Finance Act 2010 - legislation

1 Finance Act 2010 CHAPTER 13 CONTENTSPART 1 CHARGES, RATES ETCI ncome tax1 Charge, main rates, thresholds and allowances etc for 2010 -11 Corporation tax2 Charge and main rate for financial year 20113 Small profits rates and fractions for financial year 2010 Capital gains tax4 Increase in entrepreneurs reliefCapital allowances5 Annual investment allowanceStamp duty land tax6 Relief for first-time buyers7 Rate in respect of residential property where consideration over 1mInheritance tax8 Rate bandsAlcohol and tobacco9 Rates of alcoholic liquor dutiesFinance Act 2010 (c. 13)ii10 Rates of tobacco products dutyVehicle excise duty11 Rates for motorcyclesFuel duties12 Fuel duties: rates and rebates from April 201013 Fuel duties: further changes in rates and rebatesOther environmental taxes14 Rates of air passenger duty15 Standard rate of landfill tax16 Rate of aggregates levy17 Rates of climate change levy18 Climate change levy: reduced-rate suppliesGambling19 Rate of bingo duty20 Rates of gaming duty21 Amusement machine licence dutyNew taxes22 Bank payroll tax23 Pensions: high income excess relief chargePART 2 ANTI-AVOIDANCE AND REVENUE PROTECTIONL osses, capital allowances etc24 Sideways relief etc25 Property loss relief26 Capital allowance buying27 Leased assets28 Cushion gas29 Sale of lessors: consortium relationshipsCharities etc30 Charities and community amateur sports clubs.

2 Definitions31 Gifts of shares etc to charities32 Miscellaneous amendmentsRemittance basis33 Relevant person 34 Foreign currency bank accountsFinance Act 2010 (c. 13)iiiOther international matters35 Penalties: offshore income etc36 Reliefs and reductions for foreign tax37 Asset transfer to non-resident company: recovery of postponed chargeSecurities etc38 Transactions in securities39 Approved CSOP schemes: eligible shares40 Unauthorised unit trusts41 Index-linked gilt-edged securities42 Approved share incentive plansLoan relationships and derivative contracts43 Close companies: release of loans to participators etc44 Connected companies: releases of debts45 Relationships treated as loan relationships etc: repos46 Risk transfer schemesInsurance companies47 Apportionment of asset value increasesPensions48 Extension of special annual allowance charge49 InformationValue added tax and insurance premium tax50 Extension of reverse charge provisions to supplies of services51 Insurance premium tax.

3 Separate contractsInheritance tax52 Reversionary interests of purchaser or settlor etc in relevant property53 Interests in possessionStamp taxes54 SDRT: depositary receipt systems and clearance services systems55 SDLT: partnershipsAdministration56 Disclosure of tax avoidance schemes57 Opening of postal packetsFinance Act 2010 (c. 13)ivPART 3 OTHER PROVISIONSI ncome tax: benefits in kind58 Zero and low emission vehicles59 Cars with CO2 emissions figure60 Subsidised meals for employees: salary sacrifice etcCorporation tax61 Sale of lessors: election out of charge62 Accounting standards: loan relationships and derivative contractsMiscellaneous63 Champions League final64 FSCS intervention in relation to insurance contracts65 Stamp duty and SDRT: clearing houses66 Alcoholic liquor duties: power to amend definition of cider 67 Climate change levy: compatible state aid68 Pensions: minor correctionsFinal provisions69 Interpretation70 Short titleSchedule 1 Bank payroll taxPart 1 The taxPart 2 Collection and management of taxPart 3 DefinitionsSchedule 2 Pensions.

4 High income excess relief chargeSchedule 3 Sideways relief etcSchedule 4 Capital allowance buyingSchedule 5 Leased assetsSchedule 6 Charities and community amateur sports clubs: definitionsPart 1 Definition of charity , charitable company and charitabletrust Part 2 Repeals of superseded definitions and other consequentialamendments Part 3 Meaning of community amateur sports club Part 4 CommencementSchedule 7 Gifts of shares etc to charitiesSchedule 8 Charities: miscellaneous amendmentsSchedule 9 Foreign currency bank accountsSchedule 10 Penalties: offshore income etcSchedule 11 Reliefs and reductions for foreign taxSchedule 12 Transactions in securitiesSchedule 13 Unauthorised unit trustsFinance Act 2010 (c. 13)vSchedule 14 Index-linked gilt-edged securitiesSchedule 15 Connected companies: releases of debtsSchedule 16 Risk transfer schemesSchedule 17 Disclosure of tax avoidance schemesSchedule 18 Sale of lessors: election out of chargeSchedule 19 Accounting standards: loan relationships and derivativecontractsSchedule 20 Champions League finalELIZABETH IIc.

5 13 Finance Act 20102010 CHAPTER 13An Act to grant certain duties, to alter other duties, and to amend the lawrelating to the National Debt and the Public Revenue, and to make furtherprovision in connection with Finance .[8th April 2010 ]Most Gracious SovereignE, Your Majesty s most dutiful and loyal subjects, the Commons of theUnited Kingdom in Parliament assembled, towards raising the necessarysupplies to defray Your Majesty s public expenses, and making an addition to thepublic revenue, have freely and voluntarily resolved to give and to grant unto YourMajesty the several duties hereinafter mentioned; and do therefore most humblybeseech Your Majesty that it may be enacted, and be it enacted by the Queen s mostExcellent Majesty, by and with the advice and consent of the Lords Spiritual andTemporal, and Commons, in this present Parliament assembled, and by the authorityof the same, as follows: PART 1 CHARGES, RATES ETCI ncome tax1 Charge, main rates, thresholds and allowances etc for 2010 -11(1)Income tax is charged for the tax year 2010 -11.

6 (2)For that tax year (a)the basic rate is 20%,(b)the higher rate is 40%, and(c)the additional rate is 50%.WFinance Act 2010 (c. 13)Part 1 Charges, rates etc2(3)The amounts specified in the following provisions of ITA 2007 are the same forthe tax year 2010 -11 as for the tax year 2009-10 (a)sections 10(5) and 12(3) (basic rate limit and starting rate limit forsavings),(b)sections 35, 36(1), 37(1) and 38(1) (personal allowances and blindperson s allowance),(c)sections 43, 45(3)(a) and (b) and 46(3)(a) and (b) (tax reductions formarried couples and civil partners), and(d)sections 36(2), 37(2), 45(4) and 46(4) (adjusted net income limit).Corporation tax2 Charge and main rate for financial year 2011 (1)Corporation tax is charged for the financial year 2011 .(2)For that year the rate of corporation tax is (a)28% on profits of companies other than ring fence profits, and(b)30% on ring fence profits of companies.

7 (3)In subsection (2) ring fence profits has the same meaning as in Part 8 of CTA2010 (see section 276 of that Act).3 Small profits rates and fractions for financial year 2010 (1)For the financial year 2010 the small profits rate is (a)21% on profits of companies other than ring fence profits, and(b)19% on ring fence profits of companies.(2)For the purposes of Part 3 of CTA 2010 , for that year (a)the standard fraction is 7/400ths, and(b)the ring fence fraction is 11/400ths.(3)In subsection (1) ring fence profits has the same meaning as in Part 8 of CTA2010 (see section 276 of that Act).Capital gains tax4 Increase in entrepreneurs relief(1)In section 169N(3) of TCGA 1992 (limit on entrepreneurs relief) (a)for 1 million (in both places) substitute 2 million , and(b)in paragraph (b), after total of insert so much of and insert at theend as was subject to reduction under subsection (2) .(2)The amendments made by subsection (1) have effect in relation to qualifyingbusiness disposals occurring on or after 6 April Act 2010 (c.)

8 13)Part 1 Charges, rates etc3 Capital allowances5 Annual investment allowance(1)In section 51A(5) of CAA 2001 (entitlement to annual investment allowance:maximum allowance), for 50,000 substitute 100,000 .(2)The amendment made by subsection (1) has effect in relation to expenditureincurred on or after the relevant date.(3)Subsections (4) and (5) apply in relation to a chargeable period ( the actualchargeable period ) which (a)begins before the relevant date, and(b)ends on or after that date.(4)The maximum allowance under section 51A of CAA 2001 for the actualchargeable period is the sum of each maximum allowance that would be foundif (a)the period beginning with the first day of the chargeable period andending with the day before the relevant date, and(b)the period beginning with the relevant date and ending with the lastday of the chargeable period,were treated as separate chargeable periods.

9 (5)But, so far as concerns expenditure incurred before the relevant date, themaximum allowance under section 51A of that Act for the actual chargeableperiod is to be calculated as if the amendment made by subsection (1) had notbeen made.(6)In this section the relevant date means (a)for corporation tax purposes, 1 April 2010 , and(b)for income tax purposes, 6 April duty land tax6 Relief for first-time buyers(1)Part 4 of FA 2003 (stamp duty land tax) is amended as follows.(2)After section 57A insert 57AA First-time buyers(1)A land transaction is exempt from charge under section 55 if (a)it is a relevant acquisition of a major interest in land,(b)the land consists entirely of residential property,(c)the relevant consideration (see section 55) for the transaction(other than any consisting of rent) is more than 125,000 but notmore than 250,000,(d)the purchaser, or (if more than one) each of the purchasers, is afirst-time buyer who intends to occupy the residential propertyas the purchaser s only or main residence, and(e)(subject to subsection (4)) the transaction is not one of a numberof linked Act 2010 (c.)

10 13)Part 1 Charges, rates etc4(2)In this section first-time buyer means a person who (a)has not previously been a purchaser in relation to a relevantacquisition of a major interest in land which consisted of orincluded residential property,(b)has not previously acquired an equivalent interest in such landunder the law of a territory outside the United Kingdom,(c)has not previously been, or been one of the persons who was, the person for the purposes of section 71A, 72, 72A or 73 in acase where the first transaction within the meaning of thesection concerned was a relevant acquisition of a major interestin land which consisted of or included residential property, and(d)would not have been such a person for those purposes in sucha case if the provisions mentioned in paragraph (c) had been inforce, and had had effect in the territory concerned, at allmaterial times (subject, where required, to appropriatemodifications).