Office of Public Sector Information
SCHEDULE 9 continued
16 (1) Section 88 of FA 1989 is amended as follows.
(2) In subsection (3A) (meaning of “income and gains of the company’s life assurance business” in subsection (3)) after paragraph (a) insert—
“(aa) receipts of the company chargeable under Case VI of Schedule D by virtue of section 85(1) above,
(ab) income of the company treated as referable to basic life assurance and general annuity business by section 441B(2) of the Taxes Act 1988 (treatment of UK land),
(ac) amounts treated as accruing to the company and charged to tax under Case VI of Schedule D by virtue of section 442A of that Act (taxation of investment return where risk reinsured), and”.
(3) The amendment made by this paragraph has effect in relation to periods of account beginning on or after 1st January 2005.
17 (1) Section 156 of FA 2003 is amended as follows.
(2) For subsection (4) (regulations amending certain provisions relating to overseas life insurance companies may be made with effect from 1st January 2003) substitute—
“(4) Regulations under this section may be made so as to have effect in relation to accounting periods or periods of account (whenever beginning) which end on or after the day on which the regulations come into force.”.
18 (1) Schedule 35 to FA 2004 is amended as follows.
(2) Paragraph 20 (life assurance: meaning of “pension business”) is amended as follows.
(3) In the section 431B of ICTA substituted by that paragraph, in subsection (2)—
(a) after “registered pension scheme” (where first occurring) insert “by virtue of the withdrawal of registration of the pension scheme under section 157 of the Finance Act 2004”;
(b) after “in which the pension scheme” insert “so”.
(4) In that section, insert at the end—
“(3) Where—
(a) immediately before 6th April 2006 an annuity contract falls within any of the descriptions of contracts specified in subsection (2) of this section as it had effect immediately before that date, but
(b) on or after that date the contract does not fall to be regarded for the purposes of this section as having been entered into for the purposes of a registered pension scheme,
the contract is to be treated for the purposes of this section as having been entered into for such purposes.”.
(5) Paragraph 22 (friendly societies: meaning of “pension business”) is amended as follows.
(6) In sub-paragraph (3), in the subsection (2B) of section 466 of ICTA inserted by that sub-paragraph—
(a) after “registered pension scheme” (where first occurring) insert “by virtue of the withdrawal of registration of the pension scheme under section 157 of the Finance Act 2004”;
(b) after “in which the pension scheme” insert “so”.
(7) The preceding provisions of this paragraph come into force on 6th April 2006.
19 (1) In section 432B of ICTA (apportionment of receipts brought into account) in subsection (1), for “class” substitute “category”.
(2) In section 444A of ICTA (transfers of business) in subsection (3), for “class” substitute “category”.
(3) In Schedule 12 to FA 1997 (leasing arrangements: finance leases and loans) in paragraph 19 (companies carrying on life assurance business) in sub-paragraph (2), for “class” substitute “category”.
(4) In Schedule 29 to FA 2002 (gains and losses of a company from intangible fixed assets) in paragraph 138 (interpretation provisions relating to insurance companies) in sub-paragraph (3), for “class” substitute “category”.
(5) The amendments made by this paragraph have effect in relation to periods of account beginning on or after 1st January 2005.
20 (1) Section 12 of ICTA (corporation tax: basis of, and periods for, assessment) is amended as follows.
(2) In subsection (7A), after “(7ZA) above” insert “and subject to subsection (7C) below”.
(3) After subsection (7B) insert—
“(7C) Where subsection (1) of section 444AA applies in the case of an insurance business transfer scheme—
(a) an accounting period of the transferor shall end for purposes of corporation tax—
(i) with the end of the period covered by the periodical return deemed by virtue of subsection (2) of that section, or
(ii) where the last period covered by an actual periodical return of the transferor ends immediately before the transfer, with the end of that period,
(so that an accounting period will end immediately before the transfer), and
(b) an accounting period of the transferor shall end for purposes of corporation tax with the end of the period covered by the periodical return deemed by virtue of subsection (3) of that section (so that the time of the transfer shall be an accounting period of the transferor);
and for this purpose, expressions used in this subsection and in that section have the same meaning in this subsection as in that section.”.
(4) In section 444AB of ICTA (transfers of business: charge on transferor retaining assets) in subsection (3), for “ending with the day of the transfer” substitute “ending immediately before the transfer”.
(5) In section 444ABA of ICTA (subsequent charge in certain cases within section 444AB of ICTA) in subsection (3), for “ending with the day of the transfer” substitute “ending immediately before the transfer”.
(6) In section 213 of TCGA 1992 (spreading of gains and losses under section 212 of TCGA 1992) at the end insert—
“(10) If the transfer is one to which section 444AA(1) of the Taxes Act applies, the references in this section to the accounting period of the transferor ending with the day of the transfer are references to the accounting period ending immediately before the transfer.”.
(7) The amendments made by sub-paragraphs (2) to (5) have effect in relation to insurance business transfer schemes taking place on or after 16th March 2005.
(8) The amendment made by sub-paragraph (6) has effect where the accounting period for which the net amount represents an excess of losses over gains is an accounting period beginning on or after 1st January 2003.
Finance (No. 2) Act 2005