Finance (No. 2) Act 2005

JurisdictionUK Non-devolved
Citation2005 c. 22


Finance (No. 2) Act 2005

2005 Chapter 22

An Act to grant certain duties, to alter other duties, and to amend the law relating to the National Debt and the Public Revenue, and to make further provision in connection with finance.

[20th July 2005]

Most Gracious Sovereign

We , Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom in Parliament assembled, towards raising the necessary supplies to defray Your Majesty's public expenses, and making an addition to the public revenue, have freely and voluntarily resolved to give and to grant unto Your Majesty the several duties hereinafter mentioned; and do therefore most humbly beseech Your Majesty that it may be enacted, and be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

1 Value added tax

Part 1

Value added tax

S-1 Goods subject to warehousing regime: place of acquisition or supply

1 Goods subject to warehousing regime: place of acquisition or supply

In section 18 of VATA 1994 (goods subject to warehousing regime: place and time of acquisition or supply), after subsection (1) insert—

‘(1A) The Commissioners may by regulations prescribe circumstances in which subsection (1) above shall not apply.

S-2 Cars: determination of consideration for fuel supplied for private use

2 Cars: determination of consideration for fuel supplied for private use

(1) Section 57 of VATA 1994 (determination of consideration for fuel supplied for private use) is amended as follows.

(2) After subsection (4) (power of Treasury by order to substitute a different Table for Table A) insert—

‘(4A) The power conferred by subsection (4) above includes power to substitute for Table A a Table (whether or not of the same or a similar configuration) where any description of vehicle may be by reference to any one or more of the following—

(a) the CO2 emissions figure for the vehicle;

(b) the type or types of fuel or power by which the vehicle is, or is capable of being, propelled;

(c) the cylinder capacity of the engine in cubic centimetres.

(4B) The provision that may be included in any such Table includes provision for the purpose of enabling the consideration to be determined by reference to the Table—

(a) by applying a percentage specified in the Table to a monetary amount specified in the Table, or

(b) by any other method.

(4C) Table A, as from time to time substituted by virtue of subsection (4A) above, may be implemented or supplemented by either or both of the following—

(a) provision in Rules inserted before the Table, prescribing how the consideration is to be determined by reference to the Table;

(b) provision in Notes inserted after the Table in accordance with the following provisions of this section.

(4D) The provision that may be made in Notes includes provision—

(a) with respect to the interpretation or application of the Table or any Rules or Notes;

(b) with respect to the figure that is to be regarded as the CO2 emissions figure for any vehicle or any particular description of vehicle;

(c) for treating a vehicle as a vehicle with a particular CO2 emissions figure;

(d) for treating a vehicle with a CO2 emissions figure as a vehicle with a different CO2 emissions figure;

(e) for or in connection with determining the consideration appropriate to vehicles of any particular description (in particular, vehicles falling within any one or more of the descriptions in subsection (4E) below).

(4E) The descriptions are—

(a) vehicles capable of being propelled by any particular type or types of fuel or power;

(b) vehicles first registered before 1st January 1998;

(c) vehicles first registered on or after that date which satisfy the condition in subsection (4F) below (registration without a CO2 emissions figure).

(4F) The condition is that the vehicle is not one which, when it is first registered, is so registered on the basis of—

(a) an EC certificate of conformity that specifies a CO2 emissions figure, or

(b) a UK approval certificate that specifies such a figure.

(4G) Any Rules or Notes do not form part of the Table, but the Treasury, by order taking effect from the beginning of any prescribed accounting period beginning after the order is made, may—

(a) insert Rules or Notes,

(b) vary or remove Rules or Notes, or

(c) substitute any or all Rules or Notes.

’.

(3) In subsection (5) (fuel supplied for 2 or more vehicles)—

(a) in paragraph (a), for ‘Table A above, that Table’ substitute ‘Table A above or any Notes, that Table and those Notes’;

(b) in paragraph (b), after ‘that Table’, in both places, insert ‘or those Notes’.

(4) In subsection (7) (cubic capacity of internal combustion engine with reciprocating pistons) after ‘for the purposes of Table A above’ insert ‘and any Notes’.

(5) In subsection (8) (cubic capacity in other cases) after ‘for the purposes of Table A above’ insert ‘and any Notes’.

(6) After subsection (8) insert—

‘(9) In this section—

"CO2 emissions figure" means a CO2 emissions figure expressed in grams per kilometre driven;

"EC certificate of conformity" means a certificate of conformity issued by a manufacturer under any provision of the law of a Member State implementing Article 6 of Council Directive 70/156/EEC, as from time to time amended;

"Notes" means Notes inserted by virtue of subsection (4C)(b) above;

"Rules" means Rules inserted by virtue of subsection (4C)(a) above;

"UK approval certificate" means a certificate issued under—

(a) section 58(1) or (4) of the Road Traffic Act 1988, or

(b) Article 31A(4) or (5) of the Road Traffic (Northern Ireland) Order 1981.

(10) If the Treasury consider it necessary or expedient to do so in consequence of—

(a) the form or content of any Table substituted or to be substituted by virtue of subsection (4A) above, or

(b) any provision included or to be included in Rules or Notes,

they may by order amend, repeal or replace so much of this section as for the time being follows subsection (1) and precedes Table A and relates to the use of that Table.

’.

(7) The amendments made by this section come into force on such day or days as the Treasury may appoint by order made by statutory instrument; and different days may be so appointed for different purposes.

S-3 Credit for, or repayment of, overstated or overpaid VAT

3 Credit for, or repayment of, overstated or overpaid VAT

(1) Section 80 of VATA 1994 (recovery of overpaid VAT) is amended as follows.

(2) For subsection (1) (liability of Commissioners to repay overpaid VAT) substitute—

‘(1) Where a person—

(a) has accounted to the Commissioners for VAT for a prescribed accounting period (whenever ended), and

(b) in doing so, has brought into account as output tax an amount that was not output tax due,

the Commissioners shall be liable to credit the person with that amount.

(1A) Where the Commissioners—

(a) have assessed a person to VAT for a prescribed accounting period (whenever ended), and

(b) in doing so, have brought into account as output tax an amount that was not output tax due,

they shall be liable to credit the person with that amount.

(1B) Where a person has for a prescribed accounting period (whenever ended) paid to the Commissioners an amount by way of VAT that was not VAT due to them, otherwise than as a result of—

(a) an amount that was not output tax due being brought into account as output tax, or

(b) an amount of input tax allowable under section 26 not being brought into account,

the Commissioners shall be liable to repay to that person the amount so paid.

’.

(3) In subsection (2) (Commissioners only liable to repay an amount on a claim) before ‘repay’ insert ‘credit or’.

(4) After subsection (2) insert—

‘(2A) Where—

(a) as a result of a claim under this section by virtue of subsection (1) or (1A) above an amount falls to be credited to a person, and

(b) after setting any sums against it under or by virtue of this Act, some or all of that amount remains to his credit,

the Commissioners shall be liable to pay (or repay) to him so much of that amount as so remains.

’.

(5) In subsection (3) (defence of unjust enrichment) for ‘under this section, that repayment’ substitute ‘under this section by virtue of subsection (1) or (1A) above, that the crediting’.

(6) For subsection (3A) (cost of payment borne for practical purposes by third party) substitute—

‘(3A) Subsection (3B) below applies for the purposes of subsection (3) above where—

(a) an amount would (apart from subsection (3) above) fall to be credited under subsection (1) or (1A) above to any person ("the taxpayer"), and

(b) the whole or a part of the amount brought into account as mentioned in paragraph (b) of that subsection has, for practical purposes, been borne by a person other than the taxpayer.

’.

(7) In subsection (3B) (loss or damage to be disregarded) in paragraph (a), for ‘repayment’ substitute ‘crediting’.

(8) For subsection (4) (time limit on claims) substitute—

‘(4) The Commissioners shall not be liable on a claim under this section—

(a) to credit an amount to a person under subsection (1) or (1A) above, or

(b) to repay...

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