Finance Bill 2017-19 and draft Finance (No. 2) | KPMG | UK

Finance Bill 2017-19 and draft Finance (No. 2) Bill clauses

Finance Bill 2017-19 and draft Finance (No. 2)

As well as the Finance Bill published on 8 September, the draft clauses for Finance (No. 2) Bill will also be published on 13 September.

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After being delayed before Parliament’s summer recess, Finance Bill 2017-19 was finally published on Friday 8 September. The Bill contains a number of measures that were originally to be included in Finance Act 2017 after the Spring Budget, but were dropped to allow it to be passed quickly before the general election. While the timing of the Bill’s passage is not yet known, given that the House is due to rise for the conference season recess on 17 September, it is unlikely the Bill will make much meaningful progress towards enactment before this date. If it follows a usual timetable, Royal Assent is likely to be in December with substantive enactment potentially before the end of November. However, we may see an accelerated timetable for the Bill’s passage once the House returns on 12 October if the Government would prefer it to be passed before the Budget, the date of which will hopefully soon be confirmed.

We last saw an update on the content of the Bill when revised draft clauses for some of the measures were released on 13 July 2017, along with confirmation that some of these measures would have retroactive effect from the date they were originally intended to be introduced before the election. Some of the key measures in the Finance Bill include:

  • The corporate interest restriction (CIR) rules: Start date 1 April 2017.
  • Corporate loss reform: Start date 1 April 2017.
  • Hybrid and other mismatches: Start date 1 January 2017 (with some changes starting 13 July 2017 – see this article for further details). 
  • Substantial Shareholding Exemption for institutional investors: Start date 1 April 2017.
  • Deemed domicile changes and IHT on UK residential property: Start date 6 April 2017.
  • Employment income provided through third parties: Start date 5 April 2019.

Explanatory notes to accompany the Bill have been published by HM
Treasury.

Updated explanatory notes to the Finance Bill resolutions, agreed by the House of Commons on 6 September, have also been published.

In what’s shaping up to be a busy week for followers of UK tax legislation, the Financial Secretary to the Treasury Mel Stride has also announced in a Written Ministerial Statement that draft clauses for the Finance (No.2) Bill will be published on Wednesday 13 September 2017. These draft clauses will be included in next year’s Finance Bill. This is commonly referred to as ‘Legislation Day’ and previously took place in December but, under the new Budget timetable, will be moving to the summer.

No further information has been given but we would not expect the draft clauses to cover new policy items as these should generally be announced at the Budget. The draft clauses may include some of the measures included in section 2 of the OOTLAR published at the Spring Budget. Check in with next week’s edition of Tax Matters Digest to find out more.
 

For further information please contact:

Grace Havard

 

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