ANNEX 1:: MINOR CHANGES IN THE LAW MADE BY THE BILL This change is adverse to some taxpayers in principle. But it is expected to have no practical effect as it is in line with current practice. Section 285
This Change also has an impact on the interpretation of references to investments in section 285 of this Act.
Paragraph 8 of Schedule 14 to FA 2006 provides an interpretation of the references to a company’s investments in section 842AA of ICTA. Paragraph 8(1) also provides that the interpretation applies to references to investments in section 842(2)(b) of ICTA as this provision is applied to section 842AA.
The FA 2006 provisions do not extend this interpretation explicitly to the definitions in section 842(3) of ICTA which section 842AA(11)(c) applies to section 842AA.
The interpretation of investments in section 285(4) to (6) of this Act applies to the whole of Chapter 3 of Part 6. It therefore covers the reference to investments in section 278(4), which is derived in part from section 824(3) of ICTA. This subsection provides a definition of an addition of a holding for the purposes of valuing a holding of investments of any description. Applying the interpretation to this reference accords with the intention that the FA 2006 interpretation would be applied consistently in section 842AA of ICTA.
The transitional provision for section 285 in Schedule 2 to this Act, is based on the commencement rule in paragraph 8(2) of Schedule 14 to FA 2006 and applies the interpretation from 6 April 2007.