Finance Bill 2002
Amendments 145-146
Amendment 145 Page: 304 Line: 9
Amendment 146 Page: 304 Line: 18
Mr Andrew Smith (Labour, Oxford East)
145
Schedule 25, page 304, line 9, at end insert-
'(1A) In sub-paragraph (1) (accounting periods to which the paragraph applies) for paragraph (b) substitute-
"(b) at any time in that period another company stands in the position of a creditor as respects that security;".'.
146
Schedule 25, page 304, line 18, at end insert
'(3A) For sub-paragraph (8) (which defines what it is for the benefit of a security to be available to a company) substitute-
"(8) Any reference in this paragraph to a person who stands in the position of a creditor as respects a relevant discounted security includes a reference to a person who indirectly stands in that position by reference to a series of relevant discounted securities.
(8A) Where this paragraph applies by virtue of sub-paragraph (8) above, the reference to the corresponding creditor relationship in sub-paragraph (1)(d) above is a reference to the creditor relationship of the company which indirectly stands in the position of a creditor as respects the relevant discounted security.".'.
EXPLANATORY NOTE
SUMMARY
1. The purpose of the amendments is to conform the wording of paragraph 17 Schedule 9 FA 1996 with the revised wording of paragraph 18.
DETAILS OF THE AMENDMENTS
2. Paragraph 18 Schedule 9 FA 1996 (discounted securities where issuer is close company) is modified by paragraph 34 of Schedule 25 to the Bill. One change there is to replace references to "beneficial ownership" with references to a person standing in the position of creditor. This brings paragraph 18 into line with other provisions of Chapter 2 Part 4 FA 1996.
3. Paragraph 17 Schedule 9 (discounted securities where holder and issuer connected) is not similarly amended by Schedule 25. These two amendments now bring it into line with paragraph 18. Amendment 145 replaces the test in paragraph 17(1)(b) Schedule 9 of whether a benefit is available to a person with a test of whether that person stands in the position of creditor.
4. Amendment 146 replaces the definition of "benefit available" in paragraph 17(8) Schedule 9 with a new definition of what "stands in the position of a creditor" means, and includes the case where a person indirectly stands in that position (new paragraph 17(8A)).
BACKGROUND
5. The measures included in the Finance Bill as Schedule 25 represent the outcome of a major consultative process between the Government and representatives of, and advisers to, business. Two Consultative documents and a Technical Note have been produced, and two rounds of draft clauses have been published, most recently on 19 December 2001.