Finance Act, 1986

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Application of Principal Act.

104.—In relation to a charge for tax arising by reason of the provisions of section 103 —

(a) a reference in section 16 of the Principal Act to a company controlled by the successor shall be construed as including a reference to a company that is under the control of any one or more of the following, that is to say, the trustees of the discretionary trust, the living objects of the discretionary trust, the relatives of those objects, and nominees of those trustees or of those objects or of the relatives of those objects;

(b) (i) subject to the provisions of subparagraph (ii), the valuation date of the taxable inheritance shall be the relevant chargeable date;

(ii) where—

(I) a charge for tax arises on a particular date by reason of the provisions of section 106 of the Finance Act, 1984 , giving rise to a taxable inheritance (in this subparagraph called the first taxable inheritance),

(II) on a later date, a charge for tax arises under or in consequence of the same disposition by reason of the provisions of section 103 giving rise to a taxable inheritance (in this subparagraph called the second taxable inheritance) comprising the same property or property representing that property, and

(III) the valuation date of the first taxable inheritance is a date after the chargeable date of the second taxable inheritance,

the valuation date of the second taxable inheritance shall be the same date as the valuation date of the first taxable inheritance;

(c) a person who is a trustee of the discretionary trust concerned for the time being at the date of the inheritance or at any date subsequent thereto shall be a person primarily accountable for the payment of the tax;

(d) an object of the discretionary trust concerned to whom or for whose benefit any of the property subject to the trust is applied or appointed shall also be accountable for the payment of tax the charge in respect of which has arisen prior to the date of the application or appointment of the property to him or for his benefit, and the Principal Act shall have effect, in its application to that charge for tax, as if that object of the discretionary trust were a person referred to in section 35 (2) of the Principal Act;

(e) any person who is primarily accountable for the payment of tax by virtue of paragraph (c) shall, within three months after the valuation date or the date of the passing of this Act, whichever is the later—

(i) deliver to the Commissioners a full and true return—

(I) of every inheritance in respect of which he is so primarily accountable;

(II) of all the property comprised in such inheritance; and

(III) of an estimate of the market value of such property;

(ii) notwithstanding the provisions of the Principal Act, make an assessment of such amount of tax as, to the best of his knowledge, information and belief, ought to be charged, levied and paid on that valuation date; and

(iii) pay the amount of such tax to the Accountant-General of the Commissioners;

(f) the provisions of section 41 of the Principal Act shall have effect, in the application of the Principal Act to any such charge for tax as aforesaid arising before the date of the passing of this Act, as if the references to the valuation date in subsections (1), (2) and (3) of that section were references to the date of the passing of this Act, or to the valuation date, whichever is the later;

and

(g) section 21, subsection (1) of section 35, subsections (2), (3), (4) and (5) of section 36 and sections 40, 43, 45 and 57 of, and the Second Schedule to, the Principal Act shall not apply.