1999 No. 2155

INCOME TAX

The Income Tax (Employments) (Amendment No. 3) Regulations 1999

Made

Laid before the House of Commons

Coming into force

The Commissioners of Inland Revenue, in exercise of the powers conferred on them by section 203 of the Income and Corporation Taxes Act 19881, hereby make the following Regulations:

Citation, commencement and effect1

1

These Regulations may be cited as the Income Tax (Employments) (Amendment No. 3) Regulations 1999 and shall come into force on 19th August 1999.

2

Regulations 8 to 14 shall have effect in relation to the year 1999–00 and subsequent years of assessment.

3

Regulations 15 to 17 shall have effect in relation to the year of assessment 2000–01.

4

Regulations 18 and 19 shall have effect in relation to the year 2000–01 and subsequent years of assessment.

5

Regulations 20 to 24 shall have effect in relation to the year 2001–02 and subsequent years of assessment.

Interpretation2

In these Regulations “the principal Regulations” means the Income Tax (Employments) Regulations 19932 and “regulation” means a regulation of the principal Regulations.

Amendments to the principal Regulations

3

In regulation 7(2) after sub-paragraph (a) there shall be inserted the following sub-paragraph–

aa

where the code is determined before the beginning of the year for which it is to have effect, any proposed alteration of alterations in the rates for that year of any of the reliefs referred to in sub-paragraph (a);

4

In regulations 10(2) and 12(3) after the words “an alteration or alterations” there shall be inserted the words “, or proposed alteration or alterations,”.

5

In regulation 13(4) after the word “change” in each place in which it occurs there shall be inserted the words “, or proposed change,”.

6

In regulation 28(2)(a) for “50 pence” there shall be substituted “£1”.

7

In regulation 49(7) for the words “Parts IV, V and VI of the Management Act3” there shall be substituted the words “Part IV, Part V (other than section 554), and Part VI, of the Management Act”.

Amendments to the principal Regulations having effect in relation to the year 1999–00 and subsequent years of assessment

8

In regulation 2(1) after the definition of “reliefs from income tax” there shall be inserted the following definition–

“starting rate” has the same meaning as in section 832(1) of the Taxes Act5;

9

In regulation 29(2) and (3)6 for the words “the rates referred to in regulation 8(4)” there shall be substituted the words “the starting rate, the basic rate and the higher rate”.

10

In regulation 30(2) and (3)6 for the words “the rates referred to in regulation 8(4)” there shall be substituted the words “the starting rate, the basic rate and the higher rate”.

11

In regulation 326 for the words “the rates referred to in regulation 8(4)” there shall be substituted the words “the starting rate, the basic rate and the higher rate”.

12

In regulation 80F(2)(d)7 for the words “the lower rate” in each place where they occur there shall be substituted the words “the starting rate”.

13

In regulation 84(7)8 for the words “the rates referred to in regulation 8(4)” there shall be substituted the words “the starting rate, the basic rate and the higher rate”.

14

In regulation 98C(3)9 for the words “the lower rate” there shall be substituted the words “the starting rate”.

Amendments to the principal Regulations having effect in relation to the year of assessment 2000–01

15

In regulation 10(2) for the words “sections 257 to 257F10 or 25911” there shall be substituted the words “sections 257 and 257A”.

16

In regulation 12(3) for the words “sections 257 to 257F or 259” there shall be substituted the words “sections 257 and 257A”.

17

In regulation 13(4) for the words “sections 257 to 257F” there shall be substituted the words “sections 257 and 257A”.

Amendments to the principal Regulations having effect in relation to the year 2000–01 and subsequent years of assessment

18

In regulation 98C(4) sub-paragraph (b) shall be revoked.

19

In regulation 98F(3)12–

a

for sub-paragraph (b) there shall be substituted the following sub-paragraph–

b

the relief specified in section 257A(2) of the Taxes Act (married couples allowance);

b

sub-paragraph (d) shall be revoked.

Amendments to the principal Regulations having effect in relation to the year 2001–02 and subsequent years of assessment

20

In regulation 10(2) for the words “sections 257 to 257F or 259” there shall be substituted the words “sections 257, 257A and 257AA13”.

21

In regulation 12(3) for the words “sections 257 to 257F or 259” there shall be substituted the words “sections 257, 257A and 257AA”.

22

In regulation 13(4) for the words “sections 257 to 257F” there shall be substituted the words “sections 257, 257A and 257AA”.

23

In regulation 98C(4) after sub-paragraph (a) there shall be inserted–

aa

the relief specified in section 257AA(1) of the Taxes Act (children’s tax credit);

24

In regulation 98F(3) after sub-paragraph (c) there shall be inserted–

ca

the relief specified in section 257AA(1) of the Taxes Act;

Nick MontaguS C T MathesonTwo of the Commissioners of Inland Revenue

(This note is not part of the Regulations)

These Regulations amend the Income Tax (Employments) Regulations 1993 (S.I. 1993/744) (“the principal Regulations”).

Regulation 1 provides for citation, commencement and effect, and regulation 2 for interpretation.

Regulation 3 amends regulation 7(2) of the principal Regulations so that any proposed alteration or alterations in the rates of the reliefs from income tax are matters to which an inspector may have regard when determining a PAYE code before the beginning of the year for which it is to have effect.

Regulations 4 and 5 make consequential amendments to the principal Regulations in the light of the amendments to regulation 7(2) of the principal Regulations made by regulation 3 of these Regulations.

Regulation 6 amends regulation 28(2)(a) of the principal Regulations so that the minimum rate relevant to an employer making payment of emoluments to an employee in respect of whom there is no PAYE code authorisation is rounded to the nearest pound.

Regulation 7 amends regulation 49(7) of the principal Regulations so that section 55 of the Taxes Management Act 1970 does not apply to an appeal against a determination under regulation 49 of the principal Regulations.

Regulations 8 to 14 make amendments to the principal Regulations to take into account the replacement of the lower rate of income tax with the new starting rate of 10% introduced by sections 22 and 23 of the Finance Act 1999. The Regulations, like the new starting rate, have effect in relation to the year 1999–00 and subsequent years of assessment.

Regulations 15 to 19 make amendments to the principal Regulations so as to reflect the changes made by sections 31(2) to (5) and (8), 32(2) and 33 of the Finance Act 1999 to certain of the reliefs from income tax. These changes are the restriction of the married couple’s allowance under section 257A of the Income and Corporation Taxes Act 1988 (“the 1988 Act”) to couples where either spouse is aged 65 or upwards before 6th April 2000; the abolition of the transitional reliefs under sections 257D to 257F of the 1988 Act; and the abolition of the additional relief in respect of children under sections 259 and 261A of the 1988 Act. Regulations 15 to 17 has effect in relation to the year 2000–01, and regulations 18 and 19, like the changes they reflect, have effect in relation to that year and subsequent years of assessment.

Regulations 20 to 24 make amendments to the principal Regulations so as to take into account the introduction of the children’s tax credit under section 257AA of the 1988 Act (inserted by section 30 of the Finance Act 1999). The Regulations, like the new tax credit, have effect in relation to the year 2001–02 and subsequent years of assessment.