The Income Tax (Deposit-takers and Building Societies) (Interest Payments) Regulations 2008
| Jurisdiction | UK Non-devolved |
| Citation | SI 2008/2682 |
| Year | 2008 |
2008 No. 2682
Income Tax
The Income Tax (Deposit-takers and Building Societies) (Interest Payments) Regulations 2008
Made 9th October 2008
Laid before the House of Commons 10th October 2008
Coming into force 31th October 2008
The Commissioners for Her Majesty’s Revenue and Customs make the following Regulations in exercise of the powers conferred by sections 852 and 871 of the Income Tax Act 20071.
PART 1
INTRODUCTION
Citation, commencement and effect
1.—(1) These Regulations may be cited as the Income Tax (Deposit-takers and Building Societies) (Interest Payments) Regulations 2008 and shall come into force on 31st October 2008.
(2) These Regulations shall have effect in relation to payments of interest made on or after 31st October 2008.
Interpretation
2. In these Regulations—
“certificate” means a certificate of non-liability to tax given in accordance with regulation 5;
“the Commissioners” means the Commissioners for Her Majesty’s Revenue and Customs;
“electronic communication” includes any communication conveyed by means of an electronic communications network;
“electronic signature” has the meaning given by section 7(2) of the Electronic Communications Act 20002;
“ITA 2007” means the Income Tax Act 2007;
“ITTOIAITTOIA 2005” means the Income Tax (Trading and Other Income) Act 20053;
“notice” means notice in writing;
“officer” means an officer of Revenue and Customs;
“relevant financial institution” means a deposit-taker or building society as the case requires;
“section 851” means section 851 of ITA 2007 (duty to deduct sums representing income tax);
“tax year” means a year beginning with 6th April in any year and ending with 5th April in the following year.
Scope of these Regulations
3.—(1) These Regulations make the following provisions.
(2) Part 2 makes provision in respect of payments of interest by relevant financial institutions relating to relevant investments (regulations 4 to 13).
(3) Part 3 makes provision in respect of payments of interest by relevant financial institutions relating to investments which are not relevant investments (regulation 14).
(4) Part 4 makes provision in relation to information requirements (regulations 15 to 18).
(5) Part 5 makes general provisions relating to continuity of certificates and declarations, consequential amendments, savings and revocations (regulations 19 to 20).
PART 2
PAYMENTS OF INTEREST IN RELATION TO RELEVANT INVESTMENTS
Gross payments
4.—(1) Section 851 does not apply in relation to—
(a)
(a) a payment of interest, or
(b)
(b) part of a payment of interest within regulation 13(2)(a) (joint accounts),
where, in respect of the person beneficially entitled to the payment or the part of the payment, a certificate has been supplied (see regulation 5) and has not ceased to be valid (see regulation 11).
This is subject to regulation 13(3).
(2) But paragraph (1) does not apply if—
(a)
(a) the provisions of section 629 of ITTOIAITTOIA 20054(income paid to relevant children of settlor) apply to the payment; or
(b)
(b) a notice of deduction under regulation 12 has been issued in relation to the payment and it has not been cancelled.
(3) Where a certificate has been supplied and it has not ceased to be valid, a relevant financial institution which operates a system which refunds an amount corresponding to tax deducted from payments of interest made previously in the tax year shall—
(a)
(a) refund any such amount in relation to the investment to which the certificate relates, and
(b)
(b) recover an amount corresponding to the amount refunded on a written application to the Commissioners.
This is subject to paragraph (4).
(4) Paragraph (3) shall not apply where a relevant financial institution has given a statement under section 975 of ITA 2007 (statements about deduction of income tax), if—
(a)
(a) the statement relates to the tax year in which the certificate was given; and
(b)
(b) the statement was given prior to the receipt of the certificate.
Certificate of non-liability to tax
5. A certificate of non-liability to tax must—
(a) certify that the person beneficially entitled to a payment of interest or, where regulation 13 (joint accounts) applies, to part of a payment of interest, is unlikely to be liable to pay any amount by way of income tax for the tax year in which that payment is made,
(b) be supplied by a prescribed person (regulation 6),
(c) be supplied to the relevant financial institution within the prescribed time limit (regulation 7),
(d) be in the prescribed form (regulation 8), and
(e) contain the prescribed contents (regulation 9).
Prescribed persons
6.—(1) A prescribed person is—
(a)
(a) a person—
(i) in whose name an investment is held,
(ii) who is beneficially entitled to a payment of interest on that investment, and
(iii) who was aged 16 or over at the beginning of the tax year in which the payment is made;
(b)
(b) the parent or guardian of a person who is beneficially entitled to a payment of interest where that person is under the age of 16 at the beginning of the tax year in which the payment is made;
(c)
(c) a person—
(i) who is beneficially entitled to a payment of interest, and
(ii) who is under the age of 16 at the beginning of the tax year in which the payment is made but who will become 16 during that tax year;
(d)
(d) the donee of a power of attorney authorising the donee to administer the financial affairs of a person beneficially entitled to a payment of interest;
(e)
(e) a parent, guardian, spouse, civil partner, daughter or son of a person suffering from mental disorder who is beneficially entitled to a payment of interest;
(f)
(f) a receiver or other person appointed by any court in the United Kingdom to act in relation to the property and affairs of a person beneficially entitled to a payment of interest who is incapable, by reason of mental disorder, of managing and administering their property and affairs; or
(g)
(g) a person appointed by the Secretary of State under—
(i) paragraph (1) of regulation 33 of the Social Security (Claims and Payments) Regulations 1987 (persons unable to act)5, whose appointment has not been revoked or terminated, or who has not resigned, under paragraph (2) of that regulation; or
(ii) paragraph (2) of regulation 28 of the Child Benefit and Guardian’s Allowance (Administration) Regulations 2003 (appointment of persons to act on behalf of those unable to act)6, whose appointment has not been revoked, or who has not resigned, under paragraph (3) of that regulation, or whose appointment has not been terminated under paragraph (4) of that regulation.
(2) In this regulation—
“daughter or son” means a daughter or son aged 16 or over and includes a stepdaughter or stepson and an adopted or illegitimate daughter or son; and
“mental disorder” has the meaning given by—
(a) section 1(2) of the Mental Health Act 1983 (application of Act: “mental disorder”)7in England and Wales,
(b) section 328 of the Mental Health (Care and Treatment) (Scotland) Act 2003 (meaning of “mental disorder”)8in Scotland, and
(c) Article 3 of the Mental Health (Northern Ireland) Order 1986 (definition of “mental disorder” and related expressions)9in Northern Ireland.
Supply within prescribed time limit
7.—(1) A certificate is treated as supplied to the relevant financial institution on the date it is given to the relevant financial institution or recorded by the relevant financial institution in accordance with paragraph (1)(b) of regulation 8 and nothing in paragraphs (2) or (3) of that regulation affects that date.
(2) The prescribed time limit is—
(a)
(a) where regulation 6(1)(c) applies, before the end of the tax year in which the person beneficially entitled to the payment attains the age of 16; and
(b)
(b) in any other case, before the end of the tax year in which the payment is made.
Prescribed form of a certificate
8.—(1) A certificate must be—
(a)
(a) in writing, signed by a prescribed person, or
(b)
(b) if not in writing, recorded in writing by the relevant financial institution on behalf of a prescribed person.
(2) If the relevant financial institution operates a record system under which the original certificate is not retained, the relevant financial institution must make a record of the certificate.
(3) Where paragraph (1)(b) or (2) applies—
(a)
(a) a copy of the record of the certificate must be sent by the relevant financial institution to the prescribed person within 30 days of that record being made;
(b)
(b) the prescribed person must notify the relevant financial institution of any corrections required within 30 days from the date the copy is sent; and
(c)
(c) the relevant financial institution must incorporate any such corrections in a revised record which must be sent to the prescribed person as soon as possible.
(4) A certificate shall be regarded as being in writing if it was supplied—
(a)
(a) by telephonic facsimile transmission; or
(b)
(b) by electronic communication containing an electronic signature of the prescribed person.
(5) A certificate or a record of a certificate must be retained by a relevant financial institution in such manner as may be approved by the Commissioners for two years after the relevant financial institution has ceased to pay interest without deduction of a sum representing income tax in relation to a relevant investment.
Prescribed contents of a certificate
9.—(1) A certificate must contain—
(a)
(a) the information prescribed in paragraphs (2) and (4); and
(b)
(b) the undertaking prescribed in paragraph (5).
(2) In relation to the person beneficially entitled to the payment of interest, the prescribed information is that...
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