Finance Act 2008

Finance Act 2008 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 2008 Finance Act 2008 Finance Act 2008 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 3 of 2008 FINANCE ACT 2008 ARRANGEMENT OF SECTIONS

PART 1

Income Tax, Corporation Tax and Capital Gains Tax

Chapter 1

Interpretation Section

Section 1

Chapter 2

Income Tax

Section 2

Section 3

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 3

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 4

Corporation Tax

Section 43

Section 44

Section 45

Section 46

Section 47

Section 48

Section 49

Section 50

Section 51

Section 52

Section 53

Chapter 5

Capital Gains Tax

Section 54

Section 55

Section 56

PART 2

Excise

Chapter 1

Electricity Tax

Section 57

Section 58

Section 59

Section 60

Section 61

Section 62

Section 63

Section 64

Section 65

Section 66

Section 67

Section 68

Chapter 2

Miscellaneous

Section 69

Section 70

Section 71

Section 72

Section 73

Section 74

Section 75

Section 76

Section 77

Section 78

Section 79

Section 80

Section 81

PART 3

Value-Added Tax

Section 82

Section 83

Section 84

Section 85

Section 86

Section 87

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

PART 4

Stamp Duties

Section 110

Section 111

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

PART 5

Capital Acquisitions Tax

Section 126

Section 127

Section 128

Section 129

PART 6

Miscellaneous

Section 130

Section 131

Section 132

Section 133

Section 134

Section 135

Section 136

Section 137

Section 138

Section 139

Section 140

Section 141

Section 142

Section 143

Section 144

SCHEDULE 1 Amendments Consequential on Changes in Personal Tax Credits SCHEDULE 2 Rates of Electricity Tax SCHEDULE 3 Repeals Relating to Excise Law

PART 1

Repeals

PART 2

Revocation SCHEDULE 4 Miscellaneous Amendments Relating to the Amendment of the Definition of Taxable Person SCHEDULE 5 Stamp Duty on Instruments SCHEDULE 6 Miscellaneous Amendments in Relation to Claims for Repayment of Tax SCHEDULE 7 Provisions relating to Certain Customs Regulations SCHEDULE 8 Miscellaneous Technical Amendments in Relation to Tax Acts Referred to Betting Act 1931 1931, No. 27 Capital Acquisitions Tax Act 1976 1976, No. 8 Capital Acquisitions Tax Consolidation Act 2003 2003, No. 1 Companies Act 1990 1990, No. 33 Criminal Justice Act 1984 1984, No. 22 Criminal Law Act 1997 1997, No. 14 Customs-free Airport Act 1947 1947, No. 5 Finance (1909-10) Act 1910 10 Edw.7, c.8 Finance Act 1925 1925, No. 28 Finance Act 1949 1949, No. 13 Finance Act 1950 1950, No. 18 Finance Act 1964 1964, No. 15 Finance Act 1966 1966, No. 17 Finance Act 1971 1971, No. 23 Finance Act 1980 1980, No. 14 Finance Act 1983 1983, No. 15 Finance Act 1989 1989, No. 10 Finance Act 1992 1992, No. 9 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 2004 2004, No. 8 Finance Act 2005 2005, No. 5 Finance Act 2006 2006, No. 6 Finance Act 2007 2007, No. 11 Housing Act 1988 1988, No. 28 Housing Acts 1996 to 2004 Housing (Miscellaneous Provisions) Act 1992 1992, No. 18 Housing (Private Rented Dwellings) Act 1982 1982, No. 6 Industrial and Provident Societies Act 1893 56 & 57 Vict., c.34 Industrial Development Act 1995 1995, No. 28 Investment Intermediaries Act 1995 1995, No. 11 Local Government Act 2001 2001, No. 37 Post Office Savings Bank Act 1861 24 & 25 Vict., c.14 Postal and Telecommunications Services Act 1983 1983, No. 24 Public Health (Tobacco) Act 2002 2002, No. 6 Public Health (Tobacco) (Amendment) Act 2004 2004, No. 6 Registration of Deeds and Title Act 2006 2006, No. 12 Registration of Title Act 1964 1964, No. 16 Residential Tenancies Act 2004 2004, No. 27 Succession Duty Act 1853 16 & 17 Vict., c.51 Stamp Act 1891 54 & 55 Vict., c.39 Stamp Duties Consolidation Act 1999 1999, No. 31 State Airports Act 2004 2004, No. 32 Taxes Consolidation Act 1997 1997, No. 39 Tourist Traffic Acts 1939 to 2003 Value-Added Tax Act 1972 1972, No. 22 Value-Added Tax Acts 1972 to 2007 Number 3 of 2008 FINANCE ACT 2008 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. [13th March, 2008] BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:

PART 1

Income Tax, Corporation Tax and Capital Gains Tax

Chapter 1

Interpretation Interpretation (Part 1).

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

Chapter 2

Income Tax Amendment of section 15 (rate of charge) of Principal Act.

2.— As respects the year of assessment 2008 and subsequent years of assessment, section 15 of the Principal Act is amended— (a) by substituting “€26,400” for “€25,000” (inserted by the Finance Act 2007 ) in subsection (3), and (b) by substituting the following Table for the Table (as so inserted) to that section: “TABLE

PART 1

Part of taxable income Rate of tax Description of rate

(1)

(2)

PART 2

Part of taxable income Rate of tax Description of rate

(1)

(2)

PART 3

Part of taxable income Rate of tax Description of rate

(1)

(2)

Personal tax credits.

3.— (1) Where an individual is entitled under a provision of the Principal Act mentioned in column (1) of the Table to this subsection to have the income tax to be charged on the individual, other than in accordance with the provisions of section 16(2) of the Principal Act, reduced for the year of assessment 2008 or any subsequent year of assessment and the amount of the reduction would, but for this section, be an amount which is the lesser of— (a) the amount specified in column (2) of that Table, and (b) the amount which reduces that liability to nil, the amount of the reduction in accordance with paragraph (a) shall be the amount of the tax credit specified in column (3) of the Table.

TABLE Statutory Provision Existing tax credit Tax credit for the year 2008 and subsequent years

(1)

(2)

(3)

Section 461

(basic personal tax credit) (married person) (widowed person bereaved in year of assessment) (single person) €3,520 €3,520 €1,760 €3,660 €3,660 €1,830 Section 461A (additional tax credit for certain widowed persons) €550 €600

Section 462

(one-parent family tax credit) €1,760 €1,830

Section 463

(widowed parent tax credit) (1st year) (2nd year) (3rd year) (4th year) (5th year) €3,750 €3,250 €2,750 €2,250 €1,750 €4,000 €3,500 €3,000 €2,500 €2,000

Section 464

(age tax credit) (married person) (single person) €550 €275 €650 €325

Section 465

(incapacitated child tax credit) €3,000 €3,660 Section 466A (home carer tax credit) €770 €900

Section 468

(blind person’s tax credit) (blind person) (both spouses blind) €1,760 €3,520 €1,830 €3,660

Section 472

(employee tax credit) €1,760 €1,830

Age exemption.

4.— As respects the year of assessment 2008 and subsequent years of assessment, section 188 of the Principal Act is amended, in subsection (2), by substituting “€40,000” for “€38,000” (inserted by the Finance Act 2007 ) and “€20,000” for “€19,000” (as so inserted).

Cesser of exemption limits.

5.— The Principal Act is amended— (a) in section 187 by inserting the following after subsection (4): “(5) This section ceases to have effect on or after 1 January 2008.”, (b) in section 188— (i) in subsection (1) by deleting “and in section 187”, (ii) in subsection (2) by substituting “subject to subsection (2A)” for “subject to section 187(2)”, and (iii) by inserting the following after subsection (2)— “(2A) (a) For the purposes of this section, where a claimant proves that he or she has living at any time during the year of assessment any qualifying child then, subject to subsection (2B), the specified amount (within the meaning of this section) shall be increased for that year of assessment by— (i) €575 in respect of the first such child, (ii) €575 in respect of the second such child, and (iii) €830 in respect of each such child in excess of 2. (b) Any question as to whether a child is a qualifying child for the purposes of this section shall be determined on the same basis as it would be for the purposes of section 462, but without regard to subsections (1)(b), (2) and (3) of that section. (2B) Where for any year of assessment 2 or more individuals are, or but for this subsection would be, entitled under subsection (2A) to an increase in the specified amount, (within the meaning of this section) in respect of the same child, the following provisions shall apply: (a) only one such increase under subsection (2A) shall be allowed in respect of each child; (b) where such child is maintained by one individual only, that individual only shall be entitled to claim the increase; (c) where such child is maintained by more than one individual, each individual shall be entitled to claim such part of the increase as is proportionate to the amount expended on the child by that individual in relation to the total amount paid by all individuals towards the maintenance of the child; (d) in ascertaining for the purposes of this subsection whether an individual maintains a child and, if so, to what extent, any payment made by the individual for or towards the maintenance of the child which that individual is entitled to deduct in computing his or her total income for the purposes of the Income Tax Acts shall be deemed not to be a payment for or towards the maintenance of the child.”, and (iv) in subsection (6) by deleting “or under section 187” in both places where it occurs, (c) in section 244(2)(c) by substituting “Except for the purpose of section 188” for “Except for the purposes of sections 187 and 188”,

(d) in section 261— (i) in subsection (c)(i)(I) by substituting “section 188” for “section 187 or 188”, and (ii) in subsection (c)(ii) by substituting “section 188” for “sections 187 or 188”, (e) in section 459(6) by substituting “section 188” for “section 187 or 188”, (f) in section 644A(3)(b) by substituting “section 188” for “sections 187 or 188”, and (g) in section 787R(1)(b) by substituting “section 188” for “sections 187 or 188”.

Amendment of section 473 (allowance for rent paid by certain tenants) of Principal Act.

6.— Section 473 of the Principal Act is amended, as respects the year of assessment 2008 and subsequent years of assessment, by substituting in subsection (1) the following definition for the definition of “specified limit” (inserted by the Finance Act 2007 ): “ ‘ specified limit ’, in relation to an individual for a year of assessment, means— (a) in the case of— (i) a married person assessed to tax in accordance with section 1017, or (ii) a widowed person, €4,000; but, if at any time during the year of assessment the individual was of the age of 55 years or over, ‘specified limit’ means €8,000, and (b) in any other case, €2,000; but, if at any time during the year of assessment the individual was of the age of 55 years or over, ‘specified limit’ means €4,000;”.

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

7.— As respects the year of assessment 2008 and subsequent years of assessment, section 244 of the Principal Act is amended in the definition of “relievable interest” in subsection (1)(a)— (a) by substituting “€20,000” for “€16,000” (inserted by the Finance Act 2007 ), and (b) by substituting “€10,000” for “€8,000” (inserted by the Finance Act 2007 ).

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

8.— As respects the year of assessment 2008 and subsequent years of assessment, section 122 of the Principal Act is amended in the definition of “the specified rate” in subsection (1)(a)— (a) by substituting “5.5 per cent” for “4.5 per cent” (inserted by the Finance Act 2007 ) in both places where it occurs, and (b) by substituting “13 per cent” for “12 per cent” (inserted by the Finance Act 2007 ).

Amendment of section 467 (employed person taking care of incapacitated individual) of Principal Act.

9.— Section 467 of the Principal Act is amended by inserting the following after subsection (2): “(2A) Notwithstanding subsection (2)(a) but subject to all other provisions of this section, relief may be granted under this section in the first year in which the individual proves that either he or she or a relative of the individual was totally incapacitated by physical or mental infirmity.”.

Amendment of section 472C (relief for trade union subscriptions) of Principal Act.

10.— As respects the year of assessment 2008 and subsequent years of assessment, section 472C of the Principal Act is amended, in subsection (1), by substituting “€350” for “€300” (inserted by the Finance Act 2006 ) in the definition of “specified amount”.

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

11.— As respects the year of assessment 2008 and subsequent years of assessment, section 216A of the Principal Act is amended, in subsection (5), by substituting “€10,000” for “€7,620”.

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

12.— (1) Schedule 13 to the Principal Act is amended— (a) by substituting the following for paragraph 111: “111. Director of the Equality Tribunal.”, (b) by substituting the following for paragraph 114: “114. Competition Authority.”, (c) by substituting the following for paragraph 120: “120. Citizens Information Board.”, (d) by substituting the following for paragraph 143: “143. Children Acts Advisory Board.”, (e) by deleting paragraphs 34, 81, 86, 107, 112 and 157, and (f) by inserting the following after paragraph 164 (inserted by the Finance Act 2007 ): “165. Limerick Northside Regeneration Agency.

Amendment of Schedule 12A (approved savings-related share option schemes) to Principal Act.

13.— (1) Schedule 12A to the Principal Act is amended in paragraph 25— (a) in subparagraph (2)(a) by substituting “€500” for “€320”, and (b) by deleting subparagraph (3).

Amendment of section 515 (excess or unauthorised shares) of Principal Act.

14.— (1) Section 515(2A) of the Principal Act is amended in paragraph (c) by substituting “a period of at least 10 years, or such lesser period (not being less than the period referred to in paragraph (b)) as the Revenue Commissioners may allow,” for “a period of at least 10 years”.

Amendment of section 657 (averaging of farm profits) of Principal Act.

15.— Section 657 of the Principal Act is amended by inserting the following after subsection (10): “(10A) Where the commencement of a partnership to which European Communities (Milk Quota) (Amendment) Regulations 2002 ( S.I. No. 97 of 2002 ) apply, would otherwise result in the permanent discontinuation of another trade of farming then, notwithstanding subsection (10) and solely for the purposes of the application of this section, the partnership trade shall be treated as a continuation of that other trade.”.

Tax treatment of directors and employees who acquire convertible securities.

16.— (1) The Principal Act is amended by inserting the following after section 128B: “128C.— (1) In this section— ‘ chargeable amount ’ has the same meaning as it has in subsection (6), computed in accordance with subsection (8); ‘ chargeable event ’ has the meaning given in subsection (7); ‘ collective investment scheme ’ means any scheme or arrangement made for the purpose, or having the effect, of providing facilities for the participation by persons, as beneficiaries, in profits or income arising from the acquisition, holding, management or disposals of assets; ‘ convertible securities ’ shall be construed in accordance with subsection (4); ‘director’ and ‘employee’ have the meanings respectively assigned to them by section 770(1); ‘ interest ’, in relation to securities, includes an interest in securities which is less than full beneficial ownership and an interest in the proceeds of the sale of them, but does not include a right to acquire securities; ‘ market value ’ shall be construed in accordance with section 548; ‘ securities ’ includes— (a) shares, (b) securities within the meaning of section 135, (c) debentures, debenture stock, loan stock, bonds, certificates of deposit, and other instruments (including certificates and warrants) creating or acknowledging indebtedness, including certificates and other instruments providing for a share in the profits of a company, (d) options (other than options to acquire securities, except where such options are acquired under arrangements of which the main purpose or one of the main purposes is the avoidance of income tax, corporation tax or capital gains tax) and financial and commodity futures (within the meaning of the Investment Intermediaries Act 1995 ), (e) warrants and other instruments entitling their holders to subscribe for securities, (f) certificates and other instruments conferring rights in respect of securities held by persons other than persons on whom the rights are conferred and the transfer of which may be effected without the consent of those persons, and (g) units in a collective investment scheme, but does not include cheques or other bills of exchange, bankers’ drafts or letters of credit, statements showing balances in current, deposit or savings accounts, or leases and other dispositions of property; ‘ shares ’ includes securities (within the meaning of section 135) and stock.

H — I where— H is the amount by which the market value of the employment-related securities for the purposes specified in paragraph (a) of subsection (5), exceeded what it would have been had that paragraph applied, and I is the aggregate of any amount by which the chargeable amount on any previous chargeable event relating to the employment-related securities has been reduced under this subsection.

Amendment of section 986 (regulations) of Principal Act.

17.— Section 986 of the Principal Act is amended in subsection (1)— (a) in paragraph (j) by substituting “regulations;” for “regulations.”, (b) by inserting the following after paragraph (j): “(k) for the collection and recovery, to the extent that the Revenue Commissioners deem appropriate and the employee does not object, of tax in respect of income other than emoluments to which this Chapter applies, which has not otherwise been recovered during the year; (l) for the collection and recovery, from the employee rather than from the employer of any amount of tax that the Revenue Commissioners consider should have been deducted by the employer from the emoluments of the employee; (m) for requiring any employer making any payment of emoluments to which this Chapter applies to provide, within a prescribed time, and on such form as the Revenue Commissioners may approve or prescribe, information in relation to payments of emoluments (including emoluments in the form of notional payments) and tax deducted from such emoluments, and such other information or documents as the Revenue Commissioners deem appropriate.”, and (c) by inserting the following after subsection (6)— “(6A) Notwithstanding any other provision of this section, where the Revenue Commissioners are satisfied that it is unnecessary or is not appropriate for an employer to comply with any of the regulations made under subsection (1) they may notify the employer accordingly.”.

Amendment of tax treatment of income from certain possessions in Great Britain or Northern Ireland.

18.— (1) The Principal Act is amended— (a) in section 73 by inserting the following after subsection (3): “(4) This section ceases to have effect in respect of income arising on or after 1 January 2008.”, and (b) in section 823 by substituting the following for subsection (2)(b): “(b) This section does not apply in any case where the income from an office or employment— (i) is chargeable to tax in accordance with section 71(3), or (ii) is income to which section 822 applies.”.

Share schemes: returns of information.

19.— (1) The Principal Act is amended— (a) in section 510 by inserting the following after subsection (7): “(8) Without prejudice to subsection (7) the trustees of an approved scheme shall as respects any year, prepare and deliver to the Revenue Commissioners on or before 31 March in the year following that year, a return in the prescribed form (within the meaning of section 951) of such particulars relating to the approved scheme for that year as may be required by the prescribed form and sections 1052 and 1054 shall apply to a failure by the trustees to deliver a return in accordance with this subsection as they apply to a failure to deliver a return referred to in section 1052.”, (b) in Schedule 12 by inserting the following after paragraph 3(4): “(5) Without prejudice to subparagraph (4) the trustees of a trust shall as respects any year, prepare and deliver to the Revenue Commissioners on or before 31 March in the year following that year, a return in the prescribed form (within the meaning of section 951) of such particulars relating to the trust for that year as may be required by the prescribed form and sections 1052 and 1054 shall apply to a failure by the trustees to deliver a return in accordance with this subparagraph as they apply to a failure to deliver a return referred to in section 1052.”, (c) in Schedule 12A by inserting the following after paragraph 6: “6A. Without prejudice to paragraph 6 the trustees of an approved scheme shall as respects any year, prepare and deliver to the Revenue Commissioners on or before 31 March in the year following that year, a return in the prescribed form (within the meaning of section 951) of such particulars relating to the approved scheme for that year as may be required by the prescribed form and sections 1052 and 1054 shall apply to a failure by the trustees to deliver a return in accordance with this paragraph as they apply to a failure to deliver a return referred to in section 1052.”, (d) in Schedule 12C by inserting the following after paragraph 20: “20A. Without prejudice to paragraph 20 the trustees of an approved scheme shall as respects any year, prepare and deliver to the Revenue Commissioners on or before 31 March in the year following that year, a return in the prescribed form (within the meaning of section 951) of such particulars relating to the approved scheme for that year as may be required by the prescribed form and sections 1052 and 1054 shall apply to a failure by the trustees to deliver a return in accordance with this paragraph as they apply to a failure to deliver a return referred to in section 1052.”,

and (e) in Schedule 29, column 3, by inserting— (i) “section 510(8)” before “section 531 and regulations under that section”, and (ii) “Schedule 12, paragraph 3(5); Schedule 12A, paragraph 6A; Schedule 12C, paragraph 20A;” before “Schedule 23, paragraph 3(2)(a)”.

Restructuring and diversification aid for sugar beet growers.

20.— Chapter 1 of Part 23 of the Principal Act is amended by substituting the following for section 657B: “657B.— (1) In this section— ‘ specified individual ’ means an individual who carries on in the year of assessment 2007 or in any subsequent year of assessment the trade of farming in respect of which the individual is within the charge to tax under Case I of Schedule D; ‘ specified payment ’ means a payment to a specified individual under the EU temporary scheme for the restructuring of the sugar industry in the Community, operated by the Department of Agriculture, Fisheries and Food under any of Articles 3(6) first indent, 6 and 7 of Council Regulation (EC) No. 320/2006 of 20 February 2006 (as amended by Council Regulation (EC) No. 1261/2007 of 9 October 2007) in respect of which the specified individual would, apart from this section, be chargeable to income tax on the profits or gains from farming for the year of assessment 2007 or for any subsequent year of assessment.

Revenue approved salary sacrifice agreements.

21.— The Principal Act is amended in Chapter 3 of Part 5 by inserting the following section after section 118A— “118B.— (1) In this section— ‘ approved transport provider ’ has the same meaning as in section 118(5A); ‘ exempt employee benefit ’ means a benefit specifically approved by the Revenue Commissioners which is referred to in subsection (2)(a)(i) and (ii); ‘ salary sacrifice agreement ’ means any arrangement under which an employee forgoes the right to receive any part of his or her remuneration due under his or her terms or contract of employment, and in return his or her employer agrees to provide him or her with a benefit; ‘ approved profit sharing scheme ’ shall be construed in accordance with section 510.

Amendment of section 201 (exemptions and reliefs in respect of tax under section 123) of Principal Act.

22.— (1) Section 201 of the Principal Act is amended by inserting the following subsection after subsection (1)— “(1A) (a) In this subsection— ‘eligible employee’ means an employee, being a person who is being made redundant, who, in relation to a full-time employment, has completed at least 2 years continuous service in that employment or is, for the purposes of the law relating to redundancy, deemed to have at least 2 years continuous service; ‘retraining’ means a training course, made available by an employer as part of a redundancy package, that is— (i) designed to impart or improve skills or knowledge relevant to, or intended to be used in, obtaining gainful employment or in the setting up of a business, (ii) primarily devoted to the teaching or practical application of such skills or knowledge, and (iii) completed within 6 months of the termination of employment; ‘redundancy package’, in relation to an eligible employee, means any scheme of compensation offered to the employee on termination of his or her employment. (b) Income tax shall not be charged by virtue of section 123 in respect of the first €5,000 of the cost of retraining an eligible employee where— (i) such training forms part of his or her redundancy package, and (ii) the employer makes available such retraining for all eligible employees. (c) Paragraph (b) does not apply to any retraining provided to either or both the spouse and any dependant of the employer. (d) Paragraph (b) does not apply to an eligible employee where there is an arrangement or scheme in place whereby an employee may receive the cost of retraining in money or money’s worth, wholly or partly, directly or indirectly, and such employee so receives that cost.”.

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

23.— (1) Section 485G of the Principal Act is amended by inserting the following subsections after subsection (3): “(4) (a) Subject to paragraph (b) and subsection (5), where under any provision of the Tax Acts (other than any provision of this Chapter) the calculation of a relief, deduction, credit in relation to tax or, as the case may be, a reduction in the amount of tax payable arises for a tax year which requires total income, taxable income, tax payable or tax chargeable for the year to be taken into account as part of the calculation— (i) that calculation shall be carried out as if this Chapter, other than section 485F, does not apply, and (ii) (I) in the case of a relief or deduction, effect shall be given to such relief or deduction before the application of this Chapter but after the application of section 485F, or (II) in the case of a credit in relation to tax or, as the case may be, a reduction in the amount of tax payable, the benefit of that credit or reduction (as calculated in accordance with subparagraph (i)) shall be given against the amount of tax to be charged on the individual for the year involved in relation to his or her taxable income as determined in accordance with section 485E. (b) Where this Chapter applies to an individual for a tax year nothing in paragraph (a) shall affect the calculation of the amount of tax which is to be charged on the individual for the year involved in relation to his or her taxable income as determined in accordance with section 485E.

Chapter 3

Income Tax, Corporation Tax and Capital Gains Tax Amendment of Part 16 (income tax relief for investment in corporate trades — business expansion scheme and seed capital scheme) of Principal Act.

24.— (1) Part 16 of the Principal Act is amended— (a) in section 495— (i) by inserting in subsection (1) the following before the definition of “EEA Agreement”: “ ‘assisted area’ means an area specified in the National Regional State Aid Map for Ireland in relation to the period 1 January 2007 to 31 December 2013 approved under Commission Decision No. N 374/2006 of 24 October 2006;”, and (ii) by inserting the following after subsection (3A) (inserted by the Finance Act 2004 ): “(3B) The company shall as respects the period commencing on 1 January 2007— (a) be a micro or small enterprise within the meaning of Annex 1 to Commission Regulation (EC) No. 364/2004 of 25 February 2004, (b) be a medium-sized enterprise within the meaning of Annex 1 to Commission Regulation (EC) No. 364/2004 of 25 February 2004 located in an assisted area, or (c) where it is not located in an assisted area, be a medium-sized enterprise within the meaning of Annex 1 to Commission Regulation (EC) No. 364/2004 of 25 February 2004 which is at a stage of development not beyond start-up stage within the meaning of the Community Guidelines on State Aid to Promote Risk Capital Investments in Small and Medium-Sized Enterprises. (3C) For the purposes of subsection (3B), the location of a company shall be determined by reference to the location at which the company or, as the case may be, the qualifying subsidiary, carries on qualifying trading operations or, in the case of a company which is resident in an EEA State other than the State that carries on business in the State through a branch or agency, the location at which that branch or agency carries on qualifying trading operations.”, (b) in section 496(9A) (inserted by the Finance Act 2007 ), by substituting the following for paragraph (a): “(a) For the purposes of subsection (2)(a)(xvi) ‘ recycling activities in relation to waste material ’ means— (i) the subjection of the waste material to any process or treatment which results in value-added material that is reusable, and (ii) in respect of which activities, the qualifying company— (I) has obtained approval of a grant or financial assistance from an industrial development agency or a County Enterprise Board (being a board referred to in the Schedule to the Industrial Development Act 1995 ), or (II) has been provided with written confirmation from an industrial development agency or a County Enterprise Board (being a board referred to in the Schedule to the Industrial Development Act 1995 ) that the qualifying company has submitted a business proposal to the agency or board, as the case may be, and that, in the opinion of that agency or board, as the case may be, the activities described in the business proposal, come within the scope of a service industry specified in the Schedule to the Industrial Development (Services Industries) Order 2003 (

S.I. No. 458 of 2003 ).”, (c) in section 497— (i) in subsection (4)— (I) by deleting “or” in paragraph (b) and inserting “or” after “section 496(2)(a)(xii),” in paragraph (c), and (II) by inserting the following after paragraph (c): “(d) an industrial development agency or a County Enterprise Board (being a board referred to in the Schedule to the Industrial Development Act 1995 ) in respect of qualifying trading operations referred to in section 496(2)(a)(xvi),” and (ii) in subsection (7)(a) by substituting “subparagraphs (i), (ii), (v) and (xvi) of section 496(2)(a),” for “subparagraphs (i), (ii), and (v) of section 496(2)(a),”, and (d) in section 508A (inserted by the Finance Act 2007 ) by inserting the following after subsection (3): “(3A) No obligation as to secrecy imposed by statute or otherwise shall preclude the Revenue Commissioners from publishing information obtained by them in accordance with subsection (1).”.

Amendment of section 81A (restriction of deductions for employee benefit contributions) of Principal Act.

25.— (1) Section 81A of the Principal Act is amended— (a) in subsection (1)(a) by substituting the following for the definition of “qualifying expenses”: “ ‘ qualifying expenses ’, in relation to a scheme manager and an employee benefit scheme, does not include expenses that, if incurred by the employer, would not be allowed as a deduction in calculating the profits or gains of the employer to be charged to tax under Case I or II of Schedule D but, subject to the foregoing, includes any expenses of a scheme manager (apart from the provision of benefits to employees of the employer) incurred in the operation of the employee benefit scheme; ‘ scheme manager ’ means a person who administers an employee benefit scheme or any person to whom an employer pays money or transfers an asset and such person is entitled or required, under the provisions of an employee benefit scheme to retain or use the money or asset for or in connection with the provision of benefits to employees of the employer.”, (b) in subsection (1)(b) by substituting the following for sub-paragraph (i): “(i) an employee benefit contribution is made if, as a result of any act or omission— (I) any assets are held, or may be used, under an employee benefit scheme, or (II) there is an increase in the total value of assets that are so held or may be so used (or a reduction in any liabilities under an employee benefit scheme),”, (c) in subsection (3)(b)(i) by substituting “a scheme manager” for “the third party” in the first place where it occurs, and by substituting “the scheme manager” for “the third party” in the second place where it occurs, (d) in subsection (3)(b)(ii) by substituting “the scheme manager” for “the third party”, (e) in subsection (4)(b)(i) by substituting “a scheme manager” for “the third party” in the first place where it occurs, and by substituting “the scheme manager” for “the third party” in the second place where it occurs, (f) in subsection (4)(b)(ii) by substituting “the scheme manager” for “the third party”, and (g) in subsection (5) by substituting the following for paragraph (b): “(b) The amount provided shall be taken for the purposes of this section to be the total of— (i) (I) the amount, if any, expended on the asset by a scheme manager, or (II) where the asset consists of new shares in a company connected (within the meaning of section 10) with the employer, or rights in respect of such shares, issued by the connected company, the market value of those shares or rights, as the case may be, at the time of the transfer,

and (ii) in a case in which the asset was transferred to a scheme manager by the employer, the amount of the deduction that would be allowed as referred to in subsection (2) in respect of the transfer.”.

Capital allowances for qualifying specialist palliative care units.

26.— (1) The Principal Act is amended― (a) in section 268― (i) in subsection (1)― (I) by deleting “or” where it last occurs in paragraph (k) and by substituting “centre, or” for “centre,” in paragraph (l), and (II) by inserting the following after paragraph (l): “(m) for the purposes of a trade which consists of the operation or management of a qualifying specialist palliative care unit,”, (ii) by inserting the following after subsection (1D): “(1E) Where the relevant interest in relation to capital expenditure incurred on the construction of a building or structure in use for the purposes specified in subsection (1)(m) is held by— (a) a company, (b) the trustees of a trust, (c) an individual who is involved in the operation or management of the unit concerned either as an employee or director or in any other capacity, or (d) a property developer (within the meaning of section 843A) or a person who is connected with the property developer, in the case where either of such persons incurred the capital expenditure on the construction of that building or structure, or such expenditure was incurred by any other person connected with the property developer, then, notwithstanding that subsection, that building or structure shall not, as regards a claim for any allowance under this Part by any such person, be regarded as an industrial building or structure for the purposes of this Part, irrespective of whether that relevant interest is held by the person referred to in paragraph (a), (b), (c) or (d), as the case may be, in a sole capacity or jointly or in partnership with another person or persons.”, (iii) by inserting the following after subsection (2B): “(2BA) In this section― ‘palliative care’ means the active total care of patients who suffer from illnesses or diseases which are active, progressive and advanced in nature and which are no longer curable by means of the administration of existing or available medical treatments; ‘qualifying specialist palliative care unit’ means, subject to subsection (2BB), a building or structure― (a) which is a hospital, hospice (within the meaning of section 47 (as amended by section 16 of the Public Health (Tobacco) (Amendment) Act 2004 ) of the Public Health (Tobacco) Act 2002 ) or similar facility which has palliative care as its main activity, (b) which, before entering into a legal commitment for its design, commissioning, construction or refurbishment, is approved by the Health Service Executive, with the consent of the Minister for Health and Children, as being in accordance with national development plans or national needs assessments for palliative care facilities,

(c) which has the capacity to provide― (i) day-patient and out-patient palliative care services, and (ii) palliative care accommodation on an overnight basis of not less than 20 in-patient beds, (d) in respect of which relevant data is provided to the Health Service Executive, for onward transmission to the Minister for Health and Children and the Minister for Finance, in relation to― (i) the amount of the capital expenditure actually incurred on the construction or refurbishment of the unit, (ii) the amount, if any, of such expenditure which has been or is to be met directly or indirectly by the State or by any other person by way of grant or other financial assistance, (iii) the number and nature of the investors that are investing in the unit, (iv) the amount to be invested by each investor, and (v) the nature of the structures which are being put in place to facilitate the investment in the unit, together with such other information as may be specified by the Minister for Finance, in consultation with the Minister for Health and Children, as being of assistance in evaluating the costs, including but not limited to exchequer costs, and the benefits arising from the operation of tax relief under this Part for qualifying specialist palliative care units, (e) in relation to which an undertaking is given to the Health Service Executive— (i) to make available annually, for the palliative care of persons who have been awaiting day-patient, in-patient or out-patient palliative care services as public patients, not less than 20 per cent of its capacity, subject to service requirements to be specified by the Health Service Executive in advance and to the proviso that nothing in this subparagraph shall require the Health Service Executive to take up all or any part of the capacity made available to the Health Service Executive by the unit, and (ii) in relation to the fees to be charged in respect of the palliative care afforded to any such person, that such fees shall not be more than 90 per cent of the fees which would be charged in respect of similar palliative care afforded to a person who has private medical insurance, and (f) in respect of which the Health Service Executive, in consultation with the Minister for Health and Children and with the consent of the Minister for Finance, gives an annual certificate in writing during the period of― (i) 15 years beginning with the time when the unit was first used, or (ii) where capital expenditure on the refurbishment of the unit is incurred, 15 years beginning with the time when the unit was first used subsequent to the incurring of that expenditure,

stating that it is satisfied that the unit complies with the conditions mentioned in paragraphs (a) to (e). (2BB) (a) Subject to paragraphs (b) and (c), a qualifying specialist palliative care unit includes any part of the unit which consists of rooms used exclusively for the assessment, treatment or care of patients. (b) A qualifying specialist palliative care unit does not include any part of the unit which consists of consultants’ rooms or offices. (c) A qualifying specialist palliative care unit does not include any part of the unit in which a majority of the persons being maintained are being treated for acute illnesses.”, and (iv) in subsection (9)― (I) by deleting “and” at the end of paragraph (h) and by substituting “2006, and” for “2006.” in paragraph (i), and (II) by inserting the following after paragraph (i): “(j) by reference to paragraph (m), as respects capital expenditure incurred on or after the date of the coming into operation of section 26 of the Finance Act 2008.”, (b) in section 272― (i) in subsection (3)― (I) by deleting “and” at the end of paragraph (h) and by substituting “subsection (2)(c), and” for “subsection (2)(c).” in paragraph (i), and (II) by inserting the following after paragraph (i): “(j) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of paragraph (m) of section 268(1), 15 per cent of the expenditure referred to in subsection (2)(c).”, and (ii) in subsection (4)― (I) by deleting “and” at the end of paragraph (h) and by substituting “expenditure, and” for “expenditure.” in paragraph (i), and (II) by inserting the following after paragraph (i): “(j) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of paragraph (m) of section 268(1)― (I) 15 years beginning with the time when the building or structure was first used, or (II) where capital expenditure on the refurbishment of the building or structure is incurred, 15 years beginning with the time when the building or structure was first used subsequent to the incurring of that expenditure.”, (c) in section 274― (i) in subsection (1)(b)― (I) by deleting “and” at the end of subparagraph (vii) and by substituting “expenditure, and” for “expenditure.” in subparagraph (viii), and (II) by inserting the following after subparagraph (viii): “(ix) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of paragraph (m) of section 268(1)―

(I) 15 years after the building or structure was first used, or (II) where capital expenditure on the refurbishment of the building or structure is incurred, 15 years after the building or structure was first used subsequent to the incurring of that expenditure.”, (ii) in subsection (2A)(a)― (I) by deleting “or” at the end of subparagraph (v) and by substituting “section, or” for “section.” in subparagraph (vi), and (II) by inserting the following after subparagraph (vi): “(vii) is in use for the purposes of a trade referred to in paragraph (m) of section 268(1).”, and (iii) in subsection (2A)(b)(i), by substituting “(v), (vi) or (vii)” for “(v) or (vi)”, and (d) in Schedule 25B― (i) by inserting the following after clause (VI) of paragraph (a)(i) of the matter set out opposite reference number 13: “(VII) section 268(1)(m) (inserted by the Finance Act 2008),”, and (ii) by inserting the following after clause (VI) of paragraph (a)(i) of the matter set out opposite reference number 15: “(VII) section 268(1)(m) (inserted by the Finance Act 2008),”.

Mid-Shannon corridor tourism infrastructure investment scheme.

27.— Section 372AZ(1) of the Principal Act is amended by substituting the following for paragraph (c): “(c) unless the potential capital allowances in relation to the building or structure concerned and the project in which it is comprised comply with— (i) the requirements of the Guidelines on National Regional Aid for 2007-2013 prepared by the Commission of the European Communities and issued on 4 March 2006, and (ii) the National Regional Aid Map for Ireland for the period 1 January 2007 to 31 December 2013 which was approved by the said Commission on 24 October 2006, or (d) where the person who is entitled to the relevant interest, within the meaning of section 269, in relation to that expenditure is subject to an outstanding recovery order following a previous decision of the Commission of the European Communities declaring aid in favour of that person to be illegal and incompatible with the common market.”.

Capital allowances for buildings and structures in registered caravan and camping sites.

28.— Chapter 1 of Part 9 of the Principal Act is amended— (a) in section 268, by inserting the following after subsection (2C): “(2D) For the purposes of this Part, a building or structure which is comprised in, and is in use as part of, premises which are registered in the register of caravan sites and camping sites kept under the Tourist Traffic Acts 1939 to 2003 shall, as respects capital expenditure incurred on or after 1 January 2008 on its construction (within the meaning of section 270), be deemed to be a building or structure in use for the purposes of the trade of hotel-keeping.”, (b) in section 272— (i) in subsection (3)— (I) in paragraph (c), by substituting “paragraph (d), (da) or (db)” for “paragraph (d) or (da)”, and (II) by inserting the following after paragraph (da): “(db) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of section 268(1)(d) by reason of being comprised in, and in use as part of, premises which are registered in the register of caravan sites and camping sites kept under the Tourist Traffic Acts 1939 to 2003, 4 per cent of the capital expenditure on the construction (within the meaning of section 270) of the building or structure which is incurred on or after 1 January 2008,”, and (ii) in subsection (4)— (I) in paragraph (c), by substituting “paragraph (d), (da) or (db)” for “paragraph (d) or (da)”, and (II) by inserting the following after paragraph (da): “(db) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of section 268(1)(d) by reason of being comprised in, and in use as part of, premises which are registered in the register of caravan sites and camping sites kept under the Tourist Traffic Acts 1939 to 2003— (i) 25 years beginning with the time when the building or structure was first used, or (ii) where capital expenditure on the refurbishment of the building or structure is incurred, 25 years beginning with the time when the building or structure was first used subsequent to the incurring of that expenditure, in the case where the capital expenditure on the construction (within the meaning of section 270) of the building or structure is incurred on or after 1 January 2008,”, and (c) in section 274(1)— (i) in paragraph (b)(iii), by substituting “subparagraph (iv), (iva) or (ivb)” for “subparagraph (iv) or (iva)”, and (ii) by inserting the following after subparagraph (iva): “(ivb) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of section 268(1)(d) by reason of being comprised in, and in use as part of, premises which are registered in the register of caravan sites and camping sites kept under the Tourist Traffic Acts 1939 to 2003—

(i) 25 years after the building or structure was first used, or (ii) where capital expenditure on the refurbishment of the building or structure is incurred, 25 years after the building or structure was first used subsequent to the incurring of that expenditure, in the case where the capital expenditure on the construction (within the meaning of section 270) of the building or structure is incurred on or after 1 January 2008,”.

Amendment of restriction on property developers under certain schemes and of capital allowances for certain childcare facilities.

29.— (1) The Principal Act is amended— (a) in section 268— (i) in subsection (1A) by substituting the following for paragraph (d): “(d) a property developer (within the meaning of section 843A) or a person who is connected with the property developer, in the case where either of such persons incurred the capital expenditure on the construction of that building or structure, or such expenditure was incurred by any other person connected with the property developer,”, and (ii) in subsection (1D) by substituting the following for paragraph (d): “(d) a property developer (within the meaning of section 843A) or a person who is connected with the property developer, in the case where either of such persons incurred the capital expenditure on the construction of that building or structure, or such expenditure was incurred by any other person connected with the property developer,”, (b) in section 372AZ(1)(a)— (i) in subparagraph (i) by inserting “or a person who is connected (within the meaning of section 10) with the property developer” after “a property developer”, and (ii) by substituting the following subparagraph for subparagraph (ii): “(ii) either of the persons referred to in subparagraph (i) incurred the capital expenditure on the construction or refurbishment of the building or structure concerned, or such expenditure was incurred by any other person connected (within the meaning of section 10) with the property developer,”, and (c) in section 843A— (i) in the definition of “qualifying premises” in subsection (1) by substituting “the requirements of Regulation 10 or 11(1), as appropriate, of the Child Care (Pre-School Services) (No. 2) Regulations 2006 ( S.I. No. 604 of 2006 )” for “the requirements of Article 9, 10(1) or 11, as appropriate, of the Child Care (Pre-School Services) Regulations, 1996 ( S.I. No. 398 of 1996 )”, and (ii) by substituting the following for subsection (5)— “(5) Subsections (3) and (3A) shall not apply in respect of qualifying expenditure incurred on a qualifying premises on or after 1 January 2008— (a) where a property developer or a person who is connected (within the meaning of section 10) with the property developer is entitled to the relevant interest, within the meaning of section 269, in that qualifying expenditure, and (b) either of the persons referred to in paragraph (a) incurred the qualifying expenditure on that qualifying premises, or such expenditure was incurred by any other person connected (within the meaning of section 10) with the property developer.”.

Decommissioning of fishing vessels: amendment of section 288 (balancing allowances and balancing charges) of Principal Act.

30.— (1) Section 288 of the Principal Act is amended by inserting the following after subsection (6): “(6A) (a) Where— (i) the sale, insurance, salvage or compensation moneys consist of a payment or payments to a person under the scheme for compensation in respect of the decommissioning of fishing vessels implemented by the Minister for Agriculture, Fisheries and Food in accordance with Council Regulation (EC) No. 1198/2006 of 27 July 2006, and (ii) on account of the receipt by the person of such payment or payments, a balancing charge is to be made on the person for any chargeable period other than by virtue of paragraph (b), then, the amount on which the balancing charge is to be made for that chargeable period shall be an amount equal to one-fifth of the amount (in this subsection referred to as ‘the original amount’) on which the balancing charge would but for this subsection have been made. (b) Notwithstanding paragraph (a), there shall be made on the person for each of the 4 immediately succeeding chargeable periods a balancing charge, and the amount on which that charge is made for each of those periods shall be an amount equal to one-fifth of the original amount.”.

Capital allowances and expenses for business cars.

31.— (1) The Principal Act is amended by inserting the following after Part 11: “PART 11C Emissions-based Limits on Capital Allowances and Expenses for Certain Road Vehicles Interpretation and general (Part 11C).

380K.— (1) Subject to section 380P(1), this Part and not Part 11 shall apply to a vehicle which is a mechanically propelled road vehicle constructed or adapted for the carriage of passengers, other than a vehicle of a type not commonly used as a private vehicle and unsuitable to be so used.

TABLE Vehicle Category CO 2 Emissions (CO 2g/km) A 0g/km up to and including 120g/km B More than 120g/km up to and including 140g/km C More than 140g/km up to and including 155g/km D More than 155g/km up to and including 170g/km E More than 170g/km up to and including 190g/km F More than 190g/km up to and including 225g/km G More than 225g/km

Emissions-based limits for certain cars.

380L.— (1) In relation to a vehicle to which this Part applies, where an allowance which, apart from this section, would be made under section 284 is to be increased or reduced, as the case may be, by virtue of this section, any reference in the Tax Acts to an allowance made under section 284 shall be construed as a reference to that allowance as increased or reduced under this section.

Limit on deductions, etc. for hiring cars.

380M.— Where apart from this section the amount of any expenditure on the hiring (otherwise than by means of hire-purchase) of a vehicle to which this Part applies would be allowed to be deducted or taken into account as mentioned in section 375, then the amount of that expenditure shall— (a) in the case of a vehicle in Category A, B or C, be increased or reduced, as the case may be, in the proportion which the specified amount bears to the retail price of the vehicle at the time it was made, (b) in the case of a vehicle in category D or E where the retail price of the vehicle at the time it was made was— (i) less than or equal to the specified amount, be reduced by 50 per cent, and (ii) greater than the specified amount, be reduced in the proportion which 50 per cent of the specified amount bears to that price, and (c) in the case of a vehicle in category F or G, be nil.

Cars: provisions as to hire-purchase, etc.

380N.— (1) In the case of a vehicle to which this Part applies, subsections (2) to (4) shall apply.

Cars: provisions where hirer becomes owner.

380O.— Where, having hired (otherwise than by means of hire-purchase) a vehicle to which this Part applies, a person subsequently becomes the owner of the vehicle, then, for the purposes of the Tax Acts (and in particular sections 380L and 380M)— (a) so much of the aggregate of the payments for the hire of the vehicle and of any payment for the acquisition of the vehicle as does not exceed the retail price of the vehicle at the time it was made shall be treated as capital expenditure incurred on the provision of the vehicle, and as having been incurred when the hiring began, and (b) the payments to be treated as expenditure on the hiring of the vehicle shall be rateably reduced so as to amount in the aggregate to the balance.

Provisions supplementary to sections 380L to 380O.

380P.— (1) Sections 380L and 380M, subsections (2) and (3) of section 380N and section 380O shall not apply where a vehicle is provided or hired, wholly or mainly, for the purpose of hire to or the carriage of members of the public in the ordinary course of trade.

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

32.— (1) Section 481 of the Principal Act is amended— (a) in subsection (1) by substituting “31 December 2012” for “31 December 2008” in the definition of “qualifying period”, (b) in subsection (2)(c) by substituting “€50,000,000” for “€35,000,000”, (c) in subsection (8) by substituting “the year of assessment 2012” for “the year of assessment 2008”, and (d) in subsection (9) by substituting “the year of assessment 2012” for “the year of assessment 2008”.

Amendment of section 668 (compulsory disposals of livestock) of Principal Act.

33.— Section 668 of the Principal Act is amended in subsection (1) by deleting “relating to the eradication or control of brucellosis in livestock” in paragraph (a) of the definition of “stock to which this section applies”.

Amendment of Schedule 26A (donations to approved bodies, etc.) to Principal Act.

34.— (1) Schedule 26A to the Principal Act is amended in Part 1 by deleting paragraph 20.

Amendment of section 531 (payments to subcontractors in certain industries) of Principal Act.

35.— (1) Section 531 of the Principal Act is amended— (a) by inserting the following after subsection (2): “(2A) (a) Subject to paragraph (b), a person shall be deemed not to be a principal of a kind specified in subsection (1)(c) where the following conditions are met— (i) in the performance of a relevant contract, the person makes a payment to a subcontractor solely in connection with construction operations carried out in or on buildings or land to be used or occupied by such person or the employees of such person, and (ii) the person does not carry on a business of the type mentioned in subsection (1)(b)(i). (b) Where a person is a principal of a kind specified in subsection (1)(c) by reason of the fact that such person is connected with a company carrying on a business of the type mentioned in subsection (1)(b)(i), paragraph (a) shall apply only where in addition to the conditions specified in that paragraph such person is a company.”, and (b) in subsection (6)(b)(i) by inserting “(other than where one of such persons comes within a class or classes of persons as may be specified in the regulations)” after “by the persons who intend to enter into such a contract”.

Amendment of section 110 (securitisation) of Principal Act.

36.— (1) Section 110 of the Principal Act is amended in subsection (1)— (a) in the definition of “ qualifying asset ” by inserting “(including a partnership interest)” after “interest”, (b) in the definition of “ financial asset ”— (i) in paragraph (g) by deleting “and” where it last occurs and in paragraph (h) by substituting “instruments,” for “instruments;” and (ii) by inserting the following after paragraph (h): “(i) greenhouse gas emissions allowance, and (j) contracts for insurance and contracts for reinsurance;”, and (c) by inserting the following after the definition of “ financial asset ”: “ ‘ greenhouse gas emissions allowance ’ means an allowance, permit, licence or right to emit during a specified period, a specified amount of carbon dioxide or any other greenhouse gas as defined in Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/EC of 24 September 1996, where such allowance, permit, licence or right is issued by a State or by an inter-governmental or supra-national institution pursuant to a scheme which— (a) imposes limitations on the emission of such greenhouse gases, and (b) allows the transfer for value of such allowances, permits, licences or rights;”.

Equalisation reserves for credit insurance and reinsurance business of companies.

37.— (1) The Principal Act is amended in Chapter 6 of Part 4 by inserting the following section after section 81A: “81B.— (1) In this section— ‘ Reinsurance Regulations ’ means the European Communities (Reinsurance) Regulations 2006 ( S.I. No. 380 of 2006 ); ‘ relevant rules ’ means the rules as set out in point D, as inserted by Council Directive 87/343/EEC of 22 June 1987, to the Annex to the First Council Directive 73/239/EEC of 24 July 1973.

Amendment of section 730D (gain arising on a chargeable event) of Principal Act.

38.— (1) Section 730D of the Principal Act is amended in subsection (2A)(b)— (a) by substituting the following for subparagraph (i): “(i) (I) (A) the assurance company which commenced the life policy has established a branch in an offshore state, and (B) the commitment represented by that life policy is covered by that branch, or (II) (A) the assurance company which commenced the life policy underwrites the business from the State on a freedom of services basis under Regulation 50 of the European Communities (Life Assurance) Framework Regulations 1994 ( S.I. No. 360 of 1994 ) or other equivalent arrangement in an EEA state, and (B) the policyholder resides in an offshore state, and”, and (b) by deleting subparagraph (ii).

Amendment of Chapter 1A (investment undertakings) of Part 27 of Principal Act.

39.— (1) Chapter 1A of Part 27 of the Principal Act is amended— (a) in section 739B(1) in paragraph (ccc) of the definition of “ chargeable event ” by inserting “where such ending is not otherwise a chargeable event within the meaning of this section,” after “of a relevant period,”, (b) in section 739D— (i) in subsection (2)— (I) in paragraph (dd) by inserting “except as a consequence of a gain arising on a chargeable event within the meaning of paragraph (ccc) in section 739B(1),” after “entitlement to a unit,”, and (II) by substituting the following for paragraph (ddd): “(ddd) where the chargeable event is the ending of a relevant period in relation to a unit of a unit holder— (i) the excess (if any) of the value of the unit, without having regard to any amount of appropriate tax (within the meaning of section 739E) thereby arising, held by the unit holder on the day of that ending over the total amount invested in the investment undertaking by the unit holder for the acquisition of the unit, and where the unit was otherwise acquired by the unit holder, the amount so invested to acquire that unit shall be the value of the unit at the time of its acquisition by the unit holder, or (ii) in a case where the investment undertaking has made an election under subsection (5B), the amount determined under that subsection, and”, (ii) in subsection (2A) by substituting the following for paragraph (a): “(a) a chargeable event occurs in relation to an investment undertaking in respect of a unit holder, and”, (iii) in subsection (3), in the construction of C, by substituting “before the chargeable event, reduced by any amount of first tax (within the meaning of section 739E (1A)(a)),” for “before the chargeable event”, (iv) in subsection (4), in the construction of C, by substituting “before the chargeable event, reduced by any amount of first tax (within the meaning of section 739E (1A)(a)),” for “before the chargeable event”, and (v) by inserting the following after subsection (5A): “(5B) (a) The election referred to in paragraph (ddd) of subsection (2) is an irrevocable election made by an investment undertaking in respect of all its unit holders at the time of the election or at any other time and the amount is as determined by the formula— A1 — A2 where— A1 is the value of the unit at the later of 30 June or 31 December prior to the date of the chargeable event, and A2 is— (i) the total amount invested in the investment undertaking by the unit holder for the acquisition of the unit, and where the unit was otherwise acquired by the unit holder, the amount so invested to acquire that unit shall be the value of the unit at the time of its acquisition by the unit holder, or

(ii) if a chargeable event to which paragraph (ccc) of section 739B(1) refers has previously occurred, the value of the unit at the later of 30 June or 31 December prior to the date of the latest of such chargeable events. (b) On the first occasion that the investment undertaking is required to compute a gain on the happening of a chargeable event within the meaning of paragraph (ccc) in section 739B(1) in respect of a unit holder, and— (i) the gain is computed in accordance with paragraph (a), the investment undertaking will be deemed to have made the election specified in that paragraph, or (ii) the gain is not computed in accordance with paragraph (a), an election under paragraph (a) shall not be made.”, (c) in section 739E— (i) in subsection (1A)— (I) in paragraph (a)— (A) by substituting the following for the definition of “ first tax ”: “ ‘ first tax ’, in relation to a unit of a unit holder, means the appropriate tax that was accounted for and paid in accordance with section 739F in respect of a chargeable event within the meaning of paragraph (ccc) of the definition of ‘chargeable event’ in section 739B(1) in relation to an investment undertaking in respect of the unit and which has not been repaid;”, (B) by substituting the following for the definition of “ new gain ”: “ ‘ new gain ’, in relation to a unit of the unit holder, means a gain referred to in section 739D(2A) in respect of that unit;”, (II) in paragraph (b)— (A) by substituting the following for subparagraph (ii): “(ii) Where such relevant proportion exceeds such second tax, an amount equal to the amount of the excess shall— (I) (A) be paid by the investment under-taking to the unit holder in respect of the unit, (B) be included in a return under section 739F(2), and (C) be treated as an amount which may be set off against appropriate tax payable by the investment under-taking in respect of any chargeable event in the period for which such a return is made, or any subsequent period, or (II) if the investment undertaking so elects, in writing to the Revenue Commissioners, be paid by the Revenue Commissioners to the unit holder in respect of the unit on receipt of a claim by the unit holder but only if immediately before the chargeable event the value of the number of units of the investment undertaking in respect of which, if a gain had arisen, would be treated as arising to the investment undertaking on the happening of a chargeable event does not exceed 15 per cent of the value of the total number of units of the investment undertaking at that time,

and where the investment undertaking has advised the unit holder, in writing, that clause (II) applies and has supplied the unit holder with the necessary information to enable the claim to be made to the Revenue Commissioners, then the investment undertaking shall be deemed to have made the election specified in that clause; otherwise the election under that clause shall not be made.”, and (B) by deleting subparagraph (iii), (ii) in subsection (2) by substituting “Subject to subsection (2A), an investment undertaking” for “An investment undertaking”, (iii) by inserting the following after subsection (2): “(2A) (a) Subsection (2) shall not apply in relation to a chargeable event to which paragraph (ccc) in section 739B(1) refers where— (i) immediately before the chargeable event the value of the number of units in the investment undertaking, or if an umbrella scheme exists in the sub-fund concerned, in respect of which any gains arising would be treated as arising to the investment undertaking, or the sub-fund as the case may be, on the happening of a chargeable event is less than 10 per cent of the value of the total number of units in the investment undertaking, or the sub-fund as the case may be, at that time, and (ii) the investment undertaking has made an election, in writing, to the Revenue Commissioners that it will make in respect of each year of assessment a statement (including where it is the case, a statement with a nil amount) to the Revenue Commissioners in electronic format approved by them, on or before 31 March in the year following the year of assessment, which specifies in respect of each person who is a unit holder— (I) the name and address of the person, (II) the value at the end of the year of assessment of the units to which the person is entitled at that time, and (III) such other information as the Revenue Commissioners may require. (b) Where paragraph (a) applies— (i) the investment undertaking shall advise the unit holder concerned, in writing, that paragraph (a) applies, (ii) the statement specified in paragraph (a)(ii) shall be made by the investment undertaking in accordance with that paragraph, and (iii) the unit holder shall be deemed for that chargeable period to be a chargeable person for the purposes of sections 951 and 1084, and the return of income to be delivered by the person for that chargeable period shall include the following particulars: (I) the name and address of the investment undertaking, and (II) the gains arising on the chargeable event.”,

(d) in section 739G by inserting the following after subsection (2): “(2A) Where a gain arises on a chargeable event to which paragraph (ccc) in section 739B(1) refers, and section 739E(2) does not apply to that chargeable event by virtue of subsection (2A) of that section, then such gain— (a) shall be treated for the purposes of the Tax Acts as arising to the unit holder, constituting profits or gains chargeable to tax under Case IV of Schedule D at the rate specified in section 739E(1)(b), and (b) shall not be reckoned in computing total income for the purposes of the Tax Acts, and section 188, and the reductions specified in Part 2 of the Table to section 458, shall not apply as regards the tax so charged.”, and (e) in section 739H— (i) by inserting the following after subsection (1): “(1A) For the purposes of subsection (1) a reference in the definition of ‘exchange’ to an investment undertaking includes a reference to a sub-fund of an umbrella scheme where the exchange concerned is between 2 or more sub-funds of different umbrella schemes. (1B) Subsection (1A) shall not apply unless the exchange concerned is effected for bona fide commercial reasons and not primarily for the purpose of avoiding liability to taxation.”, and (ii) by substituting the following for subsection (2): “(2) The cancellation of old units arising from an exchange in relation to a scheme of reconstruction or amalgamation shall not be a chargeable event and the amount invested by a unit holder for, and the date of, the acquisition of the new units shall for the purposes of this Chapter be the amount invested by the unit holder for, and the date of, the acquisition of the old units.”.

Amendment of section 768 (allowance for know-how) of Principal Act.

40.— (1) Section 768 of the Principal Act is amended— (a) by substituting the following for subsection (3): “(3) Where— (a) a person acquires a trade or part of a trade and, together with the trade or the part of the trade, know-how used in the trade or part of the trade, or (b) (i) a person acquires a trade or part of a trade, and (ii) a person connected (within the meaning of section 10) with the person acquires know-how used in the trade or the part of the trade, then no amount shall be allowed to be deducted under this section in respect of expenditure incurred on the acquisition of the know-how. (3A) The amount which shall be allowed to be deducted under this section in respect of expenditure incurred by a person on know-how shall be limited to the amount which has been incurred wholly and exclusively on the acquisition of know-how for bona fide commercial reasons and was not incurred as part of a scheme or arrangement the main purpose or one of the main purposes of which is the avoidance of tax.”, and (b) by inserting the following after subsection (4): “(5) (a) The Revenue Commissioners may, in relation to a claim by a person that expenditure is allowed to be deducted in accordance with subsection (2)— (i) consult with any person (in this subsection referred to as an ‘expert’) who in their opinion may be of assistance in ascertaining the extent to which such expenditure is incurred on know-how, and (ii) notwithstanding any obligation as to secrecy or other restriction on the disclosure of information imposed by, or under, the Tax Acts or any other statute or otherwise, but subject to paragraph (b), disclose any detail in the person’s claim under this section which they consider necessary for such consultation. (b) (i) Before disclosing information to any expert under paragraph (a), the Revenue Commissioners shall make known to the person— (I) the identity of the expert who they intend to consult, and (II) the information they intend to disclose to the expert. (ii) Where the person shows to the satisfaction of the Revenue Commissioners (or on appeal to the Appeal Commissioners) that disclosure of such information to that expert could prejudice the person’s trade, then the Revenue Commissioners shall not make such disclosure.”.

Expenditure involving crime.

41.— (1) The Principal Act is amended by inserting the following section after section 83: “83A.— (1) In computing any income chargeable to tax under Schedule D, no deduction shall be made for any expenditure incurred— (a) in making a payment the making of which constitutes the commission of a criminal offence, or (b) in making a payment outside of the State where the making of a corresponding payment in the State would constitute a criminal offence.

Certain transfers of assets between companies.

42.— (1) The Principal Act is amended— (a) in section 615(2)(a)— (i) in subparagraph (ii) by substituting “before that time,” for “before that time, and”, and in subparagraph (iii) by substituting “of the business), and” for “of the business)”, and (ii) by inserting the following after subparagraph (iii): “(iv) the company acquiring the assets is not an authorised investment company (within the meaning of Part XIII of the Companies Act 1990 ) that is an investment undertaking (within the meaning of section 739B),”, and (b) in section 617(1) by substituting the following for paragraph (c): “(c) the other company— (i) is resident in the State at the time of the disposal or the asset is a chargeable asset in relation to that company immediately after that time, and (ii) is not an authorised investment company (within the meaning of Part XIII of the Companies Act 1990 ) that is an investment undertaking (within the meaning of section 739B),”.

Chapter 4

Corporation Tax Tax treatment of certain dividends, etc.

43.— (1) The Principal Act is amended— (a) in section 21A(3) by substituting “but subject to subsection (4) and section 21B” for “but subject to subsection (4)”, and (b) by inserting the following section after section 21A: “Tax treatment of certain dividends.

21B.— (1) (a) In this section—