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PART 15 continued CHAPTER 15 continued
(1) This section applies if a person makes a section 946 payment on a date which does not fall within an accounting period of the person.
(2) The person must deliver a return to an officer of Revenue and Customs within 14 days after the date on which the payment is made.
(3) The return must show the amount of—
(a) the payment, and
(b) the income tax payable by the person in respect of that payment (see section 951).
(1) Income tax in respect of a section 946 payment is due, from the person who makes the payment, on the date by which the return on which the payment must be included is required to be delivered.
(2) The income tax due is equal to the sum which the person is required to deduct from the payment under the applicable provision mentioned in section 946.
(3) The income tax is payable by the person without an officer of Revenue and Customs making any assessment.
(1) A person who makes a section 946 payment may make a set-off claim if conditions A and B are met at the end of a return period which falls within an accounting period of the person.
(2) Condition A is that in the return period the person has—
(a) made a section 946 payment, or
(b) received a payment on which the person has suffered income tax by deduction.
(3) Condition B is that at the end of the return period there is—
(a) a net amount of income tax suffered (see subsection (4)), and
(b) a net amount of income tax payable (see subsection (5)).
(4) There is a net amount of income tax suffered at the end of a return period if—
(a) the person has received any payments on which income tax has been suffered by deduction in the return period or in any previous return period which falls within the accounting period, and
(b) the amount of income tax so suffered by the person on those payments exceeds the amount of such income tax treated as repaid for the accounting period to date as a result of any previous set-off claim.
(5) There is a net amount of income tax payable at the end of a return period if—
(a) the person has made any section 946 payments in the return period or in any previous return period which falls within the accounting period, and
(b) the amount of income tax payable by the person in respect of those payments exceeds the amount of such income tax treated as paid for the accounting period to date as a result of any previous set-off claim.
(1) A set-off claim is a claim for the net amount of income tax suffered at the end of the return period to be set off against the net amount of income tax payable at the end of the return period.
(2) The effect of a claim is that, to the extent of the set-off—
(a) the income tax comprised in the net amount of income tax suffered is treated as repaid, and
(b) the income tax comprised in the net amount of income tax payable is treated as paid.
(3) Accordingly—
(a) any liability of the person making the set-off claim to pay any of the income tax treated as paid under subsection (2)(b) is discharged, and
(b) any of that income tax which has been paid is to be repaid to the person.
(4) A set-off claim must be made in a return under section 949 for the return period.
(5) A return may be made under that section for the purposes of making a set-off claim despite the fact that the person making the claim may not have made any section 946 payments in the return period.
(6) Income tax suffered which is taken into account in a set-off claim may not also be taken into account for the purposes of—
(a) section 7(2) of ICTA (income tax deducted from payments to UK resident company to be set off against corporation tax), or
(b) section 11(3) of that Act (income tax deducted from payments to non-UK resident company to be set off against corporation tax).
(7) Income tax suffered by a deposit-taker is to be taken into account in a set-off claim only if the payment on which the income tax is suffered is to be taken into account in calculating the deposit-taker’s liability to corporation tax.
“Deposit-taker” has the same meaning as in Chapter 2 (see section 853).
(1) If a set-off claim has been made no proceedings for collecting income tax which would have to be discharged if the claim were allowed may be brought until the claim is finally determined.
(2) Subsection (1) does not affect the date when the income tax is due.
(3) Any income tax underpaid as a result of this section must be paid when the claim is finally determined.
(4) In this section “proceedings” includes proceedings by way of distraint or attachment.
(1) This section applies if—
(a) a person has made a set-off claim, and
(b) before the claim was made, proceedings were brought for collecting income tax assessed, or interest on income tax assessed, under section 956 or 957.
(2) No effect is to be given to the set-off claim so as to affect or delay the collection or recovery of the income tax, or of interest on that income tax, until the claim is finally determined.
(3) Any income tax overpaid as a result of this section must be repaid when the claim is finally determined.
(4) In this section “proceedings” includes proceedings by way of distraint or attachment.
(1) This section applies if any income tax in respect of a section 946 payment which is included in a return under this Chapter has not been paid at or before the date mentioned in section 951.
(2) An officer of Revenue and Customs may make an assessment on the person who made the payment.
(3) Income tax may be assessed under this section whether or not it has been paid when the assessment is made.
(1) This section applies if an officer of Revenue and Customs thinks—
(a) that there is a section 946 payment which should have been included in a return under this Chapter and which has not been so included, or
(b) that a return under this Chapter is otherwise incorrect.
(2) An officer of Revenue and Customs may make an assessment, to the best of the officer’s judgement, on the person who made the return, or who should have made one.
(1) This section applies if a person who has made a section 946 payment becomes aware that—
(a) anything which should have been included in a return delivered by the person under this Chapter has not been so included,
(b) anything which should not have been included in a return delivered by the person under this Chapter has been so included, or
(c) any other error has occurred in a return delivered by the person under this Chapter.
(2) The person must deliver an amended return correcting the error to an officer of Revenue and Customs without delay.
(3) If the person delivers an amended return such assessments, adjustments, set-offs or payments or repayments of income tax as are necessary for achieving the objective mentioned in subsection (4) must be made.
(4) The objective is that the resulting liabilities to income tax (including interest on unpaid or overpaid income tax) of the person or any other person are the same as they would have been if a correct return had been delivered.
(1) This section deals with the application of the provisions of the Income Tax Acts about time limits for making assessments.
(2) So far as the provisions refer or relate to—
(a) the tax year for which an assessment is made, or
(b) the year to which an assessment relates,
they apply to assessments under this Chapter despite the fact that an assessment under this Chapter may relate to a return period which is not a tax year.
(3) Subsection (4) applies if an assessment under this Chapter relates to income tax due in respect of a payment required to be included in a return for a return period under section 949 (payments in an accounting period).
(4) In that case, for the purposes of the provisions mentioned in subsection (1), the assessment is treated as made for the tax year in which the return period ends.
(5) Subsection (6) applies if an assessment under this Chapter relates to income tax due in respect of a payment required to be included in a return under section 950 (payments otherwise than in an accounting period).
(6) In that case, for the purposes of the provisions mentioned in subsection (1), the assessment is treated as made for the tax year in which payment is made.
(1) Income tax assessed on a person under this Chapter is due on the date mentioned in section 951 and an appeal against the assessment does not affect the date when the income tax is due under that section.
(2) On the determination of an appeal against an assessment under this Chapter any income tax overpaid must be repaid.
(3) Any income tax assessable under any one or more of the provisions of this Chapter may be included in a single assessment if all the income tax is due on the same date.
Nothing in this Chapter affects any powers conferred by the Income Tax Acts for the recovery of income tax by means of an assessment or otherwise.
(1) The Commissioners for Her Majesty’s Revenue and Customs may by regulations modify, replace or supplement any of the provisions of this Chapter for the purpose of regulating the time and manner in which persons making section 946 payments—
(a) are to account for and pay income tax which is to be collected from them in respect of those payments, and
(b) are to be repaid income tax in respect of payments received by them.
(2) In particular, regulations under this section may, in relation to income tax for which a person is liable to account,—
(a) modify any provision of Parts 2 to 6 of TMA 1970, or
(b) apply any such provision with or without modifications.
(3) Regulations under this section may—
(a) make different provision for different kinds of payer,
(b) make different provision for different circumstances, and
(c) authorise the Commissioners for Her Majesty’s Revenue and Customs, if they think there are special circumstances justifying it, to make special arrangements in relation to—
(i) income tax for which a person is liable to account, or
(ii) the repayment of income tax suffered by a person.
(4) Regulations under this section may contain incidental, supplemental, consequential and transitional provision and savings.
(5) The Commissioners for Her Majesty’s Revenue and Customs must not make any regulations under this section unless a draft of them has been laid before and approved by a resolution of the House of Commons.
(6) References in this Act and in any other enactment to any of the provisions of this Chapter are to be read as references to those provisions as modified, replaced or supplemented by provision made by regulations under this section.
(1) This section makes provision for the collection of income tax in respect of—
(a) a payment from which a person other than a UK resident company is required to deduct a sum representing income tax under—
(i) section 874(2) (certain payments of yearly interest),
(ii) section 889(4) (payments in respect of building society securities),
(iii) section 892(2) (certain payments of UK public revenue dividends),
(iv) section 901(4) (annual payments made by persons other than individuals),
(v) section 903(7) (patent royalties),
(vi) section 906(5) (royalty payments etc where the owner lives abroad),
(vii) section 910(2) (proceeds of a sale of patent rights paid to non-UK residents),
(viii) section 928(2) (chargeable payments connected with exempt distributions), or
(ix) section 944(2) (directions for deduction from payments to non-UK residents), and
(b) a payment from which a person other than a company is required to deduct a sum representing income tax under section 919(2) (manufactured interest for UK securities: payments by UK residents etc).
(2) The person required to deduct the sum must deliver to an officer of Revenue and Customs an account of the payment without delay.
(3) An officer of Revenue and Customs may make an assessment on that person for income tax equal to the sum required to be deducted.
(4) The provisions of the Income Tax Acts relating to—
(a) persons chargeable to income tax,
(b) income tax assessments, and
(c) the collection and recovery of income tax,
apply (unless excluded expressly or by implication) to the assessment, collection and recovery of income tax which is assessable on persons under this section.
(1) This section applies if—
(a) a person makes a payment from which the person is required to deduct a sum representing income tax, and
(b) income tax equal to the sum required to be deducted is, under section 900(3), 901(3) or 903(5) or (6), to be collected through the person’s self-assessment return.
(2) This section also applies if, in accordance with section 942, income tax is to be collected through a trustee’s self-assessment return.
(3) The income tax is to be treated for the purposes of TMA 1970 as if it were income tax charged on the person or trustee.
(4) Accordingly, the income tax must be taken into account for the purposes of—
(a) the person’s or trustee’s return under section 8 or 8A of TMA 1970, and
(b) the person’s or trustee’s assessment to income tax under section 9 of that Act,
(in addition to the person or trustee’s income tax liability calculated in accordance with Chapter 3 of Part 2 (calculation of income tax liability)).
(5) But the relevant amount under section 59A of TMA 1970 (payments on account of income tax) is to be calculated as if the income tax were not taken into account for the purposes of the assessment to income tax under section 9 of TMA 1970.
(1) Sections 966 to 970 make provision for the payment of sums representing income tax to the Commissioners for Her Majesty’s Revenue and Customs where certain payments or transfers are made in connection with activities performed in the United Kingdom by non-UK resident entertainers, sportsmen and sportswomen.
(2) See also—
section 556 of ICTA (entertainers and sportsmen) which makes provision in relation to such payments or transfers for the purposes of corporation tax,
Chapter 8 of Part 2 of ITEPA 2003 (application of provisions to workers under arrangements made by intermediaries), in particular section 48(2) (exclusions from the scope of the Chapter), and
sections 13 and 14 of ITTOIA 2005 (trades and trade profits: visiting performers).
(1) This section applies if—
(a) an entertainer, sportsman or sportswoman of a prescribed description (“a performer”) who is non-UK resident for a tax year performs a relevant activity in the United Kingdom in the tax year, and
(b) a payment or transfer connected with the relevant activity is made.
(2) It does not matter—
(a) whether the payment or transfer is made to the performer or anyone else, or
(b) when the payment or transfer is made.
(3) If a payment within subsection (1)(b) is made the person who makes the payment must, on making it, deduct from it a sum representing income tax and account to the Commissioners for Her Majesty’s Revenue and Customs for the sum.
(4) If a transfer within subsection (1)(b) is made the person who makes the transfer must account to the Commissioners for Her Majesty’s Revenue and Customs for a sum representing income tax.
(5) See section 967 as to the calculation of the sums representing income tax mentioned in subsections (3) and (4).
(6) This section does not apply to payments or transfers of such a kind as may be prescribed.
(7) In this section—
(a) “relevant activity” means an activity of a prescribed description, and
(b) a payment or transfer is connected with a relevant activity if it has a connection of a prescribed kind with that activity.
(1) The sums representing income tax mentioned in section 966(3) and (4) are to be calculated in accordance with prescribed rules.
(2) But the sums must not exceed the relevant proportion of the payment concerned or of the value of what is transferred.
“Relevant proportion” means a proportion equal to the basic rate of income tax for the tax year in which the payment or transfer is made.
(3) Regulations made by the Treasury may provide, in relation to a transfer to which section 966 applies, that for the purposes of the Tax Acts the value of what is transferred is to be calculated in accordance with prescribed rules.
(4) In particular, rules may include provision—
(a) for the calculation of an amount representing the actual value of what is transferred,
(b) for that amount to be treated as a net amount corresponding to a gross amount from which income tax at the basic rate has been deducted, and
(c) for the gross amount to be taken to be the value of what is transferred.
(1) This section applies if, in accordance with section 966(3) or (4), a person pays a sum to the Commissioners for Her Majesty’s Revenue and Customs.
(2) The sum is treated as paid on account of a liability of another person to income tax or corporation tax.
(3) The liability and the other person are to be found in accordance with prescribed rules.
(4) If the sum exceeds the liability concerned, the Commissioners must pay so much of the sum as is appropriate to the other person.
(5) If no liability is found, the Commissioners must pay the sum to the recipient of the relevant payment or transfer.
(6) The relevant payment or transfer is the payment or transfer—
(a) to which section 966 applies, and
(b) which gave rise to the payment of the sum.
(7) A reference to a sum in this section does not include anything representing interest.
(1) The Treasury may by regulations—
(a) make provision enabling the Commissioners for Her Majesty’s Revenue and Customs to serve notices requiring persons who make payments or transfers to which section 966 applies to give them prescribed information in respect of such payments or transfers,
(b) make provision requiring persons who make payments or transfers to which section 966 applies to make, at prescribed times and for prescribed periods, returns to the Commissioners containing prescribed information about payments or transfers and the income tax for which those persons are accountable in respect of them,
(c) make provision for the collection and recovery of such income tax, for assessments and claims to be made in respect of it, and for the payment of interest on it, and
(d) adapt, or modify the effect of, any enactment relating to income tax for the purpose of making any provision mentioned in paragraphs (a) to (c).
(2) The Treasury may also by regulations make provision generally for giving effect to this section and sections 966 to 968 (including different provision for different cases or descriptions of case).
(1) For the purposes of the Tax Acts a payment to which section 966 applies is treated as if it were not reduced by the deduction of a sum representing income tax under that section.
(2) An officer of Revenue and Customs may disclose, to any person who appears to the officer to have an interest in the matter, information relevant to determining whether section 966 applies to a payment or transfer.
(3) An officer is not precluded from doing so by any obligation as to secrecy imposed by statute or otherwise.
(4) In this section and sections 966 to 969—
(a) references to a payment include references to a payment by way of loan of money, and
(b) references to a transfer do not include references to a transfer of money but, subject to that, include references to—
(i) a temporary transfer (as by way of loan), and
(ii) a transfer of a right (whether or not a right to receive money).
(5) In sections 966 to 969 “prescribed” means prescribed by regulations made by the Treasury.
(1) The Commissioners for Her Majesty’s Revenue and Customs may by regulations make provision for—
(a) the collection, from non-resident landlord representatives of a prescribed description, of prescribed amounts of income tax in respect of non-resident landlord income, and
(b) the assessment and recovery of the income tax on or from such persons.
(2) “Non-resident landlord income” means income of a person whose usual place of abode is outside the United Kingdom (“the non-resident”) and which is or may become chargeable—
(a) under Schedule A, or
(b) as the profits of a UK property business under Chapter 3 of Part 3 of ITTOIA 2005.
(3) “Non-resident landlord representative” means—
(a) a person by whom any sums are payable to the non-resident which are to be treated as receipts of a Schedule A business, or a UK property business, carried on by the non-resident, or
(b) a person who acts on behalf of the non-resident in connection with the management or administration of any such business.
(4) A non-resident landlord representative who must pay prescribed amounts of income tax to the Commissioners for Her Majesty’s Revenue and Customs under regulations under this section is entitled—
(a) to be indemnified by the non-resident for all such payments, and
(b) to retain out of any sums otherwise due from the representative to the non-resident, or received by the representative on behalf of the non-resident, sums representing income tax sufficient for meeting any liabilities under the regulations to make such payments.
(5) Subsection (4)(b) applies whether the liability is one which the representative has discharged or to which the representative is subject.
(1) Regulations under section 971 may, in particular, include all or any of the following provisions—
(a) provision for the amount of any income tax in respect of non-resident landlord income, which is to be paid to the Commissioners for Her Majesty’s Revenue and Customs, to be calculated by reference to prescribed factors,
(b) provision for the determination in accordance with the regulations of the period for which, the circumstances in which and the times at which any payments are to be made to the Commissioners,
(c) provision for requiring the payment of interest on amounts which are not paid to the Commissioners at the times required under the regulations,
(d) provision as to the certificates to be given in prescribed circumstances to the non-resident by a non-resident landlord representative, and as to the particulars to be included in any such certificate,
(e) provision for the making of repayments of income tax to the non-resident and for such repayments to be made in prescribed cases to non-resident landlord representatives,
(f) provision for the payment of interest by the Commissioners on sums repaid under the regulations,
(g) provision for the rights and obligations arising under the regulations to depend on the giving of such notices and the making of such claims and determinations as may be prescribed,
(h) provision for the making and determination of applications for requirements of the regulations not to apply in certain cases, and for the variation or revocation, in prescribed cases, of the determinations made on such applications,
(i) provision for appeals with respect to questions arising under the regulations,
(j) provision requiring non-resident landlord representatives within section 971(3)(b) who are of a prescribed description to register with the Commissioners,
(k) provision requiring persons registered with the Commissioners and other non-resident landlord representatives of a prescribed description to make returns and supply prescribed information to the Commissioners and to make available prescribed books, documents and other records for inspection on behalf of the Commissioners,
(l) provision for the partnership, as such, to be treated as the non-resident landlord representative if a liability to make a payment under the regulations arises from amounts payable or things done in the course of a business carried on by persons in partnership, and
(m) provision which, in relation to payments of income tax to be made by virtue of section 971 or to sums retained in respect of such payments, applies (with or without modifications) any enactment or subordinate legislation having effect apart from section 971 with respect to cases in which tax is or is treated as deducted from any income.
(2) Interest required to be paid by regulations under section 971 is to be paid without deduction of a sum representing income tax and is not to be taken into account in calculating any income, profits or losses for any tax purposes.
(3) Regulations under section 971 may—
(a) make different provision for different cases, and
(b) contain incidental, supplemental, consequential and transitional provision and savings.
(4) Provision made by virtue of subsection (3)(b) may, in particular, in connection with any other provision made by regulations under section 971, modify the operation in any case of section 59A of TMA 1970 (payments on account of income tax).
(5) In this section and section 971 “prescribed” means prescribed by, or determined by an officer of Revenue and Customs in accordance with, regulations made by the Commissioners for Her Majesty’s Revenue and Customs under section 971.
(6) See section 121(2)(c) of FA 2006 which prevents certain distributions of Real Estate Investment Trusts being non-resident landlord income for the purposes of regulations under section 971.
Income Tax Act 2007