← Ireland

Finance Act, 1996

In short

This law, the Finance Act, 1996, primarily deals with various aspects of taxation, including income tax, corporation tax, capital gains tax, customs and excise duties, and value-added tax. It introduces amendments to existing tax provisions and establishes new reliefs and regulations across these areas.

What it regulates

Who it concerns

Key points

Legal text

Finance Act, 1996 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.

  1. 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.
  2. ie)Aistriúcháin (Tithe an Oireachtais) Foilseacháin Rialtais ar Díol Dlí AE (EUR-Lex) CCanna (Ceisteanna Coitianta) Séanadh Aiseolas Deasc chabhrach Cuardach TitleTeideal Year(
  3. s)or rangeBliain nó blianta nó raon TypeCineál All Legislation Acts Statutory Instruments Advanced SearchCuardach Casta HomeBaile ActsAchtanna 1996 Finance Act, 1996 Finance Act, 1996 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 9 of 1996 FINANCE ACT, 1996 ARRANGEMENT OF SECTIONS PART I Income Tax, Corporation Tax and Capital Gains Tax CHAPTER I Income Tax Section 1. Amendment of provisions relating to exemption from income tax. 2. Alteration of rates of income tax. 3. Personal reliefs. 4. Taxation treatment of unemployment benefit in certain cases. 5. Relief for payments made by certain persons in respect of alarm systems. 6. Amendment of section 4 (benefit of use of a car) of Finance Act, 1982. 7. Amendment of section 145 (insurance against expenses of illness) of Income Tax Act, 1967. 8. Amendment of Second Schedule to Finance Act, 1992. 9. Taxation treatment of Hepatitis C compensation payments. 10. Amendment of section 10 (exemption of certain income from leasing of farm land) of Finance Act, 1985. 11. Amendment of section 62 (trading stock of discontinued trade) of Income Tax Act, 1967. 12. Amendment of section 12 (relief for new shares purchased on issue by employees) of Finance Act, 1986. 13. Retirement annuities. 14. Amendment of section 2 (exemption of certain earnings of writers, composers and artists) of Finance Act, 1969. 15. Relief for fees paid for part-time third level education. CHAPTER II Income Tax: Relief for Investment in Corporate Trades 16. Amendment of section 11 (Interpretation (Chapter III)) of Finance Act, 1984. 17. Amendment of section 12 (the relief) of Finance Act, 1984. 18. Amendment of section 13 (limits on relief) of Finance Act, 1984. 19. Amendment of section 13A (restriction of relief where amounts raised exceed permitted maximum) of Finance Act, 1984. 20. Certification in respect of shares exceeding £250,000. 21. Transitional arrangements in relation to section 20. 22. Amendment of section 15 (qualifying companies) of Finance Act, 1984. 23. Amendment of section 16 (qualifying trades) of Finance Act, 1984. 24. Amendment of section 16A (relevant trading operations) of Finance Act, 1984. CHAPTER III Income Tax, Corporation Tax and Capital Gains Tax 25. Stud greyhound service fees. 26. Amendment of section 41B (capital allowances in relation to construction or refurbishment of certain multistorey car-parks) of Finance Act, 1994. 27. Amendment of section 22 (continuation of certain allowances, etc.) of Finance Act, 1991. 28. Continuation of certain industrial buildings annual allowances. 29. Amendment of section 255 (meaning of “industrial building or structure”) of Income Tax Act, 1967. 30. Amendment of Chapter III (Income Tax and Corporation Tax: Reliefs for Renewal and Improvement of Certain Resort Areas) of Part I of Finance Act, 1995. 31. Relief for investment in films. 32. Treatment of patent royalties and related distributions. 33. Amendment of section 31 (interest payments by companies and to non-residents) of Finance Act, 1974. 34. Allowance for mine rehabilitation expenditure. 35. Amendment of section 18 (taxation of collective investment undertakings) of Finance Act, 1989. 36. Amendment of section 13 (special investment schemes) of Finance Act, 1993. 37. Amendment of section 14 (special portfolio investment accounts) of Finance Act, 1993. 38. Amendment of section 17 (undertakings for collective investment) of Finance Act, 1993. 39. Exemption of bodies designated under section 4 of Securitisation (Proceeds of Certain Mortgages) Act, 1995, from certain tax provisions. 40. Treatment under Tax Acts of certain employment grants and recruitment subsidies. 41. Amendment of section 17 (tax deduction from payments to sub-contractors) of Finance Act, 1970. 42. Provisions supplemental to section 33 of Finance Act, 1986, relating to interest payments by certain deposit takers. 43. Amendment of section 51 (application of certain allowances in relation to certain areas and certain expenditure) of Finance Act, 1988. CHAPTER IV Corporation Tax 44. Reduced rate of corporation tax for certain income. 45. Amendment of section 12A (foreign currency: computation of income and chargeable gains) of Corporation Tax Act, 1976. 46. Amendment of section 33 A (acquisition expenses) of Corporation Tax Act, 1976. 47. Amendment of section 35A (chargeable gains of life business) of Corporation Tax Act, 1976. 48. Amendment of section 36 (investment income reserved for policy holders) of Corporation Tax Act, 1976. 49. Amendment of section 36A (special investment policies) of Corporation Tax Act, 1976. 50. Amendment of section 46B (gains or losses arising by virtue of section 46A) of Corporation Tax Act, 1976. 51. Amendment of section 135 (company ceasing to be a member of a group) of Corporation Tax Act, 1976. 52. Amendment of section 162 (surcharge on undistributed income of service companies) of Corporation Tax Act, 1976. 53. Amendment of section 39A (relief in relation to income from certain trading operations carried on in Shannon Airport) of Finance Act, 1980. 54. Amendment of section 28 (relief in relation to income from qualifying shipping trade) of Finance Act, 1987. 55. Amendment of section 31 (securitisation of assets) of Finance Act, 1991. 56. Amendment of section 56 (relief for gifts to The Enterprise Trust Ltd.) of Finance Act, 1992. 57. Amendment of section 59 (deduction for certain expenditure on research and development) of Finance Act, 1995. 58. Amendment of Chapter VII (advance corporation tax) of Part I of the Finance Act, 1983. CHAPTER V Capital Gains Tax 59. Amendment of paragraph 11 (disposal of certain assets) of Schedule 4 to Capital Gains Tax Act, 1975. 60. Amendment of section 26 (disposal of business or farm on retirement) of Capital Gains Tax Act, 1975. 61. Amendment of section 46 (debts) of Capital Gains Tax Act, 1975. 62. Amendment of section 27 (relief for individuals on certain reinvestment) of Finance Act, 1993. 63. Amendment of section 66 (reduced rate of capital gains tax on certain disposals of shares by individuals) of Finance Act, 1994. 64. Exemption of certain milk boards and associated companies from capital gains tax. CHAPTER VI Income Tax and Corporation Tax: Reliefs for Renewal and Improvement of Residential Accommodation on Certain Islands 65. Interpretation (Chapter VI). 66. Deduction for certain expenditure on construction of rented residential accommodation. 67. Rented residential accommodation: deduction for expenditure on conversion. 68. Rented residential accommodation: deduction for expenditure on refurbishment. 69. Residential accommodation: allowance to owner-occupiers in respect of expenditure on construction or refurbishment. 70. Provisions supplementary to sections 66 to 69. PART II Customs & Excise CHAPTER I Vehicle Registration Tax 71. Interpretation (Chapter I). 72. Amendment of section 130 (interpretation) of Act of 1992. 73. Amendment of section 135B (repayment of amounts in respect of vehicle registration tax in certain cases) of Act of 1992. 74. Amendment of section 141 (regulations) of Act of 1992. CHAPTER II Miscellaneous 75. Exemption from duty on certain bets. 76. Reductions of duty on certain gaming machine licences. 77. Amendment of section 155 (spirits retailers' on-licences) of Finance Act, 1992. 78. Amendment of section 92 (tax concessions for disabled drivers, etc) of Finance Act, 1989. 79. Hydrocarbons and substitute motor fuel. 80. Amendment of section 56 (hydrocarbons) of Finance Act, 1988. 81. Amendment of section 74 (deferment of duty on beer) of Finance Act, 1993. 82. Spirits. 83. Tobacco products. 84. Amendment of section 7 (ascertainment of retail prices of tobacco products) of Finance (Excise Duty on Tobacco Products) Act, 1977. 85. Amendment of section 10A (offences in relation to tax stamps) of Finance (Excise Duty on Tobacco Products) Act, 1977. 86. Amendment of Finance (Excise Duties) (Vehicles) Act, 1952. PART III Value-Added Tax 87. Interpretation (Part III). 88. Amendment of section 1 (interpretation) of Principal Act. 89. Amendment of section 3 (supply of goods) of Principal Act. 90. Amendment of section 5 (supply of services) of Principal Act. 91. Amendment of section 10B (special scheme for auctioneers) of Principal Act. 92. Amendment of section 11 (rates of tax) of Principal Act. 93. Amendment of section 12 (deductions for tax borne or paid) of Principal Act. 94. Amendment of section 12A (special provisions for tax invoiced by flat-rate farmers) of Principal Act. 95. Amendment of section 13A (supplies to, and intra-Community acquisitions and imports by, certain taxable persons) of Principal Act. 96. Amendment of section 15 (charge of tax on imported goods) of Principal Act. 97. Amendment of section 17 (invoices) of Principal Act. 98. Amendment of Second Schedule to Principal Act. 99. Amendment of Sixth Schedule to Principal Act. 100. Revocation (Part III). PART IV Stamp Duties CHAPTER I Special provisions relating to uncertiflcated securities 101. Interpretation (Chapter I). 102. Operator-instruction deemed to be an instrument of conveyance or transfer. 103. Rate of duty. 104. Application and adaptation of Stamp Acts. 105. Collection and payment of duty. 106. Exemptions. 107. Relief for member firms. 108. Obligations of system-members. 109. Overpayment of duty. 110. Regulations. 111. Amendment of section 150 (stock borrowing) of Finance Act, 1995. CHAPTER II Miscellaneous 112. Removal of stamp duty on memorandum and articles of association of company. 113. Amendment of section 49 (exemption of certain instruments from stamp duty) of Finance Act, 1969. 114. Amendment of section 203 (stamp duty in respect of cash cards) of Finance Act, 1992. 115. Amendment of section 207 (exemption from stamp duty of certain financial services instruments) of Finance Act, 1992. 116. Amendment of section 144 (relief from stamp duty in the case of reconstructions or amalgamations of companies) of Finance Act, 1995. 117. Exemption from stamp duty of designated body. 118. Exemption from stamp duty of Community trade marks and international trade marks. 119. Repeals (Part IV). PART V CAPITAL ACQUISITIONS TAX 120. Interpretation (Part V). 121. Amendment of section 16 (market value of certain shares in private trading companies) of Principal Act. 122. Amendment of section 19 (value of agricultural property) of Principal Act. 123. Exemption relating to qualifying expenses of incapacitated persons. 124. Amendment of section 118 (application of section 60 (relief in respect of certain policies of insurance) of Finance Act, 1985) of Finance Act, 1991. 125. Amendment of section 126 (business relief) of Finance Act, 1994. 126. Amendment of section 127 (relevant business property) of Finance Act, 1994. 127. Amendment of section 135 (withdrawal of relief) of Finance Act, 1994. 128. Amendment of section 146 (certificate relating to registration of title based on possession) of Finance Act, 1994. 129. Amendment of section 164 (payment of tax on certainassets by instalments) of Finance Act, 1995. PART VI Miscellaneous Pre-Consolidation Provisions CHAPTER I Income Tax, Corporation Tax and Capital Gains Tax 130. Information. 131. Connected persons. 132. Pre-consolidation amendments and repeals. CHAPTER II Income Tax and Corporation Tax. 133. Interpretation. 134. Deduction for increase in stock values. 135. Special provision for qualifying farmers. 136. Compulsory disposals of livestock. 137. Supplementary provisions. PART VII Miscellaneous 138. Capital Services Redemption Account. 139. Amendment of section 176 (relief for donations of heritage items) of Finance Act, 1995. 140. Payment of certain expenses of licensing authorities in respect of collection of certain excise duties. 141. Amendment of section 4 (casual trading licences) of Casual Trading Act, 1995. 142. Care and management of taxes and duties. 143. Short title, construction and commencement. FIRST SCHEDULE Amendments Consequential on changes in Personal Reliefs SECOND SCHEDULE Rates of Excise Duty on Spirits THIRD SCHEDULE Rates of Excise Duty on Tobacco Products FOURTH SCHEDULE Stamp Duty Enactments Repealed FIFTH SCHEDULE PART I Pre-Consolidation Amendments PART II Pre-Consolidation Repeals Number 9 of 1996 FINANCE ACT, 1996 AN ACT TO CHARGE AND IMPOSE CERTAIN DUTIES OF CUSTOMS AND INLAND REVENUE (INCLUDING EXCISE), TO AMEND THE LAW RELATING TO CUSTOMS AND INLAND REVENUE (INCLUDING EXCISE) AND TO MAKE FURTHER PROVISIONS IN CONNECTION WITH FINANCE. [15th May, 1996] BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS: PART I Income Tax, Corporation Tax and Capital Gains Tax Chapter I Income Tax Amendment of provisions relating to exemption from income tax. 1.—As respects the year of assessment 1996-97 and subsequent years of assessment, the Finance Act, 1980 , is hereby amended— (
  4. a)in section 1, by the substitution, in subsection

(2)(inserted by the Finance Act, 1989 ), of “£7,800” and “£3,900”, respectively, for “£7,400” and “£3,700” (inserted by the Finance Act, 1995 ), and (b) in section 2, by the substitution, in subsection
(6)(inserted by the Finance Act, 1989 )— (
  1. i)of “£9,000” and “£10,200”, respectively, for “£8,600” and “£9,800” (inserted by the Finance Act, 1995 ), in paragraph (a), and (
  2. ii)of “£4,500” and “£5,100”, respectively, for “£4,300” and “£4,900” (inserted by the Finance Act, 1995 ), in paragraph (b), and the said subsection
(2)of the said section 1 and the said subsection
(6)of the said section 2, as so amended, are set out in the Table to this section. TABLE
(2)In this section “the specified amount” means, subject to subsection
(3)— (
  1. a)in a case where the individual would, apart from this section, be entitled to a deduction specified in section 138 (
  2. a)of the Income Tax Act, 1967 , £7,800, and (
  3. b)in any other case, £3,900.
(6)In this section “the specified amount” means, subject to subsection
(3)of section 1— (
  1. a)in a case where the individual would, apart from this section, be entitled to a deduction specified in section 138 (
  2. a)of the Income Tax Act, 1967 , £9,000: Provided that, if at any time during the year of assessment either the individual or his spouse was of the age of seventy-five years or upwards, “the specified amount” means £10,200, and (
  3. b)in any other case, £4,500: Provided that, if at any time during the year of assessment the individual was of the age of seventy-five years or upwards, “the specified amount” means £5,100. Alteration of rates of income tax. 2.— Section 2 of the Finance Act, 1991 , is hereby amended, as respects the year of assessment 1996-97 and subsequent years of assessment, by the substitution of the following Table for the Table to that section: “TABLE PART I Part of taxable income Rate of tax Description of rate
(1)
(2)
(3)The first £9,400 27 per cent. the standard rate The remainder 48 per cent. the higher rate PART II Part of taxable income Rate of tax Description of rate
(1)
(2)
(3)The first £18,800 27 per cent. the standard rate The remainder 48 per cent. the higher rate ”. Personal reliefs. 3.—
(1)Where a deduction falls to be made from the total income of an individual for the year of assessment 1996-97 or any subsequent year of assessment in respect of relief to which the individual is entitled under a provision mentioned in column
(1)of the Table to this subsection and the amount of the deduction would, but for this section, be an amount specified in column
(2)of the said Table, the amount of the deduction shall, in lieu of being the amount specified in the said column
(2), be the amount specified in column
(3)of the said Table opposite the mention of the amount in the said column
(2). TABLE Statutory provision Amount to be deducted from total income for the year 1995-96 Amount to be deducted from total income for the year 1996-97 and subsequent years
(1)
(2)
(3)£ £ Income Tax Act, 1967 : section 138 (married person) 5,000 5,300 (widowed person bereaved in the year of assessment) 5,000 5,300 (widowed person) 3,000 3,150 (single person) 2,500 2,650 section 138A (additional allowance for widowed persons and others in respect of children) (widowed person) 2,000 2,150 (other person) 2,500 2,650 section 141 (incapacitated child) 600 700 Finance Act, 1969 : section 3 (housekeeper taking care of incapacitated person) 5,000 7,500 Finance Act, 1971 : section 11 (blind person) 600 700 (both spouses blind) 1,400 1,600
(2)Section 3 of the Finance Act, 1985 , section 4 of the Finance Act, 1986 , section 4 of the Finance Act, 1990 , and section 3 of the Finance Act, 1995 , shall have effect subject to the provisions of this section.
(3)The First Schedule shall have effect for the purpose of supplementing subsection
(1). Taxation treatment of unemployment benefit in certain cases. 4.—
(1)In this section “short-time employment” has the same meaning as it has for the purposes of the Social Welfare Acts but also includes such an employment as is referred to in section 79
(2)(b) of the Social Welfare (Consolidation) Act, 1993 .
(2)Notwithstanding the provisions of section 15 (as amended by the Finance Act, 1995 ) of the Finance Act, 1992 , and the Finance Act, 1992 (Commencement of Section 15) (Unemployment Benefit and Pay-Related Benefit) Order, 1994 ( S.I. No. 19 of 1994 ), the said section 15 shall not apply, as respects the year of assessment 1996-97, in relation to unemployment benefit paid or payable to a person employed in short-time employment. Relief for payments made by certain persons in respect of alarm systems. 5.—
(1)In this section— “appropriate percentage”, in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year; “installation” means the placing in position, including any necessary wiring, drilling, plastering or similar, of a relevant alarm system; “qualifying expenditure”, in relation to a qualifying individual, means expenditure incurred in the qualifying period in connection with either or both the provision and installation of a relevant alarm system in a premises which is that qualifying individual's sole or main residence, but it does not include any expenditure in so far as it is in respect of the repair, maintenance or monitoring of such an alarm system; “qualifying individual”, in relation to qualifying expenditure, means an individual who, at the time the expenditure is incurred, has attained the age of 65 years and who, for the greater part of the year of assessment in which the expenditure is incurred, lives alone; “qualifying period” means the period beginning on 23rd day of January, 1996, and ending on the 5th day of April, 1998; “relative”, in relation to a qualifying individual, includes a relation by marriage and a person in respect of whom the individual is or was the legal guardian; “relevant alarm system” means an electrical apparatus which, when activated, is designed to give notice to the effect that there is an intruder present or attempting to enter the premises in which it is installed.
(2)Where a claimant, being a qualifying individual or a relative of that individual, having made a claim in that behalf, proves that he or she has incurred qualifying expenditure in relation to the qualifying individual, the income tax to be charged on the claimant, other than in accordance with section 5
(3)of the Finance Act, 1974 , for the year of assessment in which the expenditure is incurred shall be reduced by an amount which is the lesser of— (
  1. a)the appropriate percentage of the qualifying expenditure or the appropriate percentage of £800, whichever is the lesser, and (
  2. b)the amount which reduces that income tax to nil.
(3)Any claim for relief under this section shall be in such form as may be prescribed by the Revenue Commissioners for the purpose and shall be accompanied by a receipt or receipts, as may be appropriate, for the amount of qualifying expenditure incurred: Provided that where the qualifying expenditure includes expenditure in respect of installation, the receipt in respect of such expenditure shall contain the installer's name, address and the installer's value-added tax registration number or income tax reference number.
(4)Any deduction made under this section shall be in substitution for, and not in addition to, any deduction to which the individual might be entitled in respect of the same payment under any other provision of the Income Tax Acts. Amendment of section 4 (benefit of use of a car) of Finance Act, 1982. 6.—As respects the year of assessment 1996-97 and subsequent years of assessment, section 4 of the Finance Act, 1982 , is hereby amended— (a) by the insertion of the following subsection after subsection
(4): “(4A) (
  1. a)Where, for a year of assessment— (
  2. i)a person, in the performance of the duties of his employment, spends 70 per cent. or more of his time engaged on such duties away from the place of business of his employer, and (
  3. ii)in relation to that person, the business mileage exceeds 5,000, then, if the person so elects in writing to the inspector, the cash equivalent of the benefit of the car for that year in relation to the person shall, instead of being the amount ascertained under subsection
(3)or
(4), as may otherwise be appropriate, be four-fifths of the amount ascertained under subsection
(3). (
  1. b)When requested in writing by the inspector, a person who makes an election under paragraph (
  2. a)for a year of assessment shall, within 30 days of the date of such request, furnish to the inspector a relevant log book in relation to that year of assessment. (
  3. c)This subsection shall not apply as respects a year of assessment where— (
  4. i)when requested to do so, a person fails to deliver to the inspector, within the time specified in paragraph (b), a relevant log book in relation to that year, or (
  5. ii)the time spent by a person in the performance of the duties of his employment in that year is, on average, less than 20 hours per week. (
  6. d)The provisions of paragraph (
  7. e)of subsection
(6)shall apply for the purposes of this subsection as they apply for the purposes of that subsection. (
  1. e)Where a person makes an election under paragraph (
  2. a)for a year of assessment, he shall retain the relevant log book in relation to that year for a period of 6 years after the end of the year or for such shorter period as the inspector may authorise in writing.”, and (
  3. b)in paragraph (
  4. a)of subsection
(9), by the insertion of the following definition after the definition of “private use”: “‘relevant log book’, in relation to a person and a year of assessment, means a record, maintained on a daily basis, of the person's business use for the year of assessment of a car or cars in respect of which this section has effect in relation to that person for that year of assessment— (
  1. i)which contains relevant details of distances travelled, nature and location of business transacted and amount of time spent away from the employer's place of business, and (
  2. ii)which is certified by the employer as being, to the best of his knowledge and belief, true and accurate.”. Amendment of section 145 (insurance against expenses of illness) of Income Tax Act, 1967. 7.—
(1)Section 145 of the Income Tax Act, 1967 , is hereby amended by the substitution of the following subsection for subsection
(1): “
(1)In this section ‘authorised insurer’ means any undertaking entered in the Register of Health Benefits Undertakings established under section 14 of the Health Insurance Act, 1994 , lawfully carrying on such business of insurance as is referred to in subsection
(2): Provided that, in relation to an individual, it also means any undertaking authorised pursuant to Council Directive No. 73/239/EEC of 24 July 1973
(1), Council Directive No. 88/357/EEC of 22 June 1988
(2), and Council Directive No. 92/49/EEC of 18 June 1992
(3), where such a contract for insurance as is referred to in subsection
(2)was effected with the individual when the individual was not resident in the State but was resident in another Member State of the European Union.”.
(2)This section shall apply and have effect, and shall be deemed always to have applied and had effect, as on and from the 1st day of July, 1994. Amendment of Second Schedule to Finance Act, 1992. 8.—
(1)The Second Schedule to the Finance Act, 1992 , is hereby amended— (
  1. a)by the deletion of paragraphs 35, 36, 46, 54 and 60, and (
  2. b)by the addition of the following paragraphs after paragraph 73: “74. Aer Lingus Group public limited company. 75. An Bord Bia. 76. Area Development Management Limited. 77. The Combat Poverty Agency. 78. The Commissioners of Irish Lights. 79. Dublin Transportation Office. 80. The Heritage Council. 81. The Higher Education Authority. 82. The Independent Radio and Television Commission. 83. The Irish Horseracing Authority. 84. The Labour Relations Commission. 85. The Marine Institute. 86. National Rehabilitation Board. 87. National Safety Council. 88. The Pensions Board.”.
(2)Subsection
(1)shall apply and have effect— (
  1. a)in so far as it relates to the deletion of paragraph 54 of the Second Schedule to the Finance Act, 1992 , as on and from the 26th day of April, 1996, and (
  2. b)in every other case, as on and from the 6th day of June, 1996. Taxation treatment of Hepatitis C compensation payments. 9.—
(1)This section applies to any payment in respect of compensation, whether made before, on or after the passing of this Act— (
  1. a)by the Tribunal, or (
  2. b)following the institution by, or on behalf of, an individual of a civil action for damages in respect of personal injury, to a person in respect of a right of action in relation to which the person may make a claim to the Tribunal under Clause 4 of the Scheme.
(2)For all the purposes of the Income Tax Acts, and notwithstanding any provision of those Acts to the contrary— (
  1. a)income consisting of payments to which this section applies shall be disregarded, and (
  2. b)any payment by the Tribunal to which this section applies shall be treated in all respects as if it were a payment made following the institution, by or on behalf of the person to, or in respect of, whom the payment is made, of a civil action for damages in respect of personal injury.
(3)In this section— “the Scheme” means the Scheme of Compensation for certain persons who have contracted Hepatitis C from the use of Human Immunoglobulin-Anti-D, whole blood or other blood products which was approved by Dáil Éireann on the 13th day of December, 1995; “the Tribunal” means the Tribunal established by the Minister for Health on the 15th day of December, 1995, to administer the Scheme pursuant to Clause 22 thereof. Amendment of section 10 (exemption of certain income from leasing of farm land) of Finance Act, 1985. 10.— Section 10 of the Finance Act, 1985 , is hereby amended, as respects a qualifying lease (within the meaning of that section) or qualifying leases made on or after the 23rd day of January, 1996, by the substitution in paragraph (a) of subsection
(1)of the following definition for the definition of “the specified amount”: “‘the specified amount’, in relation to any surplus or surpluses (within the meaning of section 81
(4)of the Income Tax Act, 1967 ) arising in respect of the rent or the rents from any farm land let under a qualifying lease or qualifying leases, means— (
  1. i)the amount of that surplus or the aggregate amount of those surpluses, or (
  2. ii)£4,000, or (iii) where the rent or rents were not receivable in respect of a full year's letting or lettings, such amount as bears to £4,000 the same proportion as the amount of the rent or the aggregate amount of the rents bears to the amount of the rent or the aggregate amount of the rents which would be receivable for a full year's letting or lettings, whichever is the least: Provided that— (I) where a qualifying lease is for a definite term of seven years or more, the reference in paragraphs (
  3. ii)and (iii) to £4,000 shall have effect as if each were a reference to £6,000; (II) where the income of a qualifying lessor consists of, or includes, rent or rents from a qualifying lease or qualifying leases made before the 23rd day of January, 1996, and from a qualifying lease or qualifying leases made on or after that date, the specified amount shall not exceed £4,000 or, as may be appropriate, £6,000.”. Amendment of section 62 (trading stock of discontinued trade) of Income Tax Act, 1967. 11.—
(1)In this section— “farming” has the same meaning as in Chapter II of Part I of the Finance Act, 1974 ; “specified return date for the chargeable period” has the same meaning as in section 9 of the Finance Act, 1988 .
(2)As respects the year of assessment 1995-96 and subsequent years of assessment, section 62 of the Income Tax Act, 1967 , is hereby amended by the insertion in subsection
(1)of the following proviso after paragraph (b): “Provided that where trading stock of a trade of farming is tranferred by a farmer (in this proviso referred to as ‘the transferor’) to another farmer (in this proviso referred to as ‘the transferee’), the transferor and the transferee may jointly elect— (
  1. i)that the provisions of this paragraph shall not apply or have effect, and (
  2. ii)that, in computing their respective profits or gains from farming, the transferor and the transferee shall include such stock at the value at which the stock is included in the accounts of the transferor at the date of discontinuance, and such election shall be made in writing on or before the specified return date for the chargeable period in which the stock is transferred.”. Amendment of section 12 (relief for new shares purchased on issue by employees) of Finance Act, 1986. 12.—As respects the year of assessment 1996-97 and subsequent years of assessment, section 12 of the Finance Act, 1986 , is hereby amended— (
  3. a)in paragraph (
  4. a)of subsection
(1)— (
  1. i)by the substitution of the following definition for the definition of “eligible employee”: “‘eligible employee’, in relation to a qualifying company, means— (
  2. i)where the company is a trading company, a director or an employee of the company, or (
  3. ii)where the company is a holding company, a director or an employee of the company or of a company which is its 75 per cent. subsidiary;”, and (
  4. ii)by the deletion of the definition of “‘full-time director’ and ‘full-time employee’”, and (
  5. b)by the substitution, in the proviso to subsection
(2), of “£5,000” for “£3,000” (inserted by the Finance Act, 1993 ), and the said proviso, as so amended, is set out in the Table to this section. TABLE Provided that a deduction shall not be given to the extent to which the amount subscribed by an eligible employee for eligible shares issued to him in all years of assessment exceeds £5,000. Retirement annuities. 13.—As respects the year of assessment 1996-97 and subsequent years of assessment, the Income Tax Act, 1967 , is hereby amended— (
  1. a)in section 236, by the substitution of the following subsection for subsection (1A) (inserted by the Finance Act, 1978 ): “(1A) Subject to the provisions of this section, the amount which may be deducted or set off in any year of assessment (whether in respect of one or more qualifying premiums and whether or not including premiums in respect of a contract approved under section 235A) shall not be more than— (
  2. a)in the case of an individual who at any time during the year of assessment was of the age of 55 years or upwards, 20 per cent., and (
  3. b)in any other case, 15 per cent., of the individual's net relevant earnings for that year and the amount to be deducted shall to the greatest extent possible include qualifying premiums in respect of contracts approved under section 235A.”, and (
  4. b)by the deletion of Schedule 5. Amendment of section 2 (exemption of certain earnings of writers, composers and artists) of Finance Act, 1969. 14.—As respects the year of assessment 1996-97 and subsequent years of assessment, section 2 of the Finance Act, 1969 , is hereby amended, in paragraph (
  5. a)of subsection
(2), by the substitution of the following subparagraph for subparagraph (i): “(i) who is— (I) resident in the State and is not resident elsewhere, or (II) ordinarily resident and domiciled in the State and is not resident elsewhere, and”. Relief for fees paid for part-time third level education. 15.—
(1)In this section— “academic year”, in relation to an approved course, means a year of study commencing on a date not earlier than the 1st day of August in a year of assessment; “approved college”, in relation to a year of assessment, means— (
  1. a)an institution which provides courses to which a scheme approved by the Minister under the Local Authorities (Higher Education Grants) Acts, 1968 to 1992, applies, or (
  2. b)a college approved of by the Minister for the purposes of section 6 of the Finance Act, 1995 ; “approved course” means a part-time undergraduate course of study in an approved college which— (
  3. a)is of at least 2 academic years duration, and (
  4. b)in the case of a course provided by a college to which paragraph (
  5. b)of the definition of approved college relates, the Minister, having regard to a code of standards which, from time to time, may, with the consent of the Minister for Finance, be laid down by the Minister in relation to the quality of education to be offered on such approved course, approves of for the purposes of this section; “the Minister” means the Minister for Education; “qualifying fees”, in relation to an approved course and an academic year, means the amount of fees chargeable in respect of tuition to be provided in relation to that course in that year and which, in relation to a course to which paragraph (
  6. b)of the definition of approved course relates, the Minister, with the consent of the Minister for Finance, approves of for the purposes of this section; “qualifying individual” means an individual other than an individual who has been conferred with a certificate, diploma or degree in respect of the completion by him or her of an undergraduate course of study of not less than 2 academic years duration.
(2)(a) Subject to the provisions of this section, where, for a year of assessment (being the year 1996-97 or a subsequent year of assessment), a qualifying individual makes a claim in that behalf, makes a return in the prescribed form of his or her total income and proves that he or she has on his or her own behalf made a payment in respect of qualifying fees in respect of an approved course for the academic year in relation to that course commencing in that year of assessment, the income tax to be charged on the qualifying individual for that year of assessment, other than in accordance with section 5
(3)of the Finance Act, 1974 , shall be reduced by an amount which is the lesser of— (
  1. i)the amount equal to the appropriate percentage of the aggregate of all such payments proved to be so made, and (
  2. ii)the amount which reduces that income tax to nil. (
  3. b)In this subsection “appropriate percentage”, in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year.
(3)For the purposes of this section a payment in respect of qualifying fees shall be regarded as not having been made in so far as any sum, in respect of or by reference to such fees, has been or is to be received either directly or indirectly by the qualifying individual from any source whatsoever by way of grant, scholarship or otherwise.
(4)(
  1. a)Where the Minister is satisfied that a college, within the meaning of paragraph (
  2. b)of the definition of approved college, or an approved course in that college, no longer meets the appropriate code of standards laid down, the Minister may, by notice in writing given to the approved college, withdraw, with effect from the year of assessment immediately following the year of assessment in which the notice is given, the approval of that college or course, as the case may be, for the purposes of this section. (
  3. b)Where the Minister withdraws the approval of any college or course for the purposes of this section, notice of its withdrawal shall be published, as soon as may be, in the Iris Oifigiúil.
(5)On or before the 1st day of July in each year of assessment, the Minister shall furnish the Revenue Commissioners with full details of all— (
  1. a)courses, (
  2. b)colleges, and (
  3. c)the amount of qualifying fees, in respect of courses, referred to in paragraph (a), for the academic year commencing in that year of assessment, which, in accordance with the foregoing provisions of this section, the Minister has approved of for the purposes of this section.
(6)All such provisions of the Income Tax Acts as apply in relation to claims for the deductions specified in sections 138 to 142 of the Income Tax Act, 1967 , shall, with any necessary modifications, apply in relation to a claim for a reduction of income tax under this section.
(7)Section 198 (inserted by the Finance Act, 1980 ) of the Income Tax Act, 1967 , is hereby amended, in subsection
(1)(a), by the insertion of the following subparagraph after subparagraph (xvi) (inserted by the Finance Act, 1994 ): “(xvii) so far as it flows from relief under section 15 of the Finance Act, 1996, in the proportions in which they incurred the expenditure giving rise to the relief,”.
(8)If any question arises as to whether— (
  1. a)a college is an approved college, or (
  2. b)a course of study is an approved course, for the purposes of this section, the Revenue Commissioners may consult with the Minister. Chapter II Income Tax: Relief for Investment in Corporate Trades Amendment of section 11 (Interpretation (Chapter III)) of Finance Act, 1984. 16.— Section 11 of the Finance Act, 1984 , is hereby amended, in subsection
(1), by the substitution of the following definition for the definition of “certifying Minister”: “‘certifying Minister’ means the Minister for Agriculture, Food and Forestry, the Minister for Arts, Culture and the Gaeltacht or the Minister for the Marine (as may be appropriate);”. Amendment of section 12 (the relief) of Finance Act, 1984. 17.— Section 12 of the Finance Act, 1984 , is hereby amended— (a) as respects a subscription for eligible shares issued on or after the 2nd day of June, 1995, by the substitution in paragraph (iii) (inserted by the Finance Act, 1995 ) of the proviso to paragraph (c) of subsection
(1), of “subsection (2C)” for “subsection (3C)”, (
  1. b)by the insertion of the following paragraphs after paragraph (
  2. iv)of the proviso to paragraph (
  3. c)of subsection
(1)— “(
  1. v)for the purposes of qualifying trading operations such as are referred to in subparagraph (iiie) (inserted by the Finance Act, 1996) of paragraph (
  2. a)of subsection
(2)of section 16, the aforementioned evidence shall include the certificate referred to in subsection (2D) (as so inserted) of the said section, and (
  1. vi)for the purposes of qualifying trading operations such as are referred to in subparagraph (iib) (inserted by the Finance Act, 1996) of paragraph (
  2. a)of subsection
(2)of section 16 and in respect of which money is raised or intended to be raised under the provisions of this Chapter by virtue of clause (II) of the aforesaid subparagraph (iib), the aforementioned evidence shall include the certificate referred to in subsection (2E) (as so inserted) of the said section.”, (c) in subsection
(11)(inserted by the Finance Act, 1993 )— (
  1. i)by the substitution of “the 5th day of April, 1999” for “the 5th day of April, 1996”, and (
  2. ii)by the deletion of the proviso thereto. Amendment of section 13 (limits on relief) of Finance Act, 1984. 18.— Section 13 of the Finance Act, 1984 , is hereby amended by the substitution, in subsections (2A) and (2B), of the following proviso for the provisos (inserted by the Finance Act, 1995 ) to those subsections: “Provided that this subsection shall not apply or have effect for any year of assessment subsequent to the year 1998-99.”. Amendment of section 13 A (restriction of relief where amounts raised exceed permitted maximum) of Finance Act, 1984. 19.—
(1)Section 13A (inserted by the Finance Act, 1989 ) of the Finance Act, 1984 , is hereby amended— (a) in subsection
(1)— (
  1. i)as respects eligible shares issued on or after the 23rd day of January, 1996, by the substitution of “the issue of eligible shares on or after the 23rd day of January, 1996 (hereafter in this section referred to as the ‘relevant issue’)” for “the issue of eligible shares (hereafter in this section referred to as the ‘relevant issue’) on any day falling on or after the 6th day of May, 1993,”, and (
  2. ii)as on and from the passing of the Finance Act, 1996, by the addition of the following proviso: “Provided that, in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (iib) (inserted by the Finance Act, 1996) of paragraph (
  3. a)of subsection
(2)of section 16, this section shall apply and have effect, in relation to that company and money raised or intended to be raised by it under the provisions of this Chapter by virtue of clause (II) of the aforesaid subparagraph (iib), as if in the foregoing formula and in the formula in subsection (1A) (as amended by the Finance Act, 1996) ‘£100,000’ were substituted for ‘£1,000,000’ in each place where it occurs.”, and (
  1. b)by the substitution of the following subsections for subsections (1A) and (1B) (inserted by the Finance Act, 1991 ): “(1A) Where a company raises any amount through a relevant issue and that company is associated (within the meaning of this section) with one or more other companies then, as respects that company, relief shall not be given in respect of the amount so raised over the amount determined by the formula— £1,000,000—B where— B is an amount equal to so much, as does not exceed £1,000,000, of the aggregate of all amounts raised through the issue of eligible shares at any time before or on the date of the relevant issue by all of the companies (including that company) which are associated within the meaning of this section. (1B) In this section, a company is associated with another company where it could reasonably be considered that— (
  2. a)(
  3. i)both companies act in pursuit of a common purpose, or (
  4. ii)any person or any group of persons or groups of persons having a reasonable commonality of identity have or had the means or power, either directly or indirectly, to determine the trading operations carried on or to be carried on by both companies, or (
  5. b)both companies are under the control of any person or group of persons or groups of persons having a reasonable commonality of identity: Provided that, for the purposes of this section, a company shall not be considered as associated with another company only by reason of the fact that a subscription for eligible shares in both companies is made by a person or persons having the management of an investment fund designated under section 27 as nominee for any person, group of persons or groups of persons.”.
(2)As respects eligible shares issued on or after the 28th day of March, 1996, section 13A (as amended by subsection
(1)) of the Finance Act, 1984 , is hereby further amended by the substitution of the following subsections for subsection (1B) (inserted by the said subsection
(1)): “(1B) In this section, a company is associated with another company where— (
  1. a)in the case of that company, or a company which is, or was at any time, its qualifying subsidiary, and (
  2. b)that other company, or a company which is, or was at any time, its qualifying subsidiary, it could reasonably be considered that— (
  3. i)both companies act in pursuit of a common purpose, or (
  4. ii)any person or any group of persons or groups of persons having a reasonable commonality of identity have or had the means or power, either directly or indirectly, to determine the trading operations carried on or to be carried on by both companies, or (iii) both companies are under the control of any person or group of persons or groups of persons having a reasonable commonality of identity: Provided that, for the purposes of this section, a company shall not be considered as associated with another company only by reason of the fact that a subscription for eligible shares in both companies is made by a person or persons having the management of an investment fund designated under section 27 as nominee for any person, group of persons or groups of persons. (1C) In this section, ‘qualifying subsidiary’, in relation to a company, has the same meaning as it has for the purpose of section 15.”. Certification in respect of shares exceeding £250,000. 20.—Chapter III of Part I of the Finance Act, 1984 , is hereby amended by the insertion of the following section after section 13A: “13B.—
(1)Subject to the following provisions of this section, where on or after the 23rd day of January, 1996, a company raises any amount through the issue of eligible shares (hereafter in this section referred to as the ‘relevant issue’) for the purpose of qualifying trading operations other than such operations as are referred to in subparagraph (iiib) (inserted by the Finance Act, 1990 ) of paragraph (a) of subsection
(2)of section 16, relief shall not be given in respect of the excess of the amount over the amount determined by the formula set out in the Table to this subsection unless the company produces to the Revenue Commissioners a relevant certificate or a combined certificate within the meaning of this section: Provided that where the said company is associated with one or more other companies within the meaning of section 13 A (as amended by the Finance Act, 1996), then A in the formula set out in the Table to this subsection shall include the aggregate of the amounts raised through the issue of eligible shares at any time before or on the date of the relevant issue by all the companies so associated (including the said company). TABLE £250,000 — A where A is— (a) £250,000, or (b) an amount equal to the aggregate of all amounts raised by the company through the issue of eligible shares before or on the date of the relevant issue, whichever is the lesser amount.
(2)The provisions of subsections
(2)and
(3)of section 13A shall, with any necessary modifications, apply for the purposes of this section as they apply for the purposes of that section.
(3)(
  1. a)In this section ‘relevant certificate’ means a certificate from an authority (within the meaning of this section) given to a company in relation to a relevant issue, certifying, on the basis of a business plan of the company and any other information which the company supplies to the authority or which the authority may reasonably request the company to furnish to it, that, having regard to the amount of money raised or to be raised by the relevant issue, the authority is satisfied that— (
  2. i)the purpose or purposes specified in section 12
(1)(
  1. c)(
  2. i)for which the money raised, or to be raised, is intended to be used has or have the potential to create a reasonable level of additional sustainable employment in the company, or (
  3. ii)the money raised or to be raised is necessary to secure the survival of the company and maintain a reasonable level of sustainable employment. (
  4. b)In considering whether to give a relevant certificate to a company, an authority shall have regard only to such guidelines for that purpose as may, from time to time, be agreed— (
  5. i)with the consent of the Minister for Finance, between the certifying agency and the Minister for Arts, Culture and the Gaeltacht or the Minister for Enterprise and Employment or the Minister for the Marine or the Minister for Tourism and Trade (as may be appropriate in the circumstances), or (
  6. ii)between the certifying Minister and the Minister for Finance, and those guidelines may, without prejudice to the generality of the foregoing, include provision— (I) for the submission to the authority by the company concerned, in relation to its business plan, of an annual progress report, in a form to be specified by the authority, (II) to ensure that money raised through a relevant issue is used by a company or its qualifying subsidiary only for one or more of the purposes specified in section 12
(1)(
  1. c)(
  2. i)and for no other purposes, (III) that the issue of the certificate does not represent any form of approval by the authority of the commercial viability of the qualifying trading operations carried on or to be carried on by the company concerned, and (IV) for the regarding as null and void, from its date of issue, of a relevant certificate where the company concerned fails to comply with its business plan or any modification thereof which may be agreed between it and the authority.
(4)In this section ‘combined certificate’ means a certificate given by an authority to a company which comprises— (
  1. a)(
  2. i)a certificate referred to in paragraph (
  3. ii)(inserted by the Finance Act, 1993 ) of the proviso to paragraph (
  4. c)of subsection
(1)of section 12, or (
  1. ii)(I) a certificate referred to in paragraph (iii) (as amended by the Finance Act, 1996) of the proviso to paragraph (
  2. c)of subsection
(1)of section 12, and (II) an approval of a development and marketing plan as is mentioned in paragraph (
  1. a)of subsection (3B) of section 15, or (iii) a certificate referred to in paragraph (
  2. v)(inserted by the Finance Act, 1996) of the proviso to paragraph (
  3. c)of subsection
(1)of section 12, or (
  1. iv)an approval of a development and marketing plan as is mentioned in paragraph (
  2. a)of subsection (3A) of section 15, and (
  3. b)a relevant certificate.
(5)An authority shall not issue a combined certificate unless and until all necessary conditions for the issue of— (
  1. a)in the first instance, as may be appropriate— (
  2. i)the certificate mentioned in subparagraph (
  3. i)or (iii), as the case may be, of paragraph (
  4. a)of subsection
(4), or (
  1. ii)the certificate and approval mentioned in subparagraph (
  2. ii)of paragraph (
  3. a)of subsection
(4), or (iii) the approval mentioned in subparagraph (iv) of paragraph (a) of subsection
(4), and (b) thereafter, and only thereafter, the relevant certificate, have been satisfied.
(6)In this section, ‘an authority’ means— (
  1. a)in respect of such qualifying trading operations mentioned in subparagraph (
  2. i)(as amended by the Finance Act, 1990 ), (
  3. ii)(inserted by the Finance Act, 1990 ), (iid) (inserted by the Finance Act, 1995 ), or (iiic) (inserted by the Finance Act, 1990 ) of paragraph (
  4. a)(inserted by the Finance Act, 1987 ) of subsection
(2)of section 16, Forbairt, the Industrial Development Agency (Ireland), the Shannon Free Airport Development Company Limited or Údarás na Gaeltachta, as may be appropriate: Provided that for the purposes of such qualifying trading operations as are referred to in the aforesaid subparagraph (i), an authority shall mean Bord Ias-caigh Mhara in the case of those qualifying trading operations in respect of which the said Bord administers a scheme of assistance to grant aid, (b) in respect of such qualifying trading operations mentioned in subparagraph (iie) (inserted by the Finance Act, 1995 ), (iiia) (inserted by the Finance Act, 1988 ), or (iiid) (inserted by the Finance Act, 1994 ) of paragraph (a) (inserted by the Finance Act, 1987 ) of subsection
(2)of section 16, the Minister for Agriculture, Food and Forestry, (
  1. c)in respect of such qualifying trading operations mentioned in subparagraph (iiie) (inserted by the Finance Act, 1996) of paragraph (
  2. a)(inserted by the Finance Act, 1987 ) of subsection
(2)of section 16, the Minister for Arts, Culture and the Gaeltacht, (
  1. d)in respect of such qualifying trading operations mentioned in subparagraph (
  2. iv)of paragraph (
  3. a)(inserted by the Finance Act, 1987 ) of subsection
(2)of section 16, Bord Fáilte Éireann, and (
  1. e)in respect of such qualifying trading operations mentioned in subparagraph (
  2. v)of paragraph (
  3. a)(inserted by the Finance Act, 1987 ) of subsection
(2)of section 16, An Bord Tráchtála.”. Transitional arrangements in relation to section 20 . 21.—
(1)In this section— “auditor” means— (
  1. a)in relation to a company or its qualifying subsidiary, the person or persons appointed as auditor of the company or its qualifying subsidiary, as appropriate, for all the purposes of the Companies Acts, 1963 to 1990, and (
  2. b)in relation to a specified designated fund, the person or persons appointed as auditor of that fund; “eligible shares” has the meaning assigned to it by section 12 of the Finance Act, 1984 ; “specified designated fund” means an investment fund designated under section 27 of the Finance Act, 1984 , which closed on or before the 5th day of April, 1995, and where at least two-thirds of the money raised by the fund was invested in eligible shares before the 23rd day of January, 1996; “prospectus”, in relation to a company, means any prospectus, notice, circular or advertisement, offering to the public for subscription or purchase any eligible shares (within the meaning of section 12
(2)of the Finance Act, 1984 ) of the company, and in this definition “the public” includes any section of the public, whether selected as members of the company or as clients of the person issuing the prospectus or in any other manner; “qualifying subsidiary”, in relation to a company, has the same meaning as it has for the purposes of section 15 of the Finance Act, 1984 ; “qualifying trading operations” has the meaning assigned to it by section 16 of the Finance Act, 1984 (as amended by this Act); “the specified period” means the period beginning on the 1st day of January, 1995, and ending on the 23rd day of January, 1996.
(2)Section 20 shall not apply as respects eligible shares issued on or after the 23rd day of January, 1996, by a company to which this section applies and in respect of which the conditions in either subsection
(5)or
(6)are met.
(3)The provisions of Chapter III of Part I of the Finance Act, 1984 , which were in force immediately before the 23rd day of January, 1996, shall apply as respects shares issued on or after the 23rd day of January, 1996, by a company to which this section applies and in respect of which the conditions in subsection
(6)are met: Provided that this subsection shall not apply as respects eligible shares, issued by a company on or after the 23rd day of April, 1996, to which the provisions of section 13A (as amended by this Act) of the Finance Act, 1984 , apply.
(4)This section applies to a company which, or whose qualifying subsidiary, either carries on or intends to carry on one or more of the qualifying trading operations mentioned in subparagraph (
  1. i)(as amended by the Finance Act, 1990 ), (
  2. ii)(inserted by the Finance Act, 1990 ), (iid) (inserted by the Finance Act, 1995 ), (iie) (inserted by the Finance Act, 1995 ), (iiia) (inserted by the Finance Act, 1988 ), (iiic) (inserted by the Finance Act, 1990 ), (iiid) (inserted by the Finance Act, 1994 ), (
  3. iv)or (
  4. v)of paragraph (
  5. a)(inserted by the Finance Act, 1987 ) of subsection
(2)of section 16 of the Finance Act, 1984 .
(5)The conditions of this subsection, referred to in subsection
(2), are— (
  1. a)the eligible shares are issued on or before the 5th day of April, 1996, and (
  2. b)the eligible shares are issued following a subscription on behalf of an individual by a person or persons having the management of a specified designated fund, and (
  3. c)the company concerned proves to the satisfaction of the Revenue Commissioners that on or before the 23rd day of January, 1996, it had the intention of raising money, on or before the 5th day of April, 1996, under the provisions of Chapter III of Part I of the Finance Act, 1984 , through the specified designated fund referred to in paragraph (b): Provided that, in determining whether they are satisfied that the company has complied with the requirements specified in paragraph (c), the Revenue Commissioners shall have regard to the following— (
  4. i)(I) signed heads of agreement between the company and the fund, or (II) exchange of correspondence between the company and the fund showing a clear intention that the fund intended, on or before the 5th day of April, 1996, to subscribe for eligible shares in the company, and (
  5. ii)a certificate by the auditor of the fund confirming that it is a specified designated fund, and (iii) any other information the Revenue Commissioners deem necessary for the purpose.
(6)The conditions of this subsection, referred to in subsection
(2), are— (
  1. a)the shares are issued on or before the 30th day of August, 1996, and (
  2. b)(
  3. i)in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (i), (ii), (iiia) or (iiid) of paragraph (
  4. a)of subsection
(2)of section 16 of the Finance Act, 1984 , that— (I) in the specified period the company or its qualifying subsidiary, as the case may be, had entered into a binding contract in writing— (A) to purchase or lease land or a building, (B) to purchase or lease plant or machinery, or (C) for the construction or refurbishment of a building, to be used in the carrying on of its qualifying trading operation, and (II) the company proves to the satisfaction of the Revenue Commissioners that— (A) on or before the 23rd day of January, 1996, it had an intention to raise money under the provisions of Chapter III of Part I of the Finance Act, 1984 , and (B) the contract which it or its qualifying subsidiary, as the case may be, had entered into was integral to, or consistent with, the purpose for which it had intended to raise money as aforesaid and that the consideration of the said contract is equal to 25 per cent. or more of the money which it is intended to raise under the provisions of the said Chapter III: Provided that, in determining whether they are satisfied that the company has complied with the requirements specified in clause (II), the Revenue Commissioners shall have regard to either or both of the following— (AA) an application in writing made by the company to the Revenue Commissioners in the specified period for the opinion of the Revenue Commissioners as to whether the company would be a qualifying company for the purposes of Chapter III of Part I of the Finance Act, 1984 , and (BB) the publication in the specified period of a prospectus by, or on behalf of, the company; (ii) in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (iid), (iiic) or (v) of paragraph (a) of subsection
(2)of section 16 of the Finance Act, 1984 , that on or before the 23rd day of January, 1996, it had an intention to raise money under the provisions of Chapter III of Part I of the Finance Act, 1984 : Provided that, in determining whether they are so satisfied, the Revenue Commissioners shall have regard to either or both of the following— (I) an application in writing made by the company to the Revenue Commissioners in the specified period for the opinion of the Revenue Commissioners as to whether the company would be a qualifying company for the purposes of Chapter III of Part I of the Finance Act, 1984 , and (II) the publication in the specified period of a prospectus by, or on behalf of, the company; (iii) in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (iie) of paragraph (a) of subsection
(2)of section 16 of the Finance Act, 1984 , that— (I) on or before the 23rd day of January, 1996, the company or its qualifying subsidiary, as the case may be, had submitted to, and had approved of by, the Minister for Agriculture, Food and Forestry a three-year development and marketing plan as is mentioned in paragraph (
  1. a)of subsection (3B) (inserted by the Finance Act, 1995 ) of section 15 of the Finance Act, 1984 , in respect of its qualifying trading operation, (II) in the specified period the company or its qualifying subsidiary, as the case may be, had entered into a binding contract in writing— (A) to purchase or lease greenhouses, (B) to purchase or lease plant or machinery, or (C) for the construction or refurbishment of greenhouses, to be used in the carrying on of its qualifying trading operation, and (III) the company proves to the satisfaction of the Revenue Commissioners that the contract which it, or its qualifying subsidiary, as the case may be, had entered into was integral to, or consistent with, the three-year development and marketing plan approved of by the Minister for Agriculture, Food and Forestry and that the consideration of the said contract is equal to 25 per cent. or more of the money which it is intended to raise under the provisions of Chapter III of Part I of the Finance Act, 1984 , and (
  2. iv)in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (
  3. iv)of paragraph (
  4. a)of subsection
(2)of section 16 of the Finance Act, 1984 , that— (I) on or before the 23rd day of January, 1996, the company or its qualifying subsidiary, as the case may be, had submitted to, and had approved of by, Bord Fáilte Éireann a three-year development and marketing plan as is mentioned in paragraph (a) of subsection (3A) (inserted by the Finance Act, 1987 ) of section 15 of the Finance Act, 1984 , in respect of its qualifying trading operation, (II) in the specified period the company or its qualifying subsidiary, as the case may be, had entered into a binding contract in writing— (A) to purchase or lease land or a building, (B) to purchase or lease plant or machinery, or (C) for the construction or refurbishment of a building, to be used in the carrying on of its qualifying trading operation, and (III) the company proves to the satisfaction of the Revenue Commissioners that the contract which it, or its qualifying subsidiary, as the case may be, had entered into was integral to, or consistent with, the three-year development and marketing plan approved of by Bord Fáilte Éireann and that the consideration of the said contract is equal to 25 per cent. or more of the money which it is intended to raise under the provisions of Chapter III of Part I of the Finance Act, 1984 .
(7)For the purposes of subsection
(6)— (
  1. a)the date on which a contract was entered into by a company or, as the case may be, its qualifying subsidiary, and (
  2. b)the date on which a prospectus was published by, or on behalf of, a company, shall be confirmed in a certificate by the auditor of the company, or its qualifying subsidiary, as appropriate. Amendment of section 15 (qualifying companies) of Finance Act, 1984. 22.— Section 15 of the Finance Act, 1984 , is hereby amended by the insertion of the following subsection after subsection (3B): “(3C) A company, whose trade consists of the production, publication, marketing and promotion of a qualifying recording within the meaning of subsection (2D) (inserted by the Finance Act, 1996) of section 16, shall not be a qualifying company— (
  3. a)unless it exists solely for the purposes of the production, publication, marketing and promotion of a qualifying recording or qualifying recordings by one, and only one, new artist, and (
  4. b)unless and until and so long as it shows to the satisfaction of the Revenue Commissioners that a certificate referred to in the said subsection (2D) has been given, and not revoked, by the Minister for Arts, Culture and the Gaeltacht to the company in relation to such qualifying recording or qualifying recordings.”. Amendment of section 16 (qualifying trades) of Finance Act, 1984. 23.— Section 16 of the Finance Act, 1984 , is hereby amended— (
  5. a)in paragraph (
  6. a)of subsection
(2)— (
  1. i)by the substitution of the following subparagraph for subparagraph (iib) (inserted by the Finance Act, 1995 ): “(iib) in respect of— (I) a relevant investment made on or after the passing of the Finance Act, 1995 , or (II) a subscription for eligible shares, other than such a subscription consisting of a relevant investment, made on or after the passing of the Finance Act, 1996, and on or before the 5th day of April, 1998, and in respect of which a certificate for the purposes of this Chapter has been issued in accordance with the provisions of subsection (2E) (inserted by the Finance Act, 1996), and notwithstanding the provisions of subparagraph (ii), the rendering of relevant trading operations within the meaning of section 39B of the Finance Act, 1980 (inserted by the Finance Act, 1987 ), which are carried on for the purposes of, or in connection with, trading operations on an exchange facility established in the Custom House Docks Area as defined in section 41 of the Finance Act, 1986 ,”, and (
  2. ii)by the insertion of the following subparagraph after subparagraph (iiid) (inserted by the Finance Act, 1994 ): “(iiie) in respect of a subscription for eligible shares made on or after the passing of the Finance Act, 1996, the production, publication, marketing and promotion of a qualifying recording, or qualifying recordings, within the meaning of subsection (2D) (inserted by the Finance Act, 1996),”, (
  3. b)by the insertion of the following subsections after subsection (2C) (inserted by the Finance Act, 1995 ): “(2D) (
  4. a)For the purposes of subparagraph (iiie) of paragraph (
  5. a)of subsection
(2), a qualifying recording means a recording, in any recording format in any musical style including any associated video directly related to such recording, by a new artist, produced in a studio in the State, in respect of which the Minister for Arts, Culture and the Gaeltacht (hereinafter in this subsection referred to as ‘the Minister‘) has, subject to such conditions as the Minister may consider proper and specifies therein including a condition as to the maximum amount of money which may be raised under the provisions of this Chapter in relation to a qualifying recording, given a certificate to the company which intends to produce the qualifying recording, stating that the recording and any associated video, as aforesaid, may be treated as a qualifying recording for the purposes of this Chapter. (
  1. b)In considering whether to give such a certificate as is referred to in paragraph (a), the Minister shall have regard only to such guidelines as the Minister may, from time to time, lay down with the consent of the Minister for Finance, and those guidelines may, without prejudice to the generality of the foregoing, include provision for— (
  2. i)the circumstances in which an artist is to be, and continues to be, regarded as a new artist, and (
  3. ii)the manner, extent and timing in which the money to be raised under the provisions of this Chapter by a company for the production, publication, marketing and promotion of a qualifying recording is to be used. (
  4. c)A certificate to which paragraph (
  5. a)refers or any condition thereof may be amended, revoked or added to by the Minister, by giving notice in writing to the qualifying company concerned of such amendment, revocation or addition, and the provisions of this section shall apply as if— (
  6. i)a condition as so amended or added by the notice was specified in the certificate, and (
  7. ii)a condition as so revoked was not specified in the certificate. (2E) (
  8. a)In this subsection, ‘certification committee’ means the committee consisting of a chairman and four other members who, from time to time, may be appointed by the Minister for Finance for the purposes of this section. (
  9. b)The certification committee may, subject to such conditions as the committee consider proper and specifies therein including a condition as to the maximum amount of money which may be raised by the company under the provisions of this Chapter, issue a certificate for the purposes of this Chapter to a company, which carries on or intends to carry on qualifying trading operations such as are referred to in subparagraph (iib) (inserted by the Finance Act, 1996) of paragraph (
  10. a)of subsection
(2)and in respect of which money is raised or intended to be raised by it under the provisions of this Chapter by virtue of clause (II) of the aforesaid subparagraph (iib), where— (
  1. i)on the basis of such information as is supplied to it by the company or which the committee may reasonably request the company to furnish to it, and (
  2. ii)such guidelines for the purpose as may be agreed, from time to time, between it and the Minister for Finance, it is satisfied that— (I) the qualifying trading operations carried on or to be carried on by the company will contribute to the development of the exchange facility on which those operations will be carried on, and (II) the money raised or to be raised by the company under the provisions of this Chapter has the potential to maintain or create a reasonable level of sustainable employment: Provided that the committee shall not give a certificate to a company under this subsection— (A) after the 5th day of April, 1998, and (B) to the extent that the aggregate of all subscriptions made or to be made for eligible shares arising out of the issue of such certificates exceeds £2,000,000.”, and (
  3. c)in subsection
(4), by the substitution in paragraph (
  1. b)of the following subparagraphs for subparagraph (ii): “(
  2. ii)the research and development or other similar activity as is referred to in subparagraph (iiic) (inserted by the Finance Act, 1993 ) of paragraph (
  3. a)of subsection
(2), and (iii) the production, publication, marketing and promotion of a qualifying recording, or qualifying recordings, as is referred to in subparagraph (iiie) (inserted by the Finance Act, 1996) of paragraph (a) of subsection
(2):”. Amendment of section 16A (relevant trading operations) of Finance Act, 1984. 24.—Section 16A (inserted by the Finance Act, 1995 ) of the Finance Act, 1984 , is hereby amended— (a) in subsection
(2), by the substitution in clause (I) of subparagraph (
  1. ii)of paragraph (
  2. b)of “the Minister for Enterprise and Employment or the Minister for the Marine or the Minister for Tourism and Trade” for “the Minister for Enterprise and Employment or the Minister for Tourism and Trade”, and (
  3. b)in subsection
(4)— (
  1. i)by the insertion of the following paragraphs for paragraph (b): “(
  2. b)the Minister for Agriculture, Food and Forestry in respect of such qualifying trading operations as are referred to in section 16
(2)(
  1. a)(iiia) (inserted by the Finance Act, 1988 ), or (
  2. c)the Minister for Arts, Culture and the Gaeltacht in respect of such qualifying trading operations as are referred to in subparagraph (iiie) (inserted by the Finance Act, 1996) of paragraph (
  3. a)(inserted by the Finance Act, 1987 ) of subsection 2 of section 16,”, and (
  4. ii)by the substitution of the following paragraph for paragraph (ii): “(
  5. ii)between the Minister for Agriculture, Food and Forestry or the Minister for Arts, Culture and the Gaeltacht, as may be appropriate, and the Minister for Finance.”. Chapter III Income Tax, Corporation Tax and Capital Gains Tax Stud greyhound service fees. 25.—
(1)In this section— “greyhound bitches” means female greyhounds registered in the Irish Greyhound Stud Book or in any other greyhound stud book recognised for the purposes of the Irish Greyhound Stud Book; “stud greyhound” means a male greyhound registered as a sire for stud purposes in the Irish Greyhound Stud Book or in any other greyhound stud book recognised for the purposes of the Irish Greyhound Stud Book.
(2)(
  1. a)As respects income tax for the year 1996-97 and subsequent years of assessment, and (
  2. b)as respects corporation tax for an accounting period ending on or after the 6th day of April, 1996, the profits or gains arising— (
  3. i)to the owner of a stud greyhound which is ordinarily kept in the State from the sale of services of greyhound bitches within the State by the stud greyhound or to the part-owner of such a stud greyhound from the sale of such services or of rights to such services, or (
  4. ii)to the part-owner of a stud greyhound which is ordinarily kept outside the State from the sale of services of greyhound bitches by the stud greyhound or of rights to such services where the part-owner carries on in the State a trade which consists of or includes greyhound breeding, and it is shown to the satisfaction of the inspector or, on appeal, to the satisfaction of the Appeal Commissioners, that the part-ownership of the stud greyhound was acquired and is held primarily for the purposes of the service by the stud greyhound of greyhound bitches owned or partly-owned by the part-owner of the stud greyhound in the course of that trade, shall not be taken into account for any purpose of the Tax Acts.
(3)Section 93 of the Corporation Tax Act, 1976 , is hereby amended by the substitution in subsection
(1)of the following paragraphs for paragraph (b): “(b) the said section 18 as applied by section 11
(6)(continuation of exemptions), or (c) section 25 of the Finance Act, 1996 (stud greyhound service fees),”.
(4)This section applies to profits or gains arising on or after the 6th day of April,
  1. Amendment of section 41B (capital allowances in relation to construction or refurbishment of certain multi-storey car-parks) of Finance Act,
  2. 26.—
(1)Section 41B (inserted by section 35 of the Finance Act, 1995 ) of the Finance Act, 1994 , is hereby amended in subsection
(1)by the substitution of the following for the definition of “the relevant local authority”: “‘the relevant local authority’, in relation to the construction or refurbishment of a multi-storey car-park, means— (
  1. a)the corporation of a county or other borough or, where appropriate, the urban district council, or (
  2. b)in respect of the administrative county of Dún Laoghaire-Rathdown, the administrative county of Fingal or the administrative county of South Dublin, the council of the county, in whose functional area the multi-storey car-park is situated.”.
(2)Subsection
(1)shall be deemed to have applied and have effect as on and from the 1st day of July,
  1. Amendment of section 22 (continuation of certain allowances, etc.) of Finance Act,
  2. 27.— Section 22 of the Finance Act, 1991 , is hereby amended with effect as on and from the 1st day of April, 1996— (a) by the substitution of the following subsection for subsection
(1): “
(1)Subsection (2A) (
  1. a)of section 254 of the Income Tax Act, 1967 , shall have effect as if the reference therein to the 1st day of April, 1991 (as provided for in section 50 of the Finance Act, 1988 ) were a reference to the 25th day of January, 1999: Provided that the said subsection (2A) (
  2. a)shall have such effect for the purposes only of section 51 of the Finance Act, 1988 , and Chapter VII of Part I of the Finance Act, 1991 .”, and (
  3. b)by the deletion of the Table to that section. Continuation of certain industrial buildings annual allowances. 28.—
(1)Section 264 of the Income Tax Act, 1967 , is hereby amended— (a) in the proviso to subsection
(1), by the substitution of the following paragraph for paragraph (ii): “(
  1. ii)in relation to a building or structure— (I) the capital expenditure on the construction of which has been incurred on or after the 16th day of January, 1975, and which falls to be regarded as an industrial building or structure within the meaning of paragraph (
  2. a)or (
  3. b)of section 255
(1), and (II) the capital expenditure on the construction of which has been incurred on or after the 24th day of April, 1992, and which falls to be regarded as an industrial building or structure within the meaning of section 255
(1)(bb), this Part shall have effect as if ‘one-twenty-fifth’ were substituted for ‘one-fiftieth’ in the foregoing provisions of this subsection.”, and (b) in the proviso to subsection
(3), by the substitution of the following paragraph for paragraph (ii): “(
  1. ii)in relation to a building or structure— (I) the capital expenditure on the construction of which has been incurred on or after the 16th day of January, 1975, and which falls to be regarded as an industrial building or structure within the meaning of paragraph (
  2. a)or (
  3. b)of section 255
(1), and (II) the capital expenditure on the construction of which has been incurred on or after the 24th day of April, 1992, and which falls to be regarded as an industrial building or structure within the meaning of section 255
(1)(bb), this Part shall have effect as if ‘twenty-five years’ were substituted for ‘fifty years’ in the foregoing provisions of this subsection.”.
(2)Section 265 of the Income Tax Act, 1967 , is hereby amended, in the proviso to subsection
(1), by the substitution of the following paragraph for paragraph (iii): “(iii) in relation to a building or structure— (I) the capital expenditure on the construction of which has been incurred on or after the 16th day of January, 1975, and which falls to be regarded as an industrial building or structure within the meaning of paragraph (a) or (b) of section 255
(1), and (II) the capital expenditure on the construction of which has been incurred on or after the 24th day of April, 1992, and which falls to be regarded as an industrial building or structure within the meaning of section 255
(1)(bb), this Part shall have effect as if ‘twenty-five years’ were substituted for ‘fifty years’ in the foregoing provisions of this subsection.”. Amendment of section 255 (meaning of “industrial building or structure”) of Income Tax Act, 1967. 29.— Section 255 of the Income Tax Act, 1967 , is hereby amended in subsection
(1)by the insertion of the following additional proviso after the proviso to that subsection: “Provided also that expenditure incurred by a person on or after the 23rd day of April, 1996, either on the construction of, or on the acquisition of the relevant interest in, a building or structure which is not situated in the State shall not be treated as expenditure on a building or structure within the meaning of this section unless, being a building or structure not situated in the State— (
  1. a)it is a building or structure which is to be constructed or which is in the course of construction and in respect of which it can be shown that— (
  2. i)the said person has either entered into a binding contract in writing for the acquisition of the site for the building or structure or has entered into an agreement in writing in relation to an option to acquire the said site on or before the 23rd day of April, 1996, and (
  3. ii)the said person has entered into a binding contract in writing for the construction of the building or structure on or before the 1st day of July, 1996, and (iii) the construction of the building or structure had commenced on or before the said 1st day of July and had been completed before the 31st day of December, 1997, and (
  4. b)it is a building or structure to be constructed or which is being constructed which will be used for the purposes of a trade the profits or gains from which are taxable in the State.”. Amendment of Chapter III (Income Tax and Corporation Tax: Reliefs for Renewal and Improvement of Certain Resort Areas) of Part I of Finance Act, 1995. 30.—Chapter III of Part I of the Finance Act, 1995 , is hereby amended by the insertion of the following section after section 49: “Restriction of capital allowances on holiday cottages, holiday apartments, etc. 49A.—
(1)This section applies to— (a) a building or structure to which section 47 applies by virtue of the building or structure being a holiday cottage of the type referred to in the proviso to section 255
(1)of the Income Tax Act, 1967 , and (
  1. b)a building or structure which is a qualifying premises within the meaning of section 48 by virtue of the building or structure being— (
  2. i)a holiday apartment registered under Part III of the Tourist Traffic Act, 1939 , or (
  3. ii)other self-catering accommodation in a list published under section 9 of the Tourist Traffic Act, 1957 .
(2)(a) Subject to subsection
(5), a building or structure to which this section applies shall not be a qualifying premises for the purposes of section 49, unless the person to whom an allowance under Chapter II of Part XV, or Chapter I of Part XVI, of the Income Tax Act, 1967 , would, but for subsection
(3), fall to be made for the purposes of income tax or corporation tax, as the case may be, in respect of the capital expenditure incurred in the qualifying period on the construction or refurbishment of the building or structure, elects by notice in writing to the appropriate inspector (within the meaning of section 9 of the Finance Act, 1988 ) to disclaim all allowances under the said Chapter II and the said Chapter I in respect of the said capital expenditure. (b) An election under paragraph (a) shall be included in the return required to be made by the person concerned under section 10 of the Finance Act, 1988 , for the first year of assessment or the first accounting period, as the case may be, for which an allowance would, but for subsection
(3), have fallen to be made to that person under the said Chapter II or the said Chapter I in respect of the said capital expenditure. (
  1. c)An election under paragraph (
  2. a)shall be irrevocable. (
  3. d)A person who has made an election under paragraph (
  4. a)shall furnish a copy of that election to any person (hereafter in this paragraph referred to as ‘the second-mentioned person’) to whom the person grants a qualifying lease (within the meaning of section 49) in respect of a building or structure to which this section applies and the second-mentioned person shall include the said copy in the return required to be made by the second-mentioned person under section 10 of the Finance Act, 1988 , for the year of assessment or accounting period, as the case may be, in which rent is first payable by the second-mentioned person under the qualifying lease in respect of such a building or structure.
(3)Subject to subsection
(5), where a person who has incurred capital expenditure in the qualifying period on the construction or refurbishment of a building or structure to which this section applies, makes an election under paragraph (a) of subsection
(2), then, notwithstanding any other provision of the Tax Acts— (
  1. a)no allowance under Chapter II of Part XV, or Chapter I of Part XVI, of the Income Tax Act, 1967 , shall be made to the person in respect of the said capital expenditure, (
  2. b)on the occurrence, in relation to the building or structure, of any of the events referred to in section 265
(1)of the Income Tax Act, 1967 , the residue of expenditure (within the meaning of section 266 of that Act) in relation to the said capital expenditure shall be deemed to be nil, and (c) the provisions of section 19 (as amended by section 23 of the Finance Act, 1991 ) of the Finance Act, 1970 , shall not apply or have effect in the case of any person who buys the relevant interest (within the meaning of section 268 of the Income Tax Act, 1967 ) in the building or structure.
(4)Subject to subsection
(5), where, in the qualifying period, a person incurs capital expenditure on the acquisition, construction or refurbishment of a building or structure which is, or is to be, a building or structure to which paragraph (b) of subsection
(1)applies and an allowance falls to be made in respect of that expenditure under section 254 (as amended by section 22 of the Finance Act, 1994 ) or 264 (as amended by section 28 of the Finance Act, 1996) of the Income Tax Act, 1967 , then— (a) neither— (i) section 307 (as amended by section 27 of the Finance Act, 1990 ) of the Income Tax Act, 1967 , nor (ii) subsection
(2)of section 16 of the Corporation Tax Act, 1976 , shall apply or have effect as respects the whole or part (as the case may
  1. be)of any loss which would not have arisen but for the making of the said allowance, and (
  2. b)neither the proviso to subsection
(1)of section 296 of the Income Tax Act, 1967 , nor subsection
(6)of section 14 of the Corporation Tax Act, 1976 , shall apply or have effect as respects the said allowance.
(5)This section shall not apply— (
  1. a)to expenditure incurred within the qualifying period on the acquisition, construction or refurbishment of a building or structure (hereafter in this subsection referred to as ‘the holiday cottage or apartment’) which is, or is to be, a building or structure to which this section applies if, before the 5th day of April, 1996— (
  2. i)a binding contract in writing for the acquisition or construction of the holiday cottage or apartment was entered into, or (
  3. ii)an application for planning permission for the construction of the holiday cottage or apartment was received by a planning authority, or (iii) in relation to the holiday cottage or apartment, an opinion in writing was issued by the Revenue Commissioners to the effect that an allowance to be made in respect of expenditure on the said holiday cottage or apartment would not fall to be restricted by virtue of section 24 of the Finance Act, 1991 , or (
  4. b)where before the 5th day of April, 1996— (
  5. i)expenditure was incurred on the acquisition of land on which the holiday cottage or apartment is to be constructed or refurbished, by the person who incurred the expenditure on the said construction or refurbishment, or (
  6. ii)a binding contract in writing for the acquisition of the said land by the said person was entered into, and the said person can prove to the satisfaction of the Revenue Commissioners that a detailed plan had been prepared and that detailed discussions had taken place with a planning authority in relation to the holiday cottage or apartment on or after the 8th day of February, 1995 but before the 5th day of April, 1996 and that this can be supported by way of an affidavit from the said planning authority.”. Relief for investment in films. 31.—
(1)Subject to subsections
(2)and
(3), Chapter V of Part I of the Finance Act, 1987 , is hereby amended, as respects a sum of money which is paid on or after the 23rd day of January, 1996, by the substitution for section 35 of the following section— “35.—
(1)In this section: ‘allowable investor company’ means, in relation to a qualifying company, a company which is not connected with the qualifying company; ‘authorised officer’ means an officer of the Revenue Commissioners authorised by them in writing for the purposes of this section; ‘film’ means a film which is produced— (
  1. a)on a commercial basis with a view to the realisation of profit, and (
  2. b)wholly or principally for exhibition to the public in cinemas or by way of television broadcasting, but does not include a film made for exhibition as an advertising programme or as a commercial; ‘the Minister’ means the Minister for Arts, Culture and the Gaeltacht; ‘qualifying company’ means a company which— (
  3. a)is incorporated in the State, and (
  4. b)is resident in the State and is not resident elsewhere, and (
  5. c)exists solely for the purposes of the production and distribution of one, and only one, qualifying film; ‘qualifying film’ means a film in respect of which the Minister has given a certificate under subsection
(2)which certificate has not been revoked under that subsection; ‘qualifying individual’ means, in relation to a qualifying company, an individual who is not connected with the company; ‘qualifying period’ means— (
  1. a)in relation to an allowable investor company, the period commencing on the 23rd day of January, 1996, and ending on the 22nd day of January, 1999, and (
  2. b)in relation to a qualifying individual, the period commencing on the 23rd day of January, 1996, and ending on the 5th day of April, 1999; ‘relevant deduction’ means a deduction of an amount equal to 80 per cent. of a relevant investment; ‘relevant investment’ means a sum of money which is— (
  3. a)paid in the qualifying period to a qualifying company in respect of shares in the company by an allowable investor company on its own behalf or by a qualifying individual on that individual's own behalf, and is paid by the allowable investor company or by the qualifying individual, as the case may be, directly to the qualifying company, and (
  4. b)paid by the allowable investor company or the qualifying individual, as the case may be, for the purposes of enabling the qualifying company to produce a film in respect of which, at the time such sum of money is paid, the Minister has given notice in writing to the qualifying company that the Minister is satisfied, for the time being, that an application in writing containing such information as may be specified in guidelines referred to in subsection
(2)has been made to enable the Minister to consider whether a certificate should be given to that company under that subsection, and (c) used by the qualifying company, within two years of the receipt of that sum, for that purpose, but does not include a sum of money paid to the qualifying company on terms which provide that it will be repaid, other than a provision for its repayment in the event of the Minister not giving a certificate under subsection
(2), and a reference to the making of a relevant investment shall be construed as a reference to the payment of such a sum to a qualifying company.
(2)(
  1. a)(
  2. i)The Minister, on the making of an application by a qualifying company, may, in accordance with guidelines laid down by the Minister with the consent of the Minister for Finance, give a certificate to a qualifying company stating, in relation to a film to be produced by the company, that the film may be treated as a qualifying film for the purposes of this section. (
  3. ii)An application under this section shall be in such form as the Minister may direct and shall contain such information as may be specified in the guidelines referred to in subparagraph (i). (
  4. b)A certificate given by the Minister under paragraph (
  5. a)shall be subject to such conditions as the Minister may consider proper (having regard, in particular, to any contribution which the production of the film is expected to make to either or both the development of the film industry in the State and the promotion and expression of Irish culture) and specifies therein including— (
  6. i)a condition that not less than— (I) 75 per cent., or (II) such lower percentage, not being less than 10 per cent., which, in accordance with guidelines laid down under paragraph (a), the Minister specifies in the certificate, of the work on the production of the film is carried out in the State, (
  7. ii)a condition that the amount per cent. of the total cost of production of the film which may be met by relevant investments shall not exceed the amount per cent. (in the proviso to this provision referred to as ‘the specified percentage’) specified in the certificate: Provided that— (I) subject to paragraph (II) of this proviso, the specified percentage shall not exceed— (A) where the total cost of production of the film does not exceed £4,000,000, 60 per cent., (B) where the total cost of production of the film exceeds £4,000,000 and does not exceed £5,000,000, the amount per cent. (hereafter in this paragraph referred to as ‘the allowable percentage’) where the amount of the allowable percentage is determined by the formula— E 60 — _________ £100,000 where E is the excess of the total cost of production of the film over £4,000,000, and (C) where the total cost of production of the film exceeds £5,000,000, 50 per cent., but in any case to which subparagraph (A), (B) or (C) relates, the total cost of production of the film which is met by relevant investments shall not exceed £7,500,000, and where the percentage of the work on the production of the film carried out in the State (in this proviso referred to as the ‘lower percentage’) is less than 50 per cent., paragraph (
  8. b)shall be construed as if the reference to 60 per cent., the reference to the allowable percentage and the reference to 50 per cent. were a reference to the lower percentage, and (II) in relation to a film (otherwise than an animation film) in respect of which the principal photography commences at any time during the months of October, November, December and January, and the production of the film continues to completion without unreasonable delay from that time, the references in paragraph (I) of this proviso to— (A) 60 per cent., shall be construed as a reference to 66 per cent., (B) 50 per cent., shall be construed as a reference to 55 per cent., and (C) £7,500,000 shall be treated as a reference to £8,250,000, and (iii) a condition that the qualifying company shall, in respect of the qualifying film concerned, notify the Minister in writing of when the principal photography has commenced, the first animation drawings have commenced or the first model movement has commenced, as appropriate: Provided that the Minister may amend or revoke any such condition (including a condition added by virtue of this proviso) specified in the certificate, or add to such conditions, by giving notice in writing to the qualifying company concerned of the amendment, revocation or addition, and the provisions of this section shall apply as if— (I) a condition as so amended or added by the notice was specified in the certificate, and (II) a condition as so revoked was not specified in the certificate. (
  9. c)Where a company fails to comply with any of the conditions to which a certificate given to it under paragraph (
  10. a)is subject by virtue of paragraph (b)— (
  11. i)that failure shall constitute the failure of an event to happen by reason of which relief falls to be withdrawn under subsection
(11), and (ii) the Minister may, by notice in writing served by registered post on the company, revoke the certificate.
(3)Subject to the provisions of this section, where, in an accounting period, an allowable investor company makes a relevant investment, it shall, on making a claim in that behalf, be given a relevant deduction from its total profits for the accounting period: Provided that, where the amount of the relevant deduction to which the allowable investor company is entitled under this section in an accounting period exceeds its profits for that accounting period, an amount equal to ten-eighths of the amount of that excess shall be carried forward to the succeeding accounting period and the amount so carried forward shall be treated for the purposes of this section as if it were a relevant investment made in that succeeding accounting period.
(4)Where in any period of twelve months (in the proviso to this subsection referred to as a ‘twelve month period’) ending on an anniversary of the 22nd day of January, 1996, the amount, or the aggregate amount, of the relevant investments made, or treated as made, by an allowable investor company, or by such company and all companies (which other companies are referred to in the proviso to this subsection as ‘connected companies’) which, at any time in that period, would be regarded as connected with such company, exceeds £6,000,000, no relief shall be given under this section in respect of the amount of the excess and, where there is more than one relevant investment, the inspector or, on appeal, the Appeal Commissioners, shall make such apportionment of the relief available as shall be just and reasonable to allocate to each relevant investment a due proportion of the relief available and, where necessary, to grant to each allowable investor company concerned an amount of relief proportionate to the amount of the relevant investment or the aggregate amount of the relevant investments made by it in the period: Provided that no relief shall be given under this section in respect of the amount or the aggregate amount of the relevant investments (in this proviso referred to as the ‘total amount’) made by an allowable investor company and its connected companies— (a) to the extent that the amount of the relevant investment, or the total amount made in any one qualifying company, exceeds £2,000,000, and (b) where in any twelve month period the total amount exceeds £2,000,000, to the extent that the excess comprises a relevant investment or relevant investments made in a qualifying company to enable the company to produce a film, the total cost of production of which exceeds £4,000,000.
(5)Subject to the provisions of this section, where, in any year of assessment, a qualifying individual makes a relevant investment, the individual shall, on making a claim in that behalf, be given a relevant deduction from the individual's total income for that year of assessment.
(6)A relevant deduction shall not be given under this section in respect of any relevant investment made by a qualifying individual in a qualifying company in any year of assessment unless the amount of that relevant investment, or the total amount of the relevant investments, made by the individual in the qualifying company in that year is £200 or more: Provided that, in the case of a qualifying individual who is married and is assessed to tax for a year of assessment in accordance with the provisions of section 194 (inserted by section 18 of the Finance Act, 1980 ) of the Income Tax Act, 1967 , or of that section as applied by section 195B (inserted by section 10 of the Finance Act, 1993 ) of the Income Tax Act, 1967 , any relevant investment made by the qualifying individual's spouse in the qualifying company in that year of assessment shall be deemed to have been made by the qualifying individual.
(7)A relevant deduction shall not be given to a qualifying individual under this section for a year of assessment to the extent to which the amount of the relevant investment, or the total amount of the relevant investments (whether or not made in the same qualifying company), made, or treated as made, by the individual in that year of assessment exceeds £25,000.
(8)If, for any year of assessment, a greater relevant deduction would be given to a qualifying individual under this section but for either or both of the following reasons, that is to say— (a) an insufficiency of total income, or (b) the operation of subsection
(7), ten-eighths of the relevant deduction which cannot be given to the individual under this section for either or both of those reasons shall be carried forward to the next year of assessment and shall be treated for the purposes of this section as a relevant investment made by the individual in that following year: Provided that an amount shall not be carried forward to any year of assessment after the year 1998-99.
(9)To the extent that an amount once carried forward to a year of assessment under subsection
(8)(and treated as a relevant investment made by a qualifying individual in that year of assessment) gives rise to a relevant deduction which is not deducted from the qualifying individual's total income for that year of assessment, the amount shall to that extent be carried forward again to the next following year of assessment (and treated as a relevant investment made by the individual in that next following year), and so on for succeeding years of assessment: Provided that an amount shall not be carried forward to any year of assessment after the year 1998-99.
(10)A relevant deduction under this section shall be given to a qualifying individual for any year of assessment as follows: (a) in the first instance, in respect of an amount of relevant investment carried forward from an earlier year of assessment in accordance with the provisions of subsection
(8)or
(9), and, in respect of such an amount so carried forward, for an earlier year of assessment in priority to a later year of assessment, and (b) thereafter, and only thereafter, in respect of any other amount of relevant investment in respect of which a relevant deduction is to be given in that year of assessment.
(11)(
  1. a)A claim to relief under this section may be allowed at any time after the time specified in paragraph (
  2. b)in respect of the payment of a sum to a qualifying company, which, if it is used, within two years of its being paid, by the qualifying company for the production of a qualifying film, will be a relevant investment, if all the conditions for relief are or will be satisfied, but the relief shall be withdrawn if, by reason of the happening of any subsequent event including the revocation by the Minister of a certificate under subsection
(2)or the failure of an event to happen which at the time the relief was given was expected to happen, the company or the individual, as the case may be, making the claim was not entitled to the relief allowed. (
  1. b)The time referred to in paragraph (
  2. a)is the time at which all of the following events have occurred, that is to say— (
  3. i)the payment in respect of which relief is claimed has been made, and (
  4. ii)in relation to the qualifying film the principal photography has commenced, the first animation drawings have commenced or the first model movement has commenced, as appropriate.
(12)A claim for relief in respect of a relevant investment in a company shall not be allowed unless it is accompanied by a certificate issued by the company in such form as the Revenue Commissioners may direct and certifying that the conditions for the relief, so far as applying to the company and the qualifying film, are or will be satisfied in relation to that investment.
(13)Before issuing a certificate for the purposes of subsection
(12), a company shall furnish the authorised officer with— (
  1. a)a statement to the effect that it satisfies or will satisfy the conditions for the relief, so far as they apply in relation to the company and a film, (
  2. b)a copy of any notification required to be given to the Minister under subsection
(2)(
  1. b)(iii), (
  2. c)a copy of the certificate, including a copy of any notice given by the Minister amending, revoking or adding a condition to that certificate, under subsection
(2)in respect of the film, and (d) such other information as the Revenue Commissioners may reasonably require.
(14)A certificate to which subsection
(12)relates shall not be issued without the authority of the authorised officer.
(15)Any statement under subsection
(13)shall— (
  1. a)contain such information as the Revenue Commissioners may reasonably require, (
  2. b)be in such form as the Revenue Commissioners may direct, and (
  3. c)contain a declaration that it is correct to the best of the company's knowledge and belief.
(16)Where a company has issued a certificate for the purposes of subsection
(12), or furnished a statement under subsection
(13), and either— (
  1. a)the certificate or statement was made fraudulently or negligently, or (
  2. b)the certificate was issued in contravention of subsection
(14), then— (
  1. i)the company shall be liable to a penalty not exceeding £500 or, in the case of fraud, not exceeding £1,000, and such penalty may, without prejudice to any other method of recovery, be proceeded for and recovered summarily in the same manner as in summary proceedings for recovery of any fine or penalty under any Act relating to the excise, and (
  2. ii)no relief shall be given under the provisions of this section and if any such relief has been given, it shall be withdrawn.
(17)For the purpose of regulations made under section 127 of the Income Tax Act, 1967 , no regard shall be had to the relief unless a claim for it has been duly made and admitted.
(18)An allowable investor company or a qualifying individual shall not be entitled to relief in respect of a relevant investment unless the relevant investment— (
  1. a)has been made for bona fide commercial reasons and not as part of a scheme or arrangement the main purpose or one of the main purposes of which is the avoidance of tax, (
  2. b)has been, or will be, used in the production of a qualifying film, and (
  3. c)is made at the risk of the allowable investor company or the qualifying individual, as the case may be, and— (
  4. i)in a case where it is made by an allowable investor company, neither the company nor any person who would be regarded as connected with the company, or (
  5. ii)in a case where it is made by a qualifying individual, neither the individual nor any person who would be regarded as connected with the individual, is entitled to receive any payment, in money or money's worth, or other benefit directly or indirectly borne by, or attributable to, the qualifying company other than a payment made on an arm's length basis for goods or services supplied or a payment out of the proceeds of exploiting the film to which the allowable investor company or the qualifying individual, as the case may be, is entitled under the terms subject to which the relevant investment is made.
(19)Where any relief has been given under this section which is subsequently found not to have been due or is to be withdrawn by virtue of subsection
(11)or
(16), it shall be withdrawn by making an assessment to corporation tax or income tax, as the case may be, under Case IV of Schedule D for the accounting period or accounting periods, or the year of assessment or years of assessment, as the case may be, in which relief was given and, notwithstanding anything in the Tax Acts, such an assessment may be made at any time.
(20)(
  1. a)Subject to paragraph (c), where an allowable investor company is entitled to relief under this section in respect of any sum, or any part of a sum, or would be so entitled on making due claim, as a relevant deduction from its total profits for any accounting period, it shall not be entitled to any relief for that sum or any part of a sum, in computing its income or profits, or as a deduction from its income or profits, for any accounting period under any other provision of the Corporation Tax Acts or the Capital Gains Tax Acts. (
  2. b)Subject to paragraph (c), where a qualifying individual is entitled to relief under this section in respect of any sum, or any part of a sum, or would be so entitled on making due claim, as a relevant deduction from the individual's total income for any year of assessment— (
  3. i)the individual shall not be entitled to any relief for that sum or part in computing the individual's total income, or as a deduction from the individual's total income, for any year of assessment under any other provision of the Income Tax Acts, and (
  4. ii)so much of that sum or part as is equal to the amount of the relevant deduction given in relation thereto shall be treated as a sum which, by reason of paragraph 4 of Schedule 1 to the Capital Gains Tax Act, 1975 , is to be excluded from the sums allowable as a deduction in the computation of gains and losses for the purposes of the Capital Gains Tax Acts. (
  5. c)Where an allowable investor company or a qualifying individual has made a relevant investment by way of a subscription for new ordinary shares of a qualifying company and none of those shares are disposed of by the allowable investor company or the qualifying individual, as the case may be, within one year of their acquisition by that company or that individual, as the case may be, then the sums allowable as deductions from the consideration in the computation for the purpose of capital gains tax of the gain or loss accruing to the company or the individual, as the case may be, on the disposal of those shares shall be determined without regard to any relief under this section which the company or the individual, as the case may be, has obtained, or would be entitled on due claim to obtain, except that where those sums exceed the consideration they shall be reduced by an amount equal to— (
  6. i)the amount of the relevant deduction allowed to the allowable investor company or the qualifying individual, as the case may be, under this section in respect of the subscription for those shares, or (
  7. ii)the amount of the excess, whichever is the lesser amount: Provided that, if the disposal of shares is by a qualifying individual, and the disposal falls within section 13
(5)of the Capital Gains Tax Act, 1975 , the preceding provisions of this paragraph shall not apply. (d) For the purposes of this subsection ‘new ordinary shares’ means new ordinary shares forming part of the ordinary share capital of a qualifying company which, throughout the period of one year commencing on the date such shares are issued, carry no present or future preferential right to dividends, or to a company's assets on its winding up, and no present or future preferential right to be redeemed.
(21)Section 157 of the Corporation Tax Act, 1976 , shall apply for the purposes of this section.
(22)In the case of an individual, all such provisions of the Income Tax Acts as apply in relation to the deductions specified in sections 138 to 142 of the Income Tax Act, 1967 , shall, with any necessary modifications, apply in relation to relief under this section.”.
(2)(a) Where an allowable investor company has in the period of twelve months ending on the 22nd day of January, 1997, paid a sum of money to which subsection
(3)applies then the reference in subsection
(4)of section 35 (inserted by subsection
(1)) to £6,000,000 shall, in respect of that period, be construed as a reference to £6,000,000 less the amount or if there is more amounts than one the aggregate of such amounts, of such sums of money, and (b) where a qualifying individual has in the year of assessment 1995-96 paid a sum of money to which subsection
(3)applies, the reference in subsection
(7)of section 35 (inserted by subsection
(1)) to £25,000 shall, in respect of that year of assessment, be construed as a reference to £25,000 less that amount or, if there is more amounts than one the aggregate of such amounts, of such sums of money.
(3)Subsection
(1)shall not apply as respects a sum of money which is paid on or after the 23rd day of January, 1996, and on or before the 31st day of March, 1996, where the sum of money is paid in respect of shares in a qualifying company, and— (
  1. a)the Minister for Arts, Culture and the Gaeltacht had received before the 23rd day of January, 1996, an application in writing to give a certificate to the company stating, in relation to a film to be produced by the company, that the film is a qualifying film, and (
  2. b)where a certificate is given by the Minister to the company after the 23rd day of January, 1996, it includes a statement that the Minister had received the said application before that date.
(4)As respects a sum of money— (a) to which subsection
(1)does not apply by virtue of subsection
(3), or (b) which is paid before the 23rd day of January, 1996, the provisions of section 35 of the Finance Act, 1987 , which were in force immediately prior to the 23rd day of January, 1996, shall continue to have effect: Provided that where the sum of money is a sum of money paid on or after the 6th day of April, 1995, or it is a sum of money to which subsection
(3)applies and the sum of money is used for the purpose of enabling the qualifying company to produce a qualifying film in respect of which an application (to give a certificate under subsection (1A)) had not been received by the Minister before the 23rd day of January, 1996, the provisions shall have effect as if— (i) subsection
(2)was amended by the substitution for “a deduction of the amount of that investment” of “a deduction of an amount equal to 80 per cent. of that investment”, and (ii) subsection (3A) was amended by the substitution for “a deduction of the amount of that investment” of “a deduction of an amount equal to 80 per cent. of that investment”. Treatment of patent royalties and related distributions. 32.—
(1)Section 34 of the Finance Act, 1973 , is hereby amended in subsection
(1)in the definition of “income from a qualifying patent” by the insertion after paragraph (a) of the following proviso: “Provided that where the royalty or other sum exceeds the royalty or other sum which would have been paid if the payer of the royalty or other sum and the beneficial recipient thereof were independent persons acting at arm's length, the excess shall not be income from a qualifying patent,”.
(2)Section 170 of the Corporation Tax Act, 1976 , is hereby amended— (a) in subsection
(1)by the substitution for the definition of “disregarded income” of the following definition: “‘disregarded income’ means— (a) income from a qualifying patent which by virtue of subsection
(2)of section 34 of the Finance Act, 1973 (income from patent royalties) has been disregarded for the purposes of income tax, and (b) income from a qualifying patent which by virtue of subsection
(2)of section 34 of the Finance Act, 1973, and subsection
(6)of section 11 has been disregarded for the purposes of corporation tax, but does not include income from a qualifying patent (in this section referred to as ‘specified income’) which would not be income from a qualifying patent if paragraph (a) of the definition of ‘income from a qualifying patent’ in subsection
(1)of the said section 34 had not been enacted;”, and (
  1. b)by the insertion after subsection (3A) of the following subsection: “(3B) (
  2. a)Where for an accounting period a company makes one or more distributions out of specified income, so much of the amount of that distribution, or the aggregate of such distributions, as does not exceed the amount of aggregate expenditure on research and development incurred by the company in relation to the accounting period shall be treated as a distribution made out of disregarded income: Provided that— (I) subject to paragraph (II), if in an accounting period the beneficial recipient (hereafter in this proviso referred to as ‘the recipient’) of the specified income shows in writing to the satisfaction of the Revenue Commissioners that the specified income is income from a qualifying patent in respect of an invention which— (A) involved radical innovation, and (B) was patented for bona fide commercial reasons and not primarily for the purpose of avoiding liability to taxation, the Revenue Commissioners shall, after consideration of any evidence in relation to the matter which the recipient submits to them and after such consultations (if any) as may seem to them to be necessary with such persons as in their opinion may be of assistance to them, determine whether all distributions made out of specified income accruing to the recipient for that accounting period and all subsequent accounting periods are to be treated as distributions made out of disregarded income and the recipient shall be notified in writing of the determination, (II) a recipient aggrieved by the determination of the Revenue Commissioners may, by notice in writing given to the Revenue Commissioners within thirty days of the date of notification advising of the determination, appeal to the Appeal Commissioners and the Appeal Commissioners shall hear and determine the appeal made to them as if it were an appeal against an assessment to income tax and all the provisions of the Income Tax Act, 1967 , relating to the rehearing of an appeal and the statement of a case for the opinion of the High Court on a point of law shall apply accordingly with any necessary modifications. (
  3. b)The Revenue Commissioners may nominate any of their officers to perform any acts and discharge any functions, authorised by this subsection to be performed or discharged by the Revenue Commissioners and references in this subsection to the Revenue Commissioners shall, with any necessary modifications, be construed as including references to an officer so nominated. (
  4. c)In this subsection— ‘the amount of aggregate expenditure on research and development incurred by a company in relation to an accounting period’ means the amount of expenditure on research and development activities incurred in the State by the company in the accounting period and the previous two accounting periods: Provided that where in an accounting period a company incurs expenditure on research and development activities and not less than 75 per cent. of the expenditure was incurred in the State, all of the expenditure shall be deemed to have been incurred in the State; ‘the amount of the expenditure on research and development activities’, in relation to expenditure incurred by a company in an accounting period, means non-capital expenditure incurred by the company being the aggregate of the amounts of— (
  5. i)such part of the emoluments paid by the company to employees of the company engaged in carrying out research and development activities related to the company's trade as is laid out for the purposes of the said activities, (
  6. ii)expenditure incurred by the company on materials or goods used solely by the company in the carrying out of research and development activities related to the company's trade, and (iii) a sum paid to another person, not being a person connected with the company, in order that such person may carry out research and development activities related to the company's trade: Provided that where the company (hereafter in this proviso referred to as the ‘first company’) is a member of a group then for the purposes of this section the amount of expenditure on research and development activities incurred in an accounting period by another company which in the accounting period is a member of the group shall, on a joint election in writing being made on that behalf by the first company and the other company, be treated as being expenditure incurred on research and development activities in the accounting period by the first company and not by the other company; ‘research and development activities’ has the same meaning as in paragraph (
  7. a)of subsection
(1)of section 59 of the Finance Act, 1995 . (
  1. d)In this subsection— (
  2. i)two companies shall be deemed to be members of a group if both are wholly or mainly under the control of the same individual or individuals or if one is a 75 per cent. subsidiary of another or both are 75 per cent. subsidiaries of a third company: Provided that in determining whether one company is a 75 per cent. subsidiary of another, the other company shall be treated as not being the owner— (I) of any share capital which it owns directly in a company if a profit on sale of the shares would be treated

🔗 To official source

AI explanation based on the official legal text. Indicative, not a substitute for legal advice.