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12 2009

Finance Act 2009

PART 3

Value-Added Tax

Interpretation (Part 3).

20 .— In this Part “Principal Act” means the Value-Added Tax Act 1972 .

Amendment of section 7 (waiver of exemption) of Principal Act.

21 .— Section 7 of the Principal Act is amended—

(a) in subsection (3) by substituting “subsection (3), (7) or (9) of section 7B” for “section 7B(3)”, and

(b) by inserting the following after subsection (5):

“(6) Where a person cancelled his or her waiver of exemption before 1 July 2008 then, for the purposes of applying section 12E, the adjustment period (within the meaning of that section or, as the context may require, the period to be treated as the adjustment period in accordance with section 4C(11)) in relation to any capital good the tax chargeable on that person’s acquisition or development of which that person was obliged to take into account when that person made that cancellation, shall be treated as if it ended on the date on which that cancellation had effect.”.

Amendment of section 7B (transitional measures: waiver of exemption) of Principal Act.

22 .— Section 7B of the Principal Act is amended—

(a) by substituting the following for subsection (2):

“(2) For the purposes of applying section 12E, the adjustment period (within the meaning of that section or, as the context may require, the period to be treated as the adjustment period in accordance with section 4C(11)) in relation to a capital good the tax chargeable on the landlord’s acquisition or development of which that landlord was obliged to take into account when that landlord cancelled his or her waiver of exemption, shall end on the date on which that cancellation had effect.”,

and

(b) by inserting the following after subsection (6):

“(7) (a) This subsection applies where—

(i) on 1 July 2008 a landlord had an interest in relevant immovable goods,

(ii) on the relevant date the landlord did not have an interest in any relevant immovable goods, and

(iii) that landlord’s waiver of exemption had not been cancelled on or before the relevant date in accordance with section 7(3).

(b) Where this subsection applies—

(i) the landlord’s waiver of exemption shall be treated as if it were cancelled in accordance with section 7(3) on the date of the passing of the Finance Act 2009, and

(ii) that landlord shall pay an amount, being the amount payable in accordance with section 7(3) in respect of the cancellation of that waiver, as if it were tax due by that landlord for the taxable period beginning on 1 May 2009.

(8) (a) This subsection applies where—

(i) in the period from 1 July 2008 to the relevant date, a landlord made a supply of relevant immovable goods during the adjustment period (within the meaning of section 12E or, as the context may require, the period to be treated as the adjustment period in accordance with section 4C(11)) in relation to those goods, and

(ii) tax was not chargeable on that supply.

(b) Where this subsection applies, then for the purposes of sections 4B(5), 12E(3)(d) and 12E(7)(b) the supply of the relevant immovable goods is treated as if it was made on the date of the passing of the Finance Act 2009.

(c) Paragraph (b) shall not apply where—

(i) the landlord’s waiver of exemption has been cancelled in accordance with subsection (7), or

(ii) the landlord cancels his or her waiver of exemption in accordance with section 7(3) before 1 July 2009.

(9) (a) This subsection applies where—

(i) on or after the date of the passing of the Finance Act 2009 a landlord has an interest in relevant immovable goods,

(ii) the landlord ceases, whether as a result of disposing of such goods or otherwise, to have an interest in any such goods, and

(iii) on the date when that landlord ceases to have any such interest, that landlord’s waiver of exemption has not been cancelled in accordance with section 7(3).

(b) Where this subsection applies—

(i) the landlord’s waiver of exemption shall be treated as if it were cancelled on the date referred to in paragraph (a)(iii), and

(ii) that landlord shall pay an amount, being the amount payable in accordance with section 7(3) in respect of the cancellation of that waiver, as if it were tax due by that landlord for the taxable period in which the waiver of exemption is so treated as cancelled.

(10) In this section—

‘ relevant immovable goods ’ means immovable goods the tax chargeable on the acquisition or development of which a landlord would be obliged to take into account in accordance with section 7(3) in relation to the cancellation of that landlord’s waiver of exemption;

‘ relevant date ’ means the date immediately before the date of the passing of the Finance Act 2009.”.