Finance Act 2010

Finance Act 2010 Skip to content Disclaimer Feedback Helpdesk Gaeilge Léim go dtí an t-ábhar Séanadh Aiseolas Deasc chabhrach English Gaeilge English Produced by the Office of the Attorney General Táirgthe ag Oifig an Ard-Aighne Home Legislation Acts of the Oireachtas Statutory Instruments Pre-1922 Legislation Constitution External Resources Bills (Houses of the Oireachtas) Iris Oifigiúil / Official Gazette Revised Acts (LRC) Classified List of Legislation (LRC) Translations (acts.ie) Translations (Houses of the Oireachtas) Government Publications for Sale EU Law (EUR-Lex) FAQ Disclaimer Feedback Helpdesk Search Baile Reachtaíocht Achtanna an Oireachtais Ionstraimí Reachtúla Reachtaíocht Réamh-1922 Bunreacht Acmhainní Seachtracha Billí (Tithe an Oireachtais) Iris Oifigiúil Achtanna Athbhreithnithe (CAD) (An Coimisiún um Athchóiriú an Dlí) Liosta Rangaithe Reachtaíochta Aistriúcháin (achtanna.ie) Aistriúcháin (Tithe an Oireachtais) Foilseacháin Rialtais ar Díol Dlí AE (EUR-Lex) CCanna (Ceisteanna Coitianta) Séanadh Aiseolas Deasc chabhrach Cuardach TitleTeideal Year(s) or rangeBliain nó blianta nó raon TypeCineál All Legislation Acts Statutory Instruments Advanced SearchCuardach Casta HomeBaile ActsAchtanna 2010 Finance Act 2010 Finance Act 2010 Permanent Page URL View by SectionAmharc de réir Ailt View Full ActAmharc ar an Acht Iomlán Bill History Stair Bille Commencement, Amendments, SIs made under the Act Tosach Feidhme, Leasuithe, IRí arna ndéanamh faoin Acht Open PDFOscail PDF Print Full ActPriontáil an tAcht Iomlán Number 5 of 2010 FINANCE ACT 2010 ARRANGEMENT OF SECTIONS

PART 1

Cost benefit analysis of tax expenditures Section

Section 1

PART 2

Income Levy, Income Tax, Corporation Tax and Capital Gains Tax

Chapter 1

Interpretation

Section 2

Chapter 2

Income Levy

Section 3

Chapter 3

Income Tax

Section 4

Section 5

Section 6

Section 7

Section 8

Section 9

Section 10

Section 11

Section 12

Section 13

Section 14

Section 15

Section 16

Section 17

Section 18

Section 19

Section 20

Section 21

Section 22

Section 23

Chapter 4

Income Tax, Corporation Tax and Capital Gains Tax

Section 24

Section 25

Section 26

Section 27

Section 28

Section 29

Section 30

Section 31

Section 32

Section 33

Section 34

Section 35

Section 36

Section 37

Section 38

Section 39

Section 40

Section 41

Section 42

Chapter 5

Corporation Tax

Section 43

Section 44

Section 45

Section 46

Section 47

Section 48

Section 49

Section 50

Section 51

Section 52

Section 53

Section 54

Section 55

Chapter 6

Capital Gains Tax

Section 56

Section 57

Section 58

Section 59

Section 60

Section 61

Section 62

Section 63

PART 3

Customs and Excise

Chapter 1

Mineral Oil Tax Carbon Charge

Section 64

Section 65

Chapter 2

Natural Gas Carbon Tax

Section 66

Section 67

Section 68

Section 69

Section 70

Section 71

Section 72

Section 73

Section 74

Section 75

Section 76

Chapter 3

Solid Fuel Carbon Tax

Section 77

Section 78

Section 79

Section 80

Section 81

Section 82

Section 83

Section 84

Section 85

Section 86

Section 87

Chapter 4

Miscellaneous

Section 88

Section 89

Section 90

Section 91

Section 92

Section 93

Section 94

Section 95

Section 96

Section 97

Section 98

Section 99

Section 100

Section 101

Section 102

Section 103

Section 104

Section 105

Section 106

Section 107

Section 108

Section 109

Section 110

Section 111

PART 4

Value-Added Tax

Section 112

Section 113

Section 114

Section 115

Section 116

Section 117

Section 118

Section 119

Section 120

Section 121

Section 122

Section 123

Section 124

Section 125

Section 126

Section 127

Section 128

Section 129

Section 130

Section 131

Section 132

Section 133

PART 5

Stamp Duties

Section 134

Section 135

Section 136

Section 137

Section 138

Section 139

Section 140

Section 141

PART 6

Capital Acquisitions Tax

Section 142

Section 143

Section 144

Section 145

Section 146

Section 147

PART 7

Miscellaneous

Section 148

Section 149

Section 150

Section 151

Section 152

Section 153

Section 154

Section 155

Section 156

Section 157

Section 158

Section 159

Section 160

Section 161

Section 162

Section 163

Section 164

Section 165

SCHEDULE 1 Rates of Solid Fuel Carbon Tax SCHEDULE 2 Consequential Amendment of Value-Added Tax Act 1972 SCHEDULE 3 Pre-consolidation amendments and repeals (Part 4) SCHEDULE 4 Miscellaneous Technical Amendments in Relation to Tax Acts Referred to Bretton Woods Agreements Act 1957 1957, No. 18 Capital Acquisitions Tax Consolidation Act 2003 2003, No. 1 Child Care Act 1991 1991, No. 17 Companies Act 1963 1963, No. 33 Companies Act 1990 1990, No. 33 Courts of Justice Act 1924 1924, No. 10 Courts (Supplemental Provisions) Act 1961 1961, No. 39 Criminal Procedure Act 1967 1967, No. 12 Customs Consolidation Act 1876 39 & 40 Vict., c.36 Customs Act 1956 1956, No. 7 Defence Act 1954 1954, No. 18 Defence (Amendment) Act 2007 2007, No. 24 Fertilisers, Feeding Stuffs and Mineral Mixtures Act 1955 1955, No. 8 Finance (1909-10) Act 1910 10 Edw. 7, c.8 Finance Act 1931 1931, No. 31 Finance Act 1950 1950, No. 18 Finance Act 1963 1963, No. 23 Finance Act 1975 1975, No. 6 Finance Act 1976 1976, No. 16 Finance Act 1983 1983, No. 15 Finance Act 1992 1992, No. 9 Finance Act 1997 1997, No. 22 Finance Act 1999 1999, No. 2 Finance Act 2001 2001, No. 7 Finance Act 2002 2002, No. 5 Finance Act 2003 2003, No. 3 Finance Act 2005 2005, No. 5 Finance Act 2007 2007, No. 11 Finance Act 2008 2008, No. 3 Finance (No. 2) Act 2008 2008, No. 25 Finance Act 2009 2009, No. 12 Financial Emergency Measures in the Public Interest Act 2009 2009, No. 5 Gaming and Lotteries Act 1956 1956, No. 2 Health Act 1970 1970, No. 1 Health Contributions Act 1979 1979, No. 4 Health Insurance (Miscellaneous Provisions) Act 2009 2009, No. 24 Intoxicating Liquor Act 2008 2008, No. 17 Judgement Mortgage (Ireland) Act 1850 13 & 14 Vict., c.29 Judgement Mortgage (Ireland) Act 1858 21 & 22 Vict., c.105 Land and Conveyancing Law Reform Act 2009 2009, No. 27 Local Government Act 2001 2001, No. 37 Medical Practitioners Act 1978 1978, No. 4 Medical Practitioners Act 2007 2007, No. 25 National Asset Management Agency Act 2009 2009, No. 34 Nursing Homes Support Scheme Act 2009 2009, No. 15 Pensions Act 1990 1990, No. 25 Planning and Development Act 2000 2000, No. 30 Provisional Collection of Taxes Act 1927 1927, No. 7 Roads Act 1920 10 & 11 Geo. 5, c.72 Road Traffic Act 1961 1961, No. 24 Road Traffic Act 1968 1968, No. 25 Social Welfare and Pensions Act 2009 2009, No. 10 Social Welfare Consolidation Act 2005 2005, No. 26 Stamp Duties Consolidation Act 1999 1999, No. 31 Succession Act 1965 1965, No. 27 Taxes Consolidation Act 1997 1997, No. 39 Taxi Regulation Act 2003 2003, No. 25 Unit Trusts Act 1990 1990, No. 37 Value-Added Tax Act 1972 1972, No. 22

Number 5 of 2010 FINANCE ACT 2010 AN ACT TO PROVIDE FOR THE IMPOSITION, REPEAL, REMISSION, ALTERATION AND REGULATION OF TAXATION, OF STAMP DUTIES AND OF DUTIES RELATING TO EXCISE AND OTHERWISE TO MAKE FURTHER PROVISION IN CONNECTION WITH FINANCE INCLUDING THE REGULATION OF CUSTOMS. [3rd April, 2010] BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:

PART 1

Cost Benefit Analysis of Tax Expenditures Cost benefit analysis of tax expenditures.

1.— The Minister shall within three months from the passing of this Act prepare and lay before Dáil Éireann a report on a cost-benefit analysis of tax expenditures provided for by this Act, setting out the costs of tax foregone, and the benefits in terms of job creation or otherwise.

PART 2

Income Levy, Income Tax, Corporation Tax and Capital Gains Tax

Chapter 1

Interpretation Interpretation (Part 2).

2.— In this Part “Principal Act” means the Taxes Consolidation Act 1997 .

Chapter 2

Income Levy Income levy.

3.— (1) The Principal Act is amended in Part 18A— (a) in section 531B by substituting the following for paragraph (a) of the Table to subsection (1): “(a) The income described in this paragraph, to be known as ‘relevant emoluments’, is emoluments to which Chapter 4 of Part 42 applies or is applied— (i) other than social welfare payments and similar type payments, (ii) other than excluded emoluments, (iii) disregarding expenses, in respect of which an employee may be entitled to relief from income tax, which fall within Regulation 10(3) of the PAYE Regulations, (iv) having regard to any relief under section 201(5)(a) and paragraphs 6 and 8 of Schedule 3, and (v) excluding emoluments of an individual who is resident in a territory with which arrangements have been made under subsection (1)(a)(i) or (1B)(a)(ii) of section 826 in relation to affording relief from double taxation, where those emoluments are the subject of a notification issued under section 984(1).”, (b) in section 531B in paragraph (b) of the Table to subsection (1) by inserting the following after subparagraph (iv): “(iva) having regard to any reduction arising by virtue of section 825A, and”, (c) in section 531B in paragraph (b) of the Table to subsection (1) by inserting the following after subparagraph (iva) (inserted by paragraph (b)): “(ivb) having regard to any allowances due under section 659 arising from the obligations under Council Directive 91/676/EEC of 12 December 1991 1 concerning the protection of waters against pollution caused by nitrates from agricultural sources.”, and (d) in section 531B in paragraph (b) of the Table to subsection (1) by deleting subparagraphs (v), (vi) and (vii).

Chapter 3

Income Tax Amendment of section 122 (preferential loan arrangements) of Principal Act.

4.— As respects the year of assessment 2010 and subsequent years of assessment, section 122 of the Principal Act is amended in subsection (1)(a)— (a) by inserting the following after the definition of “preferential rate”: “ ‘qualifying loan’ has the meaning assigned to it by section 244(1)(a);”, and (b) by substituting for paragraph (i) of the definition of “the specified rate” the following: “(i) in a case where the preferential loan is a qualifying loan, the rate of 5 per cent per annum or such other rate (if any) prescribed by the Minister for Finance by regulations,”.

Cesser of certain reliefs.

5.— The Principal Act is amended— (a) in section 236 by inserting the following after subsection (6): “(7) This section ceases to have effect for the year of assessment 2010 and subsequent years of assessment.”, and (b) in section 470A by inserting the following after subsection (12): “(13) This section ceases to have effect for the year of assessment 2010 and subsequent years of assessment.”.

Amendment of section 469 (relief for health expenses) of Principal Act.

6.— (1) Section 469 of the Principal Act is amended— (a) in subsection (1) by substituting the following for the definition of “ health care ”: “ ‘health care’ means prevention, diagnosis, alleviation or treatment of an ailment, injury, infirmity, defect or disability, and includes care received by a woman in respect of a pregnancy, but does not include— (a) routine ophthalmic treatment, (b) routine dental treatment, or (c) cosmetic surgery or similar procedures, unless the surgery or procedure is necessary to ameliorate a physical deformity arising from, or directly related to, a congenital abnormality, a personal injury or a disfiguring disease;”, (b) in subsection (1) in the definition of “ health expenses ” by substituting the following for paragraph (c): “(c) maintenance or treatment necessarily incurred in connection with the services or procedures referred to in paragraph (a) or (b),”, (c) in subsection (1) by deleting the definition of “ hospital ”, (d) in subsection (1) in paragraph (a) of the definition of “practitioner” by substituting “ section 43 of the Medical Practitioners Act 2007 ” for “ section 26 of the Medical Practitioners Act, 1978 ”, (e) by substituting the following for subsection (2)— “(2) (a) Subject to this section, where an individual for a year of assessment proves that in the year of assessment he or she defrayed health expenses incurred for the provision of health care, the income tax to be charged on the individual, other than in accordance with section 16(2), for that year of assessment shall be reduced by the lesser of— (i) the amount equal to the appropriate percentage of the specified amount, and (ii) the amount which reduces that income tax to nil, but, where an individual proves that he or she defrayed health expenses incurred for the provision of health care in the nature of maintenance or treatment in a nursing home, other than a nursing home which does not provide access to 24 hour nursing care on-site, the individual shall be entitled for the purpose of ascertaining the amount of the income on which he or she is to be charged to income tax, to have a deduction made from his or her total income of the amount proved to have been so defrayed. (b) For the purposes of this section any contribution made by an individual in defraying expenses incurred in respect of nursing home fees where such an individual is entitled to or has received State support (within the meaning of section 3(1) of the Nursing Homes Support Scheme Act 2009 ) shall be treated as health expenses qualifying for relief under this section.

(c) Financial support (within the meaning of the Nursing Homes Support Scheme Act 2009 ) shall not be treated as health expenses for the purposes of this section.”, and (f) by inserting the following after subsection (7)— “(8) (a) Where the Minister for Finance determines that expenses, or a class of expenses, representing the cost of anything referred to in paragraphs (a) to (i) in the definition of ‘health expenses’ in subsection (1) has been or may be incurred in the provision of health care which in the opinion of the Minister for Finance is inappropriate having regard to public policy, then the Minister may by order prescribe those expenses, or class of expenses, as not being eligible for relief under this section. (b) The Minister for Finance shall not make an order under paragraph (a) unless he or she has consulted with the Minister for Health and Children and such appropriately qualified persons, bodies or institutions (if any), which in the opinion of the Minister for Finance or the Minister for Health and Children should be consulted. (c) Every order made by the Minister for Finance under paragraph (a) shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the order is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the order is laid before it, the order shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.”.

Amendment of section 244 (relief for interest paid on certain home loans) of Principal Act.

7.— As respects the year of assessment 2010 and subsequent years of assessment, section 244 of the Principal Act is amended— (a) in subsection (1)(a) by inserting “taken out on or after 1 January 2004 and on or before 31 December 2011” after “qualifying loan” in the definition of “relievable interest”, (b) by substituting the following for paragraph (b) of subsection (1A): “(b) Notwithstanding paragraph (a), this section shall continue to apply— (i) for the year of assessment 2010 and subsequent years of assessment up to and including the year of assessment 2017 in respect of qualifying interest paid in respect of a qualifying loan taken out on or after 1 January 2004 and on or before 31 December 2011, and (ii) for the year of assessment 2012 and subsequent years of assessment up to and including the year of assessment 2017 in respect of qualifying interest paid in respect of a qualifying loan taken out on or after 1 January 2012 and on or before 31 December 2012.”, and (c) by substituting the following for subsection (2)(a): “(2) (a) In this subsection ‘appropriate percentage’, in relation to a year of assessment, means— (i) as respects qualifying interest to which subsection (1A)(b)(i) applies— (I) where relievable interest is determined by reference to paragraph (i) or (ii) of the definition of ‘relievable interest ’, 15 per cent for that year, and (II) where relievable interest is determined by reference to paragraph (iii) or (iv) of the definition of ‘relievable interest ’: (A) 25 per cent for the first and second years of assessment for which there is an entitlement to relief under this section, (B) 22.5 per cent for the third, fourth and fifth years of assessment for which there is an entitlement to relief under this section, and (C) a percentage equal to the standard rate of tax for the sixth and seventh years of assessment for which there is an entitlement to relief under this section, and (ii) as respects qualifying interest to which subsection (1A)(b)(ii) applies— (I) where relievable interest is determined by reference to paragraph (i) or (ii) of the definition of ‘relievable interest’, 10 per cent for that year, and (II) where relievable interest is determined by reference to the first 6 years of assessment or, where the period of entitlement to relief under this section is shorter, such shorter period, 15 per cent for that year.”.

Amendment of section 997A (credit in respect of tax deducted from emoluments of certain directors) of Principal Act.

8.— As respects the year of assessment 2010 and subsequent years of assessment, section 997A of the Principal Act is amended by inserting the following subsection after subsection (5)— “(6) Where, in accordance with subsection (5), the tax to be treated as having been deducted from the emoluments paid to each person to whom this section applies exceeds the actual amount of tax deducted from the emoluments of each person, then the amount of credit to be given for tax deducted from those emoluments shall not exceed the actual amount of tax so deducted.”.

Amendment of section 71 (foreign securities and possessions) of Principal Act.

9.— As respects the year of assessment 2010 and subsequent years of assessment, section 71 of the Principal Act is amended— (a) by substituting the following for subsection (2): “(2) Subsection (1) shall not apply to any person who satisfies the Revenue Commissioners that he or she is not domiciled in the State.”, (b) in subsection (3), by substituting “In the case mentioned in subsection (2)” for “In the cases mentioned in subsection (2)”, and (c) in subsection (5), by substituting “as to domicile” for “as to domicile or ordinary residence”.

Amendment of section 825B (repayment of tax where earnings not remitted) of Principal Act.

10.— As respects the year of assessment 2010 and subsequent years of assessment, section 825B of the Principal Act is amended— (a) by inserting the following after subsection (1): “(1A) As regards individuals who are not domiciled in the State and who, on or after 1 January 2010— (a) become resident in the State for tax purposes for the first time, and (b) exercise the duties of their employment in the State for the first time, then, this section shall apply as if in subsection (1)— (i) the words ‘which is not a party to the EEA agreement, but’ were deleted from the definition of ‘associated company’; (ii) the words ‘that is not a party to the EEA Agreement but’ were deleted from the definition of ‘relevant employee’; and (iii) the words ‘that is not a party to the EEA Agreement but’ were deleted from the definition of ‘relevant employer’.”, (b) in subsection (2)— (i) in paragraph (c) by substituting “one year” for “3 years”, and (ii) by inserting “and not repaid” after “tax deducted”, (c) in subsection (5) by inserting “, computed by reference to paragraphs (i) and (ii) of subsection (2),” after “shall be liable to income tax on those emoluments”, and (d) in subsection (6) by substituting “one year” for “3 year”.

Amendment of section 825A (reduction in income tax for certain income earned outside the State) of Principal Act.

11.— Section 825A of the Principal Act is amended by substituting the following for subsection (7): “(7) For the purposes of this section— (a) as respects the year of assessment 2009 and previous years of assessment, an individual shall be deemed to be present in the State for a day if the individual is present in the State at the end of the day, and (b) as respects the year of assessment 2010 and subsequent years of assessment, an individual shall be deemed to be present in the State for a day if the individual is present in the State at any time during that day.”.

Amendment of section 477 (relief for service charges) of Principal Act.

12.— Section 477 of the Principal Act is amended by inserting the following after subsection (7): “(8) This section ceases to have effect as respects service charges paid in the financial year 2011 for that financial year and subsequent financial years for those financial years.”.

Amendment of section 216A (rent-a-room relief) of Principal Act.

13.— Section 216A of the Principal Act is amended by inserting the following after subsection (3A): “(3B) (a) Subsection (2) shall not apply for a year of assessment to relevant sums arising to— (i) an individual, or (ii) a person connected with the individual, where the individual is an office holder, or employee, of— (I) the person making the payment, or (II) a person connected with the person making the payment. (b) This subsection shall apply irrespective of whether the relevant sums are paid directly or indirectly by the person referred to in clauses (I) and (II) of paragraph (a) to the individual or to a person connected with the individual.”.

Amendment of section 667B (new arrangements for qualifying farmers) of Principal Act.

14.— The Table to section 667B of the Principal Act is amended in paragraph (3) by inserting the following after subparagraph (a): “(aa) Bachelor of Agricultural Science — Agri-Environmental Science awarded by University College Dublin;”.

Amendment of section 384 (relief under Case V for losses) of Principal Act.

15.— Section 384 of the Principal Act is amended— (a) in subsection (3) by substituting “Subject to subsection (4), any” for “Any”, and (b) by inserting the following after subsection (3): “(4) Any allowance to be made in charging income under Case V of Schedule D in accordance with section 305(1)(a) shall be made in priority to any relief to be given under this section.”.

Retirement benefits.

16.— (1) The Principal Act is amended— (a) in section 784A(1BA) by deleting paragraph (a) and substituting the following for paragraph (c): “(c) The specified amount for a year of assessment shall be an amount equivalent to the amount determined by the formula— (A × 3) — B 100 where the amount so determined is greater than zero and where— A is the value of the assets in an approved retirement fund on 31 December in the year of assessment or, where there is more than one approved retirement fund the assets of which are owned by the same individual and managed by the same qualifying fund manager, the aggregate of the value of the assets in each approved retirement fund on that date (in this subsection referred to as the ‘relevant value’ whether there is one or more than one such approved retirement fund), and B is the amount or value of the distribution or the aggregate of the amounts or values of the distribution or distributions (in this subsection referred to as the ‘relevant distribution’), if any, made during the year of assessment by the qualifying fund manager in respect of assets held in— (i) the approved retirement fund or, as the case may be, approved retirement funds referred to in the meaning of ‘A’, and (ii) an approved minimum retirement fund, if any, the assets of which are beneficially owned by the individual and managed by that qualifying fund manager, (in this paragraph referred to as the ‘funds’) being funds the assets in which were first accepted into the funds by the qualifying fund manager on or after 6 April 2000.”, (b) in section 787O(1) by inserting the following after paragraph (b) of the definition of “date of the current event”: “(ba) the annuity would otherwise become payable under a PRSA of a kind referred to in paragraph (c) of the definition of ‘relevant pension arrangement’ where an individual does not elect to exercise an option in accordance with section 787H(1) and instead retains the assets available in the PRSA at that date, in that PRSA or any other PRSA,”, (c) in Schedule 23 by inserting the following after paragraph 2A: “Information to be provided in electronic format 2B. In the case of an approved scheme in respect of which the administrator has to deliver annual scheme accounts to the Revenue Commissioners, the administrator shall deliver the accounts by such electronic means as are required or approved by the Commissioners.”, (d) in Schedule 23B by inserting the following after subparagraph (b) of paragraph 2: “(ba) the individual does not elect to exercise an option in accordance with section 787H(1) and instead retains the assets of the PRSA in that PRSA or any other PRSA,”,

and (e) in Schedule 23B by inserting the following after subparagraph (d) of paragraph 3: “(da) where the benefit crystallisation event is an event of a kind referred to in paragraph 2(ba), the aggregate of the amount of so much of the cash sums and the market value of such of the assets as are retained in the PRSA or in any other PRSA,”.

Amendment of section 128D (tax treatment of directors of companies and employees who acquire restricted shares) of Principal Act.

17.— (1) Section 128D of the Principal Act is amended— (a) in subsection (1) by inserting the following after the definition of “ director” and “employee”— “ ‘EEA Agreement’ means the Agreement on the European Economic Area signed at Oporto on 2 May 1992, as adjusted by all subsequent amendments to that Agreement; ‘EEA state’ means a state, other than the State, which is a Contracting Party to the EEA Agreement;”, (b) in subsection (1) in the definition of “specified period” by substituting “subsection (3)(a);” for “subsection (3)(a).” and by inserting the following after that definition: “ ‘trust’ means a trust established in the State or in an EEA state and the trustees of which are resident in the State or in an EEA state.”, (c) in subsection (4)— (i) by substituting “amount chargeable to income tax” for “charge to income tax” in both places where it occurs, and (ii) in the meaning assigned to “A” in the formula in paragraph (a) by substituting “the income chargeable to tax” for “the income tax charge”, (d) in subsection (5)— (i) by substituting “an amount chargeable to income tax” for “a charge to income tax”, (ii) by substituting “the amount chargeable to income tax” for “the income tax charge”, and (iii) by substituting “Income Tax Acts” for “Income Taxes Acts”, and (e) in subsection (6)— (i) by substituting “an amount chargeable to income tax” for “a charge to income tax”, and (ii) by substituting “the amount chargeable to income tax” for “the amount of the income tax charge”.

Information in respect of awards of shares.

18.— (1) The Principal Act is amended— (a) in Chapter 3 of Part 38 by inserting the following after section 897A: “Returns of information in respect of awards of shares to directors and employees.

897B.— (1) In this section— ‘director’, ‘employee’ and ‘employer’ have the meanings, respectively, given to them by section 770(1); ‘shares’ includes stock and securities within the meaning of section 135.

Amendment of Schedule 11 (profit sharing schemes) to Principal Act.

19.— (1) Schedule 11 to the Principal Act is amended— (a) in Part 2, paragraph 4, by inserting the following after subparagraph (1B): “(1C) (a) As respects a profit sharing scheme approved on or after 4 February 2010, the Revenue Commissioners shall be satisfied that there are no arrangements connected in any way, directly or indirectly, with the scheme, which make provision for a loan or loans to be made to some or all of the individuals eligible to participate in the scheme. (b) For the purposes of this subparagraph— ‘arrangements’ include any scheme, agreement, undertaking, or understanding of any kind, whether or not it is, or it is intended to be legally enforceable; ‘loan’ includes any form of credit.”, and (b) in Part 3, in paragraph 8 by substituting “Subject to paragraphs 8A and 8B,” for “Subject to paragraph 8A,”, and by inserting the following after paragraph 8A: “8B. (1) The shares shall not be shares— (a) in a service company, or (b) in a company that has control of a service company, where the company is under the control of a person or persons referred to in subparagraph (2)(a)(i) as it applies to a service company.

Amendment of section 470B (age-related relief for health insurance premiums) of Principal Act.

20.— Section 470B of the Principal Act is amended by substituting the following for subsection (4): “(4) Subject to subsections (5) and (6), where for a relevant year of assessment, an individual or, if the individual is a married person assessed to tax in accordance with section 1017, the individual’s spouse, makes a payment to an authorised insurer under a relevant contract and— (a) the payment is in respect of a premium due under the relevant contract and the relevant contract was renewed or entered into on or after 1 January 2009 but before 1 January 2012, and (b) the payment or part of the payment, as the case may be, is attributable to an insured person, and only to an insured person, who is aged 50 years or over on the date the relevant contract is renewed or entered into, as the case may be, then the individual shall, for the relevant year of assessment, in respect of so much of the relievable amount of the payment or part of the payment, as the case may be, as is attributable to an insured person referred to in paragraph (b), be entitled to a credit (referred to in this section as ‘age-related tax credit’) equal to the lower of— (i) as respects a relevant contract renewed or entered into on or after 1 January 2009 but before 1 January 2010, the amount specified in the second column of the Table to this subsection corresponding to the class of insured person mentioned in the first column of that Table or, where the payment made to the authorised insurer is a monthly or other instalment towards the payment of the total annual premium due under the relevant contract, an amount equal to the amount so specified divided by the total number of instalments to be made to pay such total annual premium; (ii) as respects a relevant contract renewed or entered into on or after 1 January 2010, the amount specified in the third column of the Table to this subsection corresponding to the class of insured person mentioned in the first column of that Table or, where the payment made to the authorised insurer is a monthly or other instalment towards the payment of the total annual premium due under the relevant contract, an amount equal to the amount so specified divided by the total number of instalments to be made to pay such total annual premium, and (iii) an amount which reduces the income tax to be charged on the individual for the relevant year of assessment, other than in accordance with section 16(2), to nil.

TABLE

(1)

(2)

Income tax: restriction on use of losses on approved buildings.

21.— Section 409C of the Principal Act is amended by inserting the following after subsection (4)— “(4A) (a) Notwithstanding subsection (4), where this section applies for the year of assessment 2010 or a later year of assessment, the amount of the loss referred to in subsection (3)(a) which can be treated as reducing income for each such year of assessment under section 381(1) shall be nil. (b) This subsection shall not apply for the years of assessment 2010 or 2011 in relation to— (i) work which was completed before 4 February 2010, (ii) work which was underway on 4 February 2010, or (iii) work carried out under a contractual commitment entered into before 4 February 2010 and evidenced in writing before that date where the work begins after that date.”.

Amendment of Schedule 13 (accountable persons for purposes of Chapter 1 of Part 18) to Principal Act.

22.— (1) Schedule 13 to the Principal Act is amended— (a) by deleting paragraphs 31, 45, 57, 66, 67, 71, 72, 75, 78, 104, 113, 123, 130 and 172, (b) by substituting the following for paragraph 73: “73. Pobal.”, (c) by substituting the following for paragraph 102: “102. Commission for Energy Regulation.”, (d) by substituting the following for paragraph 119: “119. Digital Hub Development Agency.”, and (e) by inserting the following after paragraph 174 (inserted by the National Asset Management Agency Act 2009 ): “175. National Transport Authority.

Limitation on amount of certain reliefs used by certain high income individuals.

23.— (1) Chapter 2A of Part 15 of the Principal Act is amended— (a) in section 485C(1) by inserting the following definitions after the definition of “excess relief”: “ ‘ income threshold amount ’, in relation to a tax year and an individual, means— (a) €125,000, or (b) in a case where the individual’s income for the tax year includes ring-fenced income and his or her adjusted income for the tax year is less than €400,000, the amount determined by the formula— €125,000 × A B where— A is the individual’s adjusted income for the year, and B is an amount determined by the formula— T + S where T and S have the same meanings respectively as they have in the definition of ‘adjusted income’; ‘ relief threshold amount ’, in relation to a tax year and an individual, means €80,000;”, (b) in section 485C(1) by deleting the definition of “threshold amount”, (c) in section 485D— (i) in paragraph (a) by substituting “the income threshold amount” for “the threshold amount”, (ii) in paragraph (b) by substituting “the relief threshold amount” for “the threshold amount”, and (iii) by substituting “20 per cent of the individual’s adjusted income” for “one-half of the individual’s adjusted income”, (d) in section 485E by substituting the following for the construction of “Y” in the formula in that section— “Y is the greater of— (i) the relief threshold amount, and (ii) 20 per cent of the individual’s adjusted income for the tax year.”, and (e) in section 485FB(6)(b) by substituting “the income threshold amount” for “the threshold amount”.

Chapter 4

Income Tax, Corporation Tax and Capital Gains Tax Provisions relating to charities and donations to approved bodies.

24.— The Principal Act is amended— (a) by inserting the following after section 208: “Overseas charities.

208A.— (1) In this section and section 208B— ‘charity’ means any body of persons or trust established for charitable purposes only; ‘EEA Agreement’ means the Agreement on the European Economic Area signed at Oporto on 2 May 1992, as adjusted byall subsequent amendments to that Agreement; ‘EEA state’ means a state, other than the State, which is a contracting party to the EEA Agreement; ‘EFTA state’ means a state, other than an EEA state, which is a Member State of the European Free Trade Association.

Charities — miscellaneous.

208B.— (1) In this section— ‘charity trustee’ includes— (a) in the case of a charity that is a company, the directors and other officers of the company, and (b) in the case of a charity that is a body corporate (other than a company) or an unincorporated body of persons, any officer of the body or any person for the time being performing the functions of an officer of the body; ‘qualified person’ means— (a) a person who, in accordance with section 187 of the Companies Act 1990 , is qualified for appointment as an auditor of a company, or (b) in relation to a person or trust that— (i) has made a claim for a determination under section 208A(2), (ii) is established in an EEA state or in an EFTA state, and (iii) does not have a principal place of business in the State, a person who is qualified under the law of that EEA state or that EFTA state, as the case may be, to perform functions the same as or similar to those which may be performed in the State by a person referred to in paragraph (a).

Amendment of Part 22 (provisions relating to dealing in or developing land and disposals of development land) of Principal Act.

25.— (1) Part 22 of the Principal Act is amended— (a) in the definition of “qualifying land” in section 644AB(1) by deleting “or” where it last occurs in paragraph (a), by substituting “section 616(1)(g), or” for “section 616(1)(g)” in paragraph (b) and by inserting the following after paragraph (b): “(c) consisting of a site of 0.4047 hectares or less whose market value at the date of disposal does not exceed €250,000 (notwithstanding that a planning authority may have granted permission in respect of that site in accordance with section 34(1) of the Planning and Development Act 2000 ), other than where the disposal by the person making it, or by a person connected with that person, forms part of a larger transaction or series of transactions,”, (b) in section 644AB(1) by deleting the definition of “rezoning” and by inserting the following after the definition of “qualifying land”: “ ‘relevant planning decision’, in relation to land and in accordance with the Planning and Development Act 2000 (in this definition referred to as the ‘Act of 2000’), means— (a) a change in the zoning of land in a development plan or a local area plan made or varied under Part II of the Act of 2000 from non-development land-uses to development land-uses or from one development land-use to another development land-use including a mixture of such uses, or (b) a decision to grant permission, in accordance with section 34(6) or 37(2) of the Act of 2000, for a development that would materially contravene a development plan;”, (c) in section 644AB(2) by substituting “a relevant planning decision” for “the rezoning of that land”, (d) in section 644AB(5)(a) by substituting “a relevant planning decision” for “the rezoning of land”, (e) in section 649B(1) by deleting the definition of “rezoning” and by inserting the following after the definition of “non-development land use”: “ ‘ relevant planning decision ’, in relation to land and in accordance with the Planning and Development Act 2000 (in this definition referred to as the ‘Act of 2000’), means— (a) a change in the zoning of land in a development plan or a local area plan made or varied under Part II of the Act of 2000 from non-development land-uses to development land-uses or from one development land-use to another development land-use including a mixture of such uses, or (b) a decision to grant permission, in accordance with section 34(6) or 37(2) of the Act of 2000, for a development that would materially contravene a development plan;”, (f) in section 649B(1) in the definition of “windfall gain” by substituting “a relevant planning decision” for “rezoning”,

(g) in section 649B(2)— (i) by deleting “, made on or after 30 October 2009,”, and (ii) by substituting “a relevant planning decision” for “rezoning” in paragraph (a) and by substituting “relevant planning decision” for “rezoning” where it occurs in paragraphs (b) and (c), (h) in section 649B(4) by deleting “or” where it last occurs in paragraph (a), by substituting “section 616(1)(g), or” for “section 616(1)(g),” in paragraph (b) and by inserting the following after paragraph (b): “(c) the disposal is the disposal of a site of 0.4047 hectares or less whose market value at the date of disposal does not exceed €250,000 (notwithstanding that a planning authority may have granted permission in respect of that site in accordance with section 34(1) of the Planning and Development Act 2000 ), other than where the disposal by the person making it, or by a person connected with that person, forms part of a larger transaction or series of transactions,”, and (i) in section 649B(5) by substituting “relevant planning decision” for “rezoning”.

Amendment of section 843A (capital allowances for buildings used for certain childcare purposes) of Principal Act.

26.— Section 843A of the Principal Act is amended— (a) in subsection (1) by inserting the following after the definition of “qualifying expenditure”: “ ‘qualifying period’ means the period commencing on 1 December 1999 and ending— (a) on 30 September 2010, or (b) where subsection (6)(a) applies, on 31 March 2011, or (c) where subsection (6)(b) applies, on 31 March 2012;”, (b) in subsection (2) by substituting “Subject to subsections (2A) to (5)” for “Subject to subsections (3) to (5)”, (c) by inserting the following after subsection (2): “(2A) An allowance shall be given by virtue of subsection (2) in relation to any qualifying expenditure on a qualifying premises only in so far as that expenditure is incurred in the qualifying period.”, (d) in subsection (3) by substituting “incurred in the qualifying period” for “incurred on or after 2 December 1998”, and (e) by inserting the following after subsection (5): “(6) (a) For the purposes of paragraph (b) of the definition of ‘ qualifying period ’, this paragraph applies where— (i) capital expenditure is incurred on the construction, conversion or refurbishment of a qualifying premises, (ii) the construction, conversion or refurbishment work on the qualifying premises represented by that expenditure is exempted development for the purposes of the Planning and Development Act 2000 by virtue of section 4 of that Act or by virtue of Part 2 of the Planning and Development Regulations 2001 ( S.I. No. 600 of 2001 ) (in this subsection referred to as the ‘Regulations of 2001’), and (iii) not less than 30 per cent of the total construction, conversion or refurbishment costs has been incurred on or before 30 September 2010. (b) For the purposes of paragraph (c) of the definition of ‘ qualifying period ’, this paragraph applies where— (i) capital expenditure is incurred on the construction, conversion or refurbishment of a qualifying premises, (ii) a planning application (not being an application for outline permission within the meaning of section 36 of the Planning and Development Act 2000 ), in so far as planning permission is required, in respect of the construction, conversion or refurbishment work on the qualifying premises represented by that expenditure, is made in accordance with the Regulations of 2001, (iii) an acknowledgement of the application, which confirms that the application was received on or before 30 September 2010, is issued by the planning authority in accordance with article 26(2) of the Regulations of 2001, and (iv) the application is not an invalid application in respect of which a notice was issued by the planning authority in accordance with article 26(5) of the Regulations of 2001.

Mid-Shannon corridor tourism infrastructure investment scheme.

27.— (1) Section 372AW of the Principal Act is amended— (a) in subsection (1) in the definition of “ qualifying period ” by substituting “31 May 2015” for “31 May 2013”, and (b) in subsection (2)(b) by substituting “4 years” for “2 years”.

Payment of tax by means of donation of heritage property.

28.— (1) Section 1003A of the Principal Act is amended in subsection (1)— (a) in the definition of “contents of the building” by substituting “the Minister is satisfied or, as appropriate, the Commissioners of Public Works in Ireland are satisfied” for “the Minister is satisfied”, and (b) by substituting the following for the definition of “relevant gift”: “ ‘relevant gift’ means a gift of heritage property to the Trust or, as appropriate, to the Commissioners of Public Works in Ireland in respect of which no consideration whatever (other than relief under this section) is received by the person making the gift, either directly or indirectly, from the Trust or from those Commissioners or otherwise;”.

(f) The Commissioners of Public Works in Ireland shall not make a determination under this subsection without the consent in writing of the Minister for Finance and any such determination shall be subject to such conditions as may be specified by the Minister for Finance. (g) The Minister and the Commissioners of Public Works in Ireland shall, as appropriate, consult with each other in connection with the general application of this section and in particular for the purposes of the application of paragraph (e). (h) (i) A property shall cease to be a heritage property for the purposes of this section if— (I) the property is sold or otherwise disposed of to a person other than the Trust or, as appropriate, the Commissioners of Public Works in Ireland, (II) the owner of the property notifies the Trust or, as appropriate, the Commissioners of Public Works in Ireland in writing that it is not intended to make a gift of the property to the Trust or, as appropriate, those Commissioners, or (III) the gift of the property is not made to the Trust or, as appropriate, to the Commissioners of Public Works in Ireland by the end of the calendar year following the calendar year in which the determination is made under this subsection. (ii) Where the Minister becomes aware or, as appropriate, the Commissioners of Public Works in Ireland become aware, at any time within the calendar year in which a determination under this subsection is made in respect of a property, that clause (I) or (II) of subparagraph (i) applies to the property, the Minister or, as appropriate, those Commissioners may revoke the determination with effect from that time.”.

Payments to subcontractors in certain industries.

29.— (1) Chapter 2 of Part 18 of the Principal Act is amended in section 530 by inserting the following after the definition of “relevant tax deduction card ”: “ ‘return period’, in relation to the principal concerned, means the period specified in a notice in writing given by the Revenue Commissioners to that principal, being a period of one or more income tax months, in respect of which the principal is required under section 531(3A) to make a return to the Collector-General;”.

Amendment of section 731 (chargeable gains accruing to unit trusts) of Principal Act.

30.— (1) Section 731 of the Principal Act is amended in subsection (5) by substituting the following for paragraph (a)— “(a) (i) Where throughout a year of assessment all the issued units in a unit trust which neither is, nor is deemed to be, an authorised unit trust scheme (within the meaning of the Unit Trusts Act 1990 ) are assets such that if those units were disposed of by the unit holder any gain accruing would be wholly exempt from capital gains tax (otherwise than by reason of residence or by virtue of section 739(3)), then gains accruing to the unit trust in that year shall not be chargeable gains. (ii) Where the trustees, or any persons duly authorised to act on their behalf, of a unit trust to which subparagraph (i) applies are satisfied that, throughout a year of assessment, all the issued units in the unit trust are assets referred to in subparagraph (i), then they shall, in respect of that year of assessment, make a declaration to that effect. (iii) The trustees, or any persons duly authorised to act on their behalf, of every unit trust to which subparagraph (i) applies shall in respect of each year of assessment, on or before 28 February in the year following the year of assessment, make a statement to the Revenue Commissioners in electronic format approved by them, which in respect of that year of assessment— (I) states whether a declaration as referred to in subparagraph (ii) has, or has not, been made, and (II) specifies in respect of each person who is a unit holder— (A) the name and address of the person, and (B) such other information as the Revenue Commissioners may require. (iv) Where the trustees, or any persons duly authorised to act on their behalf, of a unit trust— (I) make an incorrect or incomplete statement under subparagraph (iii), or (II) fail, without reasonable excuse, to make such a statement, then the trustees of that unit trust shall be liable to a penalty of €3,000. For the purposes of the recovery of a penalty under this subparagraph, section 1061 shall apply in the same manner as it applies for the purposes of the recovery of a penalty under any of the sections referred to in that section.”.

Amendment of Part 27 (unit trusts and offshore funds) of Principal Act.

31.— (1) Part 27 of the Principal Act is amended— (a) in section 739B by substituting the following for the definition of “qualifying management company”: “ ‘qualifying management company’, in relation to an investment undertaking, means a company which, in the course of a trade of managing investments, manages the whole or any part of the investments and other activities of the business of the undertaking;”, (b) in section 739D, by inserting the following subsection after subsection (7A): “(7B) (a) A gain shall not be treated as arising to an investment undertaking on the happening of a chargeable event in respect of a unit holder where, immediately before the chargeable event, the investment undertaking is in possession of written notice of approval from the Revenue Commissioners to the effect that subsection (7) is deemed to have been complied with in respect of the unit holder, and that approval has not been withdrawn. (b) The Revenue Commissioners may give to an investment undertaking the approval, referred to in paragraph (a), that subsection (7) is deemed to have been complied with— (i) as respects any unit holder or class of unit holder, and (ii) subject to such conditions as they consider necessary so as to satisfy themselves that, at the time the approval is granted, appropriate equivalent measures have been put in place by the investment undertaking to ensure that unit holders in that investment undertaking are not resident or ordinarily resident in the State. (c) (i) The Revenue Commissioners may by notice in writing withdraw any approval given under paragraph (b) if an investment undertaking has failed to comply with any of the conditions subject to which the approval was given. (ii) Where approval is withdrawn in accordance with subparagraph (i), paragraph (a) shall not apply from such date, and in respect of such unit holder or class of unit holder, as may be specified in the notice. (d) The Revenue Commissioners may nominate in writing an inspector or other officer to perform any acts and discharge any functions authorised by this subsection to be performed or discharged by the Revenue Commissioners.”, and (c) by inserting the following after section 747F: “Chapter 5 Relevant UCITS Tax treatment of relevant UCITS.

747G.— (1) In this section— ‘ management company ’, in relation to a relevant UCITS, means a management company within the meaning of the relevant Directives; ‘ relevant Directives ’ means Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 2 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS), and any Directive amending that Directive; ‘relevant profits’, in relation to a relevant UCITS, means the profits which would be relevant profits (within the meaning of section 739B) if the relevant UCITS were an investment undertaking (within the meaning of that section); ‘ relevant UCITS ’ means an undertaking for collective investment in transferable securities— (i) to which the relevant Directives apply, (ii) which is formed under the laws of any of the Member States of the European Union other than the State, and (iii) (I) the management company of which is authorised under any laws of the State which implement the relevant Directives, and (II) which, if the management company were not so authorised, would not be liable to tax in the State.

Amendment of section 1035A (relieving provision to section 1035) of Principal Act.

32.— (1) Section 1035A of the Principal Act is amended in subsection (1)— (a) in the definition of “ authorised agent ” in paragraph (a)(ii) by substituting “revoked,” for “revoked, or”, in paragraph (b) by substituting “revoked, or” for “revoked,” and by inserting the following paragraph after paragraph (b): “(c) a company— (i) authorised under any laws of the State that implement the relevant Directives, and (ii) which carries on a trade which consists of or includes the management of unit trusts, common contractual funds or investment companies, or any combination thereof, each of which is a relevant UCITS,”, (b) in the definition of “investment business services” by substituting “1995;” for “1995.”, and (c) after the definition of “investment business services” by inserting the following: “ ‘relevant Directives’ means Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 3 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS), and any Directive amending that Directive; ‘relevant UCITS’ means an undertaking for collective investment in transferable securities— (i) to which the relevant Directives apply, and (ii) which is formed under the laws of any of the Member States of the European Union other than the State.”.

Dividend withholding tax.

33.— (1) The Principal Act is amended— (a) in section 172D(3)(b) by substituting “where the declaration made is a current declaration (within the meaning of paragraph 2A of that Schedule)” for “in relation to which declaration each of the certificates referred to in clause (i), the certificate referred to in clause (ii) or, as the case may be, the certificate referred to in clause (iii), of subparagraph (f) of that paragraph is a current certificate (within the meaning of paragraph 2 of that Schedule)”, (b) in section 172F(3)(a) by substituting the following for subparagraph (ii): “(ii) a declaration made by that person in accordance with section 172D(3)— (I) in relation to which the certificate referred to in paragraph 8(f) of Schedule 2A is a current certificate (within the meaning of paragraph 2 of that Schedule), or (II) which is a current declaration (within the meaning of paragraph 2A of Schedule 2A),”, (c) in section 172I— (i) in subsection (1) by inserting “, or by means of electronic communications,” after “in writing”, (ii) in subsection (1A)— (I) by inserting “or the recipient of a relevant distribution” after “to an intermediary”, (II) in paragraph (a) by inserting “delivered to an intermediary” after “the statement”, and (III) in paragraph (b) by inserting “or the recipient of the relevant distribution” after “the intermediary”, (d) in section 172J(4) by deleting “in writing”, (e) in paragraph 2 of Schedule 2A by deleting “or 9(f)”, (f) in Schedule 2A by inserting the following after paragraph 2: “Currency of certain declarations 2A. A declaration referred to in paragraph 9 shall be treated as a current declaration for the period from the date of the making of the declaration to the 31st day of December in the fifth year following the year in which the declaration was made.”, (g) in paragraph 9 of Schedule 2A by substituting the following for subparagraph (e): “(e) contains— (i) the name and address of that company, (ii) the name of the territory in which the company is resident for the purposes of tax, (iii) in the case of a company within the meaning of section 172D(3)(b)(ii), the name of the relevant territory or names of the relevant territories, as the case may be, in which the person or persons who control (within the meaning of section 172D(4)(a)), whether directly or indirectly, the company is or are resident for the purposes of tax by virtue of the law of that territory or the laws of those territories, and (iv) in the case of a company within the meaning of section 172D(3)(b)(iii), the name and address of a recognised stock exchange on which the principal class of the shares of the company or

(I) where the company is a 75 per cent subsidiary (within the meaning of section 172D(5)) of another company, of that other company, or (II) where the company is wholly owned (within the meaning of section 172D(6)) by 2 or more companies, of each of those companies, is substantially and regularly traded,”, and (h) by deleting paragraph 9(f) of Schedule 2A.

Amendment of section 175 (purchase of own shares by quoted company) of Principal Act.

34.— (1) Section 175 of the Principal Act is amended— (a) in subsection (1) by inserting “where the redemption, repayment or purchase does not form part of a scheme or arrangement the main purpose or one of the main purposes of which is to enable the owner of the shares to participate in the profits of the company or of any of its 51 per cent subsidiaries without receiving a dividend” after “shares”, (b) by inserting the following after subsection (1): “(1A) (a) Where in any accounting period a quoted company makes a payment on the redemption, repayment or purchase of its own shares, the company shall, not later than 12 months from the end of the accounting period, give notice to the Collector-General, or such other officer of the Revenue Commissioners as may be authorised by them for the purposes of this subsection, of— (i) the payment, and (ii) whether the payment is to be treated as not being a distribution by virtue of subsection (1). (b) A notice under paragraph (a) shall be given by a company— (i) in the return required to be made under section 951 for the accounting period of the company in which the payment is made, or (ii) in such manner and form as the Revenue Commissioners may prescribe.”, and (c) in subsection (2) by substituting “subsections (1) and (1A)” for “subsection (1)”.

Amendment of Part 3 (provisions relating to the Schedule C charge and government and other public securities) of Principal Act.

35.— (1) The Principal Act is amended— (a) by substituting the following for section 42: “Exemption of interest on savings certificates.

42.— (1) In this section— ‘EEA Agreement’ means the Agreement on the European Economic Area signed at Oporto on 2 May 1992, as adjusted by the Protocol signed at Brussels on 17 March 1993; ‘EEA state’ means a state which is a contracting party to the EEA Agreement; ‘relevant State’ means— (i) a Member State of the European Union, or (ii) not being such a Member State, an EEA state which is a territory with the government of which arrangements having the force of law by virtue of section 826(1) have been made.

Amendment of section 299 (allowances to lessees) of Principal Act.

36.— (1) Section 299 of the Principal Act is amended— (a) by substituting the following for subsection (1): “(1) Subject to subsection (3), where machinery or plant is let by means of a finance lease (within the meaning of section 76D) to a person, by whom a trade is carried on, on the terms of that person being bound to maintain the machinery or plant and deliver it over in good condition at the end of the lease, and if the burden of the wear and tear of the machinery or plant in fact falls directly on that person, then, for the purposes of sections 283 and 284, the capital expenditure on the provision of the machinery or plant shall be deemed to have been incurred by that person and not by any other person and the machinery or plant shall be deemed to belong to that person and not to any other person.”, and (b) by inserting the following after subsection (2): “(3) (a) In this subsection ‘lease payments’, ‘lessee’ and ‘lessor’ have, respectively, the same meanings as in section 80A. (b) Subsection (1) shall only apply where— (i) the lessor and lessee jointly elect, or (ii) where the lessor is not a person within the charge to tax under Schedule D, the lessee elects, that this section shall apply for the purposes of sections 283 and 284 by giving notice in writing to the inspector on or before the specified return date for the chargeable period (within the meaning of section 950) in a form approved by the Revenue Commissioners and containing such particulars relating to the lessor and lessee and in connection with the lease as may be specified in the approved form. (c) Where this section applies— (i) the amount to be deducted in computing the profits or gains to be charged to tax under Case 1 of Schedule D for any chargeable period of the lessee in relation to lease payments to be paid in respect of the finance lease, shall be the amount in respect of those lease payments which in accordance with generally accepted accounting practice would be deducted in a profit and loss account for that period, and accordingly, the aggregate amount (referred to in subparagraph (ii) as the ‘aggregate deductible amount’) to be deducted in computing the profits or gains to be charged to tax under Case 1 of Schedule D for any chargeable period of the lessee in relation to lease payments to be paid in respect of and over the term of the lease, shall be the amount in relation to those lease payments which in accordance with generally accepted accounting practice would be deducted in the profit and loss account over the term of the lease, and

(ii) where capital expenditure deemed to have been incurred by the lessee would otherwise exceed the amount by which the aggregate amount of lease payments to be paid in respect of the lease exceeds the aggregate deductible amount, then the amount of capital expenditure on the provision of plant and machinery for the purposes of subsection (1) shall be deemed to be the amount by which the aggregate amount of the lease payments made in respect of and over the term of the lease exceeds the aggregate deductible amount.”.

Amendment of Chapter 4 (interest payments by certain deposit takers) of Part 8 of Principal Act.

37.— (1) Chapter 4 of Part 8 of the Principal Act is amended— (a) in section 256(1) by inserting the following definition after the definition of “pension scheme”: “ ‘PRSA provider’ has the same meaning as in Part X of the Pensions Act 1990 ;”, (b) in section 256(1) in paragraph (i) of the definition of “ re levant deposit ” by deleting “or”, (c) in section 256(1) in paragraph (j) of the definition of “relevant deposit” by substituting “subsection (1B), or” for “subsection (1B);”, (d) in section 256(1) in the definition of “relevant deposit” by inserting the following after paragraph (j): “(k) which is made by, and the interest on which is beneficially owned by, a PRSA provider where the PRSA provider has provided the relevant deposit taker with the number assigned to that provider by the Revenue Commissioners;”, (e) in section 256 by inserting the following after subsection (2): “(3) As respects any specified deposits, the relevant deposit taker shall obtain the tax reference number (within the meaning of section 885) of the person making the deposit and the person making the deposit shall provide the tax reference number.”, (f) in section 258(4) by substituting the following for paragraphs (a) and (b): “(a) Notwithstanding subsection (3), a relevant deposit taker shall for each year of assessment pay an amount of appropriate tax to the Collector-General within 21 days of each of the following dates in that year of assessment— (i) 31 March, (ii) 30 June, and (iii) 30 September. (b) The amount to be paid— (i) within 21 days of 31 March as referred to in paragraph (a)(i) shall not be less than the amount of appropriate tax which would be due and payable by the relevant deposit taker for the year of assessment concerned under subsection (3) if the total amount of the relevant interest which had accrued in the period commencing on 1 January and ending on 31 March, (ii) within 21 days of 30 June as referred to in paragraph (a)(ii) shall not be less than the amount of appropriate tax which would be due and payable by the relevant deposit taker for the year of assessment concerned under subsection (3) if the total amount of the relevant interest which had accrued in the period commencing on 1 April and ending on 30 June, and (iii) within 21 days of 30 September as referred to in paragraph (a)(iii) shall not be less than the amount of appropriate tax which would be due and payable by the relevant deposit taker for the year of assessment concerned under subsection (3) if the total amount of the relevant interest which had accrued in the period commencing on 1 July and ending on 30 September,

in that year of assessment on all relevant deposits held by the relevant deposit taker in that period (and no more) had been paid by it in that year of assessment.”, (g) in section 259(4) by substituting the following for paragraph (a): “(a) (i) Subject to subparagraph (ii) and notwithstanding section 258(3), a relevant deposit taker shall for each year of assessment pay to the Collector-General, within 21 days of each of the dates referred to in subparagraphs (i), (ii) and (iii) of section 258(4)(a) (each of which dates, as the case may be, is referred to in the Table to this subparagraph as the ‘relevant quarterly date’) in that year of assessment, an amount on account of appropriate tax which shall be not less than the amount determined by the formula set out in the Table to this subparagraph, and any amount on account of appropriate tax so paid by the relevant deposit taker for a year of assessment shall be treated as far as may be as a payment on account of any appropriate tax due and payable by it for that year of assessment under section 258(3).

TABLE A — (B — C) 3 where— A is the amount of appropriate tax which would be due and payable by the relevant deposit taker for the year of assessment (in this Table referred to as ‘the relevant year’) in accordance with section 258(3) if the total amount of the relevant interest which had accrued in the period of 12 months ending on the relevant quarterly date in the relevant year on all relevant deposits held by the relevant deposit taker in that period (and no more) had been paid by it in the relevant year, B is the amount of appropriate tax which was due and payable by the relevant deposit taker for the year of assessment preceding the relevant year in accordance with section 258(3), and C is an amount equal to the lesser of the amount at B and the amount treated, in accordance with this subsection or section 258(4), as paid by the relevant deposit taker on account of the appropriate tax due and payable by it for the year of assessment preceding the relevant year. (ii) Notwithstanding section 258(3), the aggregate of the amounts on account of appropriate tax due in accordance with subparagraphs (i) and (iii) shall not, in any event, be less than the amount determined by the formula set out in the Table to this subparagraph.

TABLE A — (B — C) where— A is the amount of appropriate tax which would be due and payable by the relevant deposit taker for the year of assessment (in this Table referred to as ‘the relevant year’) in accordance with section 258(3) if the total amount of the relevant interest which had accrued in the period of 12 months ending on 30 September in the relevant year on all relevant deposits held by the relevant deposit taker in that period (and no more) had been paid by it in the relevant year, B is the amount of appropriate tax which was due and payable by the relevant deposit taker for the year of assessment preceding the relevant year in accordance with section 258(3), and C is an amount equal to the lesser of the amount at B and the amount treated, in accordance with this subsection or section 258(4), as paid by the relevant deposit taker on account of the appropriate tax due and payable by it for the year of assessment preceding the relevant year. (iii) Where, for any year of assessment the amount computed in accordance with subparagraph (ii) exceeds the aggregate of the amounts computed in accordance with subparagraph (i), and without prejudice to the obligation to pay any amount computed in accordance with subparagraph (i), that excess shall be paid by the relevant deposit taker to the Collector-General within 21 days of 30 September in that year of assessment and shall be treated as far as may be as a payment on account of any appropriate tax due and payable by it for that year of assessment under section 258(3).”, (h) in section 260(4) by substituting the following for paragraph (a): “(a) in accordance with section 258(4) or 259(4), as may be appropriate, a relevant deposit taker makes a payment on account of appropriate tax in respect of specified interest as if, in relation to each specified deposit held by it, the references— (i) in section 258(4), to each of the periods referred to in subparagraphs (i), (ii) and (iii) of paragraph (b) of section 258(4) in the year of assessment, were a reference to the period beginning on the date on which the specified deposit was made and ending on each date referred to in subparagraphs (i), (ii) and (iii) of section 258(4)(a), as the case may be, in the year of assessment, (ii) in section 259(4)(i), where it occurs in the meaning assigned to ‘A’, to the period of 12 months ending on each of the dates referred to in subparagraphs (i), (ii) and (iii) of section 258(4)(a) in the relevant year, were a reference to the period beginning on the date on which the specified deposit was made and ending on each date referred to in subparagraphs (i), (ii) and (iii) of section 258(4)(a), as the case may be, in the year of assessment, and

(iii) in section 259(4)(ii), where it occurs in the meaning assigned to ‘A’, to the period of 12 months ending on 30 September in the relevant year, were a reference to the period beginning on the date on which the specified deposit was made and ending on 30 September in the year of assessment, and”, and (i) in section 262 by substituting “shall furnish to every person entitled to any relevant interest on a relevant deposit held by the relevant deposit taker” for “shall, when requested to do so by any person entitled to any relevant interest on a relevant deposit held by the relevant deposit taker, furnish to that person,”.

Amendment of section 481 (relief for investment in films) of Principal Act.

38.— The Principal Act is amended in section 481— (a) in subsection (3) by deleting “an amount equal to 125 per cent of the amount” and substituting “the amount”, and (b) in subsection (8) by deleting “125 per cent of the relevant deduction” and substituting “the amount of the relevant deduction”.

Specified financial transactions.

39.— The Principal Act is amended by inserting the following after Part 8— “PART 8A Specified Financial Transactions

Chapter 1

Interpretation Interpretation.

267N.— (1) For the purpose of this Part— ‘asset’ has the same meaning as in section 532; ‘charges on income’ has the same meaning as in section 243; ‘credit return’ means— (a) in the case of a credit transaction within the meaning of paragraph (a) or (b) of the definition of ‘credit transaction’, the excess of the consideration accruing to the finance undertaking from the borrower in respect of the asset over the consideration paid or payable by the finance undertaking for that asset, and (b) in the case of a credit transaction within the meaning of paragraph (c) of the definition of ‘credit transaction’, the excess of the consideration (including any consideration paid or payable for the use of the asset during the period of the arrangement) accruing to the finance undertaking from the borrower in respect of the interest of the finance undertaking in the asset over the consideration paid or payable by the finance undertaking for that asset; ‘credit transaction’ means— (a) an arrangement whereby a finance undertaking acquires an asset for the purpose of disposing of the full interest in that asset to a borrower in circumstances where— (i) the consideration paid or payable by the borrower exceeds the consideration paid or payable by the finance undertaking for the asset, (ii) all or part of that consideration is not required to be paid until a date later than the date of the disposal, and (iii) the excess of the consideration paid or payable to the finance undertaking by the borrower in respect of the asset over the consideration paid or payable by the finance undertaking for the asset is equivalent to the return on a loan of money at interest, (b) an arrangement whereby a finance undertaking acquires an asset and— (i) immediately disposes of its full interest in that asset to a borrower for a consideration which exceeds the consideration paid or payable by the finance undertaking for the asset, (ii) the borrower acquires and immediately disposes of the full interest in that asset to another person for a consideration which is at least 95 per cent of the consideration paid or payable by the finance undertaking for the acquisition of that asset, (iii) all or part of the consideration for the acquisition of the asset by the borrower is not required to be paid by the borrower until a date later than the date of the purchase of the asset, and (iv) the excess of the consideration paid or payable to the finance undertaking by the borrower in respect of the asset over the consideration paid or payable by the finance undertaking for the asset is equivalent to the return on a loan of money at interest,

or (c) an arrangement whereby— (i) a finance undertaking and a borrower jointly acquire an asset, or (ii) a finance undertaking acquires an interest in an asset from a borrower, in circumstances where the borrower retains an interest in that asset, on terms whereby— (I) the borrower— (A) in the circumstances referred to in subparagraph (i) has exclusive use of the asset immediately and, in the circumstances referred to in subparagraph (ii), retains exclusive use of the asset immediately, as the case may be, (B) is exclusively entitled to any income, profit or gain arising from or attributable to the asset (including any increase in the value of the asset), and (C) agrees to make payments to the finance undertaking amounting to the aggregate of the consideration paid or payable by the finance undertaking for the acquisition of its interest in the asset and any consideration paid or payable by the borrower for the use of the asset during the period of the arrangement, (II) the excess of the consideration (including any consideration paid or payable for the use of the asset during the period of the arrangement) accruing to the finance undertaking from the borrower in respect of the interest of the finance undertaking in the asset over the consideration paid or payable by the finance undertaking for the asset is equivalent to the return on a loan of money at interest, and (III) the finance undertaking’s interest in the asset passes either immediately or by the end of a specified period of time, to the borrower for a consideration which exceeds the consideration paid by the finance undertaking for the asset; ‘deposit transaction’ means a transaction whereby— (a) a person deposits a sum of money with a relevant deposit taker on terms under which it or any part of it may be repaid, either on demand or at a time or in circumstances agreed by or on behalf of the person making the deposit and the relevant deposit taker, (b) the relevant deposit taker makes or credits a payment or a series of payments (in this Part referred to as the ‘deposit return’) over a period of time to the person— (i) out of any profit resulting from the use of that money, and (ii) in proportion to the money deposited by the person; ‘finance company’ means a company whose income consists of either or both of the following— (a) income from the leasing of plant and machinery, and (b) income from the carrying on of specified financial transactions; ‘financial institution’ has the same meaning as in section 891B; ‘finance undertaking’ means a finance company or a financial institution;

‘investment certificate’ means a security which— (a) is issued by a qualifying company to a person in order to establish the claim of that person over the rights and obligations represented by the certificate, (b) entitles the owner to an amount equivalent to a share in the profits or losses derived from an asset held by the qualifying company which issued the certificate, in proportion to the number and value of the certificates owned, (c) is issued to the public, and (d) is wholly or partly treated in accordance with generally accepted accounting practice as a financial liability of the qualifying company which issued the certificate; ‘investment return’ means— (a) the excess (if any) of the consideration paid by the qualifying company on redemption of an investment certificate over the consideration paid in respect of that certificate by the beneficial owner to whom the certificate was first issued, and (b) any other payments (if any) made from time to time by the qualifying company to the beneficial owner from profits or gains derived by the qualifying company from the asset and in consideration of the holding of the investment certificate; ‘ investment transaction ’ means a transaction whereby a person acquires investment certificates and receives an investment return; ‘loan’ means any loan or advance or any other arrangement whatever by virtue of which an amount equivalent to interest is paid or payable; ‘ owner ’, in relation to any security, means at any time the person who would be entitled, if the securities were redeemed at that time by the issuer, to the proceeds of the redemption, and ‘owned’ shall be construed accordingly; ‘public’ means individuals generally, companies generally, or individuals and companies generally; ‘ qualifying company ’ means a company which— (a) is resident in the State, (b) issues investment certificates to investors, and (c) redeems the investment certificates after a specified period of time; ‘relevant deposit’, ‘relevant deposit taker’ and ‘relevant interest’ have, respectively, the meanings assigned to them by section 256; ‘specified financial transaction’ means— (a) a credit transaction, (b) a deposit transaction, or (c) an investment transaction, but a transaction shall not be a specified financial transaction if the terms of the transaction are not such as would reasonably have been expected if the parties to the transaction were independent persons acting at arm’s length.

Chapter 2

Credit Return Treatment of credit return.

267O.— (1) Subject to section 130, a credit return shall be treated for all the purposes of the Tax Acts as if it were interest paid or payable, as the case may be, on a loan made by the finance undertaking to the borrower, or a security issued by the borrower to the finance undertaking, as the case may be, and the return shall be chargeable to tax accordingly.

Treatment of credit transaction.

267P.— (1) A reference to a loan in section 122 or in Part 8 shall be deemed to include a reference to a credit transaction.

Chapter 3

Deposit Return Treatment of deposit return.

267Q.— Subject to section 130, a deposit return shall be treated for all the purposes of the Tax Acts as if it were relevant interest paid on a deposit of money and for this purpose— (a) Chapter 4 of Part 8 shall apply to the deposit return as if it were relevant interest on a relevant deposit, and (b) the relevant deposit taker shall not be regarded as carrying on a trade in partnership with the beneficial owner of the deposit for the purposes of Part 43 merely by virtue of the deposit arrangement.

Chapter 4

Investment Certificates and Returns Treatment of investment return.

267R.— Subject to section 130, the Tax Acts shall apply to an investment return as if that investment return were interest on a security and the return shall be chargeable to tax accordingly.

Treatment of certificate owner.

267S.— (1) For the purposes of the Tax Acts, the owner of the investment certificate shall not be regarded as having a legal or beneficial interest in the assets held by the qualifying company.

Chapter 5

Reporting Reporting.

267T.— Part 38 in so far as it relates to the reporting of interest payments shall apply to a deposit return, a credit return or an investment return as if that return were an interest payment.

Chapter 6

Application Application.

267U.— (1) This Part shall apply to a specified financial transaction between a finance undertaking or a qualifying company, as the case may be, and another person where the finance undertaking or the qualifying company, as the case may be, makes an election in writing to the inspector (within the meaning of section 950).

Transactions to avoid tax.

267V.— This Part shall not apply to any transaction unless that transaction has been undertaken for bona fide commercial reasons and does not form part of any arrangement or scheme of which the main purpose or one of the main purposes is avoidance of liability to income tax, corporation tax, capital gains tax, value-added tax, stamp duty or capital acquisitions tax.”.

Interest payments to residents in relevant territories.

40.— (1) The Principal Act is amended in section 198— (a) in subsection (1)(a) by substituting the following for the definition of “arrangements”: “ ‘arrangements’ means arrangements having the force of law by virtue of section 826(1) or arrangements made with the government of a territory which on completion of the procedures set out in section 826(1) will have the force of law;”, (b) in the definition of “ relevant territory ”— (i) in paragraph (i) by inserting “or” after “the State,”, (ii) in paragraph (ii) by deleting “made, or” and inserting “made;”, and (iii) by deleting paragraph (iii), (c) in subsection (1)(b)(i) by inserting “and have effect in accordance with the provisions of those arrangements” after “have been made”, and (d) by substituting the following for subsection (1)(c)(ii): “(ii) a company shall not be chargeable to income tax in respect of interest paid by a relevant person (within the meaning of section 246) in the ordinary course of a trade or business carried on by that person— (I) if the company is not resident in the State but is regarded for the purposes of this subsection as being a resident of a relevant territory which imposes a tax that generally applies to interest receivable in that territory by companies from sources outside that territory, or (II) where the interest— (A) is exempted from the charge to income tax under arrangements made with the government of a territory outside the State having the force of law under the procedures set out in section 826(1), or (B) would be exempted from the charge to income tax if arrangements made, on or before the date of payment of the interest, with the government of a territory outside the State, that do not have the force of law under the procedures set out in section 826(1), had the force of law when the interest was paid,”.

Credit for foreign tax.

41.— (1) Section 71 of the Principal Act is amended by inserting the following after subsection (3): “(3A) (a) In this subsection ‘foreign tax’ means a tax chargeable and payable under the law of a territory other than the State which corresponds to income tax or corporation tax. (b) Where income arising outside the State is chargeable to tax under Case III of Schedule D and a payment is made under the law of a territory other than the State to the person in receipt of the income by reference to foreign tax paid by another person, then the amount of income so chargeable shall be increased by an amount equal to the amount of the payment.”.

Transfer pricing.

42.— (1) The Principal Act is amended by inserting the following after Part 35: “PART 35A TRANSFER PRICING Interpretation.

835A.— (1) In this Part— ‘arrangement’ means any agreement or arrangement of any kind (whether or not it is, or is intended to be, legally enforceable); ‘ authorised officer ’ means an officer of the Revenue Commissioners authorised by them in writing for the purposes of this Part; ‘ chargeable period ’ has the same meaning as in section 321(2); ‘Commission Recommendation ’ means Commission Recommendation 2003/361/EC of 6 May 2003 4 concerning the definition of micro, small and medium-sized enterprises; ‘double taxation relief arrangements ’ means arrangements having effect by virtue of section 826; ‘group’ means a company which has one or more 75 per cent subsidiaries together with those subsidiaries; ‘relevant activities’, in relation to a person who is one of the persons between whom an arrangement is made, means that person’s activities—