Budget Resolutions and Economic Situation — 13. Surplus franked investment income — 7 Jul 1997
(a) the rate at which corporation tax is charged for the financial year 1997 shall be, and shall be deemed always to have been, 31 per cent. (and not 33 per cent. as provided by section 58 of the Finance Act 1997); and
(b) the small companies' rate for that year shall be, and shall be deemed always to have been, 21 per cent. (and not 23 per cent. as provided by section 59(a) of that Act).
That provision may be made in relation to sections 242 to 244 of the Income and Corporation Taxes Act 1988.
14. Tax credits (pension funds)
(1) In section 231 of the Income and Corporation Taxes Act 1988--
(a) in subsection (2) for "Subject to section 241(5)" there shall be substituted "Subject to sections 231A and 241(5)"; and
(b) at the beginning of subsection (3) there shall be inserted "Subject to section 231A,".
(2) After section 231 of the Income and Corporation Taxes Act 1988 there shall be inserted--
"Restrictions on the use of tax credits by pension funds
231A.--(1) No claim shall be made under section 231(2) for payment of the amount of a tax credit if or to the extent that the qualifying distribution to which the credit relates is income of a pension fund.
(2) In the case of any pension fund, for any year of assessment the aggregate amount of the tax credits in respect of which claims are made under section 231(3) must not exceed the aggregate amount of the tax credits in respect of the qualifying distributions comprised in the income of the pension fund and brought into charge to tax.
(3) Accordingly, no payment shall be made under section 231(3) in respect of so much of the excess there mentioned as is referable to a tax credit in respect of a qualifying distribution if or to the extent that the qualifying distribution is income of a pension fund.
(4) In this section--
"income", in relation to a pension fund, means income derived from investments or deposits held for the purposes of the pension fund;
"pension fund" means any scheme, fund or other arrangements established and maintained (whether in the United Kingdom or elsewhere) for the purpose of providing pensions, retirement annuities, allowances, lump sums, gratuities or other superannuation benefits (with or without subsidiary benefits);
"scheme" includes any deed, agreement or series of agreements.
(5) For convenience of identification only, the schemes, funds or other arrangements which are "pension funds" for the purposes of this section by virtue of the definition of that expression in subsection (4) above include, in particular, those whose income is, in whole or in part, exempt, or eligible for exemption, from tax under or by virtue of any of the following provisions--
(a) section 512(2);
(b) section 592(2);
(c) section 608(2)(a);
(d) section 613(4);
(e) section 614(2), (3), (4) or (5);
(f) section 620(6);
(g) section 643(2).
(6) The preceding provisions of this section do not have effect in relation to--
(a) claims made in respect of tax credits to which entitlement arises by virtue of section 232(3); or
(b) claims made by virtue of arrangements having effect under section 788."
(3) This Resolution has effect in relation to qualifying distributions made on or after 2nd July 1997.
And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.
The House divided: Ayes 332, Noes 199.
Votes by party, red entries are votes against the majority for that party.
What is Tell? '+1 tell' means that in addition one member of that party was a teller for that division lobby.
What are Boths? An MP can vote both aye and no in the same division. The boths page explains this.
What is Turnout? This is measured against the total membership of the party at the time of the vote.
|Party||Majority (Aye)||Minority (No)||Both||Turnout|
|Con||0||149 (+2 tell)||0||93.2%|
|Lab||331 (+2 tell)||0||0||79.9%|