Personal Equity Plan Regulations 1989
| Jurisdiction | UK Non-devolved |
| Citation | SI 1989/469 |
| Year | 1989 |
1989No. 469
INCOME TAX
The Personal Equity Plan Regulations 1989
14thMarch1989
14thMarch1989
6thApril1989
ARRANGEMENT OF REGULATIONS
1. Citation and commencement
2. Interpretation
3. Introductory
4. General conditions for plans and subscriptions to plans
5. General investment rules
6. Qualifying investments
7. Qualifying individuals who may invest under a plan
8. Plan investor ceasing to qualify
9. Conditions for application to subscribe to a plan
10. Rights issues-relaxation of provisions of regulations 4 and 7
11. Plan manager-qualifications and Board's approval
12. Plan manager-withdrawal by Board of approval
13. Plan manager-appeal against withdrawal of Board's approval
14. Plan manager ceasing to act
15. Plan manager ceasing to qualify
16. Transfer of plans to other plan managers
17. Exemption from tax of plan income and gains
18. Tax liabilities and reliefs-plan manager to act on behalf of plan investor
19. Repayments in respect of tax to plan manager-interim claims
20. Repayments in respect of tax to plan manager-annual returns and annual claims
21. Plan manager's returns and claims-supplementary provisions
22. Assessments for withdrawing relief and recovering tax
23. Records to be kept by plan manager
24. Information to be given to plan investor by plan manager
25. Information to be provided to the Board
26. Inspection of records by officer of the Board
27. Capital gains tax-adaptation of enactments
28. Administration of tax in relation to plans-supplementary
29. Transitional provisions-plans and plan investors under the 1986 Regulations.
The Treasury, in exercise of the powers conferred upon them by section 333 of the Income and Corporation Taxes Act 1988 ( a) and section 149D of the Capital Gains Tax Act 1979 ( b), hereby make the following Regulations:-
Citation and commencement
1. These Regulations may be cited as the Personal Equity Plan Regulations 1989 and shall come into force on 6th April 1989.
Interpretation
2.-(1) In these Regulations unless the context otherwise requires:-
(a) "the Board" means the Commissioners of Inland Revenue;"gains" means "chargeable gains" within the meaning of the Capital Gains Tax Act 1979;
"investment trust" has the same meaning as in section 842 of the Taxes Act ( c) ;
"the Management Act" means the Taxes Management Act 1970 ( d) ;
"market value" shall be construed in accordance with section 150 of the Capital Gains Tax Act 1979;
"notice" means notice in writing and "notify" shall be construed accordingly;
"ordinary share" means a share which forms part of a company's ordinary share capital (within the meaning of section 832(1) of the Taxes Act);
a "plan investment" is an investment under a plan which is a qualifying investment within the meaning of regulation 6;
a "plan investor" is an individual who subscribes to a plan and who is a qualifying individual within the meaning of regulation 7;
a "plan manager" is a person who fulfils the conditions of these Regulations and is approved by the Board for the purposes of these Regulations as a plan manager;
a "portfolio" is a portfolio of plan investments which are held under a plan;
"recognised stock exchange" has the same meaning as in section 841 of the Taxes Act;
"share" includes stock;
"tax" where neither income tax nor capital gains tax is specified means either of those taxes;
"tax credit" means a credit under section 231 of the Taxes Act;
"year" means a year beginning with 6th April in any year and ending with 5th April in the following year;
"the Taxes Act" means the Income and Corporation Taxes Act 1988;
"the 1986 Regulations" means the Personal Equity Plan Regulations 1986 ( e).
(b) "authorised unit trust" means a unit trust scheme in the case of which an order under section 78 of the Financial Services Act 1986 ( f) is in force and which is an authorised securities scheme within the meaning of the Authorised Unit Trust Scheme (Investment and Borrowing Powers) Regulations 1988 ( g);"unit holder" means a person entitled to a share of the investments subject to the trusts of a unit trust scheme;
"unit trust scheme" has the same meaning as in section 469 of the Taxes Act;
and references to a "unit" include references to a fraction of a unit.
(2) The Table below indexes other definitions in these Regulations:
Introductory
3. These Regulations provide-
(a) for the setting up of plans by plan managers approved by the Board under which individuals may make certain investments, for the conditions under which they may invest and under which those plans are to operate, for relief from tax in respect of plan investments and generally for the administration of tax in relation to plans, and(b) for transitional arrangements in respect of plans and plan investors under the 1986 Regulations.General conditions for plans and subscriptions to plans
4.-(1) A plan is a scheme of investment to which an individual who is a qualifying individual may subscribe and in respect of which (subject to regulation 10) the following conditions must be fulfilled-
(a) a qualifying individual may subscribe to only one plan in any year;(b) subject to paragraph (2)-(i) the individual may not subscribe to a plan otherwise than by means of a sum or sums of his cash paid directly to the plan manager; and(ii) the individual's cash subscription may not exceed the subscription limit in any year.(2) Where, in pursuance of a public offer, an application is made by a qualifying individual for the allotment to him of shares of a company which are qualifying investments and such shares are allotted to that individual, he may, subject to the conditions prescribed by paragraph (3), subscribe to a plan by transferring or renouncing his rights to any shares so allotted to the plan manager or a nominee for the plan manager.
(3) The conditions prescribed by this paragraph are-
(a) that the shares are transferred, or the rights to the shares are renounced, within 30 days of their allotment to the individual;(b) that any sum payable on such an application and the individual's cash subscription to the plan do not together exceed the subscription limit in any year.(4) The subscription limit for the purposes of these Regulations is £4,800.
(5) A plan must be managed in accordance with these Regulations by a plan manager and under terms agreed in writing between the plan manager and the plan investor.
(6) Apart from other requirements of these Regulations the terms agreed to which paragraph (5) refers shall include the following conditions-
(a) that the plan investments shall be in the beneficial ownership of the plan investor;(b) that the title to the plan investments shall be vested in the plan manager or his nominee or jointly in one of them and the plan investor;(c) that the share certificate or other document evidencing title to a plan investment shall be held by the plan manager or as he may direct;(d) that the plan manager shall, if the plan investor so elects, arrange for the plan investor to receive a copy of the annual report and accounts issued by every company or other concern in respect of shares or units (as the case may be) which are his plan investments;(e) that the plan manager shall be under an obligation (subject to any provisions made by or under any other enactment and if the plan investor so elects) to arrange for the plan investor to be able-(i) to attend shareholders' or unit holders' meetings,(ii) to vote, and(iii) to receive, in addition to the documents referred to in paragraph (d) above, any other information issued to shareholders or unit holders;(f) that at the request of the plan investor and within such time as shall be agreed an entire plan with all rights and obligations of the parties to it may be transferred to another plan manager;(g) that the plan manager shall notify the plan investor if by reason of any failure to satisfy the provisions of these Regulations a plan has or will become void.General investment rules
5.-(1) All transactions whether by way of sale, purchase or otherwise by a plan manager in investments under a plan shall be made at the price which those investments might reasonably be expected to fetch in the open market.
(2) Investments, or rights in respect of investments, may not at any time-
(a) be purchased or made otherwise than out of cash which a plan manager holds (and is entitled under the provisions of these Regulations to hold) under a plan at that time; or(b) be purchased from-(i) a plan investor, or(ii) the spouse of a plan investor,so as to become plan investments under a plan to which the plan investor subscribes or has subscribed.
(3) A plan investor's cash subscription and any other cash held by a plan manager which he is entitled to hold under a plan shall be held only in sterling and be deposited with a deposit-taker or a building society in circumstances where-
(a) the deposit-taker is liable to account for and pay an amount representing income tax on payments of interest in respect of the deposit calculated by applying the composite rate to the grossed-up amount of the payments in accordance with the provisions of section 479 of the Taxes Act, or(b) the reduced rate amount payable by the building society under Regulation 3 of the Income Tax (Building Societies) Regulations 1986 ( h) includes an amount calculated in accordance with those Regulations by applying the reduced rate there referred to to the grossed-up amount of interest paid or credited in respect of the deposit,(a) 1988 c.1.
(b) 1979 c.14; section 149D was inserted by paragraph 26 of Schedule 29 to the Income and Corporation Taxes Act 1988 and amended by section 116 of the Finance Act 1988 (c.39).
(c) Section 842 was amended by section 117(1) of the Finance Act 1988.
(d) 1970 c.9.
(e) S.I. 1986/1948, amended by S.I. 1987/2128, 1988/657 and 1348.
(f) 1986 c.60.
(g) S.I. 1988/284.
(h) S.I. 1986/482, amended by S.I. 1987/844, 1988/1011 and 1989/36.
and in either case the...
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