Two of the Lords Commissioners of Her Majesty's Treasury

2005


EXPLANATORY NOTE

(This note is not part of the Regulations)


These Regulations amend primary tax legislation to provide for civil partnerships.

The Civil Partnership Act 2004 (c. 33) comes into force on 5 December 2005. The Act enables same-sex couples to obtain legal recognition of their relationship by forming a civil partnership. A civil partnership may be formed by persons registering as civil partners of each other. In addition persons may be treated as having formed a civil partnership as a result of having registered an overseas relationship which is recognised by the Civil Partnership Act.

These Regulations provide the same or similar tax treatment for persons who are, have been or may in the future be civil partners of each other as is given to persons who are, have been or may in the future be married to each other. These Regulations also provide the same or similar tax treatment for the formation of a civil partnership as is given to marriage. For some legislation the tax consequences are determined in part by whether persons are not married to each other but are living together as husband or wife, whether persons are not married to each other or whether a person is not married. These Regulations provide that the same or similar tax consequences apply where persons are not civil partners of each other but are living together as if they were, where persons are not civil partners of each other or where a person is not a civil partner, as the case may be.

These Regulations also make provision for the purpose of removing inequalities of treatment based on gender and, in the case of a parent, marital status. The provisions affected are section 11 (dispositions for maintenance of family) of the Inheritance Tax Act 1984 (c.51) and sections 257A, 257BA, 257BB (married couple's allowance) and 347B (qualifying maintenance payments) of the Income and Corporation Taxes Act 1988 (c. 1). These Regulations also make more generous provision in relation to the children that can be provided for under a marriage settlement. The provisions affected are section 22 (gifts in consideration of marriage) of the Inheritance Tax Act, sections 77 (charge on settlor with interest in settlement) and 169F (meaning of "interest in a settlement") of, and paragraph 2 of Schedule 5 (attribution of gains to settlors with interest in non-resident or dual resident settlements) to, the Taxation of Chargeable Gains Act 1992 (c. 12), and section 625 of the Income Tax (Trading and Other Income) Act 2005 (c. 5).

Notes:

 [1] 2005 (c. 7).back

[2] 1984 (c. 43). Schedule 14 was repealed by section 290 of, and Schedule 12 to, the Taxation of Chargeable Gains Act 1992 (c.12) subject to a savings provision in paragraph 18(b) of Schedule 11 to that Act which gives continuing effect to Schedule 14 in relation to amounts of tax postponed under that Schedule.back

[3] 1984 (c. 51).back

[4] Section 29A was inserted by section 172 of the Finance Act 1989 (c. 26).back

[5] 2004 (c. 33).back

[6] Paragraph 15A was inserted by section 59 of, and paragraphs 3 and 6 of Schedule 9 to, the Finance Act 1987 (c. 16).back

[7] 1985 (c. 54).back

[8] 1986 (c. 41).back

[9] Subsection (5A) was inserted by section 185 of the Finance Act 2003 (c. 14).back

[10] Section 102A was inserted by section 104 of the Finance Act 1999 (c. 16).back

[11] 1988 (c. 1).back

[12] Section 13A was inserted by section 105 of the Finance Act 1989 (c. 26).back

[13] Section 257C was inserted by section 33 of the Finance Act 1988.back

[14] Section 266A was inserted by section 722 of, and paragraph 36 of Schedule 6 to, the Income Tax (Earnings and Pensions) Act 2003 (c. 1). It will be amended by section 281(1) of, and paragraph 10 of Schedule 35 to, the Finance Act 2004 (c. 12) with effect from 6th April 2006 9see regulation [123] below.back

[15] 1988 (c. 39).back

[16] Sections 282A and 282B were inserted by section 34 of the Finance Act 1988.back

[17] Subsection 4A was inserted by section 91 of the Finance Act 2004.back

[18] Section 347B was inserted by the Finance Act 1988.back

[19] Subsection (1A) was inserted by section 36 of the Finance Act 1999 (c. 16).back

[20] Subsection (3A) was inserted by section 47 of the Finance Act 1989 (c. 26).back

[21] Section 360A was inserted by section 48(2) of the Finance Act 1989.back

[22] Section 660C was inserted by section 74 of, and paragraph 1 of Schedule 17 to, the Finance Act 1995 (c. 4). Subsection (3) was amended by section 882 of, and paragraph 272 of Schedule 1 to, the Income Tax (Trading and Other Income) Act 2005 (c. 5).back

[23] Subsection (1)(b) was amended by section 882 of, and paragraph 278 of Schedule 1 to, the Income Tax (Trading and Other Income) Act 2005.back

[24] Subsection (3) was amended by section 882 of, and paragraph 283 of Schedule 1 to, the Income Tax (Trading and Other Income) Act 2005.back

[25] Schedule 15B was inserted by section 332A of the Income and Corporation Taxes Act 1988. Section 332A was inserted by section 71 of the Finance Act 1995 (c. 4).back

[26] Schedule 28AA was inserted by section 108 of, and Schedule 16 to, the Finance Act 1998 (c. 36).back

[27] 1990 (c. 29).back

[28] Subsection (9A) was inserted by section 39 of the Finance Act 2000 (c. 17).back

[29] 1992 (c. 12).back

[30] Section 3A was inserted by section 159 of, and paragraph 1 of Schedule 28 to, the Finance Act 2003 (c. 14).back

[31] Section 150A was inserted by section 137 of, and paragraph 30 of Schedule 15 to, the Finance Act 1994 (c.9).back

[32] Section 162A was inserted by section 49 of the Finance Act 2002 (c. 23).back

[33] Sections 169D, 169F and 169G were inserted by section 116 of, and paragraphs 4 and 10(4) of Schedule 21 to, the Finance Act 2004.back

[34] Subsections 8A and 8C were inserted by section 38(8) of, and paragraph 17 of Schedule 4 to, the Finance Act 1999 (c. 16).back

[35] Schedule A1 is introduced by section 2A(7) of the Taxation of Chargeable Gains Act 1992. Section 2A and Schedule A1 were inserted by section 121 of the Finance Act 1998 (c. 36).back

[36] Schedule 4A is introduced by section 76A of the Taxation of Chargeable Gains Act 1992. Section 76A and Schedule 4A were inserted by section 91 of the Finance Act 2000 (c. 17).back

[37] Paragraph 2A was inserted by section 131 of, and paragraph 2 of Schedule 22 to, the Finance Act 1998 (c. 36).back

[38] Schedule 5B is introduced by section 150C of the Taxation of Chargeable Gains Act 1992. Section 150C and Schedule 5B were inserted by section 67 of, and paragraph 4 of Schedule 13 to, the Finance Act 1995 (c.4).back

[39] Schedule 5C is introduced by section 151A(3) of the Taxation of Chargeable Gains Act 1992. Section 151A and Schedule 5C were inserted by section 72 of the Finance Act 1995 (c. 4). By virtue of section 94(3) of, and paragraphs 5 and 7 of Schedule 19 to, the Finance Act 2004 (c. 12) Schedule 5C ceases to have effect in relation to shares issued on or after 6th April 2004 which are shares by reference to which an individual is given relief under Part 1 of Schedule 15B to the Income and Corporation Taxes Act 1988 (c. 1) but it does continue to have effect for the purposes of section 151B(8)(b)(ii) of the Taxation of Chargeable Gains Act 1992.back

[40] Schedule 7C is introduced by section 236A of the Taxation of Chargeable Gains Act 1992. Section 236A and Schedule 7C were inserted by section 48 of the Finance Act 2000 (c. 17).back

[41] 1996 (c. 8).back

[42] 2003 (c. 1).back

[43] Section 318C was inserted by section 78 of, and paragraph 1 of Schedule 13 to, the Finance Act 2004.back

[44] Section 325A was inserted by section 882 of, and paragraph 592 of Schedule 1 to, the Income Tax (Trading and Other Income) Act 2005 (c. 5).back

[45] Section 644A was inserted by section 882 of, and paragraph 610 of Schedule 1 to, the Income Tax (Trading and Other Income) Act 2005.back

[46] The definition of "couple" was inserted into section 137(1) of SSCBA 1992 (c. 4) by clause 244 of, and paragraph 42(3) of Schedule [23] to, the Civil Partnership Act 2005 (c. ). This definition was also inserted into section 133(1) of SSCB(NI)A 1992 (c. 7) by clause 244 of, and paragraph 92(3) of Schedule [23] to, the Civil Partnership Act.back

[47] The definition of "couple" was inserted into section 35(1) of JSA 1995 (c. 18) by clause 244 of, and paragraph 112(2) of Schedule [23] to, the Civil Partnership Act 2005.back

[48] The definition of "couple" was inserted into Article 2(2) of JS(NI)O 1995 (S.I. 1995/2705) by clause 244 of, and paragraph 117(2) of Schedule [23] to, the Civil Partnership Act 2005.back

[49] Sub-paragraph (1A) was inserted by section 101 of, and paragraph 26 of Schedule 10 to, the Finance Act 2005.back

[50] Under section 284(1) of the Finance Act 2004 these provisions do not come into force until 6th April 2006.back

[51] 2005 (c. 5).back


ISBN 0 11 073529 3


 

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Prepared 2 November 2005