Finance Act 1963

CHAPTER IV Miscellaneous

43 Co-operative housing associations

(1) Where a housing association makes a claim in that behalf for any year or part of a year of assessment during which the association was approved for the purposes of this section.—

(a) rent to which the association was entitled from its members for the year or part shall be disregarded for income tax purposes, and

(b) any yearly interest payable by the association for the year or part shall be treated for tax purposes as payable not by the association but severally by the members of the association who during the year or part were tenants of property of the association, in the proportion which the rents payable by those members for the year or part bear to the aggregate of the rents to which the association was entitled for the year or part from the properties to which the interest relates.

(2) Where the property, or any of the properties, to which any such interest as aforesaid relates is for any period not subject to a tenancy, paragraph (b) of the foregoing subsection shall not apply in relation to so much of the interest as is attributable to the property not subject to a tenancy, but for the purposes of that paragraph as it applies in relation to a tenant of any other property to which the interest relates the association shall be deemed to have received, in respect of the property not subject to a tenancy, rent at the rate payable therefor when it was last let by the association.

(3) In computing the profits or gains of the association no payments shall be deductible under paragraphs 2 to 4 of Schedule 4 to this Act in so far as attributable to a period as respects which a claim under subsection (1) of this section had effect.

(4) Where a claim under subsection (1) of this section has effect.—

(a) any amount in respect of tax for which a member of the association is liable to account by virtue of the claim shall, if not otherwise recovered, be recoverable from the association, but the association shall be entitled to have recouped to it by the member any amount recovered from it under this paragraph ;

(b) any adjustment of the liability to tax of a member or of the association which is required in consequence of the claim may be made by an additional assessment or by repayment or otherwise, as the case may require.

(5) References in this section to the approval of an association shall be construed as references to approval—

(a) by the Minister of Housing and Local Government, in the case of an association in England or Wales,

(b) by the Secretary of State in the case of an association in Scotland,

(c) by the Minister of Health and Local Government for Northern Ireland, in the case of an association in Northern Ireland;

and an association shall not be approved unless the approving authority is satisfied—

(i) that the association is duly registered under the Industrial and Provident Societies Acts 1893 to 1961 or the Industrial and Provident Societies Acts (Northern Ireland) 1893 to 1963, and is a housing association within the meaning of the Housing Act 1957, the Housing (Scotland) Act 1950 or section 12 of the Housing and Local Government (Miscellaneous Provisions) Act (Northern Ireland) 1946,

(ii) that the rules of the association restrict membership to persons who are tenants or prospective tenants of the association, and preclude the granting or assignment (or in Scotland the granting or assignation) of tenancies to persons other than members, and

(iii) that the association satisfies such other requirements as may be prescribed by the approving authority, and will comply with such conditions as may for the time being be so prescribed.

(6) An approval given for the purposes of this section shall have effect as from such date (whether before or after the giving of the approval) as may be specified by the approving authority, and shall cease to have effect if revoked by him.

(7) The Minister of Housing and Local Government and the Secretary of State as respects England and Wales and Scotland, or the Minister of Health and Local Government for Northern Ireland as respects Northern Ireland, may make regulations for the purpose of carrying out the provisions of this section; and from the coming into operation of regulations under this subsection prescribing requirements or conditions for the purposes of paragraph (iii) of subsection (5) of this section, " prescribed " in that paragraph shall mean prescribed by or under such regulations.

The power to make regulations conferred by this subsection on the Minister of Housing and Local Government and the Secretary of State shall be exercisable by statutory instrument.

(8) The provisions of Schedule 10 to this Act shall have effect in relation to claims under subsection (1) of this section.

(9) As respects the year 1963-64, subsections (1) and (2) of this section shall apply to any other payment for the time being comprised within section 177 of the Act of 1952 as they apply to yearly interest.

44 Exemption from tax on housing grants

Where, under any enactment relating to the giving of financial assistance for the provision, maintenance or improvement of housing accommodation or other residential accommodation, a payment is made to a person by way of grant or other contribution towards expenses incurred or to be incurred by that or any other person, the payment shall not be treated as a receipt in computing profits or gains for any income tax purposes:

Provided that the foregoing provision shall not apply to a payment in so far as it is made in respect of an expense giving rise to a deduction in computing profits or gains for any income tax purposes.

45 Overseas Trade Corporations: holding companies

A company shall not be prevented from qualifying as an Overseas Trade Corporation by reason only that it has a subsidiary company which is resident in the United Kingdom but is not an Overseas Trade Corporation, and accordingly the proviso to section 23(1) of the Finance Act 1957 shall cease to have effect.

46 Amendment of s. 130 of Act of 1952 (cessations)

(1) Where a trade, profession or vocation is permanently discontinued in the year 1964-65 or any subsequent year of assessment, section 130 of the Act of 1952 (which by paragraph (b) of subsection (1) provides for an additional assessment so as to bring the profits chargeable for the year preceding the year of assessment in which the discontinuance occurs up to the level of the profits of the year ending on the 5th April in that preceding year) shall have effect as if in the said paragraph (b)—

(a) for the reference to the profits or gains of the said year ending on the 5th April there were substituted a reference to the aggregate of the profits or gains (if any) of the years ending on the 5th April in each of the two years preceding the year of assessment in which the discontinuance occurs, and

(b) for the reference to the amount on which a person has been or would have been charged for the preceding year there were substituted a reference to the aggregate of the amounts on which he has been or would have been charged for each of the said two preceding years,

as if for other references in that section to the year preceding the year of assessment in which the discontinuance occurs there were substituted references to each of the two years preceding that year of assessment, and as if references in that section to the making of an additional assessment included references to any other adjustment of a person's liability to tax (whether by the reduction or discharge of an assessment or by repayment).

(2) In accordance with the foregoing subsection, for the references in section 19(4)(b) of the Finance Act 1953 (changes in ownership of trade etc.) and paragraph 2(2) of Schedule 3 to the Finance Act 1954 (permanent discontinuance after certain changes in the persons carrying on a trade) to the end of the year of assessment following that in which the. change occurs there shall be substituted references to the end of the next-but-one year of assessment following that in which the change occurs.

47 Accommodation occupied by holder of office or employment

(1) Where any premises in the United Kingdom are available to the occupier by reason of his or his wife's holding an office or employment, and—

(a) he pays no rent for the premises, or

(b) the rent he pays for them is less than the annual value of the premises, determined in accordance with Schedule 5 to this Act,

the holder of the office or employment shall be treated for the purposes of tax under Schedule E as being in receipt (in addition to any other emoluments) of emoluments at an annual rate equal to the annual value of the premises, determined as aforesaid, reduced by the annual amount of any rent which he pays for them:

Provided that this section shall not apply if the rent is not less than might reasonably be expected to have been obtained at the time when the tenancy was granted, having regard to the terms of the tenancy, and, if at any subsequent time the landlord had the power (whether by terminating the tenancy or otherwise) to obtain a higher rent, the rent is not less than might reasonably be expected to have been obtained as aforesaid at that subsequent time.

(2) Where in the case of any premises any amount falls under the foregoing subsection to be treated as a person's emoluments, then if section 161(1) of the Act of 1952 (taxation of benefits in kind) applies to expense incurred in the provision of accommodation for him in the premises the expense shall be treated for the purposes of that section as reduced by that amount (or, if that amount is greater than the expense, shall be treated as not having been incurred).

(3) Where the occupier of premises holds them under a tenancy from or by the leave of the person from whom he or his wife holds an office or employment or any other person with whom that person is connected, the premises shall be conclusively presumed to be available to him by reason of his or his wife's holding the office or employment; and paragraph 20 of Schedule 9 to the Finance Act 1962 (meaning of " connected person ") shall apply for the purposes of this subsection.

(4) Subsection (1) of this section shall not apply in the case of premises provided by a local authority if the occupier proves that the terms on which he occupies are no more favourable than those on which similar premises provided by that authority are available to persons similarly circumstanced apart from the identity of the employer.

(5) For the purposes of this section any person who under section 163(1) of the Act of 1952 would be a director of a body corporate shall be treated as holding an office from the body corporate.

(6) This section shall apply to an occupier being a woman as it applies to an occupier being a man, with the substitution of " her husband " for " his wife ".

(7) In this section " terms of the tenancy " does not include any obligation imposed on the occupier or his wife in connection with his or her office or employment.

48 Dealers in land: provisions as to purchase and sale of woodlands

(1) In computing for income tax purposes the profits or gains of a trade of dealing in land, so much of the cost of woodlands in the United Kingdom purchased in the course of the trade shall be disregarded as is attributable to trees growing on the land.

(2) Where any amount has been disregarded under the foregoing subsection, and on a subsequent sale of the woodlands in the course of the trade all or any of the trees to which the amount disregarded was attributable are still growing on the land, so much of the price for the land shall be disregarded, in computing the profits or gains of the trade for income tax purposes, as is equal to the amount disregarded under the foregoing subsection in respect of those trees.

(3) References in this section to trees include references to saleable underwood.

(4) This section shall not apply where the purchase was made under a contract entered into before the 1st May 1963.

49 India, Pakistan and Burma pensions

The exemption from income tax conferred by section 40(1) of the Finance Act 1956 in respect of a pension which is paid under the authority of the Pensions (India, Pakistan and Burma) Act 1955 and is the income of a person who satisfies the Commissioners of Inland Revenue that he is not resident in the United Kingdom shall not apply to so much of any such pension as is paid by virtue of the application to the pension of the Pensions (Increase) Act 1959 or the Pensions (Increase) Act 1962, and accordingly the proviso to the said section 40(1) shall be amended by omitting the word " or " and inserting at the end the words " the Pensions (Increase) Act 1959 or the Pensions (Increase) Act 1962 ".

50 Certificates of deduction of tax

(1) Where after the passing of this Act a person makes any payment which is subject to deduction of tax by virtue of section 169 or 170 of the Act of 1952, then if the recipient so requests in writing the payer shall furnish the recipient with a statement in writing showing the gross amount of the payment, the amount of tax deducted and the actual amount paid.

(2) The duty imposed by the foregoing subsection shall be enforceable at the suit or instance of the person requesting the statement.

51 Deduction of tax from certain dividend payments

Paragraph 5 of Schedule C (by which tax on certain half-yearly payments in respect of public revenue dividends which do not exceed fifty shillings is chargeable under Case III of Schedule D and not under Schedule C) shall not apply to payments in respect of any public revenue dividends which are obtained by means of coupons in respect of bonds to bearer or stock certificates; and accordingly that paragraph shall be amended as follows:—

(a) the words from " but subject to" to " stock certificates) " shall be omitted ; and

(b) after the words " the distribution" there shall be inserted the words " (not being a payment obtained by means of a coupon in respect of a bond to bearer or stock certificate) ".