Finance Act 1996

Further amendments of section 28A

4 (1) In section 28A (amendment of self-assessment where enquiries made in the case of individuals, trustees and companies)—

(a) in each of subsections (2)(a) and (4)(b), for “subsection (1)(b) above” there shall be substituted “subsection (1)(b) or (c) above”;

(b) in subsection (4)(a), for “the tax contained in the taxpayer’s self-assessment” there shall be substituted “any amount set out in the return”; and

(c) in subsection (5)(b), at the end there shall be inserted “and as to any claims or elections into which he has enquired.”

(2) After subsection (4) of that section there shall be inserted the following subsections—

“(4A) If—

(a) any claim or election is included in the return,

(b) the officer is of opinion that the claim or election should be disallowed in whole or in part but that its disallowance to the extent he thinks appropriate would not require any amendment of the taxpayer’s self-assessment, and

(c) the claim or election, so far as the officer thinks it should be disallowed, is not, before the end of the period mentioned in subsection (3) above, amended to the officer’s satisfaction or withdrawn,

the officer shall, before the end of the period mentioned in subsection (4) above, give notice to the taxpayer of the extent to which he is disallowing the claim or election.

(4B) Subsection (4A)(c) above is without prejudice to any provision by virtue of which any claim or election is irrevocable or unamendable.”

(3) Immediately before subsection (8) of that section there shall be inserted the following subsections—

“(7A) Where, in the case of any return made in respect of any chargeable period—

(a) alternative methods are allowed by the Tax Acts for bringing amounts into account in that return,

(b) the return is made or amended using one of those methods,

(c) a return could have been made in that case using an alternative method, and

(d) an officer of the Board determines which of the alternative methods is to be used by the Board in relation to the taxpayer for that period,

any enquiry into that return or into an amendment of it shall be conducted, and this section shall have effect, as if the only method allowed for the purposes of the Tax Acts were the method determined by the officer.

(7B) For the purposes of subsection (7A) above the cases where the Tax Acts allow alternative methods for bringing amounts into account in a return are—

(a) the case where those amounts may be brought into account either—

(i) in making a computation for the purposes of Case I or II of Schedule D; or

(ii) in making a computation for the purposes of any of Cases III to V of that Schedule;

and

(b) the case where the computation in which amounts are brought into account may be either—

(i) a computation for the purposes of Case I of Schedule D; or

(ii) a computation for the purpose of applying the basis (commonly called the I minus E basis) under which a company carrying on life assurance business or capital redemption business may be charged to tax on that business otherwise than under Case I of Schedule D.

(7C) In subsection (7B) above—

• “life assurance business” includes annuity business within the meaning of Chapter I of Part XII of the principal Act; and

• “capital redemption business” means any capital redemption business, within the meaning of section 458 of that Act, which is business to which that section applies.”