SCHEDULES
C1C2SCHEDULE 6 The Categories of Preferential Debts
Sch. 6 applied (with modifications) (17.2.2009 for certain purposes, otherwise 21.2.2009) by Banking Act 2009 (c. 1), ss. 145, 263(1)(2) (with s. 247); S.I. 2009/296, arts. 2, 3, Sch. para. 3
Category 1: Debts due to Inland Revenue
1
F1Sums due at the relevant date from the debtor on account of deductions of income tax from F24taxable earnings (as defined by section 10 of the Income Tax (Earnings and Pensions) Act 2003) paid during the period of 12 months next before that date.
The deductions here referred to are those which the debtor was liable to make under F25PAYE regulations, less the amount of the repayments of income tax which the debtor was liable to make during that period.
2
Category 2: Debts due to Customs and Excise
3
F27Any value added tax which is referable to the period of 6 months next before the relevant date (which period is referred to below as “the 6-month period”).
For the purposes of this paragraph—
a
where the whole of the prescribed accounting period to which any value added tax is attributable falls within the 6-month period, the whole amount of that tax is referable to that period; and
b
in any other case the amount of any value added tax which is referable to the 6-month period is the proportion of the tax which is equal to such proportion (if any) of the accounting reference period in question as falls within the 6-month period;
F4F53A
Any insurance premium tax which is referable to the period of 6 months next before the relevant date (which period is referred to below as “the 6-month period”).
For the purposes of this paragraph—
a
where the whole of the accounting period to which any insurance premium tax is attributable falls within the 6-month period, the whole amount of that tax is referable to that period; and
b
in any other case the amount of any insurance premium tax which is referable to the 6-month period is the proportion of the tax which is equal to such proportion (if any) of the accounting period in question as falls within the 6-month period;
and references here to accounting periods shall be construed in accordance with Part III of the Finance Act 1994.
F6F73B
Any landfill tax which is referable to the period of 6 months next before the relevant date (which period is referred to below as “the 6-month period”).
For the purposes of this paragraph—
a
where the whole of the accounting period to which any landfill tax is attributable falls within the 6-month period, the whole amount of that tax is referable to that period; and
b
in any other case the amount of any landfill tax which is referable to the 6-month period is the proportion of the tax which is equal to such proportion (if any) of the accounting period in question as falls within the 6-month period;
and references here to accounting periods shall be construed in accordance with Part III of the Finance Act 1996.
F8F93C
Any climate change levy which is referable to the period of 6 months next before the relevant date (which period is referred to below as “the 6-month period”).
For the purposes of this paragraph—
a
where the whole of the accounting period to which any climate change levy is attributable falls within the 6-month period, the whole amount of that levy is referable to that period; and
b
in any other case the amount of any climate change levy which is referable to the 6-month period is the proportion of the levy which is equal to such proportion (if any) of the accounting period in question as falls within the 6-month period;
and references here to accounting periods shall be construed in accordance with Schedule 6 to the Finance Act 2000.
F10F113D
Any aggregates levy which is referable to the period of 6 months next before the relevant date (which period is referred to below as “the 6-month period”).
For the purposes of this paragraph—
a
where the whole of the accounting period to which any aggregates levy is attributable falls within the 6-month period, the whole amount of that levy is referable to that period; and
b
in any other case the amount of any aggregates levy which is referable to the 6-month period is the proportion of the levy which is equal to such proportion (if any) of the accounting period in question as falls within the 6-month period;
and references here to accounting periods shall be construed in accordance with Part 2 of the Finance Act 2001.
4
F28The amount of any car tax which is due at the relevant date from the debtor and which became due within a period of 12 months next before that date.
5
F29Any amount which is due—
a
by way of general betting duty F12, bingo duty or gaming duty, or
b
F13c
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
from the debtor at the relevant date and which became due within the period of 12 months next before that date.
F14F155A
The amount of any excise duty on beer which is due at the relevant date from the debtor and which became due within a period of 6 months next before that date.
F16F175B
Any amount which is due by way of lottery duty from the debtor at the relevant date and which became due within the period of 12 months next before that date.
F18F195C
Any amount which is due by way of air passenger duty from the debtor at the relevant date and which became due within the period of six months next before that date.
Category 3: Social security contributions
6
F30All sums which on the relevant date are due from the debtor on account of Class 1 or Class 2 contributions under the F20Social Security Contributions and Benefits Act 1992 or the M3 Social Security (Northern Ireland) Act 1975 and which became due from the debtor in the 12 months next before the relevant date.
7
F31All sums which on the relevant date have been assessed on and are due from the debtor on account of Class 4 contributions under either of those Acts of 1975, being sums which—
a
are due to the Commissioners of Inland Revenue (rather than to the Secretary of State or a Northern Ireland department), and
b
are assessed on the debtor up to 5th April next before the relevant date,
but not exceeding, in the whole, any one year’s assessment.
Category 4: Contributions to occupational pension schemes, etc.
8
Any sum which is owed by the debtor and is a sum to which F21Schedule 4 to the Pension Schemes Act 1993applies (contributions to occupational pension schemes and state scheme premiums).
Category 5: Remuneration, etc., of employees
9
So much of any amount which—
a
is owed by the debtor to a person who is or has been an employee of the debtor, and
b
is payable by way of remuneration in respect of the whole or any part of the period of 4 months next before the relevant date,
as does not exceed so much as may be prescribed by order made by the Secretary of State.
10
An amount owed by way of accrued holiday remuneration, in respect of any period of employment before the relevant date, to a person whose employment by the debtor has been terminated, whether before, on or after that date.
11
So much of any sum owed in respect of money advanced for the purpose as has been applied for the payment of a debt which, if it had not been paid, would have been a debt falling within paragraph 9 or 10.
12
So much of any amount which—
a
is ordered (whether before or after the relevant date) to be paid by the debtor under the M4Reserve Forces (Safeguard of Employment) Act 1985, and
b
is so ordered in respect of a default made by the debtor before that date in the discharge of his obligations under that Act,
as does not exceed such amount as may be prescribed by order made by the Secretary of State.
Interpertation for Category 5
13
1
For the purposes of paragraphs 9 to 12, a sum is payable by the debtor to a person by way of remuneration in respect of any period if—
a
it is paid as wages or salary (whether payable for time or for piece work or earned wholly or partly by way of commission) in respect of services rendered to the debtor in that period, or
b
it is an amount falling within the following sub-paragraph and is payable by the debtor in respect of that period.
F222
An amount falls within this sub-paragraph if it is—
a
a guarantee payment under Part III of the Employment Rights Act 1996 (employee without work to do);
b
any payment for time off under section 53 (time off to look for work or arrange training) or section 56 (time off for ante-natal care) of that Act or under section 169 of the Trade Union and Labour Relations (Consolidation) Act 1992 (time off for carrying out trade union duties etc.);
c
remuneration on suspension on medical grounds, or on maternity grounds, under Part VII of the Employment Rights Act 1996; or
d
remuneration under a protective award under section 189 of the Trade Union and Labour Relations (Consolidation) Act 1992 (redundancy dismissal with compensation).
14
1
This paragraph relates to a case in which a person’s employment has been terminated by or in consequence of his employer going into liquidation or being F33adjudgedF33made bankrupt or (his employer being a company not in liquidation) by or in consequence of—
a
a receiver being appointed as mentioned in section 40 of this Act (debenture-holders secured by floating charge), or
b
the appointment of a receiver under section 53(6) or 54(5) of this Act (Scottish company with property subject to floating charge), or
c
the taking of possession by debenture-holders (so secured), as mentioned in F32section 754 of the Companies Act 2006 .
2
For the purposes of paragraphs 9 to 12, holiday remuneration is deemed to have accrued to that person in respect of any period of employment if, by virtue of his contract of employment or of any enactment that remuneration would have accrued in respect of that period if his employment had continued until he became entitled to be allowed the holiday.
3
The reference in sub-paragraph (2) to any enactment includes an order or direction made under an enactment.
15
Without prejudice to paragraphs 13 and 14—
a
any remuneration payable by the debtor to a person in respect of a period of holiday or of absence from work through sickness or other good cause is deemed to be wages or (as the case may be) salary in respect of services rendered to the debtor in that period F40...
F40b
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F23Category 6: Levies on coal and steel production
Sch. 6 para. 15A inserted by S.I. 1987/2093, reg. 2(1)(3)
15A
Any sums due at the relevant date from the debtor in respect of—
a
the levies on the production of coal and steel referred to in Articles 49 and 50 of the E.C.S.C. Treaty, or
b
any surcharge for delay provided for in Article 50(3) of that Treaty and Article 6 of Decision 3/52 of the High Authority of the Coal and Steel Community.
F34Category 6A: Debts owed to the Financial Services Compensation Scheme
Sch. 6 para. 15AA and cross-heading inserted (26.3.2015) by The Deposit Guarantee Scheme Regulations 2015 (S.I. 2015/486), regs. 1(2), 14(3)(a)
15AA
Any debt owed by the debtor to the scheme manager of the Financial Services Compensation Scheme under section 215(2A) of the Financial Services and Markets Act 2000.
F39Category 7: Deposits covered by Financial Services Compensation Scheme
Sch. 6 paras. 15B, 15C and cross-headings inserted (31.12.2014) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 13(1), 148(5); S.I. 2014/3160, art. 2(1)(a)
15B
So much of any amount owed at the relevant date by the debtor in respect of an eligible deposit as does not exceed the compensation that would be payable in respect of the deposit under the Financial Services Compensation Scheme to the person or persons to whom the amount is owed.
F37Category 8: Other deposits
Sch. 6 paras. 15BA, 15BB and cross-heading inserted (1.1.2015) by The Banks and Building Societies (Depositor Preference and Priorities) Order 2014 (S.I. 2014/3486), arts. 1(2), 11(2) (with art. 3)
15BA
So much of any amount owed at the relevant date by the debtor to one or more eligible persons in respect of an eligible deposit as exceeds any compensation that would be payable in respect of the deposit under the Financial Services Compensation Scheme to that person or those persons.
15BB
An amount owed at the relevant date by the debtor to one or more eligible persons in respect of a deposit that—
a
was made through a non-EEA branch of a credit institution authorised by the competent authority of an EEA state, and
b
would have been an eligible deposit if it had been made through an EEA branch of that credit institution.
Interpretation for F35categories 6A, 7 and 8.
Words in Sch. 6 para. 15C heading substituted (26.3.2015) by The Deposit Guarantee Scheme Regulations 2015 (S.I. 2015/486), regs. 1(2), 14(3)(b)
15C
F36A1
In paragraph 15AA “the scheme manager” has the meaning given in section 212(1) of the Financial Services and Markets Act 2000.
1
In F43paragraphs 15B to 15BB “eligible deposit” means a deposit in respect of which the person, or any of the persons, to whom it is owed would be eligible for compensation under the Financial Services Compensation Scheme.
2
For F42the purposes of those paragraphs and this paragraph a “deposit” means rights of the kind described in—
a
paragraph 22 of Schedule 2 to the Financial Services and Markets Act 2000 (deposits), or
b
section 1(2)(b) of the Dormant Bank and Building Society Accounts Act 2008 (balances transferred under that Act to authorised reclaim fund).
F413
In paragraphs 15BA and 15BB, “eligible person” means—
a
an individual, or
b
a micro-enterprise, a small enterprise or a medium-sized enterprise, each of those terms having the meaning given in Article 2.1(107) of Directive 2014/59/EU of 15th May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms.
4
In paragraph 15BB—
a
“credit institution” has the meaning given in Article 4.1(1) of the capital requirements regulation;
b
“EEA branch” means a branch, as defined in Article 4.1(17) of the capital requirements regulation, which is established in an EEA state;
c
“non-EEA branch” means a branch, as so defined, which is established in a country which is not an EEA state;
and for this purpose “the capital requirements regulation” means Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26th June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 F38, as it had effect on the day on which the Bank Recovery and Resolution and Miscellaneous Provisions (Amendment) (EU Exit) Regulations 2018 were made.
Orders
16
An order under paragraph 9 or 12—
a
may contain such transitional provisions as may appear to the Secretary of State necessary or expedient;
b
shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.
Sch. 6 applied (with modifications) (17.2.2009 for certain purposes, otherwise 21.2.2009) by Banking Act 2009 (c. 1), ss. 103, 263(1)(2) (with s. 247); S.I. 2009/296, arts. 2, 3, Sch. para. 2