Finance Act 2005

Miscellaneous and supplementary U.K.

40 Power to make enquiries U.K.

(1) Where a vulnerable person election has been made the Inland Revenue may by notice require the trustees or the vulnerable person by whom the election was made to furnish them with such particulars as they may reasonably require for the purposes of determining—

(a) whether the requirements mentioned in subsection (1)(a) and (b) of section 37 were met at the time the election was made, and

(b) whether an event mentioned in subsection (5) of that section has occurred since the effective date.

(2) The notice must specify the time within which the information must be furnished (not being less than 60 days).

(3) If the Board of Inland Revenue determine—

(a) that either or both of the requirements mentioned in subsection (1)(a) and (b) of section 37 were not met at the time the election was made, or

(b) that an event mentioned in subsection (5) of that section has occurred since the effective date of the election,

they may give notice to the trustees and the person in relation to whom the vulnerable person election was made that the election never had effect or ceased to have effect from a date specified in the notice.

(4) A person aggrieved by a determination of the Board of Inland Revenue under subsection (3) may by notice appeal F1 ....

(5) The notice of appeal must be given to the Board of Inland Revenue within 30 days after the notice of the determination was given under subsection (3).

(6) All such adjustments shall be made, whether by discharge or repayment of tax, the making of assessments or otherwise, as are required to give effect to a determination under subsection (3) (despite any limitation on the time within which any adjustment may be made).

(7) In subsection (6) “tax” means income tax or capital gains tax.

Textual Amendments

F1 Words in s. 40(4) omitted (1.4.2009) by virtue of The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 (S.I. 2009/56), art. 1(2), Sch. 1 para. 445

41 Interpretation etc. U.K.

(1) In this Chapter—

• “the Board of Inland Revenue” means the Commissioners of Inland Revenue (as to which, see in particular the Inland Revenue Regulation Act 1890 (c. 21)),

• “the Inland Revenue” means any officer of the Board of Inland Revenue,

• [F2 “non-UK resident” means not resident in the United Kingdom in accordance with the statutory residence test in Part 1 of Schedule 45 to FA 2013,]

• “notice” means notice in writing, and

• F3 ...

• [F2 “UK resident” means resident in the United Kingdom in accordance with the statutory residence test in Part 1 of Schedule 45 to FA 2013.]

F4 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) Sections 30 to [F5 32] and Schedule 1 are to be construed as one with TCGA 1992.

(4) To the extent that any provision of this Chapter would not, apart from this subsection, form part of Income Tax Acts, the provisions of the Income Tax Acts are to apply for the purposes of any references in the provision relating to income arising (or treated as arising) to a person or to the income tax liability of a person.

Textual Amendments

F2 Words in s. 41(1) inserted (17.7.2013) by Finance Act 2013 (c. 29), Sch. 45 para. 151(6)(a)

F3 Words in s. 41(1) omitted (21.7.2008) by virtue of Finance Act 2008 (c. 9), Sch. 2 para. 102(a)

F4 S. 41(2) omitted (17.7.2013) by virtue of Finance Act 2013 (c. 29), Sch. 45 para. 151(6)(b)

F5 Word in s. 41(3) substituted (with effect in accordance with Sch. 2 para. 22 of the amending Act) by Finance Act 2008 (c. 9), Sch. 2 para. 19

42 Application in relation to Scotland U.K.

(1) This Chapter applies in relation to Scotland with the following modifications.

(2) In section 23(5), for “trusts on which property is held for the benefit of a vulnerable person are qualifying trusts” substitute “ property held in trust for the benefit of a vulnerable person is held in qualifying trust ”.

(3) In section 31(3)(a), for “on the qualifying trusts” substitute “ in qualifying trust (in the same trust as the settled property disposed of) ”.

(4) In section 34—

(a) in subsection (1), for “those trusts are qualifying trusts if they” substitute “ the property is held in qualifying trust if the trust purposes ”, and

(b) in subsection (4), for “on trusts” substitute “ in a trust ”.

(5) In section 35—

(a) in subsection (1), for “those trusts are qualifying trusts if they are” substitute “ the property is held in qualifying trust if the trust is ”,

F6 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c) in subsection (2), before “which” insert “ the purposes of ”.

(6) In section 36, for “the trusts on which it is held are qualifying trusts” substitute “ it is held in qualifying trust ”.

(7) In section 37—

(a) in subsection (1), for paragraph (b) substitute—

“(b) property held in the trust in relation to which the election is made is held in qualifying trust.”,

(b) in subsection (3)(b), for “the trusts in relation to which the election is made are qualifying trusts” substitute “ property held in the trust in relation to which the election is made is held in qualifying trust ”, and

(c) in subsection (5), for paragraph (b) substitute—

“(b) property held in the trust in relation to which the election is made ceases to be held in qualifying trust,”.

(8) Sections 34(3) and 35(4) do not apply to Scotland

(9) Unless otherwise modified by this section, any reference to anything being held on trusts is to be construed as a reference to it being held in trust.

(10) Unless otherwise modified or disapplied by this section, any reference to trusts is to be construed as a reference to a trust or the trust (as appropriate).

Textual Amendments

F6 S. 42(5)(b) repealed (retrospective to 6.4.2006) by Finance Act 2006 (c. 25), Sch. 13 para. 35(5)(7), Sch. 26 Pt. 3(15)

43 Penalties under TMA 1970 U.K.

(1) Section 98 of TMA 1970 (special returns, etc) is amended as follows.

(2) In the first column of the table insert at the appropriate place— “ section 40(1) of the Finance Act 2005 ”.

(3) In the second column of the table insert at the appropriate place— “ section 37(3) of the Finance Act 2005; ”, and “ section 37(6) of the Finance Act 2005; ”.

(4) For the purposes of that section, any information, statements or declarations given or made jointly by [F7 the trustees of a settlement] and a vulnerable person are to be treated as given or made by the trustees.

Textual Amendments

F7 Words in s. 43(4) substituted (retrospective to 6.4.2006) by Finance Act 2006 (c. 25), Sch. 13 para. 35(6)(7)

44 Consequential amendments U.K.

F8 (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F9 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F8 S. 44(1) repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

F9 S. 44(2) omitted (with effect in accordance with Sch. 2 para. 22 of the amending Act) by virtue of Finance Act 2008 (c. 9), Sch. 2 para. 21(i)

45 Commencement U.K.

This Chapter has effect for the tax year beginning on 6th April 2004 and subsequent tax years.