The Dormant Bank and Building Society Accounts (Tax) Regulations 2011
| Jurisdiction | UK Non-devolved |
| Citation | SI 2011/22 |
| Year | 2011 |
2011 No. 22
Income Tax
The Dormant Bank and Building Society Accounts (Tax) Regulations 2011
Made 10th January 2011
Laid before the House of Commons 11th January 2011
Coming into force 1st February 2011
These Regulations are made by the Treasury and the Commissioners for Her Majesty’s Revenue and Customs. The powers exercised by the Treasury are those conferred by sections 694 to 696, 699 and 701 of the Income Tax (Trading and Other Income) Act 20051and the powers exercised by the Commissioners for Her Majesty’s Revenue and Customs are those conferred by section 17(5) and (6) of the Taxes Management Act 19702, sections 852 and 871 of the Income Tax Act 20073and section 39(1) of the Finance Act 20084.
Citation, commencement and effect
1.—(1) These Regulations may be cited as the Dormant Bank and Building Society Accounts (Tax) Regulations 2011 and shall come into force on 1st February 2011.
(2) Regulations 2 to 4 have effect in relation to notices under section 17(1)5of the Taxes Management Act 1970 served on or after 1st February 2011.
(3) Regulations 5 to 7 have effect in relation to interest paid or credited on or after 1st February 2011.
(4) Regulation 8 has effect in relation to interest arising on or after 1st February 2011.
Amendment of the Income Tax (Interest Payments) (Information Powers) Regulations 1992
2. The Income Tax (Interest Payments) (Information Powers) Regulations 19926are amended as follows.
3. In regulation 2 (interpretation) after the definition of “payment”7insert—
““relevant dormant account” has the meaning in section 39(2) of the Finance Act 2008;
“repayment claim” means a repayment claim mentioned in section 5(6) of the Dormant Bank and Building Society Accounts Act 20088, and other terms used in regulation 3A and in that Act have the same meaning in that regulation as in that Act;”.
4. After regulation 3 (disapplication of section 17(1) and section 18(1))9insert—
“Dormant accounts – postponement of reporting obligations under section 17(1)
3A.—(1) A notice under section 17(1) shall be deemed not to require information in respect of a relevant dormant account before the time (if any) at which the balance of the account is paid out to the account-holder following a repayment claim (such payment being referred to in this regulation as the repayment claim being “settled”), subject to paragraph (4).
(2) In paragraph (3), the period between—
(a)
(a) the time when a dormant account first becomes a relevant dormant account, and
(b)
(b) the time at which a repayment claim to the balance of the account is settled,
is referred to, in relation to the account, as the “relevant dormant period”.
(3) Where a repayment claim to the balance of a dormant account is settled, all interest paid or credited to the account, or included in the balance of the account, during and at the end of the relevant dormant period, shall be treated for the purposes of section 17(1)—
(a)
(a) as paid at the time the repayment claim is settled;
(b)
(b) as if the bank or building society in question had retained the balance of the account, in the ordinary course of the operations of its trade or business; and
(c)
(c) if notice under section 17(1) is given to the bank or building society, specifying the year of assessment in which the relevant dormant period for any account ends, the notice shall (unless it states otherwise) be deemed to require the inclusion of information for all relevant dormant accounts, in respect of which repayment claims were settled in that year.
(4) A notice under section 17(1) shall be deemed not to require information in respect of a relevant dormant account which, at the time it first became a relevant dormant account, was a plan provided for by regulations made under Chapter 3 of Part 6 of ITTOIA 2005 (individual investment plans).”.
Amendment of the Income Tax (Deposit-takers and Building Societies) (Interest Payments) Regulations 2008
5. The Income Tax (Deposit-takers and Building Societies) (Interest Payments) Regulations 200810are amended as follows.
6. In regulation 2 (interpretation) insert at the appropriate places—
““relevant dormant account” has the meaning given in section 39(2) of the Finance Act 2008;”
““repayment claim” means a repayment claim mentioned in section 5(6) of the Dormant Bank and Building Society Accounts Act 2008, and other terms used in regulations 4A and 4B and in that Act have the same meaning in those regulations as in that Act;”.
7. After regulation 4 (gross payments) insert—
“Dormant accounts – postponement of obligation to deduct sum representing income tax(4A) (1) Section 851 does not apply to a payment of interest in respect of a relevant dormant account before the time (if any) at which the balance of the account is paid out to the holder of the relevant dormant account following a repayment claim (such payment being referred to in this regulation as the repayment claim being “settled”), subject to paragraph (4).(2) In paragraph (3) and regulation 4B, the period between—(a) the time when a dormant account first becomes a relevant dormant account, and(b) the time at which a repayment claim to the balance of the account is settled,is referred to, in relation to the account, as the “relevant dormant period.”(3) Where a repayment claim to the balance of a dormant account is settled, all interest paid or credited to the account, or included in the balance of the account, during and at the end of the relevant dormant period, shall be treated for the purposes of section 851—(a) as paid at the time the repayment claim is settled; and(b) as if the account were at that time an investment, and a relevant investment for the purposes of Chapter 2 of Part 15 of ITA 2007 (deduction by deposit-takers and building societies).(4) Section 851 does not apply to a payment of interest in respect of a relevant dormant account which, at the time it first became a relevant dormant account, was a plan...
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