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Finance Act 1998 (c. 36) (c. 36)(The document as of February, 2008) Page 8 Pages: P.1 | P.2 | P.3 | P.4 | P.5 | P.6 | P.7 | P.8 | P.9 | P.10 | P.11 | P.12 | P.13 | P.14 | P.15 | P.16 | P.17 | P.18 | P.19 | P.20 | P.21 | P.22 | P.23 | P.24 | P.25 | P.26 | P.27 | P.28 | P.29 | P.30 | P.31 | P.32 | P.33 | P.34 | P.35 | P.36 (2) Section 432A shall have effect " . (3) In that paragraph, after the sub-paragraph (2) created by virtue of subsection (2) above there shall be inserted the following sub-paragraphs-- " (3) Subject to sub-paragraphs (4) and (5) below, paragraph 4A above shall have effect as if the references in sub-paragraph (5) of that paragraph to-- (a) profits or gains arising from the deemed transaction that are chargeable to tax under Case VI of Schedule D in accordance with paragraph 1(1) above, or (b) any loss arising in the deemed transaction that is brought into account for the purposes of section 392 or 396 in accordance with paragraph 1(5) above, were references to all the income or losses in relation to which the determination mentioned in sub-paragraph (1) above falls to be made. (4) Sub-paragraph (6) of paragraph 4A above shall not apply in relation to the amount of the consideration for the acquisition of any asset acquired by the taxpayer by means of the future running to delivery or, as the case may be, by the exercise of the option if-- (a) immediately before the time of the deemed transaction, the future or option is an asset within one of the categories set out in section 440(4); and (b) immediately after its acquisition, the asset acquired is within another of those categories. (5) Sub-paragraph (6) of paragraph 4A above shall not apply in relation to the amount of the consideration for the acquisition of any asset disposed of by the taxpayer by means of the future running to delivery or, as the case may be, by the exercise of the option if-- (a) immediately before the time of the deemed transaction, the future or option is an asset within one of the categories set out in section 440(4); and (b) immediately before its disposal, the asset disposed of is within another of those categories. (6) Where any future or option would not fall (apart from this sub-paragraph) to be treated as an asset for the purposes of section 440, any question for the purposes of this paragraph whether it is an asset within any of the categories set out in subsection (4) of that section shall be determined as if it were an asset. (7) Expressions used in this paragraph and in paragraph 4A above have the same meanings in this paragraph as in that paragraph. " (4) In paragraph 4(6) of that Schedule, in the definition of "option", after paragraph (b) there shall be inserted-- " and includes any liability or entitlement under an option. " (5) This section applies where the transaction consisting in the future running to delivery or the exercise of the option takes place on or after 6th February 1998. Securities100 Accrued income scheme(1) In subsection (1) of section 1A of the Taxes Act 1988 (rate of income tax applicable to income from savings and distributions), for "and 686," there shall be substituted ", 686 and 720(5),". (2) In subsection (2) of that section, after paragraph (a) there shall be inserted the following paragraph-- " (aa) any amount chargeable to tax under Case VI of Schedule D by virtue of section 714, 716 or 723; " (3) Subsections (1) and (2) above apply for the year 1998-99 and subsequent years of assessment. 101 Dealers in securities etc(1) Section 471 of the Taxes Act 1988 (exchange of securities in connection with conversion operations, nationalisation etc.) shall cease to have effect. (2) Section 472 of that Act (distribution of securities issued in connection with nationalisation etc.) shall cease to have effect. (3) Subsection (1) above applies in relation to exchanges made after the day on which this Act is passed. (4) Subsection (2) above applies in relation to issues of securities occurring after that day. 102 Manufactured dividends(1) In section 231 of the Taxes Act 1988 (tax credits for certain recipients of qualifying distributions) in subsection (1), after "Subject to sections" there shall be inserted "231AA," and after that section there shall be inserted-- " 231AA No tax credit for borrower under stock lending arrangement or interim holder under repurchase agreement(1) A person shall not be entitled to a tax credit under section 231 in respect of a qualifying distribution if-- (a) he is the borrower under a stock lending arrangement or the interim holder under a repurchase agreement; (b) the qualifying distribution is, or is a payment representative of, a distribution in respect of securities to which the arrangement or agreement relates; and (c) a manufactured dividend representative of that distribution is paid by that person in respect of securities to which the arrangement or agreement relates. (2) In this section "stock lending arrangement" has the same meaning as in section 263B of the 1992 Act and, in relation to any such arrangement, any reference to the borrower, or the securities to which the arrangement relates, shall be construed accordingly. (3) For the purposes of this section the cases where there is a repurchase agreement are the following-- (a) any case falling within subsection (1) of section 730A; and (b) any case which would fall within that subsection if the sale price and the repurchase price were different; and, in any such case, any reference to the interim holder, or the securities to which the agreement relates, shall be construed accordingly. (4) For the purposes of this section "manufactured dividend" has the same meaning as in paragraph 2 of Schedule 23A (and any reference to a manufactured dividend being paid accordingly includes a reference to a payment falling by virtue of section 736B(2) or 737A(5) to be treated for the purposes of Schedule 23A as if it were made). " (2) In section 231 of the Taxes Act 1988, in subsection (1), after "231AA," there shall be inserted "231AB," and after section 231AA of that Act there shall be inserted-- " 231AB No tax credit for original owner under repurchase agreement in respect of certain manufactured dividends(1) A person shall not be entitled to a tax credit under section 231 in respect of a qualifying distribution if-- (a) he is the original owner under a repurchase agreement; (b) the qualifying distribution is a manufactured dividend paid to that person by the interim holder under the repurchase agreement in respect of securities to which the agreement relates; and (c) the repurchase agreement is not such that the actual dividend which the manufactured dividend represents is receivable otherwise than by the original owner. (2) For the purposes of this section the cases where there is a repurchase agreement are the following-- (a) any case falling within subsection (1) of section 730A; and (b) any case which would fall within that subsection if the sale price and the repurchase price were different; and, in any such case, any reference to the original owner, the interim holder, or the securities to which the agreement relates, shall be construed accordingly. (3) Subsection (4) of section 231AA applies for the purposes of this section as it applies for the purposes of that section. " (3) In section 737D of the Taxes Act 1988 (power by regulations to provide for manufactured payments to be eligible for relief) in subsection (2) (which defines manufactured payment as any manufactured dividend etc) the words "manufactured dividend" shall cease to have effect. (4) Schedule 23A to the Taxes Act 1988 (manufactured dividends and interest) shall be amended in accordance with subsections (5) to (8) below. (5) In paragraph 2 (UK equities) for sub-paragraph (2) there shall be substituted-- " (2) Where a manufactured dividend is paid by a dividend manufacturer who is a company resident in the United Kingdom, the Tax Acts shall have effect-- (a) in relation to the recipient, and persons claiming title through or under him, as if the manufactured dividend were a dividend on the UK equities in question; and (b) in relation to the dividend manufacturer, as if the amount paid were a dividend of his. " (6) In paragraph 2(3) (manufactured dividends to which paragraph 2(2) does not apply) paragraph (a) (duty to account for notional ACT) shall cease to have effect. (7) In paragraph 2(6) (written statement in respect of certain manufactured dividends) in paragraph (a), after "a dividend manufacturer pays a manufactured dividend" there shall be inserted "to which sub-paragraph (3) above applies". (8) In consequence of subsection (6) above, the following provisions shall also cease to have effect-- (a) in paragraph 2, sub-paragraphs (4) and (5) and, in sub-paragraph (6), paragraph (b) and the word "and" immediately preceding it; and (b) in paragraph 2A (deductibility of manufactured payment in the case of the manufacturer) in sub-paragraph (1), the words "together with an amount equal to the notional ACT" and sub-paragraph (3). (9) Subsection (1) above has effect in relation to qualifying distributions made on or after 8th April 1998 if the manufactured dividend representative of the distribution is paid (or treated for the purposes of Schedule 23A to the Taxes Act 1988 as paid) on or after 6th April 1999. (10) Subsections (2) to (8) above have effect in relation to manufactured dividends paid (or treated for the purposes of Schedule 23A to the Taxes Act 1988 as paid) on or after 6th April 1999. Double taxation relief103 Restriction of relief on certain interest and dividends(1) For section 798 of the Taxes Act 1988 there shall be substituted the following section-- " 798 Restriction of relief on certain interest and dividends(1) This section applies where-- (a) in any chargeable period the profits of a trade carried on by a qualifying taxpayer include an amount computed in accordance with section 795 in respect of foreign interest or foreign dividends; (b) the taxpayer is entitled in accordance with this Chapter to credit for foreign tax on the foreign interest or foreign dividends; and (c) in the case of foreign dividends, the foreign tax mentioned in paragraph (b) above is or includes underlying tax. (2) The amount of the credit for foreign tax referred to in subsection (1)(b) above which, in accordance with this Chapter, is to be allowed against income tax or corporation tax-- (a) shall be limited by treating the amount of the foreign interest or foreign dividends (as increased or reduced under section 798A) as reduced (or further reduced) for the purposes of this Chapter by an amount equal to the taxpayer's financial expenditure in relation to the interest or dividends (as determined in accordance with section 798B); and (b) so far as the credit relates to foreign tax on interest or foreign tax on dividends which is not underlying tax, shall not exceed 15 per cent. of the interest or dividends, computed without regard to paragraph (a) above or to any increase or reduction under section 798A. (3) In this section and sections 798A and 798B--
(4) In this section and section 798B "qualifying taxpayer" means, subject to subsection (5) below, a person carrying on a trade which includes the receipt of interest or dividends and is not an insurance business. (5) Where a company which is connected or associated with a qualifying taxpayer is acting in accordance with a scheme or arrangement the purpose, or one of the main purposes, of which is to prevent or restrict the application of this section to the taxpayer-- (a) the company shall be treated for the purposes of this section as a qualifying taxpayer; and (b) any foreign interest or foreign dividends received in pursuance of the scheme or arrangement shall be treated for those purposes as profits of a trade carried on by the company. (6) For the purposes of this section and section 798B-- (a) section 839 applies; and (b) subsection (10) of section 783 applies as it applies for the purposes of that section. " (2) This section and sections 104 and 105 do not have effect in relation to foreign interest or foreign dividends paid before 1st January 1999 in pursuance of arrangements which were entered into before, and are not altered on or after, 17th March 1998. (3) Subject to subsection (2) above, this section and sections 104 and 105 have effect in relation to foreign interest or foreign dividends paid on or after 17th March 1998. 104 Adjustments of interest and dividends for spared tax etcAfter section 798 of the Taxes Act 1988 there shall be inserted the following section-- " 798A Adjustments of interest and dividends for spared tax etc(1) In a case where section 798 applies-- (a) subsection (2) below applies if the foreign tax referred to in subsection (1)(b) of that section is or includes an amount of spared tax; and (b) subsection (3) below applies if the foreign tax so referred to is or includes an amount of tax which is not spared tax. (2) For the purposes of income tax or corporation tax, the amount which apart from this subsection would be the amount of the foreign interest or foreign dividends shall be treated as increased by so much of the spared tax as does not exceed-- (a) the amount of the spared tax for which, in accordance with any arrangements applicable to the case in question, credit falls to be given as mentioned in section 798(1)(b); or (b) if it is less, 15 per cent. of the interest or dividends, computed without regard to any increase under this subsection. (3) If the amount of tax which is not spared tax exceeds-- (a) the amount of the credit which, by virtue of this Chapter (but disregarding subsection (2) of section 798), is allowed for that tax against income tax or corporation tax; or (b) if it is less in the case of tax on foreign interest, 15 per cent. of the interest, computed without regard to any increase or reduction under this section or that subsection, then, for the purposes of income tax or corporation tax, the amount which, apart from this subsection, would be the amount of the foreign interest or foreign dividends shall be treated as reduced by a sum equal to the excess. (4) Subsection (2) above has effect for the purposes of corporation tax notwithstanding anything in section 80(5) of the [1996 c. 8.] Finance Act 1996 (matters to be brought into account in the case of loan relationships only under Chapter II of Part IV of that Act). (5) Nothing in subsection (2) above prejudices the operation of section 795 in relation to foreign tax which is not spared tax. (6) In this section "spared tax" means foreign tax which although not payable falls to be taken into account for the purposes of credit by virtue of section 788(5). " 105 Meaning of "financial expenditure"After section 798A of the Taxes Act 1988 there shall be inserted the following section-- " 798B Meaning of "financial expenditure"(1) For the purposes of section 798 "financial expenditure", in relation to a qualifying taxpayer and any interest or dividends is, subject to the provisions of this section, the aggregate of-- (a) so much of the financial expenses (consisting of interest, discounts or similar sums or qualifying losses) incurred by the taxpayer or a person connected or associated with him as-- (i) is properly attributable to the earning of the interest or dividends; and (ii) falls to be taken into account in computing the taxpayer's or person's liability to income tax or corporation tax; and (b) so much of any other sum paid by the taxpayer or a person connected or associated with him which-- (i) falls to be taken into account as mentioned in paragraph (a) above; and (ii) would not, apart from this paragraph, be taken into account in determining the amount of the interest or dividends, as it is reasonable to regard as attributable to the earning of the interest or dividends (whether or not it would fall, in accordance with normal accountancy practice, to be so treated). (2) There shall be deducted from the aggregate given by subsection (1) above so much of the qualifying gains and profits accruing to the qualifying taxpayer or a person connected or associated with him as-- (a) is properly attributable to the earning of the interest or dividends; and (b) falls to be taken into account in computing the taxpayer's or person's liability to income tax or corporation tax. (3) In a case where the amount of a qualifying taxpayer's financial expenditure in relation to the earning of the interest or dividends is not readily ascertainable-- (a) that amount shall be taken, subject to subsection (4) below, to be such sum as it is just and reasonable to attribute to the earning of the interest or dividends; and (b) in the case of interest, regard shall be had in particular to any market rates of interest by reference to which the rate of the interest is determined. (4) The Board may by regulations supplement subsection (3) above-- (a) by specifying matters to be taken into account in determining such a just and reasonable attribution as is referred to in paragraph (a); and (b) by making provision with respect to the determination of market rates of interest for the purposes of paragraph (b); and any such regulations may make different provision for different cases. (5) In this section "qualifying losses" means-- (a) losses falling to be brought into account for the purposes of Chapter II of Part II of the [1993 c. 34.] Finance Act 1993 (exchange gains and losses) in accordance with sections 125 to 127 of that Act; and (b) losses falling to be brought into account for the purposes of Chapter II of Part IV of the [1994 c. 9.] Finance Act 1994 (interest rate and currency contracts) in accordance with sections 155 to 158 of that Act; and "qualifying gains" and "qualifying profits" shall be construed accordingly. " 106 Underlying tax reflecting interest or dividends(1) Section 803 of the Taxes Act 1988 (underlying tax reflecting interest on loans) shall be amended as follows. (2) In subsection (1)-- (a) in paragraph (b), after the words "a dividend" there shall be inserted the words "("the overseas dividend")"; (b) in paragraph (c), for the words "interest on a loan made" there shall be substituted the words "interest or dividends earned or received"; and (c) for paragraph (d) there shall be substituted the following paragraph-- " (d) if the company which received the interest or dividends ("the company") had been resident in the United Kingdom, section 798 would apply in relation to that company. " (3) In subsection (3), for the words from "on so much" to the end there shall be substituted the words "on so much of the interest or dividends as exceeds the amount of the company's relevant expenditure which is properly attributable to the earning of the interest or dividends". (4) In subsection (4)-- (a) in paragraph (a), for the words "section 798(2)" there shall be substituted the words "section 798(3)"; (b) for paragraph (b) there shall be substituted the following paragraph-- " (b) "the company"s relevant expenditure' means the amount which, if the company referred to in subsection (1)(d) above were resident in the United Kingdom and were a qualifying taxpayer for the purposes of section 798, would be its financial expenditure in relation to the earning of the interest or dividends, as determined in accordance with section 798B. " (5) In subsection (5)-- (a) for the words "the dividend", in both places where they occur, there shall be substituted the words "the overseas dividend"; and (b) for the words "the interest" there shall be substituted the words "the interest or dividends". (6) In subsection (6)-- (a) for the words "the dividend" there shall be substituted the words "the overseas dividend"; and (b) for the words "the permitted amount" there shall be substituted the following paragraphs-- " (a) the amount of the spared tax which under any arrangements is to be taken into account for the purpose of allowing credit against corporation tax in respect of the overseas dividend; or (b) if it is less, 15 per cent. of the interest or dividends; " . (7) For subsection (7) there shall be substituted the following subsection-- " (7) In this section "spared tax" has the same meaning as in section 798A. " (8) In subsection (8)-- (a) after the words "amount of tax which" there shall be inserted the words "is referable to interest and"; and (b) for the words "the dividend" there shall be substituted the words "the overseas dividend". (9) In subsection (9)-- (a) for the words "the interest", in both places where they occur, there shall be substituted the words "the interest or dividends"; and (b) for the words "the dividend" there shall be substituted the words "the overseas dividend". (10) For subsections (10) and (11) there shall be substituted the following subsection-- " (10) In subsection (1) above "bank" means a company carrying on, in the United Kingdom or elsewhere, any trade which includes the receipt of interest or dividends, and section 839 applies for the purposes of that subsection. " (11) This section does not apply where the overseas dividend is paid before 1st January 1999 in pursuance of arrangements which were entered into before, and are not altered on or after, 17th March 1998. (12) Subject to subsection (11) above, this section applies where the overseas dividend is paid on or after 17th March 1998. 107 Notification of foreign tax adjustment(1) In section 806 of the Taxes Act 1988 (supplemental provision with respect to double taxation relief), after subsection (2) there shall be inserted the following subsections-- " (3) Subject to subsection (5) below, where-- (a) any credit for foreign tax has been allowed to a person under any arrangements, and (b) the amount of that credit is subsequently rendered excessive by reason of an adjustment of the amount of any tax payable under the laws of a territory outside the United Kingdom, that person shall give notice in writing to an officer of the Board that an adjustment has been made that has rendered the amount of the credit excessive. (4) A notice under subsection (3) above must be given within one year from the time of the making of the adjustment. (5) Subsections (3) and (4) above do not apply where the adjustment is one the consequences of which in relation to the credit fall to be given effect to in accordance with regulations made under-- (a) section 182(1) of the [1993 c. 34.] Finance Act 1993 (regulations relating to individual members of Lloyd's); or (b) section 229 of the [1994 c. 9.] Finance Act 1994 (regulations relating to corporate members of Lloyd's). (6) A person who fails to comply with the requirements imposed on him by subsections (3) and (4) above in relation to any adjustment shall be liable to a penalty of an amount not exceeding the amount by which the credit allowed has been rendered excessive by reason of the adjustment. " (2) This section shall be deemed to have come into force on 17th March 1998 in relation to adjustments made on or after that date. Transfer pricing, FOREX and financial instruments108 New regime for transfer pricing etc(1) For sections 770 to 773 of the Taxes Act 1988 (transfer pricing provisions) there shall be substituted the following section-- " 770A Provision not at arm's lengthSchedule 28AA (which deals with provision made or imposed otherwise than at arm's length) shall have effect. " (2) After Schedule 28A to that Act there shall be inserted, as Schedule 28AA to that Act, the Schedule set out in Schedule 16 to this Act. (3) In the [1993 c. 34.] Finance Act 1993-- (a) in sections 136(7) and (8) and 136A(5) (application of arm's length test in computing foreign exchange gains and losses), for the words "has been treated under section 770 of", in each place where they occur, there shall be substituted "falls to be treated in accordance with Schedule 28AA to"; and (b) in section 136A(6), for "has at any time in that accrual period been treated under section 770 of" there shall be substituted "falls in relation to any time in that accrual period to be treated in accordance with Schedule 28AA to". (4) In the [1996 c. 8.] Finance Act 1996-- (a) in section 100(3) (imputed interest on loan relationships), for the words from "which, in" to "of those sections" there shall be substituted "which, in pursuance of Schedule 28AA to the Taxes Act 1988 (provision not at arm's length), falls to be treated"; and (b) in paragraph 16 of Schedule 9 (imputed interest)-- (i) in sub-paragraph (1), for the words from "sections 770" to "that Act" there shall be substituted "Schedule 28AA to the Taxes Act 1988 (provision not at arm's length)"; and (ii) in sub-paragraph (2), for "Those sections" there shall be substituted "That Schedule". (5) Subject to subsection (6) below, this section and Schedule 16 to this Act have effect (in relation to provision made or imposed at any time)-- (a) for the purposes of corporation tax, as respects accounting periods ending on or after the day appointed under section 199 of the [1994 c. 9.] Finance Act 1994 for the purposes of Chapter III of Part IV of that Act (self-assessment management provisions); and (b) for the purposes of income tax, as respects any year of assessment ending on or after that day. (6) The Schedule 28AA to the Taxes Act 1988 that is inserted by subsection (2) above shall not, in the case of any potentially advantaged person, apply as respects the consequences at any time of the difference between the actual provision and the arm's length provision if-- (a) that time falls before 17th March 2001; (b) the actual provision is a provision made or imposed by means of contractual arrangements entered into by that person before 17th March 1998; (c) the requirements of paragraph 1(1)(b) of Schedule 28AA to that Act (control requirements) are satisfied in the case of the actual provision and that person by reference only to paragraph 4(2)(b) of that Schedule (joint ventures etc.); (d) the rights and obligations of that person by virtue of the actual provision are not ones that have been varied or continued in pursuance of any transaction entered into by that person in the period between 17th March 1998 and that time; and (e) that person is not a party, and has not been a party, to any transaction by virtue of which he could during that period have secured the variation or termination of those rights and obligations. (7) Expressions used in subsection (6) above and in Schedule 28AA to the Taxes Act 1988 have the same meanings in that subsection as in that Schedule. 109 Abolition of requirements for direction(1) The following provisions of Chapter II of Part II of the [1993 c. 34.] Finance Act 1993 (exchange gains and losses) shall cease to have effect-- (a) in section 135(1), paragraph (d) (which makes the giving of a direction a condition of disregarding an exchange loss where it is the main benefit), and the word "and" immediately preceding that paragraph; (b) in section 136, the following provisions (which make the giving of a direction by the Board a condition of disregarding or reducing an exchange loss where there is a transaction that is not on arm's length terms)-- (i) paragraph (d) of subsection (1) and the word "and" immediately preceding that paragraph; and (ii) in each of subsections (5) and (9), the words after paragraph (b); (c) in each of subsections (3) and (7) of section 136A, the words after paragraph (b) (which make the giving of a direction by the Board a condition of reducing an initial exchange loss where there is a transaction that is not on arm's length terms); and (d) in section 137(1), paragraph (d) (which makes the giving of a direction a condition of disregarding an exchange loss on a currency contract which is not on arm's length terms), and the word "and" immediately preceding that paragraph. (2) Accordingly, the word "and" shall be inserted-- (a) at the end of section 135(1)(b) of the [1993 c. 34.] Finance Act 1993; (b) at the end of section 136(1)(b) of that Act; and (c) at the end of section 137(1)(b) of that Act. (3) In section 167(2) of the [1994 c. 9.] Finance Act 1994, paragraph (b) (which makes the giving of a direction by the Board a condition of adjusting the amounts brought into account in respect of a relevant transaction which is not on arm's length terms), and the word "and" immediately preceding that paragraph, shall cease to have effect. (4) The preceding provisions of this section shall have effect (in relation to transactions entered into at any time) as respects accounting periods ending on or after the day appointed under section 199 of the [1994 c. 9.] Finance Act 1994 for the purposes of Chapter III of Part IV of that Act (self-assessment management provisions). (5) Where a direction given on or after 17th March 1998 under-- (a) section 135(1)(d), 136(1)(d), (5) or (9), 136A(3) or (7) or 137(1)(d) of the [1993 c. 34.] Finance Act 1993, or (b) section 167(2)(b) of the [1994 c. 9.] Finance Act 1994, relates to any accounting period ending before the day appointed as mentioned in subsection (4) above, all such adjustments shall be made, whether by assessment, repayment of tax or otherwise, as are necessary to give effect to that direction. 110 Determinations requiring the sanction of the Board(1) This section has effect where a determination requiring the Board's sanction is made for any of the following purposes, that is to say-- (a) the giving of a closure notice; (b) the giving of a notice under section 30B(1) of the [1970 c. 9.] Taxes Management Act 1970 amending a partnership statement; or (c) the making of a discovery assessment. (2) If the closure notice, the notice under section 30B(1) of the [1970 c. 9.] Taxes Management Act 1970 or, as the case may be, a notice of the discovery assessment is given to any person-- (a) without the determination, so far as it is taken into account in the notice or assessment, having been approved by the Board, or (b) without a copy of the Board's approval having been served on that person at or before the time of the giving of the notice, the closure notice, notice under section 30B(1) of that Act or, as the case may be, the discovery assessment shall be deemed to have been given or made (and in the case of an assessment notified) in the terms (if any) in which it would have been given or made had that determination not been taken into account. (3) For the purposes of this section the Board's approval of a determination requiring their sanction-- (a) must be given specifically in relation to the case in question and must apply to the amount determined; but (b) subject to that, may be given by the Board (either before or after the making of the determination) in any such form or manner as they may determine. (4) In this section references to a determination requiring the Board's sanction are references (subject to subsection (5) below) to any of the following determinations, that is to say-- (a) a determination of an amount falling to be brought into account for tax purposes in respect of any assumption made by virtue of paragraph 1(2) of Schedule 28AA to the Taxes Act 1988 (provision not at arm's length); (b) a determination of the amount of any adjustment falling to be made for tax purposes in respect of the disregarding or reduction, in accordance with section 135, 136, 136A or 137 of the [1993 c. 34.] Finance Act 1993 (main benefit and arm's length tests in relation to foreign exchange gains and losses), of any exchange loss, or of any exchange gain; (c) a determination of the amount of any adjustment falling to be made for tax purposes in respect of any deduction from, or addition to, any amount in accordance with section 167 of the [1994 c. 9.] Finance Act 1994 (arm's length test in relation to financial instruments). (5) For the purposes of this section a determination shall be taken, in relation to a closure notice, a notice under section 30B(1) of the [1970 c. 9.] Taxes Management Act 1970 or a discovery assessment, not to be a determination requiring the Board's sanction if-- (a) an agreement about the matters to which the determination relates has been made between an officer of the Board and the person in whose case it is made; (b) that agreement is in force at the time of the giving of the notice or, as the case may be, of any notice of the assessment; and (c) the matters to which the agreement relates include the amount determined. (6) For the purposes of subsection (5) above an agreement made between an officer of the Board and any person ("the taxpayer") in relation to any matter shall be taken to be in force at any time if, and only if-- (a) the agreement is one which has been made or confirmed in writing; (b) that time is after the end of the period of thirty days beginning-- (i) in the case of an agreement made in writing, with the day of the making of the agreement, and (ii) in any other case, with the day of the agreement's confirmation in writing; and (c) the taxpayer has not, before the end of that period of thirty days, served a notice on an officer of the Board stating that he is repudiating or resiling from the agreement. (7) The references in subsection (6) above to the confirmation in writing of an agreement are references to the service on the taxpayer by an officer of the Board of a notice in writing-- (a) stating that the agreement has been made; and (b) setting out the terms of the agreement. (8) The matters that may be questioned on so much of any appeal by virtue of any provision of the [1970 c. 9.] Taxes Management Act 1970 or Schedule 18 to this Act as relates to a determination the making of which has been approved by the Board for the purposes of this section shall not include the Board's approval, except to the extent that the grounds for questioning the approval are the same as the grounds for questioning the determination itself. (9) In this section--
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