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Link to original content: http://www.legislation.gov.uk/ukpga/2005/5/notes/contents
Income Tax (Trading and Other Income) Act 2005 - Explanatory Notes

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Income Tax (Trading and Other Income) Act 2005

  • Explanatory Notes Table of contents

Please note:

All reference to 'Parts' and 'sections' are from the Income Tax (Trading and Other Income) Act 2005. For other versions of these Explanatory Notes, see More Resources.

  1. Summary

  2. Background

    1. The Tax Law Rewrite Project

    2. Steering Committee

    3. Consultative Committee

    4. Consultation

  3. This Act - the End of the Schedules for Income Tax

    1. Features of the Act

  4. The Act

    1. Glossary

  5. Commentary on Sections

    1. Part 1: Overview

      1. Section 1: Overview of Act

      2. Section 2: Overview of priority rules

    2. Part 2: Trading income

      1. Overview

      2. Chapter 1: Introduction

        1. Section 3: Overview of Part 2

        2. Section 4: Provisions which must be given priority over Part 2

      3. Chapter 2: Income taxed as trade profits

        1. Overview

        2. Section 5: Charge to tax on trade profits

        3. Section 6: Territorial scope of charge to tax

        4. Section 7: Income charged

        5. Section 8: Person liable

        6. Section 9: Farming and market gardening

        7. Section 10: Commercial occupation of land other than woodlands

        8. Section 11: Commercial occupation of woodlands

        9. Section 12: Profits of mines, quarries and other concerns

        10. Section 13: Visiting performers

        11. Section 14: Visiting performers: supplementary

        12. Section 15: Divers and diving supervisors

        13. Section 16: Oil extraction and related activities

        14. Section 17: Effect of becoming or ceasing to be a UK resident

        15. Section 18: Effect of company starting or ceasing to be within charge to income tax

        16. Section 19: Tied premises

        17. Section 20: Caravan sites where trade carried on

        18. Section 21: Surplus business accommodation

        19. Section 22: Payments for wayleaves

        20. Section 23: Rent-a-room and foster-care relief

      4. Chapter 3: Trade profits: basic rules

        1. Section 24: Professions and vocations

        2. Section 25: Generally accepted accounting practice

        3. Section 26: Losses calculated on same basis as profits

        4. Section 27: Receipts and expenses

        5. Section 28: Items treated under CAA 2001 as receipts and expenses

        6. Section 29: Interest

        7. Section 30: Animals kept for trade purposes

        8. Section 31: Relationship between rules prohibiting and allowing deductions

      5. Chapter 4: Trade profits: rules restricting deductions

        1. Overview

        2. Section 32: Professions and vocations

        3. Section 33: Capital expenditure

        4. Section 34: Expenses not wholly and exclusively for trade and unconnected losses

        5. Section 35: Bad and doubtful debts

        6. Section 36: Unpaid remuneration

        7. Section 37: Unpaid remuneration: supplementary

        8. Employee benefit contributions

          1. Overview

          2. Section 38: Restriction of deductions

          3. Section 39: Making of “employee benefit contributions”

          4. Section 40: Provision of qualifying benefits

          5. Section 41: Timing and amount of certain qualifying benefits

          6. Section 42: Provision or payment out of employee benefit contributions

          7. Section 43: Profits calculated before end of 9 month period

          8. Section 44: Interpretation of sections 38 to 44

          9. Section 45: Business entertainment and gifts: general rule

          10. Section 46: Business entertainment: exceptions

          11. Section 47: Business gifts: exceptions

          12. Section 48: Car or motor cycle hire

          13. Section 49: Car or motor cycle hire: supplementary

          14. Section 50: Hiring cars (but not motor cycles) with low carbon dioxide emissions

          15. Section 51: Patent royalties

          16. Section 52: Exclusion of double relief for interest

          17. Section 53: Social security contributions

          18. Section 54: Penalties, interest and VAT surcharges

          19. Section 55: Crime-related payments

      6. Chapter 5: Trade profits: rules allowing deductions

        1. Overview

        2. Section 56: Professions and vocations

        3. Section 57: Pre-trading expenses

        4. Section 58: Incidental costs of obtaining finance

        5. Section 59: Convertible loans and loan stock etc.

        6. Section 60: Tenants under taxed leases: introduction

        7. Section 61: Tenants occupying land for purposes of trade treated as incurring expenses

        8. Section 62: Limit on deductions if tenant entitled to mineral extraction allowance

        9. Section 63: Tenants dealing with land as property employed for purposes of trade

        10. Section 64: Restrictions on section 61 expenses: lease premium receipts

        11. Section 65: Restrictions on section 61 expenses: lease of part of premises

        12. Section 66: Corporation tax receipts treated as taxed receipts

        13. Section 67: Restrictions on section 61 expenses: corporation tax receipts

        14. Section 68: Replacement and alteration of trade tools

        15. Section 69: Payments for restrictive undertakings

        16. Section 70: Employees seconded to charities and educational establishments

        17. Section 71: Educational establishments

        18. Section 72: Payroll deduction schemes: contributions to agents’ expenses

        19. Section 73: Counselling and other outplacement services

        20. Section 74: Retraining courses

        21. Section 75: Retraining courses: recovery of tax

        22. Sections 76 to 80: Redundancy payments etc

          1. Overview

        23. Section 76: Redundancy payments and approved contractual payments

        24. Section 77: Payments in respect of employment wholly in employer’s trade

        25. Section 78: Payments in respect of employment in more than one capacity

        26. Section 79: Additional payments

        27. Section 80: Payments made by the Government

        28. Section 81: Personal security expenses

        29. Section 82: Contributions to local enterprise organisations or urban regeneration companies

        30. Section 83: Meaning of “local enterprise organisation”

        31. Section 84: Approval of local enterprise agencies

        32. Section 85: Supplementary provisions with respect to approvals

        33. Section 86: Meaning of “urban regeneration company”

        34. Section 87: Expenses of research and development

        35. Section 88: Payments to research associations, universities etc

        36. Section 89: Expenses connected with patents

        37. Section 90: Expenses connected with designs or trade marks

        38. Section 91: Payments to Export Credits Guarantee Department

        39. Section 92: Expenses connected with foreign trades

        40. Section 93: Allocation of expenses

        41. Section 94: Family expenses

      7. Chapter 6: Trade Profits: Receipts

        1. Overview

        2. Section 95: Profession and vocations

        3. Section 96: Capital receipts

        4. Section 97: Debts incurred and later released

        5. Section 98: Acquisition of trade: receipts from transferor’s trade

        6. Section 99: Reverse premiums

        7. Section 100: Excluded cases

        8. Section 101: Tax treatment of reverse premiums

        9. Section 102: Arrangements not at arm’s length

        10. Section 103: Connected persons and property arrangements

        11. Section 104: Distribution of assets of mutual concerns

        12. Section 105: Industrial development grants

        13. Section 106: Sums recovered under insurance policies etc.

      8. Chapter 7: Trade profits: gifts to charities etc.

        1. Section 107: Professions and vocations

        2. Section 108: Gifts of trading stock to charities etc.

        3. Section 109: Receipt by donor or connected person of benefit attributable to certain gifts

        4. Section 110: Meaning of “designated educational establishment”

      9. Chapter 8: Trade profits: Herd basis rules

        1. Overview

        2. Section 111: Election for application of herd basis rules

        3. Section 112: Meaning of “animal”, “herd”, “production herd” etc.

        4. Section 113: Other interpretative provisions

        5. Section 114: Initial cost of herd and value of herd

        6. Section 115: Addition of animals to herd

        7. Section 116: Replacement of animals in herd

        8. Section 117: Amount of receipt if old animal slaughtered under disease control order

        9. Section 118: Sale of animals from herd

        10. Section 119: Sale of whole or substantial part of herd

        11. Section 120: Acquisition of new herd begun within 5 years of sale

        12. Section 121: Section 120: sale outside farmer's control

        13. Section 122: Replacement of part sold begun within 5 years of sale

        14. Section 123: Section 122: sale outside farmer's control

        15. Section 124: Herd basis elections

        16. Section 125: Five year gap in which no production herd kept

        17. Section 126: Slaughter under disease control order

        18. Section 127: Preventing abuse of the herd basis rules

        19. Section 128: Information if election made

        20. Section 129: Further assessment etc. if herd basis rules apply

      10. Chapter 9: Trade profits: films and sound recordings

        1. Overview

        2. Section 130: Expenditure to which this Chapter applies

        3. Section 131: Meaning of “film” and related expressions

        4. Section 132: Meaning of “original master version” and “certified master version”

        5. Section 133: Meaning of “relevant period”

        6. Section 134: Expenditure treated as revenue in nature

        7. Section 135: Films and sound recordings: production or acquisition expenditure

        8. Section 136: Application of provisions about certified master versions

        9. Section 137: Certified master versions: preliminary expenditure

        10. Section 138: Certified master versions: production or acquisition expenditure

        11. Section 139: Certified master versions: production expenditure on limited-budget films

        12. Section 140: Certified master versions: acquisition expenditure on limited-budget films

        13. Section 141: Meaning of “total production expenditure”

        14. Section 142: When expenditure is incurred

        15. Section 143: Election for sections 134 to 140 not to apply

        16. Section 144: Meaning of “genuinely intended for theatrical release”

      11. Chapter 10: Trade profits: certain telecommunication rights

        1. Overview

        2. Section 145: Professions and vocations

        3. Section 146: Meaning of “relevant telecommunication right”

        4. Section 147: Expenditure and receipts treated as revenue in nature

        5. Section 148: Credits or debits arising from revaluation

      12. Chapter 11: Trade Profits: Other specific trades

        1. Overview

        2. Section 149:Taxation of amounts taken to reserves

        3. Section 150: Conversion etc. of securities held as circulating capital

        4. Section 151: Exchanges of gilts for gilts strips

        5. Section 152: Consolidation of gilt strips

        6. Section 153: Meaning of “gilt-edged security” and “strip”

        7. Section 154: Regulations for determining market value of securities or strips

        8. Section 155: Levies and repayments under FISMA 2000

        9. Section 156: Purchase or sale of woodlands

        10. Section 157: Relief in respect of mineral royalties

        11. Section 158: Lease premiums etc.: reduction of receipts

        12. Section 159: Ministers of religion

        13. Section 160: Alternative basis of calculation in early years of practice

        14. Section 161: Mineral exploration and access

        15. Section 162: Payments by persons liable to pool betting duty

        16. Section 163: Deduction for deemed employment payment

        17. Section 164: Special rules for partnerships

        18. Section 165: Deduction for site preparation expenditure

        19. Section 166: Allocation of site preparation expenditure

        20. Section 167: Site preparation expenditure: supplementary

        21. Section 168: Site restoration payments

        22. Section 169: Cemeteries and crematoria: introduction

        23. Section 170: Deduction for capital expenditure

        24. Section 171: Allocation of ancillary capital expenditure

        25. Section 172: Exclusion of expenditure met by subsidies

      13. Chapter 12: Trade profits: valuation of stock and work in progress

        1. Overview

        2. Section 173: Valuation of trading stock on cessation

        3. Section 174: Meaning of “trading stock”

        4. Section 175: Basis of valuation of trading stock

        5. Section 176: Sale basis of valuation: sale to unconnected person

        6. Section 177: Sale basis of valuation: sale to connected person

        7. Section 178: Sale basis of valuation: election by connected persons

        8. Section 179: Connected persons

        9. Section 180: Cost to buyer of stock valued on sale basis of valuation

        10. Section 181: Meaning of “sale” and related expressions

        11. Section 182:Valuation of work in progress on cessation

        12. Section 183: Meaning of “work in progress”

        13. Section 184: Basis of valuation of work in progress

        14. Section 185: Election for valuation at cost

        15. Section 186: Determination of questions by Commissioners

      14. Chapter 13: Deductions from profits: unremittable amounts

        1. Overview

        2. Section 187: Professions and vocations

        3. Section 188: Application of Chapter

        4. Section 189: Relief for unremittable amounts

        5. Section 190: Restrictions on relief

        6. Section 191: Withdrawal of relief

      15. Chapter 14: Disposal and acquisition of know-how

        1. Overview

        2. Section 192: Meaning of “know-how” etc.

        3. Section 193: Disposal of know-how if trade continues to be carried on

        4. Section 194: Disposal of know-how as part of disposal of all or part of a trade

        5. Section 195: Seller controlled by buyer etc.

      16. Chapter 15: Basis periods

        1. Overview

        2. Section 196: Professions and vocations

        3. Section 197: Meaning of “accounting date”

        4. Section 198: General rule

        5. Section 199: First tax year

        6. Section 200: Second tax year

        7. Section 201: Tax year in which there is no accounting date

        8. Section 202: Final tax year

        9. Section 203: Apportionment etc. of profits to basis periods

        10. Section 204: Meaning of “overlap period” and “overlap profit”

        11. Section 205: Deduction for overlap profit in final tax year

        12. Section 206: Restriction on bringing losses into account twice

        13. Section 207: Treatment of business start-up payments received in an overlap period

        14. Section 208: When the late accounting date rules apply

        15. Section 209: Rule if there is an accounting date

        16. Section 210: Rules if there is no accounting date

        17. Section 211: Treating middle date as accounting date

        18. Section 212: Consequence of treating middle date as accounting date

        19. Section 213: Circumstances in which middle date not treated as accounting date

        20. Section 214: When a change of accounting date occurs

        21. Section 215: Change of accounting date in third tax year

        22. Section 216: Change of accounting date in later tax year

        23. Section 217: Conditions for basis period to end with new accounting date

        24. Section 218: Commercial reasons for change of accounting date

        25. Section 219: The year after an ineffective change of accounting date

        26. Section 220: Deduction for overlap profit on change of accounting date

      17. Chapter 16: Averaging profits of farmers and creative artists

        1. Overview

        2. Section 221: Claim for averaging of fluctuating profits

        3. Section 222: Circumstances in which claim may be made

        4. Section 223: Adjustment of profits

        5. Section 224: Effect of adjustment

        6. Section 225: Effect of later adjustment of profits

      18. Chapter 17: Adjustment income

        1. Overview

        2. Section 226: Professions and vocations

        3. Section 227: Application of Chapter

        4. Section 228: Adjustment income and adjustment expense

        5. Section 229: Income charged

        6. Section 230: Person liable

        7. Section 231: Calculation of the adjustment

        8. Section 232: Treatment of adjustment income

        9. Section 233: Treatment of adjustment expense

        10. Section 234: No adjustment for certain expenses previously brought into account

        11. Section 235: Cases where adjustment not required until assets realised or written off

        12. Section 236: Change from realisation basis to mark to market

        13. Section 237: Election for spreading if section 236 applies

        14. Section 238: Spreading on ending of exemption for barristers and advocates

        15. Section 239: Election to accelerate charge under section 238

        16. Section 240: Liability of personal representatives if person liable dies

      19. Chapter 18: Post-cessation receipts

        1. Overview

        2. Section 241: Professions and vocations

        3. Section 242: Charge to tax on post-cessation receipts

        4. Section 243: Extent of charge to tax

        5. Section 244: Income charged

        6. Section 245: Person liable

        7. Section 246: Basic meaning of “post-cessation receipt”

        8. Section 247: Other rules about what counts as post-cessation receipts

        9. Section 248: Debts paid after cessation

        10. Section 249: Debts released after cessation

        11. Section 250: Receipts relating to post-cessation expenditure

        12. Section 251: Transfer of rights if transferee does not carry on trade

        13. Section 252: Transfer of trading stock or work in progress

        14. Section 253: Lump sums paid to personal representatives for copyright etc.

        15. Section 254: Allowable deductions

        16. Section 255: Further rules about allowable deductions

        17. Section 256: Treatment of post-cessation receipts

        18. Section 257: Election to carry back

      20. Chapter 19: Miscellaneous and supplementary

        1. Section 258: Changes in trustees and personal representatives

        2. Section 259: Meaning of “statutory insolvency arrangement”

    3. Part 3: Property income

      1. Overview

      2. Chapter 1: Introduction

        1. Section 260: Overview of Part 3

        2. Section 261: Provisions which must be given priority over Part 3

        3. Section 262: Priority between Chapters within Part 3

      3. Chapter 2: Property businesses

        1. Section 263: Introduction

        2. Section 264: UK property business

        3. Section 265: Overseas property business

        4. Section 266: Meaning of “generating income from land”

        5. Section 267: Activities not for generating income from land

      4. Chapter 3: Profits of property businesses: basic rules

        1. Section 268: Charge to tax on profits of a property business

        2. Section 269: Territorial scope of charge to tax

        3. Section 270: Income charged

        4. Section 271: Person liable

        5. Section 272: Profits of a property business: application of trading income rules

        6. Section 273: Amounts not brought into account as part of a property business

        7. Section 274: Relationship between rules restricting and permitting deductions

        8. Section 275: Apportionment of profits to tax year

      5. Chapter 4: Profits of property businesses: lease premiums etc.

        1. Overview

        2. Section 276: Introduction

        3. Section 277: Lease premiums

        4. Section 278: Amount treated as lease premium where work required

        5. Section 279: Sums payable instead of rent

        6. Section 280: Sums payable for surrender of lease

        7. Section 281: Sums payable for variation or waiver of term of lease

        8. Section 282: Assignments for profit of lease granted at undervalue

        9. Section 283: Provisions supplementary to section 282

        10. Section 284: Sales with right to reconveyance

        11. Section 285: Sale and leaseback transactions

        12. Section 286: Provisions supplementary to sections 284 and 285

        13. Section 287: Circumstances in which additional calculation rule applies

        14. Section 288: The additional calculation rule

        15. Section 289: The additional calculation rule: special cases

        16. Section 290: Meaning of “unused amount” and “unreduced amount”

        17. Section 291: Deductions for expenses under section 292

        18. Section 292: Tenants under taxed leases treated as incurring expenses

        19. Section 293: Restrictions on section 292 expenses: the additional calculation rule

        20. Section 294: Restrictions on section 292 expenses: lease of part of premises

        21. Section 295: Limit on reductions and deductions

        22. Section 296: Corporation tax receipts treated as taxed receipts

        23. Section 297: Taking account of reductions in corporation tax receipts

        24. Section 298: Taking account of deductions for rent as a result of section 37(4) or 87(2) of ICTA

        25. Section 299: Payment of tax by instalments

        26. Section 300: Statement of accuracy for purposes of section 282

        27. Section 301: Claim for repayment of tax payable by virtue of section 284

        28. Section 302: Claim for repayment of tax payable by virtue of section 285

        29. Section 303: Rules for determining effective duration of lease

        30. Section 304: Applying the rules in section 303

        31. Section 305: Information about effective duration of lease

        32. Section 306: Provisions about premiums

        33. Section 307: Interpretation

      6. Chapter 5: Profits of property businesses: other rules about receipts and deductions

        1. Overview

        2. Section 308: Furnished lettings

        3. Section 309: Rent-a-room relief

        4. Section 310: Acquisition of business: receipts from transferor’s UK property business

        5. Section 311: Reverse premiums

        6. Section 312: Deduction for expenditure on energy saving items

        7. Section 313: Restrictions on relief

        8. Section 314: Regulations

        9. Section 315: Deduction for expenditure on sea walls

        10. Section 316: Transfer of interest in premises

        11. Section 317: Ending of lease of premises

        12. Section 318: Transfer involving company within the charge to corporation tax

        13. Section 319: Relief in respect of mineral royalties

        14. Section 320: Nature of item apportioned on sale of estate or interest in land

        15. Section 321: Mutual business

      7. Chapter 6: Commercial letting of furnished holiday accommodation

        1. Overview

        2. Section 322: Introduction

        3. Section 323: Meaning of “commercial letting of furnished holiday accommodation”

        4. Section 324: Meaning of “relevant period” in sections 325 and 326

        5. Section 325: Meaning of “qualifying holiday accommodation”

        6. Section 326: Under-used holiday accommodation: averaging elections

        7. Section 327: Capital allowances and loss relief

        8. Section 328: Earned income and relevant UK earnings for pension purposes

      8. Chapter 7: Adjustment income

        1. Overview

        2. Section 329: Application of Chapter

        3. Section 330: Adjustment income and adjustment expense

        4. Section 331: Income charged

        5. Section 332: Person liable

        6. Section 333: Treatment of adjustment income

        7. Section 334: Treatment of adjustment expense

      9. Chapter 8: Rent receivable in connection with a UK section 12(4) concern

        1. Overview

        2. Section 335: Charge to tax on rent receivable in connection with a UK section 12(4) concern

        3. Section 336: Meaning of “rent receivable in connection with a UK section 12(4) concern”.

        4. Section 337: Income charged

        5. Section 338: Person liable

        6. Section 339: Deduction for management expenses of owner of mineral rights

        7. Section 340: Relief in respect of mineral royalties

        8. Section 341: Meaning of “mineral lease or agreement” and “mineral royalties”

        9. Section 342: Extended meaning of “mineral royalties” etc. in Northern Ireland

        10. Section 343: Power of Board to determine what counts as “mineral royalties”

      10. Chapter 9 Rent receivable for UK electric-line wayleaves

        1. Overview

        2. Section 344: Charge to tax on rent receivable for a UK electric-line wayleave

        3. Section 345: Meaning of “rent receivable for a UK electric-line wayleave”

        4. Section 346: Extent of charge to tax

        5. Section 347: Income charged

        6. Section 348: Person liable

      11. Chapter 10: Post-cessation receipts

        1. Overview

        2. Section 349: Charge to tax on post-cessation receipts

        3. Section 350: Extent of charge to tax

        4. Section 351: Income charged

        5. Section 352: Person liable

        6. Section 353: Basic meaning of “post-cessation receipt”

        7. Section 354: Other rules about what counts as a “post-cessation receipt”

        8. Section 355: Transfer of rights if transferee does not carry on UK property business

        9. Section 356: Application to Schedule A businesses

      12. Chapter 11: Overseas property income

        1. Section 357: Charge to tax on overseas property income

        2. Section 358: Meaning of “overseas property income”

        3. Section 359: Income charged

        4. Section 360: Person liable

      13. Chapter 12: Supplementary

        1. Section 361: Changes in trustees and personal representatives

        2. Section 362: Effect of company starting or ceasing to be within charge to income tax

        3. Section 363: Overseas property businesses and overseas land: adaptation of rules

        4. Section 364: Meaning of “lease” and “premises”

    4. Part 4: Savings and investment income

      1. Overview

      2. Structure of Chapters

      3. Chapter 1: Introduction

        1. Section 365: Overview of Part 4

        2. Section 366: Provisions which must be given priority over Part 4

        3. Section 367:Priority between Chapters within Part 4

        4. Section 368: Territorial scope of Part 4 charges

      4. Chapter 2: Interest

        1. Overview

        2. Section 369: Charge to tax on interest

          1. Building Societies

          2. Open-ended Investment Companies

          3. Authorised Unit Trusts

          4. Industrial and Provident Societies

        3. Section 370: Income charged

        4. Section 371: Person liable

        5. Section 372: Building society dividends

        6. Section 373: Open-ended investment company interest distributions

        7. Section 374: Date when interest payments under section 373 made

        8. Section 375: Interpretation of sections 373 and 374

        9. Section 376: Authorised unit trust interest distributions

        10. Section 377: Date when interest payments under section 376 made

        11. Section 378: Interpretation of sections 376 and 377

        12. Section 379: Industrial and provident society payments

        13. Section 380: Funding bonds

        14. Section 381: Discounts

      5. Chapter 3: Dividends etc. from UK resident companies etc.

        Introduction

        1. Section 382: Contents of Chapter

        2. Section 383: Charge to tax on dividends and other distributions

        3. Section 384: Income charged

        4. Section 385: Person liable

        5. Section 386: Open-ended investment company dividend distributions

        6. Section 387: Date when dividends paid under section 386

        7. Section 388: Interpretation of sections 386 and 387

        8. Section 389: Authorised unit trust dividend distributions

        9. Section 390: Date when dividends paid under section 389

        10. Section 391: Interpretation of sections 389 and 390

        11. Shares in approved share incentive plans (“SIPs”)

          1. Overview

          2. Section 392: SIP shares: introduction

          3. Section 393: Later charge where cash dividends retained in SIPs are paid over

          4. Section 394: Distribution when dividend shares cease to be subject to SIP

          5. Section 395: Reduction in tax due in cases within section 394

        12. Section 396: Interpretation of sections 392 to 395

        13. Section 397: Tax credits for qualifying distributions: UK residents and eligible non-UK residents

        14. Section 398: Increase in amount or value of dividends where tax credit available

        15. Section 399: Qualifying distributions received by persons not entitled to tax credits

        16. Section 400: Non-qualifying distributions

        17. Section 401: Relief: qualifying distribution after linked non-qualifying distribution

      6. Chapter 4: Dividends from non-UK resident companies

        1. Overview

        2. Section 402: Charge to tax on dividends from non-UK resident companies

        3. Section 403: Income charged

        4. Section 404: Person liable

        5. Section 405: SIP shares: introduction

        6. Section 406: Later charge where cash dividends retained in SIPs are paid over

        7. Section 407: Dividend payment when dividend shares cease to be subject to SIP

        8. Section 408: Reduction in tax due in cases within 407

      7. Chapter 5: Stock dividends from UK resident companies

        1. Overview

        2. Section 409: Charge to tax on stock dividend income

        3. Section 410: When stock dividend income arises

        4. Section 411: Income charged

        5. Section 412: Cash equivalent of share capital

        6. Section 413: Person liable

        7. Section 414: Income tax treated as paid

      8. Chapter 6: Release of loan to participator in close company

        1. Section 415: Charge to tax under Chapter 6

        2. Section 416: Income charged

        3. Section 417: Person liable

        4. Section 418: Relief where borrowers liable as settlors

        5. Section 419: Loans and advances to persons who die

        6. Section 420: Loans and advances to trustees of trusts that have ended

        7. Section 421: Income tax treated as paid

      9. Chapter 7: Purchased Life Annuity Payments

        1. Overview

        2. Section 422: Charge to tax on purchased life annuity payments

        3. Section 423: Meaning of “purchased life annuity”

        4. Section 424: Income charged

        5. Section 425Person liable

        6. Section 426: Annuity payments received after deduction of tax

      10. Chapter 8: Profits from deeply discounted securities

        1. Overview

        2. Section 427: Charge to tax on profits from deeply discounted securities

        3. Section 428: Income charged

        4. Section 429: Person liable

        5. Section 430: Meaning of “deeply discounted security”

        6. Section 431: Excluded occasions of redemption

        7. Section 432: Securities which are not deeply discounted securities

        8. Section 433: Meaning of “excluded indexed security”

        9. Section 434: Securities issued in separate tranches: preliminary

        10. Section 435: Securities issued in separate tranches: basic rule

        11. Section 436: Deeply discounted securities issued in separate tranches: nominal value rule

        12. Section 437: Transactions which are disposals

        13. Section 438: Timing of transfers and acquisitions

        14. Section 439: Calculating the profit from disposals

        15. Section 440: Market value disposals

        16. Section 441: Market value acquisitions

        17. Section 442: Securities issued in accordance with qualifying earn-out right

        18. Section 443: Application of this Chapter to strips of government securities

        19. Section 444: Meaning of “strip” in Chapter 8

        20. Section 445: Strips of government securities: acquisitions and disposals

        21. Section 446: Strips of government securities: relief for losses

        22. Section 447: Restriction of profits on strips by reference to original acquisition cost

        23. Section 448: Restriction of losses on strips by reference to original acquisition cost

        24. Section 449: Strips of government securities: manipulation of acquisition, sale or redemption payments

        25. Section 450: Market value of strips etc.

        26. Section 451: Market value of strips etc. quoted in foreign stock exchange lists

        27. Section 452: Power to modify this Chapter for strips

        28. Section 453: Application of sections 454 to 456

        29. Section 454: Listed securities held since 26th March 2003: relief for losses

        30. Section 455: Listed securities held since 26th March 2003: calculating the profit or loss on disposals

        31. Section 456: Securities issued to connected persons etc. at excessive price: subsequent transfers to connected persons

        32. Section 457: Trustees

        33. Section 458: Non-UK resident trustees

        34. Section 459: Transfer of assets abroad

        35. Section 460: Minor definitions

      11. Chapter 9: Gains from contracts for life insurance etc.

        1. Overview

        2. Section 461: Charge to tax under Chapter 9

        3. Section 462: When gains arise from policies and contracts

        4. Section 463: Income charged

        5. Section 464: Person liable for tax: introduction

        6. Section 465: Person liable: individuals

        7. Section 466: Person liable: personal representatives

        8. Section 467: Person liable: UK resident trustees

        9. Section 468: Non-UK resident trustees and foreign institutions

        10. Section 469: Two or more persons interested in policy or contract

        11. Section 470: Interests in rights under a policy or contract for section 469

        12. Section 471: Determination of shares etc.

        13. Section 472: Trusts created by two or more persons

        14. Section 473: Policies and contracts to which Chapter 9 applies: general

        15. Section 474: Special rules: qualifying policies

        16. Section 475: Special rules: personal portfolio bonds

        17. Section 476: Special rules: foreign policies

        18. Section 477: Special rules: certain older policies and contracts

        19. Section 478: Exclusion of mortgage repayment policies

        20. Section 479: Exclusion of pension policies

        21. Section 480: Exclusion of excepted group life policies

        22. Section 481: Excepted group life policies: conditions about benefits

        23. Section 482: Excepted group life policies: conditions about persons intended to benefit

        24. Section 483: Exclusion of credit union group life policies

        25. Section 484: When chargeable events occur

        26. Section 485: Disregard of certain events in relation to qualifying policies

        27. Section 486: Exclusion of maturity of capital redemption policies in certain circumstances

        28. Section 487: Disregard of certain assignments

        29. Section 488: Disregard of some events after alterations of life insurance policy terms

        30. Section 489: Conditions applicable to alterations of life insurance policy terms

        31. Section 490: Last payment under guaranteed income bonds etc. treated as total surrender

        32. Calculating gains: general

          1. Overview

          2. Section 491: Calculating gains: general rules

          3. Section 492: The total benefit value of a policy or contract

          4. Section 493: The value of a policy or contract

          5. Section 494: The total allowable deductions for a policy or contract

          6. Section 495: Disregard of certain amounts in calculating gains under section 491

          7. Section 496: Modification of section 494: qualifying endowment policies held as security for company debts

          8. Section 497: Disregard of trivial inducement benefits

        33. Part surrenders and assignments: periodic calculations and excess events

          1. Overview

          2. Section 498: Requirement for periodic calculations in part surrender or assignment cases

          3. Section 499: Meaning of “insurance year” and “final insurance year”

          4. Section 500: Events treated as part surrenders

          5. Section 501: Part surrenders: loans

          6. Section 502: Exception from section 501 for loans to buy life annuities

          7. Section 503: Exception from section 501 for certain loans under qualifying policies

          8. Section 504: Part surrenders: payments under guaranteed income bonds etc.

          9. Section 505: Assignments etc. involving co-ownership

          10. Section 506: Assignments occurring when there is a co-ownership transaction

          11. Section 507: Method for making periodic calculations under section 498

          12. Section 508: The value of rights partially surrendered or assigned

          13. Section 509: Chargeable events in certain cases where periodic calculations show gains

        34. Transaction-related calculations and part surrender or assignment events

          1. Overview

          2. Section 510: Requirement for transaction-related calculations in certain part surrender and assignment cases

          3. Section 511: Method for making transaction-related calculations under section 510

          4. Section 512: Available premium left for relevant transaction

          5. Section 513: Special rules for part surrenders and assignments in final insurance year

          6. Section 514: Chargeable events where transaction-related calculations show gains

        35. Section 515: Requirement for annual calculations in relation to personal portfolio bonds

        36. Section 516: Meaning of “personal portfolio bond”

        37. Section 517: Policies and contracts which are not personal portfolio bonds

        38. Section 518: The index categories

        39. Section 519: The index selection conditions

        40. Section 520: The property categories

        41. Section 521: The property selection conditions

        42. Section 522: Method for making annual calculations under section 515

        43. Section 523: The total amount of personal portfolio bond excesses

        44. Section 524: The total amount of part surrender gains

        45. Section 525: Chargeable events where annual calculations show gains

        46. Section 526: Power to make regulations about personal portfolio bonds

        47. Section 527: Reduction for sums taken into account otherwise than under Chapter 9

        48. Section 528: Reduction in amount charged: non-UK resident policy holders

        49. Section 529: Exceptions to section 528

        50. Section 530: Income tax treated as paid etc.

        51. Section 531: Exceptions to section 530

        52. Section 532: Relief for policies and contracts with European Economic Area insurers

        53. Section 533: Meaning of “comparable EEA tax charge”

        54. Section 534: Regulations providing for relief in other cases where foreign tax chargeable

        55. Section 535: Top slicing relief

        56. Section 536: Top slicing relieved liability: one chargeable event

        57. Section 537: Top slicing relieved liability: two or more chargeable events

        58. Section 538: Recovery of tax from trustees

        59. Section 539: Relief for deficiencies

        60. Section 540: When deficiencies arise: events following calculation events

        61. Section 541: Calculation of deficiencies

        62. Section 542: Replacement of qualifying policies

        63. Section 543: Issue time of qualifying policy replacing foreign policy

        64. Section 544: Application of Chapter to policies and contracts in which companies interested

        65. Section 545: Minor definitions

        66. Section 546: Table of provisions subject to special rules for older policies and contracts

      12. Chapter 10: Distributions from unauthorised unit trusts

        1. Section 547: Charge to tax under Chapter 10

        2. Section 548: Income charged

        3. Section 549: Person liable

        4. Section 550: Income tax treated as paid

      13. Chapter 11: Transactions in deposits

        1. Overview

        2. Section 551: Charge to tax on profits from disposal of deposit rights

        3. Section 552: Meaning of “deposit rights”

        4. Section 553: Income charged

        5. Section 554: Person liable

      14. Chapter 12: Disposals of futures and options involving guaranteed returns

        1. Overview

        2. Section 555: Charge to tax under Chapter 12

        3. Section 556: Income charged

        4. Section 557: Person liable

        5. Section 558: Meaning of “future”, “option” etc.

        6. Section 559: When disposals involve guaranteed returns

        7. Section 560: Production of guaranteed returns

        8. Section 561: The return from one or more disposals

        9. Section 562: When disposal of futures or options occur: general

        10. Section 563: Timing of certain grants of options where related disposals occur later

        11. Section 564: Deemed disposal where futures run to delivery or options are exercised

        12. Section 565: Interpretation of section 564

        13. Section 566: When transactions are related

        14. Section 567: Losses

        15. Section 568: Special rule for certain income of trustees

        16. Section 569: Anti-avoidance: transfer of assets abroad

      15. Chapter 13: Sales of foreign dividend coupons

        1. Overview

        2. Section 570: Charge to tax under Chapter 13

        3. Section 571: Meaning of “foreign holdings” etc

        4. Section 572: Income charged

        5. Section 573: Person liable

    5. Part 5: Miscellaneous income

      1. Overview

      2. Structure of Chapters

      3. Part 5: Chapter 1: Introduction

        1. Section 574: Overview of Part 5

        2. Section 575: Provisions which must be given priority over Part 5

        3. Section 576: Priority between Chapters within Part 5

        4. Section 577: Territorial scope of Part 5 charges

      4. Chapter 2: Receipts from intellectual property

        1. Overview

        2. Section 578: Contents of Chapter

        3. Section 579: Charge to tax on royalties and other income from intellectual property

        4. Section 580: Income charged under section 579

        5. Section 581: Person liable for tax under section 579

        6. Section 582: Deductions in calculating certain income charged under section 579

        7. Section 583: Charge to tax on income from disposals of know-how

        8. Section 584: Exceptions to charge under section 583

        9. Section 585: Income charged under section 583

        10. Section 586: Person liable for tax under section 583

        11. Section 587: Charge to tax on income from sales of patent rights

        12. Section 588: Income charged under section 587

        13. Section 589: Person liable for tax under section 587

        14. Section 590: UK resident sellers: spreading rules

        15. Section 591: Non-UK resident sellers: election for spreading

        16. Section 592: Further provision about elections for spreading: instalments

        17. Section 593: Death of seller

        18. Section 594: Winding up of a body corporate

        19. Section 595: Deduction of tax from payments to non-UK residents

        20. Section 596: Adjustments where tax has been deducted

        21. Section 597: Licences connected with patents

        22. Section 598: Rights to acquire future patent rights

        23. Section 599: Sums paid for Crown use etc. treated as paid under licence

        24. Section 600: Relief for expenses: patent income

        25. Section 601: How relief is given under section 600

        26. Section 602: Payments received after deduction of tax

        27. Section 603: Contributions to expenditure

        28. Section 604: Contributions not made by public bodies nor eligible for tax relief

        29. Section 605: Exchanges

        30. Section 606: Apportionment where property sold together

        31. Section 607: Questions about apportionments affecting two or more persons

        32. Section 608: Meaning of “capital sums” etc.

      5. Chapter 3: Films and sound recordings: non-trade businesses

        1. Overview

        2. Section 609: Charge to tax on films and sound recordings businesses

        3. Section 610: Income charged

        4. Section 611: Person liable

        5. Section 612: Calculation of income

        6. Section 613: Application of trading income rules to non-trade businesses

      6. Chapter 4: Certain telecommunication rights: non-trading income

        1. Overview

        2. Section 614: Charge to tax on certain telecommunication rights of a non-trader

        3. Section 615: Income charged

        4. Section 616: Person liable

        5. Section 617: Deductions in calculating certain income charged

        6. Section 618: Payments received after deduction of tax

      7. Chapter 5: Settlements: amounts treated as income of settlor

        1. Overview

        2. Section 619: Charge to tax under Chapter 5

        3. Section 620: Meaning of “settlement” and “settlor”

        4. Section 621: Income charged

        5. Section 622: Person liable

        6. Section 623: Calculation of income

        7. Section 624: Income where settlor retains an interest

        8. Section 625: Settlor’s retained interest

        9. Section 626: Exception for outright gifts between spouses

        10. Section 627: Exceptions for certain types of income

        11. Section 628: Exception for gifts to charities

        12. Section 629: Income paid to unmarried minor children of settlor

        13. Section 630: Exceptions for gifts to charities

        14. Section 631: Retained and accumulated income

        15. Section 632: Offshore income gains

        16. Section 633: Capital sums paid to settlor by trustees of settlement

        17. Section 634: Meaning of “capital sum” and “sums paid to settlor”

        18. Section 635: Amount of available income

        19. Section 636: Calculation of undistributed income

        20. Section 637: Qualifications to section 636

        21. Section 638: Capital sums paid by way of loan or repayment of loan

        22. Section 639: Loans to participators in close companies

        23. Section 640: Grossing-up of deemed income

        24. Section 641: Capital sum paid to settlor by body connected with settlement

        25. Section 642: Exception for certain loans or repayments of loans

        26. Section 643: Interpretation of sections 641 and 642

        27. Section 644: Application to settlements by two or more settlors

        28. Section 645: Property or income originating from settlor

        29. Section 646: Adjustments between settlor and trustees etc.

        30. Section 647: Power to obtain information

        31. Section 648: Income arising under a settlement

      8. Chapter 6: Beneficiaries’ income from estates in administration

        1. Overview

        2. Section 649: Charge to tax on estate income

        3. Section 650: Absolute, limited and discretionary interests

        4. Section 651: Meaning of “UK estate” and “foreign estate”

        5. Section 652: Estate income: absolute interests in residue

        6. Section 653: Meaning of “the administration period” and “the final tax year”

        7. Section 654: Estate income: limited interests in residue

        8. Section 655: Estate income: discretionary interests in residue

        9. Section 656: Income charged: UK estates

        10. Section 657: Income charged: foreign estates

        11. Section 658: Special rules for foreign income

        12. Section 659: Person liable

        13. Section 660: Basic amount of estate income: absolute interests

        14. Section 661: Basic amount of estate income: limited interests

        15. Section 662: Basic amount of estate income: discretionary interests

        16. Section 663: The applicable rate for grossing up basic amounts of estate income

        17. Section 664: The aggregate income of the estate

        18. Section 665: Assumed income entitlement

        19. Section 666: The residuary income of the estate

        20. Section 667: Shares of residuary income of estate

        21. Section 668: Reduction in share of residuary income of estate

        22. Section 669: Reduction in residuary income: inheritance tax on accrued income

        23. Section 670: Applicable rate for determining assumed income entitlement (UK estates)

        24. Section 671: Successive absolute interests

        25. Section 672: Successive interests: assumed income entitlement of holder of absolute interest following limited interest

        26. Section 673: Successive interests: payments in respect of limited interests followed by absolute interests

        27. Section 674: Successive interests: holders of limited interests

        28. Section 675: Basic amount of estate income: successive limited interests

        29. Section 676: Apportionments

        30. Section 677: Relief where UK income tax borne by foreign estate: absolute interests

        31. Section 678: Relief where UK income tax borne by foreign estate: limited and discretionary interests

        32. Section 679: Income from which basic amounts are treated as paid

        33. Section 680: Income treated as bearing income tax

        34. Section 681: Transfers of assets etc. treated as payments

        35. Section 682: Assessments, adjustments and claims after the administration period

      9. Chapter 7: Annual payments not otherwise charged

        1. Overview

        2. Section 683: Charge to tax on annual payments not otherwise charged

        3. Section 684: Income charged

        4. Section 685Person liable

        5. Section 686: Payments received after deduction of tax

      10. Chapter 8: Income not otherwise charged

        1. Overview

        2. Section 687: Charge to tax on income not otherwise charged

        3. Section 688: Income charged

        4. Section 689: Person liable

    6. Part 6: Exempt income

      1. Overview

      2. Chapter 1: Introduction

        1. Section 690: Overview of Part 6

      3. Chapter 2: National savings income

        1. Overview

        2. Section 691: National Savings Bank ordinary account interest

        3. Section 692: Income from savings certificates

        4. Section 693: Income from Ulster Savings Certificates

      4. Chapter 3: Income from individual investment plans

        1. Overview

        2. Section 694: Income from individual investment plans

        3. Section 695: Investment plans

        4. Section 696: Plan managers

        5. Section 697: Special requirements for certain foreign managers

        6. Section 698: Requirements for discharge of foreign institution’s duties

        7. Section 699: Non-entitlement to exemption

        8. Section 700: Information

        9. Section 701: General and supplementary powers

      5. Chapter 4: SAYE interest

        1. Overview

        2. Section 702: Interest under certified SAYE savings arrangements

        3. Section 703: Meaning of “certified SAYE savings arrangement”

        4. Section 704: Types of arrangements and providers

        5. Section 705: Certification of arrangements

        6. Section 706: Withdrawal and variation of certifications and connected requirements

        7. Section 707: Authorisation of providers

        8. Section 708: Withdrawal and variation of authorisations

      6. Chapter 5: Venture capital trust dividends

        1. Overview

        2. Section 709: Venture capital trust dividends

        3. Section 710: Treatment of shares where annual acquisition limit exceeded

        4. Section 711: Identification of shares after disposals

        5. Section 712: Identification of shares after reorganisations etc.

      7. Chapter 6: Income from FOTRA securities

        1. Overview

        2. Section 713: Introduction: securities free of tax to residents abroad (“FOTRA securities”)

        3. Section 714: Exemption of profits from FOTRA securities

        4. Section 715: Interest from FOTRA securities held on trust

        5. Section 716: Restriction on deductions etc. relating to FOTRA securities

      8. Chapter 7: Purchased life annuity payments

        1. Overview

        2. Section 717: Exemption for part of purchased life annuity payments

        3. Section 718: Excluded annuities

        4. Section 719: Extent of exemption under section 717

        5. Section 720: Exempt proportion: term dependent solely on duration of life

        6. Section 721: Exempt sum: term dependent solely on duration of life

        7. Section 722: Consideration for the grant of annuities

        8. Section 723: Determinations

        9. Section 724: Regulations

        10. Section 725: Annual payments under immediate needs annuities

        11. Section 726: Meaning of “care provider”

      9. Chapter 8: Other Annual Payments

        1. Overview

        2. Section 727: Certain annual payments by individuals

        3. Section 728: Commercial payments

        4. Section 729: Payments for non-taxable consideration

        5. Section 730: Foreign maintenance payments

        6. Section 731: Periodical payments of personal injury damages

        7. Section 732: Compensation awards

        8. Section 733: Persons entitled to exemptions for personal injury payments etc.

        9. Section 734: Payments from trusts for injured persons

        10. Section 735: Health and employment insurance payments

        11. Section 736: Health and employment risks and benefits

        12. Section 737: Period for which payments may be made

        13. Section 738: Risk of significant loss

        14. Section 739: Conditions to be met by policies also providing other benefits

        15. Section 740: Conditions to be met where policies are linked

        16. Section 741: Aggregation of policies where employment ends for health reasons

        17. Section 742: Meaning of “the insured”

        18. Section 743: Policies for the benefit of others who contribute to premiums

        19. Section 744: Payments to adopters: England and Wales

        20. Section 745: Payments to adopters: Scotland

        21. Section 746: Payments to adopters: Northern Ireland

        22. Section 747: Power to amend sections 744 to 746

        23. Section 748: Payments by persons liable to pool betting duty

      10. Chapter 9: Other income

        1. Overview

        2. Section 749: Interest paid under repayment supplements

        3. Section 750: Interest from tax reserve certificates

        4. Section 751: Interest on damages for personal injury

        5. Section 752: Interest under employees’ share schemes

        6. Section 753: Interest on repayment of student loan

        7. Section 754: Redemption of funding bonds

        8. Section 755: Interest on foreign currency securities etc. owned by non-UK residents

        9. Section 756: Which securities and loans are foreign currency ones for section 755

        10. Section 757: Interest and royalty payments: introduction

        11. Section 758: Exemption for certain interest and royalty payments

        12. Section 759: The person making the payment

        13. Section 760: The person beneficially entitled to the payment

        14. Section 761: Meaning of “25% associates”

        15. Section 762: Interest payments: exemption notices

        16. Section 763: Special relationships

        17. Section 764: Application of ICTA provisions about special relationships

        18. Section 765: Anti-avoidance

        19. Section 766: Interest and royalty payments: interpretation

        20. Section 767: Power to amend references to the Directive by Order

        21. Section 768: Commercial occupation of woodlands

        22. Section 769: Housing grants

        23. Section 770: Amounts applied by SIP trustees acquiring dividend shares or retained for reinvestment

        24. Section 771: Relevant foreign income of consular officers and employees

        25. Section 772: Further provisions about Orders under section 771

        26. Section 773: Income from Inter-American Development Bank securities

        27. Section 774: Income from securities issued by designated international organisations

        28. Section 775: Income towards reducing the national debt

        29. Section 776: Scholarship income

        30. Section 777: VAT repayment supplements

        31. Section 778: Incentives to use electronic communications

        32. Section 779: Gains on commodity and financial futures

        33. Section 780: Disabled person’s vehicle maintenance grant

        34. Section 781: Payments under New Deal 50plus

        35. Section 782: Payments under employment zone programme

      11. Chapter 10: General

        1. Section 783: General disregard of exempt income for income tax purposes

    7. Part 7: Income charged under this Act: rent-a-room and foster-care relief

      1. Chapter 1: Rent-a-room relief

        1. Overview

        2. Section 784: Overview of Chapter 1

        3. Section 785: Person who qualifies for relief

        4. Section 786: Meaning of “rent-a-room receipts”

        5. Section 787: Meaning of “residence”

        6. Section 788: Meaning of “total rent-a-room amount”

        7. Section 789: The individual’s limit

        8. Section 790: Exclusive receipts condition

        9. Section 791: Full rent-a-room relief: introduction

        10. Section 792: Full rent-a-room relief: trading income

        11. Section 793: Full rent-a-room relief: property income

        12. Section 794: Full rent-a-room relief: income chargeable under Chapter 8 of Part 5

        13. Section 795: Alternative calculation of profits: introduction

        14. Section 796: Alternative calculation of profits: trading income

        15. Section 797: Alternative calculation of profits: property income

        16. Section 798: Alternative calculation of profits: income chargeable under Chapter 8 of Part 5

        17. Section 799: Election not to apply full relief

        18. Section 800: Election for alternative method of calculating profits

        19. Section 801: Time limit on adjustment of assessment

        20. Section 802: Minor definitions

      2. Chapter 2: Foster-care relief

        1. Overview

        2. Section 803: Overview of Chapter 2

        3. Section 804: Person who qualifies for relief

        4. Section 805: Meaning of “foster-care receipts”

        5. Section 806: Meaning of providing foster care

        6. Section 807: Calculation of “total foster-care receipts”

        7. Section 808: The individual’s limit

        8. Section 809: Share of fixed amount: residence used by more than one foster carer

        9. Section 810: Share of fixed amount: income period not a year

        10. Section 811: The amount per child

        11. Section 812: Full foster-care relief: introduction

        12. Section 813: Full foster-care relief: trading income

        13. Section 814: Full foster-care relief: income chargeable under Chapter 8 of Part 5.

        14. Section 815: Alternative calculation of profits: introduction

        15. Section 816: Alternative calculation of profits: trading income

        16. Section 817: Alternative calculation of profits: income chargeable under Chapter 8 of Part 5

        17. Section 818: Election for alternative method of calculating profits

        18. Section 819: Adjustment of assessment

        19. Section 820: Periods of account not ending on 5th April

        20. Section 821: Meaning of “relevant limit”

        21. Section 822: Full relief

        22. Section 823: Alternative method of calculating profits

        23. Section 824: Capital allowances: introduction

        24. Section 825: Carried forward unrelieved qualifying expenditure

        25. Section 826: Excluded capital expenditure

        26. Section 827: Excluded capital expenditure: subsequent treatment of asset

        27. Section 828: Overlap profit

    8. Part 8: Foreign income: special rules

      1. Overview

      2. Chapter 1: Introduction

        1. Overview

        2. Section 829: Overview of Part 8

        3. Section 830: Meaning of “relevant foreign income”

      3. Chapter 2: Relevant foreign income charged on remittance basis

        1. Overview

        2. Section 831: Claims for relevant foreign income to be charged on the remittance basis

        3. Section 832: Relevant foreign income charged on the remittance basis

        4. Section 833: Income treated as remitted: repayment of UK-linked debts

        5. Section 834: Arrangements treated as repayment of UK-linked debts

        6. Section 835: Relief for delayed remittances

        7. Section 836: Relief for delayed remittances: backdated pensions

        8. Section 837: Claims for relief on delayed remittances

      4. Chapter 3: Relevant foreign income charged on arising basis: deductions and reliefs

        1. Overview

        2. Section 838: Expenses attributable to collection or payment of relevant foreign income

        3. Section 839: Annual payments payable out of relevant foreign income

        4. Section 840: Relief for backdated pensions charged on the arising basis

      5. Chapter 4: Unremittable income

        1. Overview

        2. Section 841: Unremittable income: introduction

        3. Section 842: Claim for relief for unremittable income

        4. Section 843: Withdrawal of relief

        5. Section 844: Income charged on withdrawal of relief after source ceases

        6. Section 845: Valuing unremittable income

    9. Part 9: Partnerships

      1. Overview

      2. Section 846: Overview of Part 9

      3. Section 847: General provisions

      4. Section 848: Assessment of partnerships

      5. Section 849: Calculation of firm’s profits or losses

      6. Section 850: Allocation of firm’s profits or losses between partners

      7. Section 851: Calculations etc. where firm has other income or losses

      8. Section 852: Carrying on by partner of notional trade

      9. Section 853: Basis periods for partners’ notional trades

      10. Section 854: Carrying on by partner of notional business

      11. Section 855: Basis periods for partners’ notional businesses

      12. Section 856: Overlap profits from partners’ notional businesses

      13. Section 857: Partners to whom the remittance basis may apply

      14. Section 858: Resident partners and double taxation agreements

      15. Section 859: Special provisions about farming and property income

      16. Section 860: Adjustment income

      17. Section 861: Sale of patent rights: effect of partnership changes

      18. Section 862: Sale of patent rights: effect of later cessation of trade

      19. Section 863: Limited liability partnerships

    10. Part 10: General provisions

      1. Chapter 1: Introduction

        1. Section 864: Overview of Part 10

      2. Chapter 2: General calculation rules etc.

        1. Overview

        2. Section 865: Unpaid remuneration: non-trades and non-property businesses

        3. Section 866: Employee benefit contributions: non-trades and non-property businesses

        4. Section 867: Business entertainment and gifts: non-trades and non-property businesses

        5. Section 868: Social security contributions: non-trades etc.

        6. Section 869: Penalties, interest and VAT surcharges: non-trades etc.

        7. Section 870: Crime-related payments: non-trades and non-property businesses

        8. Section 871: Apportionment etc. of miscellaneous profits to tax year

        9. Section 872: Losses calculated on same basis as miscellaneous income

      3. Chapter 3: Supplementary and general provisions

        1. Section 873: Orders and regulations made by Treasury or Board

        2. Section 874: Activities in UK sector of continental shelf

        3. Section 875: Meaning of “caravan”

        4. Section 876: Meaning of “farming” and related expressions

        5. Section 877: Meaning of grossing up

        6. Section 878: Other definitions

        7. Section 879: Interpretation: Scotland

        8. Section 880: Interpretation: Northern Ireland

        9. Section 881: Disapplication of corporation tax: section 9 of ICTA

        10. Section 882: Consequential amendments

        11. Section 883: Commencement and transitional provisions etc.

        12. Section 884: Repeals and revocations

        13. Section 885: Abbreviations and general index in Schedule 4

    11. Schedule 1: Consequential Amendments

      1. Part 1: Income and Corporation Taxes Act 1988

        1. Paragraph 3: section 1A of ICTA

        2. Paragraph 7: section 9 of ICTA

        3. Paragraph 9: section 18 of ICTA

          1. Cases I and II

          2. Case III

          3. Cases IV and V

          4. Case VI

        4. Paragraph 10: section 20 of ICTA

          1. Section 20(1) paragraph 1 of ICTA – the Schedule F charging provision

          2. Section 20(1) paragraph 2 of ICTA – the income chargeable

          3. Section 20(2) of ICTA –priority provision

          4. Section 20(3) of ICTA - signpost

          5. Replacement expressions for special tax rates

        5. Paragraph 36: section 60 of ICTA

        6. Paragraph 43: section 71 of ICTA

        7. Paragraph 45: section 74 of ICTA

        8. Paragraph 53: section 82 of ICTA

        9. Paragraph 60: section 86 of ICTA

        10. Paragraph 65: section 89 of ICTA

        11. Section 92 of ICTA (no paragraph in Schedule 1)

        12. Paragraph 94: section 113 of ICTA

        13. Paragraph 106: section 122 of ICTA

        14. Paragraph 141: section 333 of ICTA

        15. Paragraph 146: section 347A of ICTA

        16. Paragraph 147: section 348 of ICTA

        17. Paragraph 148: section 349 of ICTA

        18. Paragraph 167: section 391 of ICTA

        19. Paragraph 168: section 392 of ICTA

        20. Section 443 of ICTA (no paragraph in Schedule 1)

        21. Paragraphs 209 to 228: sections 539 to 554 of ICTA

        22. Paragraph 247 and 248: sections 586 and 587 of ICTA

        23. Paragraphs 284 and 285: sections 695 and 696 of ICTA

        24. Paragraph 327: section 817 of ICTA

        25. Paragraph 333: section 827A of ICTA

        26. Paragraph 338: section 833 of ICTA

        27. Paragraph 348(3): paragraph 7A of Schedule 22 to ICTA

        28. Paragraph 352(2): paragraph 5 of Schedule 30 to ICTA

        29. Paragraph 352(3): paragraph 18 of Schedule 30 to ICTA

      2. Part 2: Other Enactments

        1. Taxes Management Act 1970

          1. Paragraphs 362, 365 and 371: sections 9D, 12AE(2) and 31(3) of TMA

        2. Taxation of Chargeable Gains Act 1992

          1. Paragraph 435: sections 148A, 148B and 148C of TCGA

          2. Section 148A Futures and options involving guaranteed returns

          3. Section 148B Deemed disposals at a gain under section 564(4) of ITTOIA 2005

          4. Section 148C Deemed disposals at a loss under section 564(4) of ITTOIA 2005

          5. Paragraph 438: section 151C of TCGA

          6. Paragraph 443: section 254(1)(c) of TCGA

        3. Finance Act 1993

          1. Paragraph 464: section 171(2) of FA 1993

        4. Income Tax (Earnings and Pensions) Act 2003

          1. Paragraph 592: section 325A of ITEPA

          2. Paragraph 594: section 360A of ITEPA

          3. Paragraph 606: section 575 of ITEPA

          4. Paragraph 607: section 613 of ITEPA

          5. Paragraph 608: section 631 of ITEPA

          6. Paragraph 609: section 635 of ITEPA

          7. Paragraph 610: section 644A of ITEPA

          8. Paragraph 611: section 646A of ITEPA

          9. Paragraph 613: section 679 of ITEPA

          10. Paragraph 614: section 681A of ITEPA

    12. Schedule 2: Transitionals and savings etc.

      1. Part 1: General provisions – continuity of the law

      2. Part 2: Changes in the law

      3. Part 3: Trading income

        1. Paragraphs 22 and 23: Training courses for employees

        2. Paragraph 48: Apportionment of profits or losses to tax years before tax year 2005-06 – basis periods

        3. Paragraph 50: Profits or losses of a trade, profession or vocation previously chargeable in accordance with section 65(1) of ICTA

        4. Paragraph 51: Profits of mines, quarries and other concerns not chargeable by reference to a basis period

        5. Paragraph 55: Averaging profits of farmers and creative artists

        6. Paragraph 58: Adjustment on change of basis: paragraph 12 of Schedule 22 to FA 2002

        7. Paragraph 59: Adjustment on change of basis: section 104 of ICTA

      4. Part 4: Property income

        1. Paragraph 62: Apportionment of profits or losses to tax years before tax year 2005-06

      5. Part 5: Savings and investment income: general

        1. Paragraph 78: Open-ended investment companies: saving for powers to make provision corresponding to provisions applicable to unit trusts

        2. Paragraph 80: Deeply discounted securities: deemed transfers of strips on 5th April

        3. Paragraphs 82 and 83: Profits from deeply discounted securities: saving for charities’ losses Profits from deeply discounted securities: saving for pension trustees’ losses

        4. Paragraph 84: Exclusion of deeply discounted securities from section 711 to 718 of ICTA (accrued income profits)

        5. Paragraph 85: Gains from contracts for life insurance etc: foreign policies of life insurance

        6. Paragraph 86: Gains from contracts for life insurance etc: exclusion of pension policies

        7. Paragraphs 87 and 88: Gains from contracts for life insurance etc: rights partially assigned

        8. Paragraph 89: Gains from contracts for life insurance etc: regulations providing for relief where foreign tax chargeable

        9. Paragraph 90: Gains from contracts for life insurance etc: pure protection group life policies

        10. Paragraph 91: Gains from contracts for life insurance etc: assessment of trustees etc

        11. Paragraphs 92 and 93: Transactions in deposits

        12. Paragraph 94: Disposals of futures and options involving guaranteed returns: certain pre-6th February 1998 transactions

        13. Paragraph 95: Disposals of futures and options involving guaranteed returns: rates of tax for pension trustees

      6. Part 6: Savings and investment income: insurance contracts and policies made before certain dates

        1. Overview

        2. Paragraph 96: Pre-20th March 1968 policies and contracts excluded from Chapter 9 of Part 4

        3. Paragraph 97: Pre-27th March 1974 policies and contracts: disapplication of section 500(c)

        4. Paragraph 98: Pre-27th March 1974 contracts: disapplication of section 531(3)(c)

        5. Paragraph 99: Pre-10th December 1974 contracts for a life annuity: disapplication of section 484(1)(d)

        6. Paragraph 100: Pre-14th March 1975 policies and contracts: calculation of gains under section 507

        7. Paragraph 101: Pre-25th March 1982 replacement policies: disapplication of section 542

        8. Paragraph 102: Certain pre-26th June 1982 policies and contracts excluded from Chapter 9 of Part 4

        9. Paragraph 103: Certain pre-18th November 1983 policies not foreign policies of life insurance

        10. Paragraph 104: Certain pre-23rd February 1984 policies not foreign capital redemption policies

        11. Paragraph 105: Pre-14th March 1984 policies: disregard of amounts deducted and repaid after tax relief by deduction from premiums abolished

        12. Paragraph 106: Certain pre-20th March 1985 policies: application of section 529(1)

        13. Paragraph 107: Pre-14th March 1989 qualifying policies: application of section 485(2)(b) and (3)(b)

        14. Paragraph 108: Pre-14th March 1989 policies and contracts: application of section 501

        15. Paragraph 109: Contracts in accounting periods beginning before 1st January 1992: disapplication of sections 530and 539(3)

        16. Paragraph 110: Certain pre-17th March 1998 policies: application of section 529(1)

        17. Paragraph 111: Certain pre-17th March 1998 policies not foreign policies of life insurance

        18. Paragraph 112: Pre-17th March 1998 policy or contract: UK resident trustees

        19. Paragraph 113: Certain pre-23rd March 1999 policies not foreign capital redemption policies

        20. Paragraph 114: Pre-9th April 2003 contract or policy: UK resident trustees

        21. Paragraph 115: Pre-9th April 2003 contract or policy: loans to trustees

        22. Paragraph 116: Pre-9th April 2003 contract or policy: excepted group life policies

        23. Paragraph 117: Pre-3rd March 2004 contract or policy: calculation of deficiencies

        24. Paragraph 118: Pre-1st January 2005 contracts for immediate needs annuities: income tax treated as paid

      7. Part 7: Savings and investment income: gains from contracts for life insurance etc. (personal portfolio bonds)

        1. Overview

        2. Paragraph 119: Pre-17th March 1998 contract or policy: conditions to be met for contract or policy not to be a personal portfolio bond

        3. Paragraph 120: The date condition

        4. Paragraph 121: The non-variation condition

        5. Paragraph 122: The first selection condition

        6. Paragraph 123: The second selection condition

        7. Paragraph 124: Policy holders becoming UK resident after 17th March 1998

        8. Paragraph 125: Policy holders becoming permanently UK resident after 17th March 1998

        9. Paragraph 126: Meaning of “permitted index”

        10. Paragraph 127: Meaning of “permitted property”

        11. Paragraph 128: Other definitions

      8. Part 8: Miscellaneous income

        1. Paragraph 132: Income treated as income of settlor: exception for pension income

        2. Paragraph 133: Amounts treated as income of settlor: income paid to unmarried minor child of settlor

        3. Paragraph 134: Amounts treated as income of settlor: capital sums paid to settlor by trustees of settlement

      9. Part 9: Exempt income

        1. Paragraph 143: Purchased life annuity payments: old determinations concerning capital elements

        2. Paragraph 144: Purchased life annuity payments: carry forward of excess capital elements

        3. Paragraph 145: Purchased life annuity payments: penalty for false statements

        4. Paragraph 146: Certain annual payments by individuals

        5. Paragraph 147: Annuity payments for non-taxable consideration

        6. Paragraph 148: Periodical payments of personal injury damages etc.

      10. Part 11: Foreign income: special rules

        1. Paragraph 150: Relevant foreign income charged on remittance basis: income arising before the tax year 2005-06

        2. Paragraph 151: Relevant foreign income charged on remittance basis: delayed remittances

        3. Paragraph 152: Relief for back-dated pensions charged on arising basis

        4. Paragraph 153: Unremittable income that arose before the tax year 2005-06

      11. Part 12: Other provisions

        1. Paragraph 158: Apportionment of profits or losses to tax years before tax year 2005-06

        2. Paragraph 159: General deduction rules

    13. Schedule 3: Repeals and revocations

    14. Schedule 4: Abbreviations and defined expressions

      1. Part 1: Abbreviations of Acts

      2. Part 2: Index of expressions defined in this Act etc.

  6. Commencement

  7. Hansard References

  8. Annex 1: Minor changes in the law made by the Act

  9. ANNEX 2: DESTINATION OF REWRITTEN EXTRA-STATUTORY CONCESSIONS

  • Explanatory Notes Table of contents

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Explanatory Notes

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