Finance Act 1991 (c. 31)

(The document as of February, 2008)

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(2) The words "the age of 55" shall be substituted for the words "the age of 60" wherever occurring in--

(a) section 69(1)(a) and (b), (4)(b) and (6)(b);

(b) section 70(1)(a) and (b), (2)(c), (4)(c) and (5)(c); and

(3) In paragraph 13(1) of Schedule 20--

(a) in paragraph (a) (full relief up to the appropriate percentage of £125,000) for "£125,000" there shall be substituted "£150,000"; and

(b) in paragraph (b) (half relief on the excess, up to the appropriate percentage of £500,000) for "£125,000" and "£500,000" there shall be substituted "£150,000" and "£600,000" respectively.

(4) The amendments made by this section shall apply in relation to disposals on or after 19th March 1991.

101 Amendments of rebasing provisions

(1) Schedule 9 to the [1988 c. 39.] Finance Act 1988 (deferred charges on gains before 31st March 1982) shall be amended as follows.

(2) In paragraph 1(b) (reduction of gain) after "within paragraph" there shall be inserted "2A or".

(3) In sub-paragraph (1) of paragraph 2 (charges rolled-over or held-over) for "sub-paragraph (2)" there shall be substituted "sub-paragraphs (2) to (2B)".

(4) After sub-paragraph (2) of that paragraph there shall be inserted--

" (2A) Where the disposal takes place on or after 19th March 1991, this Schedule does not apply if the amount of the deduction would have been less had relief by virtue of a previous application of this Schedule been duly claimed.

(2B) Where--

(a) the asset was acquired on or after 19th March 1991,

(b) the deduction is partly attributable to a claim by virtue of section 117(3) of the [1979 c. 14.] Capital Gains Tax Act 1979 (roll-over into non-depreciating asset instead of into depreciating asset), and

this Schedule does not apply by virtue of this paragraph. "

(5) After paragraph 2 there shall be inserted--

" 2A (1) This paragraph applies where this Schedule would have applied on a disposal but for paragraph 2(2B) above.

(2) This Schedule applies on the disposal if paragraph 3 below would have applied had--

(a) section 117(2) of the [1979 c. 14.] Capital Gains Tax Act 1979 (postponement of charge where depreciating asset acquired as replacement for business asset) continued to apply to the gain carried forward as a result of the claim by virtue of section 117(3) of that Act, and

(b) the time of the disposal been the time when that gain was treated as accruing by virtue of section 117(2) of that Act. "

(6) In sub-paragraph (1) of paragraph 3 (postponed charges) for "sub-paragraph (3)" there shall be substituted "sub-paragraphs (3) and (4)".

(7) In sub-paragraph (2)(e) of that paragraph the words from "(postponement" to "asset)" shall be omitted.

(8) After sub-paragraph (3) of that paragraph there shall be inserted--

" (4) Where a gain is treated as accruing in consequence of an event occurring on or after 19th March 1991, this Schedule does not apply if--

(a) the gain is attributable (whether directly or indirectly and whether in whole or part) to the disposal of an asset on or after 6th April 1988, or

(b) the amount of the gain would have been less had relief by virtue of a previous application of this Schedule been duly claimed. "

(9) In sub-paragraph (1)(a) of paragraph 8 for "which ends when" there shall be substituted "in which".

(10) Subsection (9) above shall apply in relation to claims made on or after 19th March 1991.

102 Traded options: closing purchases

(1) This section applies where, on or after the day on which this Act is passed, a person ("the grantor") who has granted a traded option ("the original option") closes it out by acquiring a traded option of the same description ("the second option").

(2) Any disposal by the grantor involved in closing out the original option shall be disregarded for the purposes of capital gains tax or, as the case may be, corporation tax on chargeable gains.

(3) The incidental costs to the grantor of making the disposal constituted by the grant of the original option shall be treated for the purposes of Chapter II of Part II of the Capital Gains Tax Act 1979 (computation of gains and losses) as increased by an amount equal to the aggregate of--

(a) the amount or value of the consideration, in money or money's worth, given by him or on his behalf wholly and exclusively for the acquisition of the second option, and

(b) the incidental costs to him of that acquisition.

(4) In this section "traded option" has the meaning given by section 137(9)(b) of the [1979 c. 14.] Capital Gains Tax Act 1979.

Part III Oil Taxation

Abandonment etc.

103 Allowance of certain expenditure relating to abandonment, decommissioning assets, etc

(1) Section 3 of the principal Act (allowance of certain expenditure) shall be amended in accordance with subsections (2) to (6) below.

(2) With respect to expenditure incurred on or after 19th March 1991, in subsection (1), after paragraph (h) there shall be inserted the following paragraph--

" (hh) obtaining an abandonment guarantee, as defined in section 104 of the Finance Act 1991 " .

(3) With respect to expenditure incurred after 30th June 1991, in subsection (1), for paragraph (i) there shall be substituted the following paragraphs--

" (i) closing down, decommissioning, abandoning or wholly or partially dismantling or removing any qualifying asset;

(j) carrying out qualifying restoration work consequential upon the closing down of the field or any part of it. "

(4) After subsection (1) there shall be inserted the following subsections--

" (1A) In this section "qualifying asset" has the same meaning as in the [1983 c. 56.] Oil Taxation Act 1983; and, in the case of a qualifying asset which was leased or hired, the reference in subsection (1)(i) above to decommissioning includes a reference to carrying out any restoration or similar work which is required to be carried out to comply with the terms of the contract of lease or hire.

(1B) In subsection (1)(j) above "qualifying restoration work", in relation to a participator in an oil field, means--

(a) restoring (including landscaping) land on which a qualifying asset is or was situated; or

(b) restoring the seabed (including the subsoil thereof) on which a qualifying asset is or was situated.

(1C) In any case where--

(a) expenditure is incurred by a participator for any of the purposes mentioned in paragraph (i) or paragraph (j) of subsection (1) above, and

(b) the participator is or was a participator in two or more oil fields and the qualifying asset which is relevant to the incurring of that expenditure is, at the end of the claim period concerned, a qualifying asset in respect of more than one of those oil fields,

the expenditure shall be apportioned between those oil fields in such manner as is just and reasonable.

(1D) Without prejudice to any apportionment under subsection (1C) above, in any case where--

(a) any expenditure incurred by a participator would, apart from this subsection, be regarded as wholly incurred for any of the purposes mentioned in paragraph (i) or paragraph (j) of subsection (1) above, and

(b) the qualifying asset which is relevant to the incurring of that expenditure has at some time been used otherwise than in connection with an oil field,

only such portion of the expenditure as it is just and reasonable to apportion to the use in connection with an oil field shall be regarded as allowable for any of the purposes referred to in paragraph (a) above. "

(5) After subsection (5A) there shall be inserted the following subsection--

" (5B) Expenditure incurred by a participator in an oil field shall be taken to be incurred for the purpose mentioned in paragraph (hh) of subsection (1) above if, and only if,--

(a) it consists of fees, commission or incidental costs incurred wholly and exclusively for the purposes of obtaining an abandonment guarantee; and

(b) the abandonment guarantee is obtained in order to comply with a term of a relevant agreement relating to that field under which the participator is required to provide security (whether or not specifically in the form of an abandonment guarantee) in respect of his liabilities to contribute to field abandonment costs;

and expressions used in this subsection shall be construed in accordance with section 104 of the Finance Act 1991. "

(6) In subsection (6) (apportionment of expenditure)--

(a) at the beginning there shall be inserted "Without prejudice to any apportionment under subsection (1C) or subsection (1D) above"; and

(b) after the words "subsections (1) and (5) above" there shall be inserted "other than paragraph (hh) of subsection (1)".

(7) In section 10 of the principal Act (exempt gas)--

(a) in subsection (2) for the words "and (i) of subsection (1)" there shall be substituted "(hh), (i) and (j) of subsection (1) and subsection (1D)";

(b) in subsection (3) for the words "paragraph (a), (b), (c) or (i)" there shall be substituted "any of paragraphs (a), (b), (c), (hh), (i) and (j)"; and

(8) So far as they relate to the paragraph (hh) inserted by subsection (2) above, the amendments in subsections (5) to (7) above have effect with respect to expenditure incurred on or after 19th March 1991 and, subject to that, the amendments in subsections (4) to (7) above have effect with respect to expenditure incurred after 30th June 1991.

104 Abandonment guarantees

(1) Subject to subsection (2) below, for the purposes of section 3 of the principal Act and sections 105 and 106 below, an abandonment guarantee is a contract under which a person ("the guarantor") undertakes to make good any default by a participator in an oil field ("the relevant participator") in meeting the whole or any part of those liabilities of his which--

(a) arise under a relevant agreement relating to that field; and

(b) are liabilities to contribute to field abandonment costs;

and such a contract is an abandonment guarantee regardless of the form of the undertaking of the guarantor and, in particular, whether or not it is expressed as a guarantee or arises under a letter of credit, a performance bond or any other instrument.

(2) For the purposes of section 3 of the principal Act and section 106 (but not section 105) below a contract is not an abandonment guarantee--

(a) unless it is entered into in good faith and on terms reasonably appropriate to the nature and extent of the guarantee; or

(b) if the guarantor undertakes any liability beyond that of making good any such default as is referred to in subsection (1) above; or

(c) if it can be revoked by the guarantor otherwise than on account of some fraud, misrepresentation or other fault on the part of the relevant participator occurring prior to the making of the contract; or

(d) if, subject to subsection (3) below, the guarantor is, or is a person connected with, a participator in one or more oil fields.

(3) Paragraph (d) of subsection (2) above does not apply if--

(a) the main business carried on by the guarantor is such that it is in the ordinary course of that business to provide guarantees; and

(b) the relevant participator is not connected with the guarantor;

and section 839 of the Taxes Act 1988 (connected persons) applies for the purposes of this subsection and subsection (2) above.

(4) Without prejudice to the generality of paragraph (a) of subsection (2) above, a contract shall not be regarded as entered into in good faith if, as a result of any arrangement, the liability to make good any such default as is referred to in subsection (1) above will be met, directly or indirectly, by such a person that, if he were the guarantor under the contract, the contract could not be an abandonment guarantee by virtue of paragraph (d) of subsection (2) above.

(5) In this section and in section 3(5B) of the principal Act--

(a) in relation to an oil field, a "relevant agreement" means a joint operating agreement, a unitisation agreement (within the meaning of paragraph 1(1) of Schedule 17 to the [1980 c. 48.] Finance Act 1980) or an agreement entered into by some or all of the parties to a joint operating agreement or such a unitisation agreement; and

(b) in relation to an oil field, "field abandonment costs" means costs incurred in closing down the field or any part of it, together with any costs incurred in discharging any continuing liabilities resulting directly from that closure.

105 Restriction of expenditure relief by reference to payments under abandonment guarantees

(1) If, under an abandonment guarantee, a payment is made by the guarantor on or after 19th March 1991, then, to the extent that any expenditure for which the relevant participator is liable is met, directly or indirectly, out of the payment, that expenditure shall not be regarded for any of the purposes of the principal Act as having been incurred by the relevant participator or any other participator in the oil field concerned.

(2) In any case where--

(a) a payment made by the guarantor under an abandonment guarantee is not immediately applied in meeting any expenditure, and

(b) the payment is for any period invested (either specifically or together with payments made by persons other than the guarantor) so as to be represented by, or by part of, the assets of a fund or account, and

(c) at a subsequent time, any expenditure for which the relevant participator is liable is met out of the assets of the fund or account,

any reference in subsection (1) above or section 106 below to expenditure which is met, directly or indirectly, out of the payment shall be construed as a reference to so much of the expenditure for which the relevant participator is liable as is met out of those assets of the fund or account which, at the subsequent time referred to in paragraph (c) above, it is just and reasonable to attribute to the payment.

(3) In subsections (1) and (2) above "the guarantor" and "the relevant participator" have the same meaning as in subsection (1) of section 104 above.

106 Relief for reimbursement expenditure under abandonment guarantees

(1) This section applies in any case where--

(a) on or after 19th March 1991 a payment (in this section referred to as "the guarantee payment") is made by the guarantor under an abandonment guarantee; and

(b) by virtue of the making of the guarantee payment, the relevant participator becomes liable under the terms of the abandonment guarantee to pay any sum or sums to the guarantor; and

(c) in any claim period (in this section referred to as "the relevant period") expenditure is incurred, or consideration in money's worth is given, by the relevant participator in or towards meeting that liability.

(2) In any case where the whole of the guarantee payment or, as the case may require, of the assets which, under section 105(2) above, are attributed to the guarantee payment is not applied in meeting liabilities of the relevant participator which fall within paragraphs (a) and (b) of subsection (1) of section 104 above and a sum representing the unapplied part of the guarantee payment or of those assets is repaid, directly or indirectly, to the guarantor,--

(a) any liability of the relevant participator to repay that sum shall be excluded in determining the total liability of the relevant participator which falls within subsection (1)(b) above; and

(b) the repayment to the guarantor of that sum shall not be regarded as expenditure incurred by the relevant participator as mentioned in subsection (1)(c) above.

(3) In the following provisions of this section "reimbursement expenditure" means expenditure incurred as mentioned in subsection (1)(c) above or consideration (or, as the case may require, the value of consideration) given as so mentioned; and any reference to the incurring of reimbursement expenditure shall be construed accordingly.

(4) So much of any reimbursement expenditure as, in accordance with subsection (5) below, is qualifying expenditure shall be treated for the purposes of the principal Act as if it were expenditure incurred by the relevant participator for the purpose of obtaining an abandonment guarantee.

(5) Subject to subsection (6) below, of the reimbursement expenditure which is incurred in the relevant period, the amount which constitutes qualifying expenditure shall be determined by the formula--

---

where--

"A" is the reimbursement expenditure incurred in the relevant period;
"B" is so much of the expenditure represented by the guarantee payment as, if it had been incurred by the relevant participator, would have constituted expenditure allowable under section 3 of the principal Act; and
"C" is the total of the sums which, at or before the end of the relevant period, the participator is or has become liable to pay to the guarantor as mentioned in subsection (1)(b) above.

(6) In relation to the guarantee payment, the total of the reimbursement expenditure (whether incurred in one or more claim periods) which constitutes qualifying expenditure shall not exceed whichever is the less of "B" and "C" in the formula in subsection (5) above; and any limitation on qualifying expenditure arising by virtue of this subsection shall be applied to the expenditure of a later in preference to an earlier claim period.

(7) For the purposes of this section, the expenditure represented by the guarantee payment is any expenditure--

(a) for which the relevant participator is liable; and

(b) which is met, directly or indirectly, out of the guarantee payment (and which, accordingly, by virtue of section 105 above is not to be regarded as expenditure incurred by the relevant participator).

(8) In this section "the guarantor" and "the relevant participator" have the same meaning as in subsection (1) of section 104 above.

107 Allowance of expenditure of participator meeting defaulter's field abandonment expenditure

(1) In Schedule 5 to the principal Act (procedure for allowance of expenditure) at the beginning of paragraph (b) of sub-paragraph (4) of paragraph 2 (claim must state the shares, by reference to their respective interests in the oil field, in which participators propose to divide expenditure) there shall be inserted "Subject to paragraph 2A below".

(2) After paragraph 2 of Schedule 5 to the principal Act there shall be inserted the following paragraph--

" 2A (1) This paragraph applies where--

(a) a claim is made under this Schedule for the allowance of any expenditure which is incurred after 30th June 1991 and is allowable for an oil field by virtue of paragraph (i) or paragraph (j) of subsection (1) of section 3 of this Act (in this paragraph referred to as "the abandonment expenditure");

(b) a participator (in this paragraph referred to as "the defaulter") has defaulted on his liability under a relevant agreement to make a payment towards the abandonment expenditure;

(c) at the end of the claim period for which the claim is made, the defaulter still has an interest in the oil field which falls to be taken into account in determining, under paragraph 2(4)(b) above, the shares of each of the participators in the abandonment expenditure;

(d) the participators (other than any who have defaulted as mentioned in paragraph (b) above) have taken all reasonable steps by way of legal remedy to secure that the defaulter meets the whole of the liability referred to in paragraph (b) above and to enforce any guarantee or other security provided in respect of that liability; and

(e) one or more of those participators has paid an amount in or towards meeting the whole or any part of the payment for which the defaulter was liable as mentioned in paragraph (b) above.

(2) For the purposes of this paragraph, a participator is to be regarded as defaulting on his liability to make a payment as mentioned in sub-paragraph (1)(b) above if he has failed to make the payment in full on the date on which it becomes due under the relevant agreement and either--

(a) on the sixtieth day after that due date any of the payment remains unpaid; or

(b) before that sixtieth day the participator's interest in a relevant licence becomes liable under the relevant agreement to be sold or forfeited, in whole or in part, by reason of his failure to meet his liability.

(3) In this paragraph--

(a) "relevant agreement" has the meaning given by section 104(5)(a) of the Finance Act 1991;

(b) "the sum in default" means so much of the payment referred to in sub-paragraph (1)(b) above as has neither been paid by the defaulter nor met by virtue of any such guarantee or security as is referred to in sub-paragraph (1)(d) above;

(c) the "default payment" means the amount which the qualifying participator has paid as mentioned in sub-paragraph (1)(e) above; and

(d) a "qualifying participator" means a participator who falls within sub-paragraph (1)(e) above and who is not connected with the defaulter, applying section 839 of the Taxes Act (connected persons) for the purposes of this paragraph.

(4) For the purposes of paragraphs 2(4)(b) and 3(1)(c) of this Schedule, there shall be attributed to a qualifying participator (as an addition to the share of the abandonment expenditure referable to his own interest in the oil field) whichever is the less of--

(a) the default payment; and

(b) subject to sub-paragraph (5) below, that portion of the sum in default which, in accordance with the relevant agreement, the qualifying participator is required to meet in the event of a failure by the defaulter to meet his liability to pay in full the payment referred to in sub-paragraph (1)(b) above.

(5) If, in the case of any oil field, there are only two participators and one of them is the defaulter, the portion referred to in sub-paragraph (4)(b) above is the whole.

(6) Where this paragraph applies, account shall, in the first instance, be taken under paragraph 2(4)(b) above of the whole of the defaulter's interest in the oil field in determining the share of the abandonment expenditure which, apart from sub-paragraph (4) above, is to be attributed to each of the other participators; but the amount of the abandonment expenditure which, apart from this paragraph, would be attributed to the defaulter by reference to his interest in the oil field shall be reduced (or, as the case may be, extinguished) by deducting therefrom any expenditure attributed to the other participators under sub-paragraph (4) above. "

108 Reimbursement by defaulter in respect of certain abandonment expenditure

(1) This section applies in any case where--

(a) paragraph 2A of Schedule 5 to the principal Act (as set out in section 107 above) applies; and

(b) under sub-paragraph (4) of that paragraph the default payment falls, in whole or in part, to be attributed to the qualifying participator (as an addition to his share of the abandonment expenditure); and

(c) expenditure is incurred, or consideration in money's worth is given, by the defaulter in reimbursing the qualifying participator in respect of, or otherwise making good to him, the whole or any part of the default payment;

and expressions used in this section have the same meaning as in the said paragraph 2A.

(2) In the following provisions of this section "reimbursement expenditure" means expenditure incurred as mentioned in subsection (1)(c) above or consideration (or, as the case may require, the value of consideration) given as so mentioned; and any reference to the incurring of reimbursement expenditure shall be construed accordingly.

(3) Subject to subsection (5) below, in relation to the defaulter, reimbursement expenditure shall be treated for the purposes of the principal Act as if it were expenditure incurred by the defaulter for purposes falling within paragraph (i) of subsection (1) of section 3 of that Act.

(4) Subject to subsection (5) below, in computing under section 2 of the principal Act the assessable profit or allowable loss accruing to the qualifying participator from the oil field concerned in any chargeable period, the positive amounts for the purposes of that section (as specified in subsection (3)(a) thereof) shall be taken to include any reimbursement expenditure received by the qualifying participator in that period.

(5) In relation to a particular default payment, reimbursement expenditure incurred at any time--

(a) shall be treated as mentioned in subsection (3) above, and

(b) shall be taken to be included as mentioned in subsection (4) above,

only to the extent that, when aggregated with any reimbursement expenditure previously incurred in respect of that default payment, it does not exceed so much of the default payment as falls to be attributed to the qualifying participator as mentioned in subsection (1)(b) above.

(6) A claim by the defaulter for the allowance of reimbursement expenditure by virtue of subsection (3) above shall be made under Schedule 6 to the principal Act (instead of under Schedule 5); and, for this purpose only, Schedule 6 to that Act shall have effect as if, in sub-paragraph (1) of paragraph 1, the words from "if the participator" onwards were omitted.

(7) The incurring of reimbursement expenditure shall not be regarded, by virtue of paragraph 8 of Schedule 3 to the principal Act (certain subsidised expenditure to be disregarded), as the meeting of the expenditure of the qualifying participator in making the default payment.

Penalties

109 PRT: proceedings for penalties

(1) In Schedule 2 to the principal Act (management and collection of petroleum revenue tax) the Table in paragraph 1(1) shall be amended as follows.

(2) The following shall be substituted for the entries relating to section 100 of the [1970 c. 9.] Taxes Management Act 1970--

" Section 100C(1)	For the words from "General" to the end substitute "Special Commissioners for any penalty".
(2)	Before "Commissioners" insert "Special".
(3)	Before "Commissioners" insert "Special".
(4)	--
(5)	-- " .

(3) The following shall be substituted for the entries relating to section 103 of the [1970 c. 9.] Taxes Management Act 1970--

" Section 103(1)	For the words from the beginning to "court--" substitute "Where the amount of a penalty is to be ascertained by reference to tax payable by a person for any period, proceedings for the penalty may be commenced before the Special Commissioners--".
(4)	For the words from the beginning to "court," substitute "Proceedings for a penalty to which subsection (1) above does not apply may be commenced before the Special Commissioners". "

Part IVV Stamp Duty and Stamp Duty Reserve Tax

110 Stamp duty abolished in certain cases

(1) This section applies where--

(a) apart from this section stamp duty under any of the headings mentioned in subsection (3) below would be chargeable on an instrument to which this section applies, and

(b) the condition mentioned in subsection (4) below is fulfilled.

(2) In such a case stamp duty under the heading concerned shall not be chargeable on the instrument.

(3) The headings are the following headings in Schedule 1 to the [1891 c. 39.] Stamp Act 1891--

(a) the heading "conveyance or transfer on sale";

(b) the heading "conveyance or transfer of any kind not hereinbefore described";

(d) the heading beginning "disposition in Scotland of any property";

(e) the heading "exchange or excambion";

(f) the heading "partition or division";

(g) the heading "release or renunciation of any property, or of any right or interest in any property";

(h) the heading "surrender".

(4) The condition is that the property concerned consists entirely of exempt property; and as regards the heading "exchange or excambion" the reference here to the property concerned is to all property subject to any part of the exchange.

(5) For the purposes of this section exempt property is property other than--

(a) land,

(b) an interest in the proceeds of the sale of land held on trust for sale, or

(6) This section applies to--

(a) an instrument executed in pursuance of a contract made on or after the abolition day;

(b) an instrument which is not executed in pursuance of a contract and is executed on or after the abolition day.

(7) For the purposes of this section the abolition day is such day as may be appointed under section 111(1) of the [1990 c. 29.] Finance Act 1990 (abolition of stamp duty for securities etc).

111 Stamp duty reduced in certain cases

(1) This section applies where--

(a) stamp duty under the heading "conveyance or transfer on sale" in Schedule 1 to the [1891 c. 39.] Stamp Act 1891 is chargeable on an instrument to which this section applies, and

(b) part of the property concerned consists of exempt property.

(2) In such a case--

(a) the consideration in respect of which duty would be charged (apart from this section) shall be apportioned, on such basis as is just and reasonable, as between the part of the property which consists of exempt property and the part which does not, and

(b) the instrument shall be charged only in respect of the consideration attributed to such of the property as is not exempt property.

(3) In this section "exempt property" has the same meaning as in section 110 above.

(4) This section applies to--

(a) an instrument executed in pursuance of a contract made on or after the abolition day;

(b) an instrument which is not executed in pursuance of a contract and is executed on or after the abolition day.

(5) In this section "the abolition day" has the same meaning as in section 110 above.

112 Apportionment of consideration for stamp duty purposes

(1) Subsection (2) below applies where part of the property referred to in section 58(1) of the Stamp Act 1891 (consideration to be apportioned between different instruments as parties think fit) consists of exempt property.

(2) Section 58(1) shall have effect as if "the parties think fit" read "is just and reasonable".

(3) Subsection (4) below applies where--

(a) part of the property referred to in section 58(2) of the Stamp Act 1891 (property contracted to be purchased by two or more persons etc.) consists of exempt property, and

(b) both or (as the case may be) all the relevant persons are connected with one another.

(4) Section 58(2) shall have effect as if the words from "for distinct parts of the consideration" to the end of the subsection read ", the consideration is to be apportioned in such manner as is just and reasonable, so that a distinct consideration for each separate part or parcel is set forth in the conveyance relating thereto, and such conveyance is to be charged with ad valorem duty in respect of such distinct consideration."

(5) In a case where subsection (2) or (4) above applies and the consideration is apportioned in a manner that is not just and reasonable, the enactments relating to stamp duty shall have effect as if--

(a) the consideration had been apportioned in a manner that is just and reasonable, and

(b) the amount of any distinct consideration set forth in any conveyance relating to a separate part or parcel of property were such amount as is found by a just and reasonable apportionment (and not the amount actually set forth).

(6) In this section "exempt property" has the same meaning as in section 110 above.

(7) For the purposes of subsection (3) above--

(a) a person is a relevant person if he is a person by or for whom the property is contracted to be purchased;

(b) the question whether persons are connected with one another shall be determined in accordance with section 839 of the Taxes Act 1988.

(8) This section applies where the contract concerned is made on or after the abolition day.

(9) In this section "the abolition day" has the same meaning as in section 110 above.

113 Certification of instruments for stamp duty purposes

(1) Section 34 of the [1958 c. 56.] Finance Act 1958 and section 7 of the [1958 c. 14 (N.I.).] Finance Act (Northern Ireland) 1958 shall be amended as mentioned in subsections (2) and (3) below.

(2) In subsection (4) of each of those sections (certification of instrument at a particular amount) the following paragraph shall be substituted for paragraph (a)--

" (a) any sale or contract or agreement for the sale of exempt property shall be disregarded; and " .

(3) In each of those sections the following subsection shall be inserted after subsection (4)--

" (4A) In subsection (4) above "exempt property" has the same meaning as in section 110 of the Finance Act 1991. "

(4) This section applies to--

(a) an instrument executed in pursuance of a contract made on or after the abolition day;

(b) an instrument which is not executed in pursuance of a contract and is executed on or after the abolition day.

(5) In this section "the abolition day" has the same meaning as in section 110 above.

114 Acquisition under statute: exempt property

(1) Section 36 of the [1949 c. 47.] [1949 c. 15 (N.I.)9.Finance Act] 1949 and section 9 of the Finance Act (Northern Ireland) 1949 shall be amended as mentioned in subsections (2) and (3) below.

(2) In subsection (4) of each of those sections (goods not affected by section 12 of the [1895 c. 16.] Finance Act 1895, which relates to duty on property acquired under statute) for the words "goods, wares or merchandise" (in each place where they occur) there shall be substituted the words "exempt property".

(3) In each of those sections the following subsection shall be inserted after subsection (4)--

" (5) In subsection (4) above "exempt property" has the same meaning as in section 110 of the Finance Act 1991. "

(4) This section applies where the Act mentioned in section 12 of the Finance Act 1895, and by virtue of which property is vested or a person is authorised to purchase property, is passed on or after the abolition day.

(5) In this section "the abolition day" has the same meaning as in section 110 above.

115 Northern Ireland bank notes: duty abolished

(1) In its application to Northern Ireland, the [1891 c. 39.] Stamp Act 1891 shall have effect with the omission from Schedule 1 of the heading "bank note".

(2) The licences required to be taken out under the [1828 c. 30.] Bankers' Composition (Ireland) Act 1828 (licences for bankers in Northern Ireland issuing certain promissory notes) are hereby abolished.

(3) This section takes effect on 1st January 1992.

116 Investment exchanges and clearing houses: stamp duty

(1) The Treasury may make regulations providing as mentioned in this section with regard to any circumstances which--

(a) would (apart from the regulations) give rise to a charge to stamp duty,

(b) involve a prescribed recognised investment exchange or a prescribed recognised clearing house, or a member or nominee (or member or nominee of a prescribed description) of such an exchange, or a nominee (or nominee of a prescribed description) of such a clearing house, or a nominee (or nominee of a prescribed description) of a member of such an exchange, and

(2) The regulations may provide that the charge to stamp duty shall be treated as not arising or (depending on the terms of the regulations) as reduced.

(3) Regulations under this section--

(a) shall be made by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons;

(b) may include such supplementary, incidental, consequential or transitional provisions as appear to the Treasury to be necessary or expedient;

(d) may make any provision in such way as the Treasury think fit (whether by amending enactments or otherwise).

(4) In this section--

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