. Payments for technical education.

        12. 85. Payments to trustees of approved profit sharing schemes.

        13. 86. Employees seconded to charities and educational establishments.

        14. 87. Taxable premiums etc.

        15. 88. Payments to Export Credit Guarantee Department.

        16. 89. Debts proving irrecoverable after event treated as discontinuance.

        17. 90. Additional payments to redundant employees.

        18. 91. Cemeteries.

      2. Treatment of regional development and other grants and debts released etc.

        1. 92. Regional development grants.

        2. 93. Other grants under Industrial Development Act 1982 etc.

        3. 94. Debts deducted and subsequently released.

        4. 95. Taxation of dealer’s receipts on purchase by company of own shares.

      3. Special provisions

        1. 96. Farming and market gardening: relief for fluctuating profits.

        2. 97. Treatment of farm animals etc.

        3. 98. Tied premises.

        4. 99. Dealers in land.

    6. Chapter VI

      Discontinuance, and Change of Basis of Computation

      1. Valuation of trading stock etc.

        1. 100. Valuation of trading stock at discontinuance of trade.

        2. 101. Valuation of work in progress at discontinuance of profession or vocation.

        3. 102. Provisions supplementary to sections 100 and 101.

      2. Case VI charges on receipts

        1. 103. Receipts after discontinuance: earnings basis charge and related charge affecting conventional basis.

        2. 104. Conventional basis: general charge on receipts after discontinuance or change of basis.

        3. 105. Allowable deductions.

        4. 106. Application of charges where rights to payments transferred.

      3. Reliefs

        1. 107. Treatment of receipts as earned income.

        2. 108. Election for carry-back.

        3. 109. Charge under section 104: relief for individuals born before 6th April 1917.

      4. Supplemental

        1. 110. Interpretation etc.

    7. Chapter VII

      Partnerships and Successions

      1. General

        1. 111. Partnership assessments to income tax.

        2. 112. Partnerships controlled abroad.

        3. 113. Effect, for income tax, of change in ownership of trade, profession or vocation.

      2. Partnerships involving companies

        1. 114. Special rules for computing profits and losses.

        2. 115. Provisions supplementary to section 114.

        3. 116. Arrangements for transferring relief.

      3. Limited partners

        1. 117. Restriction on relief: individuals.

        2. 118. Restriction on relief: companies.

    8. Chapter VIII

      Miscellaneous and Supplemental

      1. 119. Rent etc. payable in connection with mines, quarries and similar concerns.

      2. 120. Rent etc. payable in respect of electric line wayleaves.

      3. 121. Management expenses of owner of mineral rights.

      4. 122. Relief in respect of mineral royalties.

      5. 123. Foreign dividends.

      6. 124. Interest on quoted Eurobonds.

      7. 125. Annual payments for non-taxable consideration.

      8. 126. Treasury securities issued at a discount.

      9. 127. Enterprise allowance.

      10. 128. Commodity and financial futures etc.: losses and gains.

      11. 129. Stock lending.

      12. 130. Meaning of “investment company” for the purposes of Part IV.

  5. Part V

    Provisions Relating to The Schedule E Charge

    1. Chapter I

      Supplementary Charging Provisions of General Application

      1. Miscellaneous provisions

        1. 131. Chargeable emoluments.

        2. 132. Place of performance, and meaning of emoluments received in the U.K.

        3. 133. Voluntary pensions.

        4. 134. Workers supplied by agencies.

      2. Shareholdings, loans etc.

        1. 135. Gains by directors and employees from share options.

        2. 136. Provisions supplementary to section 135.

        3. 137. Payment of tax under section 135 by instalments.

        4. 138. Share acquisitions by directors and employees.

        5. 139. Provisions supplementary to section 138.

        6. 140. Further interpretation of sections 135 to 139.

      3. Vouchers etc.

        1. 141. Non-cash vouchers.

        2. 142. Credit-tokens.

        3. 143. Cash vouchers taxable under P.A.Y.E.

        4. 144. Supplementary provisions.

      4. Living accommodation

        1. 145. Living accommodation provided for employee.

        2. 146. Additional charge in respect of certain living accommodation.

        3. 147. Occupation of Chevening House.

      5. Payments on retirement, sick pay etc.

        1. 148. Payments on retirement or removal from office or employment.

        2. 149. Sick pay.

        3. 150. Job release scheme allowances, maternity pay and statutory sick pay.

        4. 151. Income support etc.

        5. 152. Notification of amount taxable under section 151.

    2. Chapter II

      Supplementary Charging Provisions Applicable to Directors and Higher-Paid Employees and Office Holders

      1. Expenses

        1. 153. Payments in respect of expenses.

      2. Benefits in kind

        1. 154. General charging provision.

        2. 155. Exceptions from the general charge.

        3. 156. Cash equivalents of benefits charged under section 154.

        4. 157. Cars available for private use.

        5. 158. Car fuel.

        6. 159. Pooled cars.

        7. 160. Beneficial loan arrangements.

        8. 161. Exceptions from section 160.

        9. 162. Employee shareholdings.

        10. 163. Expenses connected with living accommodation.

        11. 164. Director’s tax paid by employer.

        12. 165. Scholarships.

      3. General supplementary provisions

        1. 166. Notice of nil liability under this Chapter.

        2. 167. Meaning of “director’s or higher-paid employment”.

        3. 168. Other interpretative provisions.

    3. Chapter III

      Profit-Related Pay

      1. Preliminary

        1. 169. Interpretation.

        2. 170. Taxation of profit-related pay.

      2. The relief

        1. 171. Relief from tax.

        2. 172. Exceptions from tax.

      3. Registration

        1. 173. Persons who may apply for registration.

        2. 174. Excluded employments.

        3. 175. Applications for registration.

        4. 176. Registration.

        5. 177. Change of scheme employer.

        6. 178. Cancellation of registration.

      4. Administration

        1. 179. Recovery of tax from scheme employer.

        2. 180. Annual returns etc.

        3. 181. Other information.

        4. 182. Appeals.

      5. Supplementary

        1. 183. Partnerships.

        2. 184. Independent accountants.

    4. Chapter IV

      Other Exemptions and Reliefs

      1. Share option and profit sharing schemes

        1. 185. Approved share option schemes.

        2. 186. Approved profit sharing schemes.

        3. 187. Interpretation of sections 185 and 186 and Schedules 9 and 10.

      2. Retirement benefits etc.

        1. 188. Exemptions from section 148.

        2. 189. Lump sum benefits on retirement.

        3. 190. Payments to Members of Parliament, Representatives to the European Parliament and others.

        4. 191. Job release scheme allowances not to be treated as income.

      3. Foreign emoluments and earnings, pensions and certain travel facilities

        1. 192. Relief from tax for foreign emoluments.

        2. 193. Foreign earnings and travel expenses.

        3. 194. Other foreign travel expenses.

        4. 195. Travel expenses of employees not domiciled in the United Kingdom.

        5. 196. Foreign pensions.

        6. 197. Leave travel facilities for the armed forces.

      4. Other expenses, subscriptions etc.

        1. 198. Relief for necessary expenses.

        2. 199. Expenses necessarily incurred and defrayed from official emoluments.

        3. 200. Expenses of Members of Parliament.

        4. 201. Fees and subscriptions to professional bodies, learned societies etc.

        5. 202. Donations to charity: payroll deduction scheme.

    5. Chapter V

      Assessment, Collection, Recovery and Appeals

      1. 203. Pay as you earn.

      2. 204. P.A.Y.E repayments.

      3. 205. Assessments unnecessary in certain circumstances.

      4. 206. Additional provision for certain assessments.

      5. 207. Disputes as to domicile or ordinary residence.

  6. Part VI

    Company Distributions, Tax Credits etc

    1. Chapter I

      Taxation of Company Distributions

      1. 208. U.K. company distributions not generally chargeable to corporation tax.

    2. Chapter II

      Matters which are Distributions for the Purposes of the Corporation Tax Acts

      1. 209. Meaning of “distribution”.

      2. 210. Bonus issue following repayment of share capital.

      3. 211. Matters to be treated or not to be treated as repayments of share capital.

    3. Chapter III

      Matters which are not Distributions for the Purposes of the Corporation Tax Acts

      1. Payments of interest

        1. 212. Interest etc. paid in respect of certain securities.

      2. Demergers

        1. 213. Exempt distributions.

        2. 214. Chargeable payments connected with exempt distributions.

        3. 215. Advance clearance by Board of distributions and payments.

        4. 216. Returns.

        5. 217. Information.

        6. 218. Interpretation of sections 213 to 217.

      3. Purchase of own shares

        1. 219. Purchase by unquoted trading company of own shares.

        2. 220. Conditions as to residence and period of ownership.

        3. 221. Reduction of vendor’s interest as shareholder.

        4. 222. Conditions applicable where purchasing company is member of group.

        5. 223. Other conditions.

        6. 224. Relaxation of conditions in certain cases.

        7. 225. Advance clearance of payments by Board.

        8. 226. Returns and information.

        9. 227. Associated persons.

        10. 228. Connected persons.

        11. 229. Other interpretative provisions.

      4. Stock dividends

        1. 230. Stock dividends: distributions.

    4. Chapter IV

      Tax Credits

      1. 231. Tax credits for certain recipients of qualifying distributions.

      2. 232. Tax credits for non-U.K. residents.

      3. 233. Taxation of certain recipients of distributions and in respect of non-qualifying distributions.

      4. 234. Information relating to distributions.

      5. 235. Distributions of exempt funds etc.

      6. 236. Provisions supplementary to section 235.

      7. 237. Disallowance of reliefs in respect of bonus issues.

    5. Chapter V

      Advance Corporation Tax and Franked Investment Income

      1. 238. Interpretation of terms and collection of ACT.

      2. 239. Set-off of ACT against liability to corporation tax.

      3. 240. Set-off of company’s surplus ACT against subsidiary’s liability to corporation tax.

      4. 241. Calculation of ACT where company receives franked investment income.

      5. 242. Set-off of losses etc. against surplus of franked investment income.

      6. 243. Set-off of loss brought forward, or terminal loss.

      7. 244. Further provisions relating to claims under section 242 or 243.

      8. 245. Calculation etc. of ACT on change of ownership of company.

      9. 246. Charge of ACT at previous rate until new rate fixed, and changes of rate.

    6. Chapter VI

      Miscellaneous and Supplemental

      1. Group income

        1. 247. Dividends etc. paid by one member of a group to another.

        2. 248. Provisions supplementary to section 247.

      2. Stock dividends

        1. 249. Stock dividends treated as income.

        2. 250. Returns.

        3. 251. Interpretation of sections 249 and 250.

      3. Supplemental

        1. 252. Rectification of excessive set-off etc. of ACT or tax credit.

        2. 253. Power to modify or replace section 234(5) to (9) and Schedule 13.

        3. 254. Interpretation of Part VI.

        4. 255. “Gross rate” and “gross amount” of distributions to include ACT.

  7. Part VII

    General Provisions Relating to Taxation of Income of Individuals

    1. Chapter I

      Personal Reliefs

      1. The reliefs

        1. 256. General.

        2. 257. Personal relief.

        3. 258. Widower’s or widow’s housekeeper.

        4. 259. Additional relief in respect of children.

        5. 260. Apportionment of relief under section 259.

        6. 261. Claims under sections 258 and 259 for year of marriage.

        7. 262. Widows' bereavement allowance.

        8. 263. Dependent relatives.

        9. 264. Claimant depending on services of a son or daughter.

        10. 265. Relief for blind persons.

        11. 266. Life assurance premiums.

        12. 267. Qualifying policies.

        13. 268. Early conversion or surrender of life policies.

        14. 269. Surrender etc. of policies after four years.

        15. 270. Provisions supplementary to sections 268 and 269.

        16. 271. Deemed surrender in cases of certain loans.

        17. 272. Collection of sums payable under sections 268 and 269.

        18. 273. Payments securing widows' and children’s annuities.

        19. 274. Limits on relief under sections 266 and 273.

      2. Supplemental

        1. 275. Meaning of “relative”.

        2. 276. Effect on relief of charges on income.

        3. 277. Partners.

        4. 278. Non-residents.

    2. Chapter II

      Taxation of Income of Spouses

      1. General rules

        1. 279. Aggregation of wife’s income with husband's.

        2. 280. Transfer of reliefs.

        3. 281. Tax repayments to wives.

        4. 282. Construction of references to married women living with their husbands.

      2. Separate assessments

        1. 283. Option for separate assessment.

        2. 284. Effect of separate assessment on personal reliefs.

        3. 285. Collection from wife of tax assessed on husband but attributable to her income.

        4. 286. Right of husband to disclaim liability for tax on deceased wife’s income.

      3. Separate taxation

        1. 287. Separate taxation of wife’s earnings.

        2. 288. Elections under section 287.

    3. Chapter III

      Relief for Investment in Corporate Trades: The Business Expansion Scheme

      1. 289. The relief.

      2. 290. Minimum and maximum subscriptions.

      3. 291. Individuals qualifying for relief.

      4. 292. Parallel trades.

      5. 293. Qualifying companies.

      6. 294. Companies with interests in land.

      7. 295. Valuation of interests in land for purposes of section 294(1)(b).

      8. 296. Section 294 disapplied where amounts raised total £50,000 or less.

      9. 297. Qualifying trades.

      10. 298. Provisions supplementary to sections 293 and 297.

      11. 299. Disposal of shares.

      12. 300. Value received from company.

      13. 301. Provisions supplementary to section 300.

      14. 302. Replacement capital.

      15. 303. Value received by persons other than claimants.

      16. 304. Husband and wife.

      17. 305. Reorganisation of share capital.

      18. 306. Claims.

      19. 307. Withdrawal of relief.

      20. 308. Application to subsidiaries.

      21. 309. Further provisions as to subsidiaries.

      22. 310. Information.

      23. 311. Nominees, bare trustees and approved investment funds.

      24. 312. Interpretation of Chapter III.

    4. Chapter IV

      Special Provisions

      1. 313. Taxation of consideration for certain restrictive undertakings.

      2. 314. Divers and diving supervisors.

      3. 315. Wounds and disability pensions.

      4. 316. Allowances, bounties and gratuities.

      5. 317. Victoria Cross and other awards.

      6. 318. Other pensions in respect of death due to war service etc.

      7. 319. Crown servants: foreign service allowance.

      8. 320. Commonwealth Agents-General and official agents etc.

      9. 321. Consuls and other official agents.

      10. 322. Consular officers and employees.

      11. 323. Visiting forces.

      12. 324. Designated international organisations.

      13. 325. Interest on deposits with National Savings Bank.

      14. 326. Interest etc. under contractual savings schemes.

      15. 327. Disabled persons' vehicle maintenance grant.

      16. 328. Funds in court.

      17. 329. Interest on damages for personal injuries.

      18. 330. Compensation for National–Socialist persecution.

      19. 331. Scholarship income.

      20. 332. Expenditure and houses of ministers of religion.

      21. 333. Personal equity plans.

    5. Chapter V

      Residence of Individuals

      1. 334. Commonwealth citizens and others temporarily abroad.

      2. 335. Residence of persons working abroad.

      3. 336. Temporary residents in the United Kingdom.

  8. Part VIII

    Taxation of Income and Chargeable Gains of Companies

    1. Taxation of income

      1. 337. Companies beginning or ceasing to carry on a trade.

      2. 338. Allowance of charges on income and capital.

      3. 339. Charges on income: donations to charity.

      4. 340. Charges on income: interest payable to non-residents.

      5. 341. Payments of interest etc. between related companies.

      6. 342. Tax on company in liquidation.

      7. 343. Company reconstructions without a change of ownership.

      8. 344. Company reconstructions: supplemental.

    2. Chargeable gains

      1. 345. Computation of chargeable gains.

      2. 346. Capital distribution of chargeable gains: recovery of tax from shareholder.

      3. 347. Tax on one member of group recoverable from another member.

  9. Part IX

    Annual Payments and Interest

    1. Annual payments

      1. 348. Payments out of profits or gains brought into charge to income tax: deduction of tax.

      2. 349. Payments not out of profits or gains brought into charge to income tax, and annual interest.

      3. 350. Charge to tax where payments made under section 349.

      4. 351. Small maintenance payments.

      5. 352. Certificates of deduction of tax.

    2. Relief for payments of interest (excluding MIRAS)

      1. 353. General provision.

      2. 354. Loans to buy land etc.

      3. 355. Matters excluded from section 354.

      4. 356. Job-related accommodation.

      5. 357. Limit on amount of loan eligible for relief by virtue of section 354.

      6. 358. Relief where borrower deceased.

      7. 359. Loan to buy machinery or plant.

      8. 360. Loan to buy interest in close company.

      9. 361. Loan to buy interest in co-operative or employee-controlled company.

      10. 362. Loan to buy into partnership.

      11. 363. Provisions supplementary to sections 360 to 362.

      12. 364. Loan to pay inheritance tax.

      13. 365. Loan to buy life annuity.

      14. 366. Information.

      15. 367. Provisions supplementary to sections 354 to 366.

      16. 368. Exclusion of double relief etc.

    3. Mortgage interest relief at source

      1. 369. Mortgage interest payable under deduction of tax.

      2. 370. Relevant loan interest.

      3. 371. Second loans.

      4. 372. Home improvement loans.

      5. 373. Loans in excess of the qualifying maximum, and joint borrowers.

      6. 374. Conditions for application of section 369.

      7. 375. Interest ceasing to be relevant loan interest etc.

      8. 376. Qualifying borrowers and qualifying lenders.

      9. 377. Variation of terms of repayment of certain loans.

      10. 378. Supplementary regulations.

      11. 379. Interpretation of sections 369 to 378.

  10. Part X

    Loss Relief and Group Relief

    1. Chapter I

      Loss Relief: Income Tax

      1. Trade etc. losses

        1. 380. Set-off against general income.

        2. 381. Further relief for individuals for losses in early years of trade.

        3. 382. Provisions supplementary to sections 380 and 381.

        4. 383. Extension of right of set-off to capital allowances.

        5. 384. Restrictions on right of set-off.

        6. 385. Carry-forward against subsequent profits.

        7. 386. Carry-forward where business transferred to a company.

        8. 387. Carry-forward as losses of amounts taxed under section 350.

        9. 388. Carry-back of terminal losses.

        10. 389. Supplementary provisions relating to carry-back of terminal losses.

        11. 390. Treatment of interest as a loss for purposes of carry-forward and carry-back.

        12. 391. Losses from trade etc. carried on abroad.

      2. Case VI losses

        1. 392. Case VI losses.

    2. Chapter II

      Loss Relief: Corporation Tax

      1. Trade etc. losses

        1. 393. Losses other than terminal losses.

        2. 394. Terminal losses.

        3. 395. Leasing contracts and company reconstructions.

      2. Case VI losses

        1. 396. Case VI losses.

    3. Chapter III

      Loss Relief: Miscellaneous Provisions

      1. 397. Restriction of relief in case of farming and market gardening.

      2. 398. Transactions in deposits with and without certificates or in debts.

      3. 399. Dealings in commodity futures etc: withdrawal of loss relief.

      4. 400. Write-off of government investment.

      5. 401. Relief for pre-trading expenditure.

    4. Chapter IV

      Group Relief

      1. 402. Surrender of relief between members of groups and consortia.

      2. 403. Losses etc. which may be surrendered by way of group relief.

      3. 404. Limitation of group relief in relation to certain dual resident companies.

      4. 405. Claims relating to losses etc. of members of both group and consortium.

      5. 406. Claims relating to losses etc. of consortium company or group member.

      6. 407. Relationship between group relief and other relief.

      7. 408. Corresponding accounting periods.

      8. 409. Companies joining or leaving group or consortium.

      9. 410. Arrangements for transfer of company to another group or consortium.

      10. 411. Exclusion of double allowances.

      11. 412. Claims and adjustments.

      12. 413. Interpretation of Chapter IV.

  11. Part XI

    Close Companies

    1. Chapter I

      Interpretative Provisions

      1. 414. Close companies.

      2. 415. Certain quoted companies not to be close companies.

      3. 416. Meaning of “associated company” and “control”.

      4. 417. Meaning of “participator”, “associate”, “director” and “loan creditor”.

      5. Additional matters to be treated as distributions

        1. 418. “Distribution” to include certain expenses of close companies.

    2. Chapter II

      Charges to Tax in Connection with Loans

      1. 419. Loans to participators etc.

      2. 420. Exceptions from section 419.

      3. 421. Taxation of borrower when loan under section 419 released etc.

      4. 422. Extension of section 419 to loans by companies controlled by close companies.

    3. Chapter III

      Apportionment of Undistributed Income etc.

      1. 423. Apportionment of certain income, deductions and interest.

      2. 424. Exclusions from section 423.

      3. 425. Manner of apportionment.

      4. 426. Charge to income tax where apportionment is to an individual.

      5. 427. Reduction of charge under section 426 in certain cases.

      6. 428. Increase of apportioned sum etc. by reference to ACT.

      7. 429. Payment and collection of income tax.

      8. 430. Consequences of apportionment: ACT.

  12. Part XII

    Special Classes of Companies and Businesses

    1. Chapter I

      Insurance Companies, Underwriters and Capital Redemption Business

      1. Insurance companies: general

        1. 431. Interpretative provisions relating to insurance companies.

        2. 432. Separation of different classes of business.

        3. 433. Profits reserved for policy holders and annuitants.

        4. 434. Franked investment income etc.

        5. 435. Taxation of gains reserved for policy holders and annuitants.

        6. 436. Annuity business and pension business: separate charge on profits.

        7. 437. General annuity business.

        8. 438. Pension business: exemption from tax.

        9. 439. Restricted government securities.

        10. 440. Identification or exchange of long term assets.

        11. 441. Foreign life assurance funds.

        12. 442. Overseas business of U.K. companies.

        13. 443. Life policies carrying rights not in money.

        14. 444. Life policies issued before 5th August 1965.

      2. Provisions applying only to overseas life insurance companies

        1. 445. Charge to tax on investment income.

        2. 446. Annuity business.

        3. 447. Set-off of income tax and tax credits against corporation tax.

        4. 448. Qualifying distributions and tax credits.

        5. 449. Double taxation agreements.

      3. Underwriters

        1. 450. Assessment, set-off of losses and reinsurance.

        2. 451. Regulations.

        3. 452. Special reserve funds.

        4. 453. Payments into premiums trust fund on account of losses.

        5. 454. Income tax consequences on payments into and out of special reserve fund.

        6. 455. Income tax consequences on death of underwriter.

        7. 456. Unearned income, variation of arrangements and cancellation of approval etc.

        8. 457. Interpretation of sections 450 to 456.

      4. Capital redemption business

        1. 458. Capital redemption business.

    2. Chapter II

      Friendly Societies, Trade Unions and Employers' Associations

      1. Unregistered friendly societies

        1. 459. Exemption from tax.

      2. Registered friendly societies

        1. 460. Exemption from tax in respect of life or endowment business.

        2. 461. Taxation in respect of other business.

        3. 462. Conditions for tax exempt business.

        4. 463. Life or endowment business: application of the Corporation Tax Acts.

        5. 464. Maximum benefits payable to members.

        6. 465. Old societies.

        7. 466. Interpretation of Chapter II.

      3. Trade unions and employers' associations

        1. 467. Exemption for trade unions and employers' associations.

    3. Chapter III

      Unit Trust Schemes, Dealers in Securities etc.

      1. Unit trust schemes

        1. 468. Authorised unit trusts.

        2. 469. Other unit trusts.

        3. 470. Transitional provisions relating to unit trusts.

      2. Dealers in securities, banks and insurance businesses

        1. 471. Exchange of securities in connection with conversion operations, nationalisation etc.

        2. 472. Distribution of securities issued in connection with nationalisation etc.

        3. 473. Conversion etc. of securities held as circulating capital.

        4. 474. Treatment of tax-free income.

        5. 475. Tax-free Treasury securities: exclusion of interest on borrowed money.

    4. Chapter IV

      Building Societies, Banks, Savings Banks, Industrial and Provident Societies and Others

      1. 476. Building societies: regulations for payment of tax.

      2. 477. Investments becoming or ceasing to be relevant building society investments.

      3. 478. Building societies: time for payment of tax.

      4. 479. Interest paid on deposits with banks etc.

      5. 480. Deposits becoming or ceasing to be composite rate deposits.

      6. 481. “Deposit-taker”, “deposit” and “relevant deposit”.

      7. 482. Supplementary provisions.

      8. 483. Determination of reduced rate for building societies and composite rate for banks etc.

      9. 484. Savings banks: exemption from tax.

      10. 485. Savings banks: supplemental.

      11. 486. Industrial and provident societies and co-operative associations.

      12. 487. Credit unions.

      13. 488. Co-operative housing associations.

      14. 489. Self-build societies.

      15. 490. Companies carrying on a mutual business or not carrying on a business.

      16. 491. Distribution of assets of body corporate carrying on mutual business.

    5. Chapter V

      Petroleum Extraction Activities

      1. 492. Treatment of oil extraction activities etc. for tax purposes.

      2. 493. Valuation of oil disposed of or appropriated in certain circumstances.

      3. 494. Charges on income.

      4. 495. Regional development grants.

      5. 496. Tariff receipts.

      6. 497. Restriction on setting ACT against income from oil extraction activities etc.

      7. 498. Limited right to carry back surrendered ACT.

      8. 499. Surrender of ACT where oil extraction company etc. owned by a consortium.

      9. 500. Deduction of PRT in computing income for corporation tax purposes.

      10. 501. Interest on repayment of PRT.

      11. 502. Interpretation of Chapter V.

    6. Chapter VI

      Miscellaneous Businesses and Bodies

      1. 503. Letting of furnished holiday accommodation treated as a trade.

      2. 504. Supplementary provisions.

      3. 505. Charities: general.

      4. 506. Qualifying expenditure and non-qualifying expenditure.

      5. 507. The National Heritage Memorial Fund, the Historic Buildings and Monuments Commission for England and the British Museum.

      6. 508. Scientific research organisations.

      7. 509. Reserves of marketing boards and certain other statutory bodies.

      8. 510. Agricultural societies.

      9. 511. The Electricity Council and Boards, the Northern Ireland Electricity Service and the Gas Council.

      10. 512. Atomic Energy Authority and National Radiological Protection Board.

      11. 513. British Airways Board and National Freight Corporation.

      12. 514. Funds for reducing the National Debt.

      13. 515. Signatories to Operating Agreement for INMARSAT.

      14. 516. Govenment securities held by non-resident central banks.

      15. 517. Issue departments of the Reserve Bank of India and the State Bank of Pakistan.

      16. 518. Harbour reorganisation schemes.

      17. 519. Local authorities.

  13. Part XIII

    Miscellaneous Special Provisions

    1. Chapter I

      Intellectual Property

      1. Patents and know-how

        1. 520. Allowances for expenditure on purchase of patent rights: post-31st March 1986 expenditure.

        2. 521. Provisions supplementary to section 520.

        3. 522. Allowances for expenditure on purchase of patent rights: pre-1st April 1986 expenditure.

        4. 523. Lapses of patent rights, sales etc.

        5. 524. Taxation of receipts from sale of patent rights.

        6. 525. Capital sums: death, winding up or partnership change.

        7. 526. Relief for expenses.

        8. 527. Spreading of royalties over several years.

        9. 528. Manner of making allowances and charges.

        10. 529. Patent income to be earned income in certain cases.

        11. 530. Disposal of know-how.

        12. 531. Provisions supplementary to section 530.

        13. 532. Application of the 1968 Act.

        14. 533. Interpretation of sections 520 to 532.

      2. Copyright and public lending right

        1. 534. Relief for copyright payments etc.

        2. 535. Relief where copyright sold after ten years or more.

        3. 536. Taxation of royalties where owner abroad.

        4. 537. Public lending right.

      3. Artists' receipts

        1. 538. Relief for painters, sculptors and other artists.

    2. Chapter II

      Life Policies, Life Annuities and Capital Redemption Policies

      1. 539. Introductory.

      2. 540. Life policies: chargeable events.

      3. 541. Life policies: computation of gain.

      4. 542. Life annuity contracts: chargeable events.

      5. 543. Life annuity contracts: computation of gain.

      6. 544. Second and subsequent assignment of life policies and contracts.

      7. 545. Capital redemption policies.

      8. 546. Calculation of certain amounts for purposes of sections 540, 542 and 545.

      9. 547. Method of charging gain to tax.

      10. 548. Deemed surrender of certain loans.

      11. 549. Certain deficiencies allowable as deductions.

      12. 550. Relief where gain charged at a higher rate.

      13. 551. Right of individual to recover tax from trustees.

      14. 552. Information: duty of insurers.

      15. 553. Non-resident policies and off-shore capital redemption policies.

      16. 554. Borrowings on life policies to be treated as income in certain cases.

    3. Chapter III

      Entertainers and Sportsmen

      1. 555. Payment of tax.

      2. 556. Activity treated as trade etc. and attribution of income.

      3. 557. Charge on profits or gains.

      4. 558. Supplementary provisions.

    4. Chapter IV

      Sub-Contractors in the Construction Industry

      1. 559. Deductions on account of tax etc. from payments to certain sub-contractors.

      2. 560. Persons who are sub-contractors or contractors for purposes of Chapter IV.

      3. 561. Exceptions from section 559.

      4. 562. Conditions to be satisfied by individuals.

      5. 563. Conditions to be satisfied by partners who are individuals.

      6. 564. Conditions to be satisfied by firms.

      7. 565. Conditions to be satisfied by companies.

      8. 566. General powers to make regulations under Chapter IV.

      9. 567. Meaning of “construction operations”.

    5. Chapter V

      Schemes for Rationalizing Industry

      1. 568. Deductions from profits of contributions paid under certified schemes.

      2. 569. Repayment of contributions.

      3. 570. Payments under certified schemes which are not repayments of contributions.

      4. 571. Cancellation of certificates.

      5. 572. Application to statutory redundancy schemes.

    6. Chapter VI

      Other Provisions

      1. Relief for losses on unquoted shares in trading companies

        1. 573. Relief for companies.

        2. 574. Relief for individuals.

        3. 575. Exclusion of relief under section 573 or 574 in certain cases.

        4. 576. Provisions supplementary to sections 573 to 575.

      2. Miscellaneous

        1. 577. Business entertaining expenses.

        2. 578. Housing grants.

        3. 579. Statutory redundancy payments.

        4. 580. Provisions supplementary to section 579.

        5. 581. Borrowing in foreign currency by local authorities and statutory corporations.

        6. 582. Funding bonds issued in respect of interest on certain debts.

        7. 583. Inter-American Development Bank.

        8. 584. Relief for unremittable overseas income.

        9. 585. Relief from tax on delayed remittances.

        10. 586. Disallowance of deductions for war risk premiums.

        11. 587. Disallowance of certain payments in respect of war injuries to employees.

        12. 588. Training courses for employees.

        13. 589. Qualifying courses of training etc.

  14. Part XIV

    Pension Schemes, Social Security Benefits, Life Annuities etc.

    1. Chapter I

      Retirement Benefit Schemes

      1. Approval of schemes

        1. 590. Conditions for approval of retirement benefit schemes.

        2. 591. Discretionary approval.

      2. Tax reliefs

        1. 592. Exempt approved schemes.

        2. 593. Relief by way of deductions from contributions.

        3. 594. Exempt statutory schemes.

      3. Charge to tax in certain cases

        1. 595. Charge to tax in respect of certain sums paid by employer etc.

        2. 596. Exceptions from section 595.

        3. 597. Charge to tax: pensions.

        4. 598. Charge to tax: repayment of employee’s contributions.

        5. 599. Charge to tax: commutation of entire pension in special circumstances.

        6. 600. Charge to tax: unauthorised payments to or for employees.

        7. 601. Charge to tax: payments to employers.

        8. 602. Regulations relating to pension fund surpluses.

        9. 603. Reduction of surpluses.

      4. Supplementary provisions

        1. 604. Application for approval of a scheme.

        2. 605. Information.

        3. 606. Responsibilities of administrator of scheme, and employer.

        4. 607. Pilots' benefit fund.

        5. 608. Superannuation funds approved before 6th April 1980.

        6. 609. Schemes approved before 23rd July 1987.

        7. 610. Amendments of schemes.

        8. 611. Definition of “retirement benefits scheme”.

        9. 612. Other interpretative provisions, and regulations for purposes of this Chapter.

    2. Chapter II

      Other Pension Funds and Social Security Benefits and Contributions

      1. 613. Parliamentary pension funds.

      2. 614. Exemptions and reliefs in respect of income from investments etc. of certain pension schemes.

      3. 615. Exemption from tax in respect of certain pensions.

      4. 616. Other overseas pensions.

      5. 617. Social security benefits and contributions.

    3. Chapter III

      Retirement Annuities

      1. 618. Termination of relief under this Chapter, and transitional provisions.

      2. 619. Exemption from tax in respect of qualifying premiums.

      3. 620. Qualifying premiums.

      4. 621. Other approved contracts.

      5. 622. Substituted retirement annuity contracts.

      6. 623. Relevant earnings.

      7. 624. Sponsored superannuation schemes and controlling directors.

      8. 625. Carry-forward of unused relief under section 619.

      9. 626. Modification of section 619 in relation to persons over 50.

      10. 627. Lloyd’s underwriters.

      11. 628. Partnership retirement annuities.

      12. 629. Annuity premiums of Ministers and other officers.

    4. Chapter IV

      Personal Pension Schemes

      1. Preliminary

        1. 630. Interpretation.

        2. 631. Approval of schemes.

      2. Restrictions on approval

        1. 632. Establishment of schemes.

        2. 633. Scope of benefits.

        3. 634. Annuity to member.

        4. 635. Lump sum to member.

        5. 636. Annuity after death of member.

        6. 637. Lump sum on death of member.

        7. 638. Other restrictions on approval.

      3. Tax reliefs

        1. 639. Member’s contributions.

        2. 640. Maximum amount of deductions.

        3. 641. Carry-back of contributions.

        4. 642. Carry-forward of relief.

        5. 643. Employer’s contributions and personal pension income etc.

        6. 644. Meaning of “relevant earnings”.

        7. 645. Earnings from pensionable employment.

        8. 646. Meaning of “net relevant earnings”.

      4. Charge to tax

        1. 647. Unauthorised payments.

        2. 648. Contributions under unapproved arrangements.

      5. Miscellaneous

        1. 649. Minimum contributions under Social Security Act 1986.

        2. 650. Withdrawal of approval.

        3. 651. Appeals.

        4. 652. Information about payments.

        5. 653. Information: penalties.

        6. 654. Remuneration of Ministers and other officers.

        7. 655. Transitional provisions.

    5. Chapter V

      Purchased Life Annuities

      1. 656. Purchased life annuities other than retirement annuities.

      2. 657. Purchased life annuities to which section 656 applies.

      3. 658. Supplementary.

    6. Chapter VI

      Miscellaneous

      1. 659. Financial futures and traded options.

  15. Part XV

    Settlements

    1. Chapter I

      Dispositions for Short Periods

      1. 660. Dispositions for period which cannot exceed six years.

      2. 661. Adjustments between disponor and trustees.

      3. 662. Application of Chapter I to dispositions by two or more disponors.

    2. Chapter II

      Settlements on Children

      1. 663. The general rule.

      2. 664. Accumulation settlements.

      3. 665. Meaning of “irrevocable”.

      4. 666. Interest paid by trustees.

      5. 667. Adjustments between disponor and trustees.

      6. 668. Application of Chapter II to settlements by two or more settlors.

      7. 669. Power to obtain information under Chapter II.

      8. 670. Interpretation of Chapter II.

    3. Chapter III

      Revocable Settlements etc.

      1. 671. Revocable settlements allowing release of obligation.

      2. 672. Revocable settlements allowing reversion of property.

      3. 673. Settlements where settlor retains an interest.

      4. 674. Settlements: discretionary power for benefit of settlor etc.

      5. 675. Provisions supplementary to sections 671 to 674.

      6. 676. Disallowance of deduction from total income of certain sums paid by settlor.

      7. 677. Sums paid to settlor otherwise than as income.

      8. 678. Capital sums paid by body connected with settlement.

      9. 679. Application of Chapter III to settlements by two or more settlors.

      10. 680. Power to obtain information for purposes of Chapter III.

      11. 681. Interpretation of Chapter III.

      12. 682. Ascertainment of undistributed income.

    4. Chapter IV

      Liability to Higher Rate and Additional Rate Tax

      1. Liability of settlors

        1. 683. Settlements made after 6th April 1965.

        2. 684. Settlements made before 7th April 1965 but after 9th April 1946.

        3. 685. Provisions supplementary to sections 683 and 684.

      2. Liability of trustees

        1. 686. Liability to additional rate tax of certain income of discretionary trusts.

        2. 687. Payments under discretionary trusts.

        3. 688. Schemes for employees and directors to acquire shares.

        4. 689. Recovery from trustees of discretionary trusts of higher rate tax due from beneficiaries.

    5. Chapter V

      Maintenance Funds for Historic Buildings

      1. 690. Schedule 4 directions.

      2. 691. Certain income not to be income of settlor etc.

      3. 692. Reimbursement of settlor.

      4. 693. Severance of settled property for certain purposes.

      5. 694. Trustees chargeable to income tax at 30 per cent. in certain cases.

  16. Part XVI

    Estates of Deceased Persons in Course of Administration

    1. 695. Limited interests in residue.

    2. 696. Absolute interests in residue.

    3. 697. Supplementary provisions as to absolute interests in residue.

    4. 698. Special provisions as to certain interests in residue.

    5. 699. Relief from higher rate tax for inheritance tax on accrued income.

    6. 700. Adjustments and information.

    7. 701. Interpretation.

    8. 702. Application to Scotland.

  17. Part XVII

    Tax Avoidance

    1. Chapter I

      Cancellation of Tax Advantages from Certain Transactions in Securities

      1. 703. Cancellation of tax advantage.

      2. 704. The prescribed circumstances.

      3. 705. Appeals against Board’s notices under section 703.

      4. 706. The tribunal.

      5. 707. Procedure for clearance in advance.

      6. 708. Power to obtain information.

      7. 709. Meaning of “tax advantage” and other expressions.

    2. Chapter II

      Transfers of Securities

      1. Transfers with or without accrued interest: introductory

        1. 710. Meaning of “securities”, “transfer” etc. for purposes of sections 711 to 728.

        2. 711. Meaning of “interest”, “transfers with or without accrued interest” etc.

        3. 712. Meaning of “settlement day” for purposes of sections 711 to 728.

      2. Transfers with or without accrued interest: charge to tax and reliefs

        1. 713. Deemed sums and reliefs.

        2. 714. Treatment of deemed sums and reliefs.

        3. 715. Exceptions from sections 713 and 714.

        4. 716. Transfer of unrealised interest.

        5. 717. Variable interest rate.

        6. 718. Interest in default.

        7. 719. Unrealised interest in default.

      3. Transfers with or without accrued interest: supplemental

        1. 720. Nominees, trustees etc.

        2. 721. Death.

        3. 722. Trading stock.

        4. 723. Foreign securities: delayed remittances.

        5. 724. Insurance companies.

        6. 725. Lloyd’s underwriters.

        7. 726. Building societies.

        8. 727. Stock lending.

        9. 728. Information.

      4. Other transfers of securities

        1. 729. Sale and repurchase of securities.

        2. 730. Transfers of income arising from securities.

      5. Purchase and sale of securities

        1. 731. Application and interpretation of sections 732 to 734.

        2. 732. Dealers in securities.

        3. 733. Persons entitled to exemptions.

        4. 734. Persons other than dealers in securities.

        5. 735. Meaning of “appropriate amount in respect of” interest.

      6. Miscellaneous provisions relating to securities

        1. 736. Company dealing in securities: distribution materially reducing value of holding.

        2. 737. Manufactured dividends: treatment of tax deducted.

      7. Supplemental

        1. 738. Power to amend sections 732, 735 and 737.

    3. Chapter III

      Transfer of Assets Abroad

      1. 739. Prevention of avoidance of income tax.

      2. 740. Liability of non-transferors.

      3. 741. Exemption from sections 739 and 740.

      4. 742. Interpretation of sections 739 to 741.

      5. 743. Supplemental provisions.

      6. 744. No duplication of charge.

      7. 745. Power to obtain information.

      8. 746. Persons resident in the Republic of Ireland.

    4. Chapter IV

      Controlled Foreign Companies

      1. 747. Imputation of chargeable profits and creditable tax of controlled foreign companies.

      2. 748. Limitations on direction-making power.

      3. 749. Residence and interest.

      4. 750. Territories with a lower level of taxation.

      5. 751. Accounting periods and creditable tax.

      6. 752. Apportionment of chargeable profits and creditable tax.

      7. 753. Notices and appeals.

      8. 754. Assessment, recovery and postponement of tax.

      9. 755. Information relating to controlled foreign companies.

      10. 756. Interpretation and construction of Chapter IV.

    5. Chapter V

      Offshore Funds

      1. Material interests in non-qualifying offshore funds

        1. 757. Disposal of material interests in non-qualifying offshore funds.

        2. 758. Offshore funds operating equalisation arrangements.

        3. 759. Material interests in offshore funds.

        4. 760. Non-qualifying offshore funds.

      2. Charge to tax of offshore income gains

        1. 761. Charge to income tax or corporation tax of offshore income gain.

        2. 762. Offshore income gains accruing to persons resident or domiciled abroad.

        3. 763. Deduction of offshore income gain in determining capital gain.

        4. 764. Offshore income gains of trustees.

    6. Chapter VI

      Miscellaneous

      1. Migration etc. of company

        1. 765. Migration etc. of companies.

        2. 766. Offences under section 765.

        3. 767. Interpretation and commencement of sections 765 and 766.

      2. Change in ownership of company

        1. 768. Change in ownership of company: disallowance of trading losses.

        2. 769. Rules for ascertaining change in ownership of company.

      3. Transactions between associated persons

        1. 770. Sales etc. at an undervalue or overvalue.

        2. 771. Transactions by petroleum companies.

        3. 772. Information for purposes of section 770, and appeals.

        4. 773. Interpretation of sections 770 and 771.

        5. 774. Transactions between dealing company and associated company.

      4. Other provisions

        1. 775. Sale by individual of income derived from his personal activities.

        2. 776. Transactions in land: taxation of capital gains.

        3. 777. Provisions supplementary to sections 775 and 776.

        4. 778. Power to obtain information.

        5. 779. Sale and lease-back: limitation on tax reliefs.

        6. 780. Sale and lease-back: taxation of consideration received.

        7. 781. Assets leased to traders and others.

        8. 782. Leased assets: special cases.

        9. 783. Leased assets: supplemental.

        10. 784. Leased assets subject to hire-purchase agreements.

        11. 785. Meaning of “asset”, “capital sum” and “lease” for purposes of sections 781 to 784.

        12. 786. Transactions associated with loans or credit.

        13. 787. Restriction of relief for payments of interest.

  18. Part XVIII

    Double Taxation Relief

    1. Chapter I

      The Principal Reliefs

      1. 788. Relief by agreement with other countries.

      2. 789. Arrangements made under old law.

      3. 790. Unilateral relief.

      4. 791. Power to make regulations for carrying out section 788.

    2. Chapter II

      Rules Governing Relief by Way of Credit

      1. General

        1. 792. Interpretation of credit code.

        2. 793. Reduction of United Kingdom taxes by amount of credit due.

        3. 794. Requirement as to residence.

        4. 795. Computation of income subject to foreign tax.

        5. 796. Limits on credit: income tax.

        6. 797. Limits on credit: corporation tax.

        7. 798. Interest on certain overseas loans.

      2. Tax underlying dividends

        1. 799. Computation of underlying tax.

        2. 800. Dividends paid between related companies but not covered by arrangements.

        3. 801. Dividends paid between related companies: relief for U.K. and third country taxes.

        4. 802. U.K. insurance companies trading overseas.

        5. 803. Underlying tax reflecting interest on loans.

      3. Miscellaneous rules

        1. 804. Relief against income tax in respect of income arising in years of commencement.

        2. 805. Elections against credit.

        3. 806. Time limit for claims etc.

    3. Chapter III

      Miscellaneous Provisions

      1. 807. Sale of securities with or without accrued interest.

      2. 808. Restriction on deduction of interest or dividends from trading income.

      3. 809. Relief in respect of discretionary trusts.

      4. 810. Postponement of capital allowances to secure double taxation relief.

      5. 811. Deduction for foreign tax where no credit allowable.

      6. 812. Withdrawal of right to tax credit of certain non-resident companies connected with unitary states.

      7. 813. Recovery of tax credits incorrectly paid.

      8. 814. Arrangements to avoid section 812.

      9. 815. Power to inspect documents.

      10. 816. Disclosure of information.

  19. Part XIX

    Supplemental

    1. Miscellaneous

      1. 817. Deductions not to be allowed in computing profits or gains.

      2. 818. Arrangements for payments of interest less tax or of fixed net amount.

      3. 819. Old references to standard rate tax.

      4. 820. Application of Income Tax Acts from year to year.

      5. 821. Under-deductions from payments made before passing of annual Act.

      6. 822. Over-deductions from interest on loan capital etc. made before passing of annual Act.

      7. 823. Adjustments of reliefs where given at different times.

      8. 824. Repayment supplements: individuals and others.

      9. 825. Repayment supplements: companies.

      10. 826. Interest on tax overpaid.

      11. 827. VAT penalties etc.

      12. 828. Orders and regulations made by the Treasury or the Board.

      13. 829. Application of Income Tax Acts to public departments and avoidance of exempting provisions.

      14. 830. Territorial sea and designated areas.

    2. Interpretation

      1. 831. Interpretation of this Act.

      2. 832. Interpretation of the Tax Acts.

      3. 833. Interpretation of Income Tax Acts.

      4. 834. Interpretation of the Corporation Tax Acts.

      5. 835. “Total income” in the Income Tax Acts.

      6. 836. Returns of total income.

      7. 837. “Annual value” of land.

      8. 838. Subsidiaries.

      9. 839. Connected persons.

      10. 840. Meaning of “control” in certain contexts.

      11. 841. Recognised stock exchange and recognised investment exchanges.

      12. 842. Investment trusts.

    3. Commencement, savings, repeals etc.

      1. 843. Commencement.

      2. 844. Savings, transitional provisions, consequential amendments and repeals.

      3. 845. Short title.

  20. Schedules:

    1. Schedule 1

      Restrictions on Schedule A deductions.

    2. Schedule 2

      Premiums etc. taxable under Schedules A and D: special relief for individuals.

    3. Schedule 3

      Machinery for assessment, charge and payment of income tax under Schedule C and, in certain cases, Schedule D.

      1. Part I

        Public revenue dividends etc. payable to the Bank of England or the Bank of Ireland or entrusted for payment to the Bank of England, the Bank of Ireland or the National Debt Commissioners.

      2. Part II

        Public revenue dividends payable by public offices and departments.

      3. Part III

        Other public revenue dividends, foreign dividends and proceeds of coupons.

      4. Part IV

        Interest payable out of the public revenue of the Republic of Ireland etc.

    4. Schedule 4

      Deep discount securities.

    5. Schedule 5

      Treatment of farm animals etc. for purposes of Case I of Schedule D.

    6. Schedule 6

      Taxation of directors and others in respect of cars.

      1. Part I

        Tables of flat rate cash equivalents.

      2. Part II

        Supplementary provisions.

    7. Schedule 7

      Taxation of benefit from loans obtained by reason of employment.

      1. Part I

        Meaning of “obtained by reason of employment”.

      2. Part II

        Calculation of cash equivalent of loan benefit.

      3. Part III

        Exceptions where interest eligible for relief.

    8. Schedule 8

      Profit-related pay schemes: conditions for registration.

    9. Schedule 9

      Approved share option schemes and profit sharing schemes.

      1. Part I

        General.

      2. Part II

        Requirements generally applicable.

      3. Part III

        Requirements applicable to savings-related share option schemes.

      4. Part IV

        Requirements applicable to other share option schemes.

      5. Part V

        Requirements applicable to profit sharing schemes.

      6. Part VI

        Material interest test.

    10. Schedule 10

      Further provisions relating to profit sharing schemes.

    11. Schedule 11

      Relief as respects tax on payments on retirement or removal from office or employment.

      1. Part I

        General provisions.

      2. Part II

        Payments in pursuance of pre-10th March 1981 obligations.

    12. Schedule 12

      Foreign earnings.

    13. Schedule 13

      Collection of advance corporation tax.

    14. Schedule 14

      Provisions ancillary to section 266.

      1. Part I

        Modification of section 266 in certain cases.

      2. Part II

        Supplementary provisions as to relief under section 266.

    15. Schedule 15

      Qualifying policies.

      1. Part I

        Qualifying conditions.

      2. Part II

        Certification of qualifying policies.

      3. Part III

        Policies issued by non-resident companies.

    16. Schedule 16

      Collection of income tax on company payments which are not distributions.

    17. Schedule 17

      Dual resident investing companies.

      1. Part I

        Division of accounting periods covering 1st April 1987.

      2. Part II

        Early payments of interest etc. and charges on income.

      3. Part III

        General.

    18. Schedule 18

      Group relief: equity holders and profits or assets available for distribution.

    19. Schedule 19

      Apportionment of income of close companies.

      1. Part I

        Determination of relevant income and distributions.

      2. Part II

        Procedure.

    20. Schedule 20

      Charities: qualifying investments and loans.

      1. Part I

        Qualifying investments.

      2. Part II

        Qualifying loans.

      3. Part III

        Attribution of excess non-qualifying expenditure to earlier chargeable periods.

    21. Schedule 21

      Tax relief in connection with schemes for rationalizing industry and other redundancy schemes.

      1. Part I

        Preliminary.

      2. Part II

        Relief in respect of certain payments.

      3. Part III

        Exclusion of relief in respect of contributions paid after relief has been given under Part II.

    22. Schedule 22

      Reduction of pension fund surpluses.

    23. Schedule 23

      Occupational pension schemes: schemes approved before 23rd July 1987.

    24. Schedule 24

      Assumptions for calculating chargeable profits, creditable tax and corresponding United Kingdom tax of foreign companies.

    25. Schedule 25

      Cases excluded from direction-making powers.

      1. Part I

        Acceptable distribution policy.

      2. Part II

        Exempt activities.

      3. Part III

        The public quotation condition.

      4. Part IV

        Reductions in United Kingdom tax and diversion of profits.

    26. Schedule 26

      Reliefs against liability for tax in respect of chargeable profits..

    27. Schedule 27

      Distributing funds.

      1. Part I

        The distribution test.

      2. Part II

        Modifications of conditions for certification in certain cases.

      3. Part III

        Certification procedure.

      4. Part IV

        Supplementary.

    28. Schedule 28

      Computation of offshore income gains.

      1. Part I

        Disposals of interests in non-qualifying funds.

      2. Part II

        Disposals involving an equalisation element.

    29. Schedule 29

      Consequential amendments.

    30. Schedule 30

      Transitional provisions and savings.

    31. Schedule 31

      Repeals.

An Act to consolidate certain of the enactments relating to income tax and corporation tax, including certain enactments relating also to capital gains tax; and to repeal as obsolete section 339(1) of the Income and Corporation Taxes Act 1970 and paragraphs 3 and 4 of Schedule 11 to the Finance Act 1980.

[9th February 1988]

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:—

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