ANNEX 1:: MINOR CHANGES IN THE LAW MADE BY THE BILL The change has no implications for the amount of tax paid, who pays it, or when. It affects (in principle but not in practice) only administrative matters. Change 142: Deduction of tax: collection: deposit-takers, building societies and certain companies: building society return periods: section 947
This change removes any doubt about whether paragraph 2(2)(b) of Schedule 16 to ICTA and regulation 10(3)(d)(b) of the Income Tax (Building Societies) (Dividends and Interest) Regulations 1990 (SI 1990/2231) (the building society regulations) have the same meaning.
Under the source legislation regulation 10(3)(d) of the building society regulations modifies paragraph 2(2)(a) to (c) of Schedule 16 to ICTA in respect of building societies, so that complete payment quarters and any part of an accounting period will be treated as a return period. But where a complete accounting period is wholly contained within a return period, there is no return period. This means, for example, that a complete accounting period running from say 1 January to 31 January will not be caught by regulation 10.
So, in keeping with the alignment of the rules on deduction of tax at source for deposit-takers and building societies (see Changes 126 and 127), subsections (2) and (3) of section 947 have been drafted so that they also apply to building societies.