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.

[23rd May, 1994]

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 1994-95 and subsequent years of assessment, the Finance Act, 1980 , is hereby amended—

( a ) in section 1—

(i) by the substitution, in paragraph (b) of subsection (1), of "40 per cent." for "48 per cent." (inserted by the Finance Act, 1992 ), and

(ii) by the substitution, in paragraph (a)(inserted by the Finance Act, 1991 ) of subsection (3) (inserted by the Finance Act, 1989 ), of "£450 for "£350" (inserted by the Finance Act, 1993 ) in both places where it occurs and of "£650" for "£550" (inserted by the Finance Act, 1993 ),

and

( b ) in section 2, by the substitution, in subsection (3), of "40 per cent." for "48 per cent." (inserted by the Finance Act, 1992 ),

and the said paragraph (b) of subsection (1), and the said paragraph (a)of subsection (3), of the said section 1 and the said subsection (3) of the said section 2, as so amended, are set out in the Table to this section.

TABLE

( b ) an individual makes a claim for the purpose, makes a return in the prescribed form of his total income for that year and proves that it does not exceed a sum equal to twice the specified amount, he shall be entitled to have the amount of income tax payable in respect of his total income for that year, if that amount would, but for the provisions of this subsection, exceed a sum equal to 40 per cent. of the amount by which his total income exceeds the specified amount, reduced to that sum.

( a ) For the purposes of this section and section 2, where a claimant proves that he has living at any time during the year of assessment, any qualifying child, then, subject to subsection (4), the specified amount (within the meaning of this section or section 2, as the case may be) shall be increased, for that year of assessment, by £450 in respect of the first such child, £450 in respect of the second such child and £650 in respect of each such child in excess of two.

(3) Where an individual to whom this section applies proves that his total income for a year of assessment for which this section applies does not exceed a sum equal to twice the specified amount, he shall be entitled to have the amount of income tax payable in respect of his total income for that year, if that amount would, but for the provisions of this subsection, exceed a sum equal to 40 per cent. of the amount by which his total income exceeds the specified amount, reduced to that sum.

Alteration of rates of income tax.

2.—(1) Section 2 of the Finance Act, 1991 , is hereby amended, as respects the year of assessment 1994-95 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 £8,200	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 £16,400	27 per cent.	the standard rate
The remainder	48 per cent.	the higher rate

( 2 ) ( a ) The First Schedule to the Finance Act, 1993 , is hereby amended, in paragraph I of Part 1, by the substitution of the following definition for the definition of "higher rate":

"'higher rate', in relation to tax, means the rate of tax, known by that description, provided for in section 2 of the Finance Act, 1991 ;".

( b ) Paragraph ( a ) shall be deemed to have come into force and shall take effect as on and from the 6th day of April, 1993.

Personal reliefs.

3.—(1) Where a deduction falls to be made from the total income of an individual for the year of assessment 1994-95 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 1993-94	Amount to be deducted from total income for the year 1994-95 and subsequent years
(1)	(2)	(3)
Income Tax Act, 1967 :	£	£
section 138
(married person)	4,350	4,700
(widowed person bereaved in the year of assessment)	4,350	4,700
(widowed person)	2,675	2,850
(single person)	2,175	2,350
section 138A
(additional allowance for widowed persons and others in respect of children)
(widowed person)	1,675	1,850
(other person)	2,175	2,350

(2) Section 3 of the Finance Act, 1993 , shall have effect subject to the provisions of this section.

(3) The First Schedule shall have effect for the purpose of supplementing subsection (1).

Amendment of section 138B (employee allowance) of Income Tax Act, 1967 .

4.—As respects the year of assessment 1994-95 and subsequent years of assessment, section 138B (inserted by the Finance Act, 1980 ) of the Income Tax Act, 1967 , is hereby amended by the insertion after subsection (2) of the following subsection:

"(2A) ( a ) The exclusion from the definition of 'emoluments' in subsection (2) of the emoluments referred to in paragraphs (a) and (b) of the said definition shall not apply for any year of assessment to any such emoluments paid to an individual, being a child (other than a child who is a proprietary director) to whom the said paragraph (a) or (b)relates, if, for that year—

(i) (I) the individual is a specified employed contributor within the meaning of section 6 of the Finance Act, 1982 , or

(II) the provisions of the Income Tax (Employments) Regulations, 1960 ( S.I. No. 28 of 1960 ), in so far as they apply, have, in relation to any such emoluments paid to the individual in the year of assessment, been complied with by the person by whom the emoluments are paid, and

(ii) the conditions of the office or employment, in respect of which any such emoluments are paid, are such that the individual is required to devote, throughout the year of assessment, substantially the whole of the individual's time to the duties of the office or employment and the individual does in fact do so, and

(iii) the amount of any such emoluments, paid to the individual in the year of assessment, are not less than £3,600.

( b ) Where a deduction under this section is to be made from emoluments for any year of assessment by virtue of the operation of paragraph (a)of this subsection such deduction shall be given by way of repayment of tax.".

Amendment of section 6 (special allowance in respect of P R S I for 1982-83) of Finance Act, 1982 .

5.— Section 6 of the Finance Act, 1982 , shall have effect for the purpose of ascertaining the amount of income on which an individual referred to therein is to be charged to income tax for the year 1994-95, as if in subsection (2)—

( a ) "1994-95" were substituted for "1982-83", and

( b ) "£286" were substituted for "£312" in each place where it occurs.

Amendment of provisions relating to relief in respect of interest.

6.—(1) In this section "the principal sections" has the same meaning as it has in section 5 of the Finance Act, 1993 , that is to say, sections 76 (1) and 496 of, and paragraph 1 (2) of Part III of Schedule 6 to, the Income Tax Act, 1967 .

(2) As respects the year of assessment 1994-95 and subsequent years of assessment, section 5 of the Finance Act, 1993 , is hereby amended—

( a ) by the substitution in subsection (4) of "year of assessment 1994-95" for "year of assessment 1993-94" and of "five years" for "three years", and

( b ) by the addition of the following proviso to subsection (5):

"Provided that—

( a ) this subsection shall not apply or have effect for the first five years of assessment for which relief falls to be given under the principal sections in respect of one or more than one qualifying loan (within the meaning of section 21 of the Finance Act, 1982 ), and

( b ) for the purposes of calculating the additional relief, if any, which but for the enactment of paragraph (a)would not have been given for a year of assessment, any relief given in accordance with the principal sections in the case of a person who has elected or could be deemed to have duly elected to be assessed to tax in accordance with the provisions of section 194 of the Income Tax Act, 1967 , for any year of assessment shall, notwithstanding any other provision of the Tax Acts, be treated as given equally to the person and that person's spouse for such year of assessment notwithstanding that—

(i) section 197 of the Income Tax Act, 1967 , may have applied for that year of assessment, and

(ii) the payments in respect of which relief is given may not have been made in such proportions.",

and the said subsection (4) (other than the proviso), as so amended, is set out in the Table to this subsection.

TABLE

(4) As respects the year of assessment 1994-95 and subsequent years of assessment, section 6 of the Finance Act, 1987 , shall not apply or have effect for the first five years of assessment for which relief falls to be given under the principal sections in respect of one or more than one qualifying loan (within the meaning of section 21 of the Finance Act, 1982 ):

( 3 ) ( a ) The amount of relievable interest which would, but for this subsection, be taken into account for a year of assessment in accordance with the principal sections either as a deduction from income or by way of repayment of tax in respect of that interest shall, as respects the year of assessment 1994-95 and subsequent years of assessment, be restricted to the percentage (which may be nil) of such relievable interest as is set out in the Table to this subsection.

( b ) In relation to any part of relievable interest in respect of which relief would, but for this subsection, fall to be given for a year of assessment either as a deduction from income or by way of repayment of tax in respect of that part of the relievable interest, the income tax to be charged, other than in accordance with section 5 (3) of the Finance Act, 1974 , on the person by whom that interest is paid for that year of assessment shall be reduced by an amount which is the lesser of—

(i) the amount equal to the appropriate percentage of such part of the relievable interest, and

(ii) the amount which reduces that income tax to nil.

( c ) Except for the purposes of sections 1 and 2 of the Finance Act, 1980 , no account shall be taken of that part of the relievable interest as is referred to in paragraph ( b ) in calculating the total income of the person by whom the relievable interest is paid.

( d ) 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;

"relievable interest" means the interest in respect of which relief would, but for this subsection, otherwise have been given under the principal sections and any restriction which is imposed by any other enactment as to the amount of interest in respect of which relief is to be given under the principal sections shall be applied as if this subsection had not been enacted.

TABLE

Year of assessment	Percentage
1994 - 95	75%
1995 - 96	50%
1996 - 97	25%
A 1997 - 98 and subsequent years	0%

Restriction of relief in respect of insurance against expenses of illness.

7.—As respects the year of assessment 1995-96 and subsequent years of assessment, section 145 of the Income Tax Act, 1967 , is hereby amended by the insertion after subsection (3) of the following subsection:

"(3A) ( a ) The amount of a payment or part of a payment, as the case may be, (referred to in this subsection as the 'relievable amount') which would, but for this subsection, be taken into account in accordance with the foregoing provisions of this section either as a deduction from or set-off against any income of an individual for a year of assessment shall be restricted to the percentage (which may be nil) of such relievable amount as is set out in the Table to this subsection.

( b ) In relation to any part of the relievable amount in respect of which relief would, but for this subsection, fall to be given either as a deduction from or set-off against any income of an individual for a year of assessment, the income tax to be charged for that year of assessment, other than in accordance with section 5 (3) of the Finance Act, 1974 , on the person by whom the payment is made shall be reduced by an amount which is the lesser of—

(i) the amount equal to the appropriate percentage of such part of the relievable amount, and

(ii) the amount which reduces that income tax to nil.

( c ) 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.

TABLE

Year of assessment	Percentage
1995-96	50%
1996-97 and subsequent years	0%

Amendment of section 12 (relief for health expenses) of Finance Act, 1967 .

8.—As respects the year of assessment 1994-95 and subsequent years of assessment, section 12 of the Finance Act, 1967 , is hereby amended, in subsection (2), by the substitution—

( a ) in paragraph (a), of "£100" for "£50", and

( b ) in paragraph (c)(inserted by the Finance Act, 1969 ), of "£200" for "£100" in both places where it occurs,

and the said paragraphs (a) and (c), as so amended, are set out in the Table to this section.

TABLE

( a ) Subject to the provisions of this section, where an individual, having made a claim in that behalf and having made a return in the prescribed form of his total income, proves that in the year of assessment he defrayed health expenses which were incurred for the provision of health care for any one qualified person and the amount of which in the aggregate exceeds £100, he shall be entitled, for the purpose of ascertaining the amount of the income on which he is to be charged to income tax, to have a deduction of the amount of the excess made from his total income.

( c ) Where an individual, having made a claim in that behalf and having made a return in the prescribed form of his total income, proves that in the year of assessment he defrayed health expenses which were incurred for the provision of health care for qualified persons and which amount in the aggregate to more than £200, he shall be entitled, for the purpose of ascertaining the amount of the income on which he is to be charged to income tax, to have a deduction of the amount by which the aggregate of the health expenses so computed exceeds £200 made from his total income and such deduction shall be in substitution for and not in addition to a deduction under paragraph (a).

Amendment of section 8 (restriction of relief in respect of interest paid on certain loans at a reduced rate) of Finance Act, 1982 .

9.— Section 8 of the Finance Act, 1982 , is hereby amended, as respects the year 1994-95 and subsequent years of assessment, by the substitution in the definition of "the specified rate" (inserted by the Finance Act, 1989 ) in subsection (1) of—

( a ) "7.5 per cent." for "11 per cent." (inserted by the Finance Act, 1992 ) in both places where it occurs, and

( b ) "11. 5 per cent." for "15 per cent." (inserted by the Finance Act, 1992 ),

and the said definition, as so amended, is set out in the Table to this section.

TABLE

"the specified rate", in relation to a preferential loan, means—

(i) in a case where—

(I) the interest which is paid on the preferential loan qualifies for relief under section 76 (1) ( c ) or 496 of, or paragraph 1 (2) of Part III of Schedule 6 to, the Income Tax Act, 1967 , or

(II) if no interest is paid on the preferential loan, the interest which would have been paid on that loan (if interest had been payable) would have so qualified,

the rate of 7.5 per cent. per annum or such other rate (if any) as stands prescribed by the Minister for Finance by regulations, or

(ii) in a case where—

(I) the preferential loan is made to an employee by an employer,

(II) the making of loans for the purposes of purchasing a dwelling-house for occupation by the borrower as a residence, for a stated term of years at a rate of interest which does not vary for the duration of the loan, forms part of the trade of the employer, and

(III) the rate of interest at which the employer in the course of his trade at the time the preferential loan is or was made makes or made loans at arm's length to persons, other than employees for the purposes of purchasing a dwelling-house for occupation by the borrower as a residence is less than 7.5 per cent. per annum or such other rate (if any) as stands prescribed by the Minister for Finance by regulations,

the first-mentioned rate in subparagraph (III), or

(iii) in any other case, the rate of 11.5 per cent. per annum or such other rate (if any) as stands prescribed by the Minister for Finance by regulations.

Taxation treatment of unemployment benefit in certain cases.

10.—(1) In this section—

"day of unemployment" has the same meaning as it has in section 42 of the Social Welfare (Consolidation) Act, 1993 ;

"period of interruption of employment" shall be construed in accordance with section 42 of the Social Welfare (Consolidation) Act, 1993 ;

"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 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 or have effect, as respects the year of assessment 1994-95, in relation to unemployment benefit paid or payable to a person, employed in short-time employment and who was so employed on the 5th day of April, 1994, in respect of a day of unemployment forming part of a period of interruption of employment which commenced on or before that day.

Amendment of Second Schedule to Finance Act, 1992 .

11.—(1) The Second Schedule to the Finance Act, 1992 , is hereby amended—

( a ) by the substitution of the following paragraph for paragraph 17:

"17. A vocational education committee or a technical college established under the Vocational Education Act, 1930 .",

( b ) by the substitution of the following paragraph for paragraph 22:

"22. The Industrial Development Agency (Ireland).",

( c ) by the deletion of paragraph 28, and

( d ) by the addition of the following paragraphs after paragraph 62:

"63. The Environmental Protection Agency.

64. Forbairt.

65. Forfás.

66. The Irish Aviation Authority.

67. The National Economic and Social Council.

68. The National Economic and Social Forum.

69. The National Roads Authority.

70. Temple Bar Properties Limited.

71. The Irish Film Board.

72. An educational institution established by or under section 3 of the Regional Technical Colleges Act, 1992 , as a regional technical college.

73. The Dublin Institute of Technology.".

(2) This section shall apply and have effect as on and from the 6th day of June, 1994.

Amendment of provisions relating to interest payments by certain deposit takers.

12.—(1) Chapter IV of Part I of the Finance Act, 1986 , is hereby amended—

( a ) in paragraph (c)(inserted by the Finance Act, 1993 ) of subsection (1) of section 35, by the insertion, as respects the year 1994-95 and subsequent years of assessment, of the following proviso:

"Provided that, where the specified amount is so increased, references in the said sections 1 and 2 to—

(i) 'income tax payable' shall be construed as references to the income tax payable after credit is given, by virtue of section 4 of the Finance Act, 1974 , for appropriate tax deducted from the said payment of relevant interest, and

(ii) 'a sum equal to twice the specified amount' shall be construed as references to a sum equal to the aggregate of twice the specified amount (before it is so increased) and the amount of the said payment of relevant interest,",

and

( b ) in subsection (1) of section 37A (inserted by the Finance Act, 1992 ), by the insertion, as respects payments of relevant interest made on or after the 9th day of July, 1993, of the following paragraph after paragraph (d):

"( dd ) interest paid or payable in respect of the relevant deposit or relevant deposits held in the account shall not, directly or indirectly, be linked to, or determined by, any change in the price or value of any shares, stocks, debentures or securities listed on a stock exchange or dealt in on an unlisted securities market;".

(2) Section 14 of the Finance Act, 1993 , is hereby amended by the insertion in subparagraph (i) of paragraph (c)of subsection (1) of ", (dd) (inserted by the Finance Act, 1994 )" after "( d )".

Amendment of section 18 (date for payment of tax) of Finance Act, 1988 .

13.— Section 18 (as amended by the Finance Act, 1993 ) of the Finance Act, 1988 , is hereby amended by the substitution, in paragraph (b) of subsection (3), of the following proviso for the additional proviso (inserted by the Finance Act, 1991 ) to subparagraph (ii):

"Provided also that, for the purpose of this subparagraph, where the chargeable person is chargeable to income tax—

( a ) for a chargeable period being the year of assessment 1991-92 or any subsequent year of assessment, the tax payable for the immediately preceding chargeable period shall be determined without regard to any relief to which the chargeable person is, or may become, entitled for that immediately preceding chargeable period under Chapter III of Part I of the Finance Act, 1984 ;

( b ) for a chargeable period being the year of assessment 1994-95 or any subsequent year of assessment, the tax payable for the immediately preceding chargeable period shall be determined without regard to any relief to which the chargeable person is, or may become, entitled for that immediately preceding chargeable period under section 35 (as amended by the Finance Act, 1994 ) of the Finance Act, 1987 ;

( c ) for a chargeable period being the year of assessment 1994-95, the tax payable for the immediately preceding chargeable period shall be determined as if section 9 of the Finance Act, 1993 , had not been enacted,".

Amendment of section 2 (exemption of certain earnings of writers, composers and artists) of Finance Act, 1969 .

14.—(1) In this section "section 2" means section 2 of the Finance Act, 1969 .

( 2 ) ( a ) An Comhairle Ealaíon and the Minister for Arts, Culture and the Gaeltacht shall, with the consent of the Minister for Finance, draw up guidelines for determining, for the purposes of section 2, whether a work falling into a category specified in subsection (1) of that section is an original and creative work and whether it has, or is generally recognised as having, cultural or artistic merit.

( b ) Without prejudice to the generality of paragraph ( a ), a guideline under that paragraph may—

(i) consist of a specification of types or kinds of works that are not original and creative or that have not, or are not generally recognised as having, cultural or artistic merit, including a specification of works that are published, produced or sold for a specified purpose, and

(ii) specify criteria by reference to which the questions whether works are original or creative and whether they have, or are generally recognised as having, cultural or artistic merit are to be determined.

( 3 ) ( a ) Where a claim for a determination under subsection (2) of section 2 is or was made to the Revenue Commissioners on or after the 3rd day of May, 1994, the Revenue Commissioners shall not determine that the work concerned is original and creative or has, or is generally recognised as having, cultural or artistic merit unless it complies with the guidelines under subsection (2) for the time being in force.

( b ) Paragraph ( a ) shall, with any necessary modifications, apply to—

(i) a determination by the Appeal Commissioners under subsection (5C) of section 2 on an appeal to them under that subsection in relation to such a claim as is mentioned in paragraph ( a ), and

(ii) a rehearing by a judge of the Circuit Court of such an appeal as is mentioned in subparagraph (i) and, to the extent necessary, to the determination by the High Court of any question of law arising on such an appeal or rehearing and specified in the statement of a case for the opinion of the High Court, by the Appeal Commissioners or, as the case may be, a judge of the Circuit Court.

(4) Where a determination has been or is made under clause (I) or (II) of subsection (2) ( a ) (ii) of section 2 in relation to a work or works of a person, subsection (3) ( a ) of that section shall not apply to a work of that person that is in the same category as the work or works aforesaid and is or was first published, produced or sold on or after the 3rd day of May, 1994, unless the work is one that complies with the guidelines under subsection (2) for the time being in force and would qualify to be determined by the Revenue Commissioners as an original or creative work and as having, or being generally recognised as having, cultural or artistic merit.

(5) On application to the Revenue Commissioners in that behalf by any person, the Revenue Commissioners shall supply the person free of charge with a copy of any guidelines under subsection (2) for the time being in force.

Interest on quoted Eurobonds.

15.—The Income Tax Act, 1967 , is hereby amended by the insertion after section 462 of the following section:

"462A.—(1) In this section—

'appropriate inspector' means the inspector authorised by the Revenue Commissioners for the purposes of this section;

'quoted Eurobond' means a security which—

( a ) is issued by a company,

( b ) is quoted on a recognised stock exchange,

( c ) is in bearer form, and

( d ) carries a right to interest;

'recognised clearing system' means any system for clearing quoted Eurobonds or relevant foreign securities which is for the time being designated for the purposes of this section by order of the Revenue Commissioners as a recognised clearing system;

'relevant foreign securities' means—

( a ) any such stocks, funds, shares or securities as give rise to dividends to which this Part applies, or

( b ) any such securities as give rise to foreign public revenue dividends, within the meaning of section 51;

'relevant person' means—

( a ) the person by or through whom interest is paid, or

( b ) a banker or any other person, or a dealer in coupons, referred to in section 461,

as the case may be.

(2) Section 31 (2) of the Finance Act, 1974 , shall not apply to interest paid on any quoted Eurobond where—

( a ) the person by or through whom the payment is made is not in the State, or

( b ) the payment is made by or through a person in the State and—

(i) the quoted Eurobond is held in a recognised clearing system, or

(ii) the person who is the beneficial owner of the quoted Eurobond and who is beneficially entitled to the interest is not resident in the State and has made a declaration of the kind mentioned in subsection (7).

(3) In a case falling within subsection (2) ( b ) the person by or through whom the payment is made shall deliver to the appropriate inspector—

( a ) on demand by the appropriate inspector an account of the amount of any such payment, and

( b ) not later than 12 months after making any such payment, and unless within that time that person delivers an account with respect to the payment under paragraph (a), a written statement specifying that person's name and address and describing the payment.

(4) Where by virtue of any provision of the Tax Acts interest paid on any quoted Eurobond is deemed to be income of a person other than the person who is the beneficial owner of the quoted Eurobond, subsection (2) ( b ) (ii) shall apply as if it referred to that other person.

(5) Sections 461 and 462 and, in so far as it relates to the said section 461, Schedule 1 shall apply in relation to interest on quoted Eurobonds as they would apply to dividends to which this Part applies—

( a ) if in paragraph (a)of section 461 for 'applies elsewhere than in the State' there were substituted the following:

'applies and—

(i) the payment of those dividends was not made by or entrusted to any person in the State, or

(ii) the stocks, funds and securities in respect of which those dividends are paid are held in a recognised clearing system',

( b ) if in section 462 there were substituted for subsection (1), apart from the proviso, the following:

'(1) No tax shall be chargeable in respect of dividends to which this Part applies which are payable in the State where the person who is the beneficial owner of the stocks, funds, shares or securities and who is beneficially entitled to the dividends is not resident in the State and has made a declaration of the kind mentioned in subsection (7) of section 462A:',

and

( c ) if in subparagraph (1) of paragraph 1 of Part IV of Schedule 1 there were omitted clauses (a) and (b).

(6) An order under subsection (1)—

( a ) may contain such transitional and other supplemental provisions as appear to the Revenue Commissioners to be necessary or expedient, and

( b ) may be varied or revoked by a subsequent order so made.

(7) The declaration referred to in subsection (2) ( b ) (ii) or subsection (1) of section 462 (as construed by reference to subsection (5) ( b )) is a declaration in writing to a relevant person which—

( a ) is made by a person (hereafter in this section referred to as 'the declarer') to whom any interest in respect of which the declaration is made is payable by the relevant person, and is signed by the declarer,

( b ) is made in such form as may be prescribed or authorised by the Revenue Commissioners,

( c ) declares that at the time the declaration is made the person who is beneficially entitled to the interest is not resident in the State,

( d ) contains as respects the person mentioned in paragraph (c) —

(i) the name of the person,

(ii) the address of that person's principal place of residence, and

(iii) the name of the country in which that person is resident at the time the declaration is made,

( e ) contains an undertaking by the declarer that if the person referred to in paragraph (c)becomes resident in the State, the declarer will notify the relevant person accordingly, and

( f ) contains such other information as the Revenue Commissioners may reasonably require for the purposes of this section.

(8) ( a ) A relevant person shall—

(i) keep and retain for the longer of the following periods, that is to say—

(I) a period of six years, and

(II) a period which ends not earlier than three years after the latest date on which interest in respect of which the declaration was made is paid,

and

(ii) on being so required by notice given to it in writing by an inspector, make available to the inspector, within the time specified in the notice,

all declarations of the kind mentioned in this section which have been made in respect of interest paid by a relevant person.

( b ) The inspector may examine or take extracts from or copies of any declarations made available to him under paragraph (a).".

CHAPTER II Income Tax, Corporation Tax and Capital Gains Tax

Amendment of Chapter III (Income Tax: Relief for Investment in Corporate Trades) of Part I of Finance Act, 1984 .

16.—(1) Chapter III of Part I of the Finance Act, 1984 , is hereby amended—

( a ) in subsection (1) of section 11—

(i) by the insertion of the following definitions after the definition of "associate" (inserted by the Finance Act, 1985 ):

"'certifying agency' means an industrial development agency or Bord Fáilte Éireann or An Bord Iascaigh Mhara or An Bord Tráchtála — The Irish Trade Board (as may be appropriate);

'certifying Minister' means the Minister for Agriculture, Food and Forestry or the Minister for the Marine (as may be appropriate);",

(ii) by the substitution of the following definition for the definition of "relevant trading operations" (inserted by the Finance Act, 1993 )—

"'relevant trading operations' means 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) carried on or to be carried on by a relevant company in respect of which a certificate has been issued by a certifying agency or a certifying Minister (as may be appropriate) certifying that the agency or the Minister (as the case may be) is satisfied, on the basis of such information as is supplied to the agency or the Minister (as may be appropriate) by the company or which the agency or the Minister (as may be appropriate) may reasonably require the company to furnish, that the carrying on of such operations by the company is, or will be, a bona fide new venture which, having regard to—

( a ) the potential for the creation of additional sustainable employment, and

( b ) the desirability of minimising the displacement of existing employment,

may be eligible, based on guidelines agreed (as may be appropriate in the circumstances)—

(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, or

(ii) between the certifying Minister and the Minister for Finance,

to be grant-aided under a scheme of assistance administered by the certifying agency or the certifying Minister (as the case may be)

Provided that—

(I) the carrying on of such qualifying trading operations shall not be regarded as not being a bona fide new venture by reason only that they were carried on as, or as part of, a trade by another person at any time before the issue of the relevant shares in respect of which relief is claimed, and

(II) such a certificate may be issued in the case of a qualifying trading operation such as is referred to in subparagraph (iiia ) (inserted by the Finance Act, 1988 ) of paragraph (a)of subsection (2) of section 16 without regard as to whether such an operation is eligible to be grant-aided, but in considering whether to issue such a certificate, the Minister for Agriculture, Food and Forestry shall have regard to such guidelines, in relation to the issue of such a certificate, as may be agreed between the said Minister and the Minister for Finance, and

(III) such a certificate shall not be issued—

( A ) by Bord Fáilte Éireann where the value of the relevant company's interests in land and buildings (excluding fixtures and fittings) is or is intended to be greater than half the value of its assets as a whole, or

( B ) unless the relevant company undertakes in writing to furnish the certifying agency or the certifying Minister (as may be appropriate) when requested to do so with such details in relation to the carrying on of the relevant trading operations as the agency or the Minister (as may be appropriate) may specify;",

(iii) by the substitution of the following paragraph for paragraph (b) of the definition of "specified individual" (inserted by the Finance Act, 1993 )—

"( b ) in each of the three years of assessment preceding the year of assessment immediately prior to the year of assessment in which such employment commences, was not in receipt of income chargeable to tax otherwise than under Schedule E or under Case III of Schedule D in respect of profits or gains from an office or employment held or exercised outside the State in excess of the lesser of—

(i) the aggregate of the amounts, if any, of the individual's income chargeable to tax under Schedule E and under Case III of Schedule D as aforesaid, or

(ii) £10,000,",

( b ) as respects eligible shares issued on or after the 6th day of April, 1994, in paragraph (a) of subsection (7A) (inserted by the Finance Act, 1993 ) of section 14, by the substitution of "£250,000" for "£150,000", and the said paragraph (a), as so amended, is set out in the Table to this section, and

( c ) in paragraph (a)of subsection (2) of section 16—

(i) by the insertion of the following subparagraph after subparagraph (ii):

"( iia ) in respect of a subscription for relevant shares issued on or after the 17th day of June, 1993, the rendering of such services as are mentioned in subparagraph (ii) in respect of which an employment grant would have been made or a grant or financial assistance would have been made available, as the case may be, by an industrial development agency under one of the provisions mentioned in the said subparagraph (ii) but for the fact, and only for the fact, that the industrial development agency concerned was or is precluded from making such an employment grant or making available such a grant or financial assistance, as the case may be, by virtue of the fact that a grant or financial assistance had already been made by some other person,",

and

(ii) by the insertion of the following subparagraph after subparagraph ( iiic ) (inserted by the Finance Act, 1993 ):

"( iiid ) in respect of a subscription for eligible shares issued on or after the 11th day of April, 1994, the cultivation of mushrooms within the State,".

(2) Subsection (1) ( a ) shall be deemed to have come into force and shall take effect as on and from the 17th day of June, 1993.

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( a ) if, throughout the relevant period, the aggregate of all amounts subscribed for the issued share capital and the loan capital (within the meaning of subsection (5)) of the company does not exceed £250,000, or

Cesser of transitional provisions relating to amounts raised by companies acting in concert, or for trade of subsidiary.

17.—Subsection (3) ( b ) of section 17 of the Finance Act, 1991 , shall not apply or have effect in relation to eligible shares issued on or after the 30th day of June, 1994.

Amendment of Section 19 (relief for expenditure on significant buildings) of Finance Act, 1982 .

18.—(1) Section 19 of the Finance Act, 1982 , is hereby amended—

( a ) as respects qualifying expenditure incurred in a chargeable period beginning on or after the passing of this Act, by the substitution of the following subsection for subsection (2):

"(2) ( a ) Subject to the provisions of this section, where a person, having made a claim in that behalf, proves—

(i) that he has incurred in a chargeable period qualifying expenditure in respect of an approved building owned or occupied by him,

and

(ii) that he has on or before the 1st day of January in the chargeable period in respect of which the claim is made and in each of the chargeable periods comprising whichever is the shortest of the following periods—

(I) the period consisting of the chargeable periods since the passing of the Finance Act, 1994 ,

(II) the period consisting of the chargeable periods since a determination under subsection (4) ( a) (ii) was made in relation to the building,

(III) the period consisting of the chargeable periods since the approved building was purchased or occupied by him,

(IV) the period consisting of the 5 chargeable periods immediately preceding the chargeable period for which the claim is made,

provided Bord Fáilte Éireann (hereinafter in this subsection referred to as 'the Board') with particulars of—

( A ) the name, if any, and address of the approved building, and

( B ) the days and times during the year when access to the approved building is afforded to the public,

the particulars being provided to the Board on the understanding by the person and the Board that they may be published by the Board or by another body concerned with the promotion of tourism,

then, all the provisions of the Tax Acts shall apply as if the amount of the qualifying expenditure were a loss sustained in the chargeable period in a trade carried on by the person separate from any trade actually carried on by that person.

( b ) Relief authorised by this subsection shall not apply for any chargeable period prior to the chargeable period in which the application concerned to the Revenue Commissioners is made under subsection (4) (a).",

and

( b ) as respects a determination made on or after the passing of this Act by the Revenue Commissioners in accordance with the provisions of paragraph (a)(ii) of subsection (4), by the substitution in paragraph (b) (ii) of the said subsection of "60 days (including not less than 40 days during the period commencing on the 1st day of May and ending on the 30th day of September)" for "thirty days" and the said paragraph (b)(ii), as so amended, is set out in the Table to this section.

(2) Notwithstanding the fact that the Revenue Commissioners have, before the passing of this Act, made a determination in accordance with the provisions of paragraph (a)(ii) of subsection (4) of section 19 of the Finance Act, 1982 , that a building is a building to which reasonable access is afforded to the public, relief under subsection (2) of the said section 19, as amended by paragraph ( a ) of subsection (1), in relation to qualifying expenditure incurred in a chargeable period beginning on or after the 1st day of January, 1995, in respect of the building, shall not be given unless the person who owns or occupies the building satisfies the Revenue Commissioners on or before the 1st day of January in the chargeable period that it is a building to which reasonable access is afforded to the public having regard to the provisions of paragraph (b)(ii) of subsection (4) of the said section 19 as amended by paragraph ( b ) of subsection (1).

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(ii) subject to temporary closure necessary for the purposes of the repair, maintenance or restoration of the building, access is so afforded for not less than 60 days (including not less than 40 days during the period commencing on the 1st day of May and ending on the 30th day of September) in any year and on each such day access is afforded in a reasonable manner and at reasonable times for a period, or periods in the aggregate, of not less than 4 hours, and

Exemption from charge to tax of certain loans of art objects.

19.—(1) In this section—

"art object" has the meaning assigned to it by subsection (2);

"authorised person" means—

( a ) an inspector or other officer of the Revenue Commissioners authorised by them in writing for the purposes of this section, or

( b ) a person authorised by the Minister in writing for the purposes of this section;

"the Minister" means the Minister for Arts, Culture and the Gaeltacht;

"relevant building" means an approved building within the meaning of section 19 of the Finance Act, 1982 ;

"relevant garden" means an approved garden within the meaning of section 29 of the Finance Act, 1993 .

( 2 ) ( a ) In this section "art object" means any work of art (including a picture, sculpture, print, book, manuscript, piece of jewellery, furniture or other similar object) or scientific collection, which, on application to them in that behalf by a person who owns or occupies a relevant building or a relevant garden, as the case may be, is determined—

(i) by the Minister, after consideration of any evidence in relation to the matter which the individual submits to the Minister and after such consultation (if any) as may seem to the Minister to be necessary with such person or body of persons as in the opinion of the Minister may be of assistance to the Minister, to be an object which is intrinsically of significant national, scientific, historical or aesthetic interest, and

(ii) by the Revenue Commissioners, to be an object reasonable access to which is afforded, and in respect of which reasonable facilities for viewing are provided, to the public.

( b ) Without prejudice to the generality of the requirement that reasonable access be afforded, and that reasonable facilities for viewing be provided, to the public, access to and facilities for the viewing of an art object shall not be regarded as being reasonable access afforded, or the provision of reasonable facilities for viewing, to the public unless—

(i) subject to such temporary removal as is necessary for the purposes of the repair, maintenance or restoration of the object as is reasonable, access to it is afforded and facilities for viewing it are provided for not less than 60 days (including not less than 40 days during the period commencing on the 1st day of May and ending on the 30th day of September) in any year and on each such day such access is afforded and such facilities for viewing are provided in a reasonable manner and at reasonable times for a period, or periods in the aggregate, of not less than 4 hours, and

(ii) such access is afforded and such facilities are provided to the public on the same days and at the same times as access is afforded to the public to the relevant building or the relevant garden, as the case may be, in which the object is kept, and

(iii) the price, if any, paid by the public in return for such access is, in the opinion of the Revenue Commissioners, reasonable in amount and does not operate to preclude the public from seeking access to the object.

( c ) Where under paragraph ( a ) the Revenue Commissioners make a determination in relation to an art object, and reasonable access to the object ceases to be afforded, or reasonable facilities for the viewing of the object cease to be provided, to the public, the Revenue Commissioners may, by notice in writing given to the owner or occupier of the relevant building or relevant garden, as the case may be, in which the object is kept, revoke the determination with effect from the date on which they consider that such access or such facilities for viewing so ceased, and—

(i) this subsection shall cease to apply to the object from that date, and

(ii) for the year of assessment in which this subsection ceases to apply to the object, subsection (3) shall cease to apply to any expense referred to in paragraph ( a ) of that subsection incurred or deemed to have been incurred by the body corporate concerned.

(3) Subject to the provisions of this section, where—

( a ) a body corporate incurs an expense solely in, or solely in connection with, or is deemed to incur an expense in connection with, the provision to an individual (being an individual who is employed by the body corporate in an employment to which Chapter III of Part V of the Income Tax Act, 1967 , applies, or who is a director (within the meaning of that Chapter) of the body corporate) of a benefit or facility which consists of the loan of an art object of which the body corporate is the beneficial owner, and

( b ) the object is kept in a relevant building or a relevant garden, as the case may be, owned or occupied by the individual,

section 96 (2) of the Corporation Tax Act, 1976 , shall not apply to any such expense and section 117 (1) of the Income Tax Act, 1967 , shall not apply to any such expense for any year of assessment for which a claim in that behalf is made by the individual to the Revenue Commissioners.

( 4 ) ( a ) Where an individual makes an application under subsection (2), or a claim under subsection (3), an authorised person may, at any reasonable time, enter the relevant building or relevant garden concerned for the purpose of inspecting the art object to which the application or claim relates.

( b ) Whenever an authorised person exercises any power conferred on him by this subsection, he shall, on request, produce his authorisation to any person concerned.

( c ) Any person who obstructs or interferes with an authorised person in the course of exercising a power conferred on him by this subsection shall be guilty of an offence and shall be liable, on summary conviction, to a fine not exceeding £500.

(5) An application under subsection (2) or a claim under subsection (3)—

( a ) shall be made in such form as the Revenue Commissioners may from time to time prescribe, and

( b ) in the case of a claim under subsection (3), shall be accompanied by such statements in writing as may be required by the prescribed form in relation to the expense in respect of which the claim is made, including statements by the body corporate which incurred the expense.

(6) Section 43 of the Finance Act, 1991 , shall not apply to an object which is an art object.

(7) This section shall apply and have effect for the year of assessment 1994-95 and subsequent years of assessment:

Provided that for any earlier year of assessment (being a year of assessment not earlier than 1982-83) subsection (3) shall apply and have effect, notwithstanding the provisions of section 498 of the Income Tax Act, 1967 , where, in relation to an art object, an individual shows to the satisfaction of the Revenue Commissioners that reasonable access to the object was afforded, and reasonable facilities for the viewing of the object were provided, to the public on the same days and at the same times as access was afforded to the public to the relevant building or relevant garden, as the case may be, in which the object was kept; and, for the purposes of this proviso, subsection (2) (b) (i) shall have effect as if "30 days" were substituted for "60 days (including not less than 40 days during the period commencing on the 1st day of May and ending on the 30th day of September)".

Amendment of section 35 (relief for investment in films) of Finance Act, 1987 .

20.—(1) Section 35 of the Finance Act, 1987 , is hereby amended—

( a ) in subsection (1)—

(i) by the insertion of the following definition after the definition of "allowable investor company":

"'authorised officer' means an officer of the Revenue Commissioners authorised by them in writing for the purposes of this section;",

(ii) by the insertion of the following definition after the definition of "film":

"'the Minister' means the Minister for Arts, Culture and the Gaeltacht;",

(iii) by the substitution of the following definition for the definition of "qualifying film":

"'qualifying film' means a film in respect of which the Minister has given a certificate under subsection (1A) (inserted by the Finance Act, 1994 );",

and

(iv) by the substitution, in the definition of "relevant investment", of the following paragraph for paragraph (a):

"( 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",

( b ) by the insertion of the following subsection after subsection (1):

"(1 A) ( a ) The Minister 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 either—

(i) for the purposes of this section (other than subsection (7A) (inserted by the Finance Act, 1994 )), or

(ii) for the purposes of this section.

( b ) A certificate given by the Minister under paragraph (a) shall—

(i) be subject to the following conditions, that is to say—

(A) 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, and

(B) not more than 60 per cent. of the cost of the production of the film is met by relevant investments:

Provided that where the percentage of the work on the production of the film carried out in the State (referred to subsequently in this proviso as the specified percentage) is less than 60 per cent., paragraph (b) shall be construed as if the reference to 60 per cent. were a reference to the specified percentage,

and

(ii) be subject to such other conditions as the Minister may consider proper and specifies therein.

( c ) Where a company fails to comply with any of the conditions to which a certificate issued to it under paragraph (a)is subject by virtue of paragraph (b), that failure shall constitute the failure of an event to happen by reason of which relief falls to be withdrawn under subsection (4). ",

( c ) by the insertion of the following subsections after subsection (4):

"(4A) 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.

(4B) Before issuing a certificate for the purposes of subsection (4A) a company shall furnish the authorised officer with 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 the qualifying film.

(4C) A certificate to which subsection (4A) relates shall not be issued without the authority of the authorised officer.

(4D) Any statement under subsection (4B) shall—

( a ) contain such information as the Revenue Commissioners may reasonably require,

( b ) be in such form as the Revenue Commissioners may direct, and

( c ) contain a declaration that it is correct to the best of the company's knowledge and belief.

(4E) Where a company has issued a certificate for the purposes of subsection (4A), or furnished a statement under subsection (4B), and either—

( a ) the certificate or statement was made fraudulently or negligently, or

( b ) the certificate was issued in contravention of subsection (4C),

then 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.

(4F) 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.",

and

( d ) by the insertion of the following subsection after subsection (7):

"(7A) ( a ) In this subsection 'a film or films to which this subsection applies' means a qualifying film or films the cost of production of each of which does not exceed £1,050,000 and in respect of each of which the Minister has given a certificate under subsection (1A) (a) (ii).

( b ) Where, in the period beginning on the 9th day of July, 1994, and ending on the 8th day of July, 1995, an allowable investor company makes, by way of a subscription for new ordinary shares (within the meaning of subsection (7)), a relevant investment in a qualifying company which exists solely for the purposes of the production and distribution of a film or films to which this subsection applies and that relevant investment is not one to which paragraph (b) of subsection (3) refers, then, if those shares are disposed of by the allowable investor company on a day which is not earlier than 12 months after the date of their acquisition by that company, the provisions of paragraph (b) of subsection (7) shall apply to the consideration upon such disposal of those shares as if the reference therein to three years were a reference to one year.".

(2) ( a ) Subparagraph (iv) of paragraph (a) of subsection (1) shall apply and have effect as respects relevant investments made on or after the 14th day of January, 1994:

Provided that the said subparagraph (iv) shall not apply or have effect in relation to a sum of money paid to a company on or before the 1st day of August, 1994, in respect of the production of a particular film where, on or before the 14th day of January, 1994, the Revenue Commissioners having received an application in that behalf from the company and on the basis of the information furnished to them by the company in support of that application, had expressed an opinion that, in relation to the production of that film, the company would be regarded as a qualifying company for the purposes of section 35 of the Finance Act, 1987 , and, but for the enactment of the said subparagraph (iv), the sum of money would fall to be treated as a relevant investment (within the meaning of that section).

( b ) Paragraphs (a) (other than subparagraph (iv)), (b) and (c)of subsection (1) shall apply and have effect as respects relevant investments made on or after the passing of this Act.

Capital allowances for, and deduction in respect of, vehicles.

21.—(1) ( a ) Subject to paragraph ( b ), sections 25 to 29 of the Finance Act, 1973 , shall have effect, in relation to expenditure incurred on the provision or hiring of a vehicle to which those sections apply, as if for "£2,500" (construed as a reference to £10,000 by virtue of section 21 of the Finance Act, 1992 ), in each place where it occurs in those sections, there were substituted "£13,000".

(b) Paragraph ( a ) shall apply only to expenditure incurred on the provision or hiring of a vehicle which, on or after the 27th day of January, 1994, is first registered in the State under section 131 of the Finance Act, 1992 , without having been previously registered in any other State which duly provides for the registration of a mechanically propelled vehicle, and it does not include—

(i) as respects the said sections 25 to 27, expenditure incurred before the 27th day of January, 1994, or incurred within 12 months after that day under a contract entered into before that date, and

(ii) as respects subsections (2) and (3) of the said section 28 and the said section 29, expenditure incurred under a contract entered into before the said 27th day of January, 1994.

(2) Section 32 of the Finance Act, 1976 , shall have effect, in relation to qualifying expenditure (within the meaning of that section) incurred after the 26th day of January, 1994, as if for "£3,500" (construed as a reference to £10,000 by virtue of section 21 of the Finance Act, 1992 ), in each place where it occurs, there were substituted "£13,000".

Capital allowances for industrial buildings or structures.

22.—(1) The Income Tax Act, 1967 , is hereby amended—

( a ) in section 254, by the deletion of subsection (3A) (inserted by the Finance Act, 1990 ),

(b) in section 256, by the renumbering of the existing provision as subsection (1) and by the insertion of the following provision as subsection (2):

"(2) Where a building or structure which is to be an industrial building or structure forms part of a building or is one of a number of buildings in a single development, or forms a part of a building which is itself one of a number of buildings in a single development, there shall be made such apportionment as is necessary of the expenditure incurred on the construction of the whole building or number of buildings, as the case may be, for the purpose of determining the expenditure incurred on the construction of the building or structure which is to be an industrial building or structure.",

( c ) in section 264—

(i) by the substitution of the following paragraphs for paragraph (i) of the proviso to subsection (1):

"(i) in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) (d) by reason of its use as a holiday cottage and in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) (c), this Part shall have effect as if 'one-tenth' were substituted for 'one-fiftieth' in the foregoing provisions of this subsection, and

( ia ) in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) (d), other than a building or structure to which paragraph (i) relates, this Part shall have effect as if 'fifteen hundredths' were substituted for 'one-fiftieth' in the foregoing provisions of this subsection, and",

and

(ii) by the substitution of the following paragraphs for paragraph (i) of the proviso to subsection (3):

"(i) in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) ( d ) by reason of its use as a holiday cottage and in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) ( c ), this Part shall have effect as if 'ten years' were substituted for 'fifty years' in the foregoing provisions of this subsection, and

( ia ) in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) ( d ), other than a building or structure to which paragraph (i) relates, this Part shall have effect as if 'seven years' were substituted for 'fifty years' in the foregoing provisions of this subsection, and",

and

( d ) in section 265—

(i) by the substitution, in paragraph (c)of subsection (1), of "ceases to be used as an industrial building or structure" for "ceases altogether to be used", and

(ii) by the substitution of the following paragraphs for paragraph (ii) of the proviso to subsection (1):

"(ii) in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) ( d ) by reason of its use as a holiday cottage and in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) ( c ), this Part shall have effect as if 'ten years' were substituted for 'fifty years' in the foregoing provisions of this subsection, and

( iia ) in relation to a building or structure which falls to be regarded as an industrial building or structure within the meaning of section 255 (1) ( d ), other than a building or structure to which paragraph (ii) relates, this Part shall have effect as if 'seven years' were substituted for 'fifty years' in the foregoing provisions of this subsection, and".

( 2 ) ( a ) Paragraphs ( a ), (b) and (d) (i) of subsection (1) shall apply and have effect as on and from the 11th day of April, 1994.

( b ) Paragraphs ( c ) and (d) (ii) of subsection (1) shall apply and have effect as respects capital expenditure incurred on the construction of a building or structure on or after the 27th day of January, 1994.

Farming: allowances for capital expenditure on construction of buildings and other works.

23.—(1) Section 22 of the Finance Act, 1974 , is hereby amended—

( a ) by the substitution of the following subsection for subsection (2) and the proviso thereto:

"(2) Where a person to whom this section applies incurs, for the purpose of a trade of farming land occupied by such person, any capital expenditure on the construction of farm buildings (excluding a building or part of a building used as a dwelling), fences, roadways, holding yards, drains or land reclamation or other works, there shall be made to such person during a writing-down period of seven years beginning with the chargeable period related to that expenditure, writing-down allowances (in this section referred to as 'farm buildings allowances') in respect of that expenditure and such allowances shall be made in taxing the trade:

Provided that, as respects each of the first six years of the aforesaid writing-down period, the writing-down allowance to be made under this subsection shall be of an amount equal to 15 per cent. of the capital expenditure incurred as aforesaid and, as respects the last year of the said writing-down period, the writing-down allowance to be made under this subsection shall be of an amount equal to 10 per cent. of the said capital expenditure.",

( b ) by the substitution of the following subsection for subsection (2A):

"(2A) For the purposes of the application to this section of the provisions of paragraph 1 (2) of the First Schedule to the Corporation Tax Act, 1976 , 'basis period' has the meaning assigned to it by section 297 of the Income Tax Act, 1967 .",

and

( c ) by the deletion of subsection (2C).

(2) The provisions of this section shall apply to and have effect in respect of capital expenditure incurred on or after the 27th day of January, 1994.

Computer software.

24.—The Income Tax Act, 1967 , is hereby amended—

( a ) by the insertion after section 241 of the following section:

"241A.—(1) If a person carrying on a trade incurs capital expenditure in acquiring for the purposes of the trade a right to use or otherwise deal with computer software, then, for the purposes of this Part, Chapters I and III of Part XV and Chapters II and V of Part XVI—

( a ) the right and the software to which it relates shall be treated as machinery or plant,

( b ) such machinery or plant shall be treated as having been provided for the purposes of the trade, and

( c ) for so long as the person is entitled to the right, that machinery or plant shall be treated as belonging to that person.

(2) In any case where—

( a ) a person carrying on a trade incurs capital expenditure on the provision of computer software for the purposes of the trade, and

( b ) in consequence of the person incurring that expenditure, the computer software belongs to that person, but the computer software does not constitute machinery or plant,

then, for the purposes of this Part, Chapters I and III of Part XV and Chapters II and V of Part XVI, the computer software shall be treated as machinery or plant.",

( b ) by the insertion after paragraph (c)in subsection (1) of section 272 of the following paragraph:

"( d ) in the case of machinery or plant consisting of computer software or the right to use or otherwise deal with computer software, any event whereby the person grants to another person a right to use or otherwise deal with the whole or part of the computer software concerned in circumstances where the consideration in money for the grant constitutes (or if there were consideration in money for the grant would constitute) a capital sum,",

and

( c ) by the substitution in subsection (1) of section 304 of the following paragraph for paragraph (a)of the definition of "sale, insurance, salvage or compensation moneys":

"( a ) where the event is a sale of any property, including the sale of a right to use or otherwise deal in machinery or plant consisting of computer software, the net proceeds to the person of the sale,".

25 Amendment of Section 18 (taxation of collective investment undertakings) of Finance Act, 1989 .

25.—(1) Section 18 of the Finance Act, 1989 , is hereby amended—

( a ) in subsection (1)—

(i) in the definition of "collective investment undertaking" (inserted by section 19 of the Finance Act, 1991 ) by the deletion of "and" in paragraph (b) and by the insertion after paragraph (b) of the following paragraph—

"( bb ) a limited partnership which—

(i) has as its principal business, as expressed in the partnership agreement establishing the limited partnership, the investment of its funds in property, and

(ii) has been authorised to carry on that business, under any enactment which provides for such authorisation, by the Central Bank of Ireland,

and where, in addition to being a collective investment undertaking, it is also a specified collective investment undertaking, and",

(ii) in paragraph (b)(as inserted by section 19 of the Finance Act, 1991 ) of the definition of "specified collective investment undertaking" by the substitution for "or by" of ",a company referred to in subsection (1A) (inserted by the Finance Act, 1991 ) of section 35 of the Corporation Tax Act, 1976 , or", and

(iii) by the substitution for the definition of "unit" of the following definition—

"'unit' includes any investment, such as a subscription for shares or a contribution of capital, in a collective investment undertaking, being an investment which entitles the investor—

( a ) to a share of the investments or relevant profits of, or

( b ) to receive a distribution from,

the collective investment undertaking;",

( b ) in subsection (4) by the insertion after "relevant payment", where it first occurs in that subsection, of "made by a collective investment undertaking which is not a specified collective investment undertaking", and

( c ) by the insertion after subsection (11) of the following subsection:

"(11A) For the purposes of the Tax Acts, a unitholder, other than a qualifying management company, shall not be treated as carrying on a trade in the State, through a branch or agency or otherwise, where that unitholder would not be so treated if the unitholder did not hold any units in a specified collective investment undertaking.".

(2) Subsection (1) ( a ) (i) shall not come into effect until such time as legislation governing the regulation of any class of limited partnerships by the Central Bank of Ireland is enacted and shall come into effect subject to such legislation and on such date as the Minister for Finance shall by order appoint.

Amendment of section 29 (taxation of income deemed to arise on certain sales of securities) of Finance Act, 1984 .

26.—As respects any chargeable period (within the meaning of section 17 of the Finance Act, 1993 ) beginning on or after the 1st day of January, 1994, section 29 of the Finance Act, 1984 , is hereby amended in subsection (2A) (inserted by section 27 of the Finance Act, 1991 ) by the insertion after paragraph (b) of the following paragraph:

"( bb ) if—

(i) the owner is an undertaking for collective investment within the meaning of section 17 of the Finance Act, 1993 , and

(ii) any gain or loss accruing to the owner on the sale or transfer is a chargeable gain or an allowable loss, as the case may be, or".

Distributions to non-residents.

27.—As respects distributions made on or after 6 April, 1994, Part IX of the Corporation Tax Act, 1976 , is hereby amended—

( a ) in section 83 by the substitution for subsection (4) (as substituted by section 38 of the Finance Act, 1992 ) of the following subsection:

"(4) Where for any year of assessment the income of a person who for that year is neither resident nor ordinarily resident in the State includes an amount in respect of a distribution made by a company which is resident in the State—

( a ) the liability of the person to income tax in respect of the distribution shall be reduced by the amount by which that liability, before it is reduced by the tax credit (if any) in respect of the distribution, exceeds the amount, which may be nil, of that tax credit, and

( b ) the amount or value of the distribution shall be treated for the purposes of sections 433 (yearly interest, etc., payable wholly out of taxed profits) of the Income Tax Act, 1967 , as not brought into charge to income tax.",

and

( b ) in section 88—

(i) by the deletion from subsection (1) of "and the person receiving the distribution is another such company or a person resident in the State, not being a company,", and

(ii) by the substitution for subsection (4) of the following subsection:

"(4) A person, not being a company resident in the State, who is entitled to a tax credit in respect of a distribution may claim—

( a ) to have the credit set against the income tax chargeable on such person's income for the year of assessment in which the distribution is made, and

( b ) where the credit exceeds that income tax, and the person is—

(i) resident in the State, or

(ii) entitled under section 160 to a tax credit in respect of the distribution,

to have the excess paid to that person.".

Amendment of section 34 (exemption from tax of income derived from patent royalties) of Finance Act, 1973 .

28.—As respects payments made on or after the 11th day of April, 1994, section 34 of the Finance Act, 1973 , is hereby amended in subsection (1) by the substitution for the definition of "income from a qualifying patent" of the following definition:

"'income from a qualifying patent' means any royalty or other sum paid in respect of the user of the invention to which the qualifying patent relates, including any sum paid for the grant of a licence to exercise rights under such patent, where that royalty or other sum is paid—

( a ) for the purposes of activities which—

(i) would be regarded, otherwise than by virtue of section 39B of the Finance Act, 1980 , or paragraph (b) or (c) of subsection (5) of section 39A of that Act, as the manufacture of goods for the purpose of relief under Chapter VI of the said Act, or

(ii) would be so regarded if they were carried on in the State by a company,

( b ) by a person who—

(i) is not connected (within the meaning of section 33 of the Capital Gains Tax Act, 1975 ) with the person who is the beneficial recipient of the royalty or other sum, and

(ii) has not entered into any arrangement, in connection with the royalty or other sum, the main purpose, or one of the main purposes, of which was to satisfy the provisions of subparagraph (i);".

Amendment of section 46 (limited partnerships) of Finance Act, 1986 .

29.—(1) Section 46 (as amended by section 23 of the Finance Act, 1992 ) of the Finance Act, 1986 , is hereby amended by the addition after subsection (5) of the following subsection:

"(6) For the purposes of this section, where in connection with the making of a contribution to a partnership trade by a general partner in the partnership—

( a ) there exists any agreement, arrangement, scheme or understanding under which the partner is required to cease to be a partner in the partnership at any time before the partner is entitled to receive back from the partnership the full amount of the partner's contribution to the trade, or

( b ) by virtue of any agreement, arrangement, scheme or understanding—

(i) any asset owned by the partner is exempt from execution upon goods or from a process or mode of enforcement of a debt of the partner or the partnership, or

(ii) any other limit or restriction is placed on the creditor's entitlement to recover any such debt from the partner,

the partner shall be treated as a person who is not entitled to take part in the management of the trade and who is entitled to have the person's liabilities, or the person's liabilities beyond a certain limit, for debts or obligations, incurred for the purposes of the trade, discharged or reimbursed by some other person.".

( 2 ) ( a ) This section shall apply and have effect, in relation to an amount given or allowed under any of the specified provisions (within the meaning of section 46 of the Finance Act, 1986 ) as respects a contribution (within the meaning of that section) by a partner to the trade of the partnership which is made on or after the 11th day of April, 1994.

( b ) In determining whether an amount is given or allowed under any of the specified provisions (within the meaning of section 46 of the Finance Act, 1986 ) as respects a contribution to a trade (within the meaning of that section) on or after the 11th day of April, 1994, any amount which would not otherwise have been given or allowed by virtue of that section but for a contribution to a trade on or after the said date and on the basis that paragraph ( a ) had not been enacted, shall be treated as given or allowed as respects such a contribution.

Restriction on capital allowances for certain leased machinery or plant.

30.—(1) ( a ) In this section—

"agricultural machinery" means machinery or plant used or intended to be used for the purposes of a trade of farming (within the meaning of Chapter II of Part I of the Finance Act, 1974 ) or machinery or plant of a type which is commonly used for such a trade and is used or intended to be used for the purposes of a trade which consists of supplying services which normally play a part in agricultural production;

"asset" means machinery or plant;

"chargeable period", "chargeable period related to", and "chargeable period or its basis period" have the meaning assigned to them by paragraph 1 (2) of the First Schedule to the Corporation Tax Act, 1976 ;

"fair value", in relation to a leased asset, means an amount equal to such consideration as might be expected to be paid for the asset at the inception of the lease on a sale negotiated on an arm's length basis less any grants receivable by the lessor towards the purchase of the asset;

"inception of the lease" means the date on which the leased asset is brought into use by the lessee or the date from which lease payments under the lease first accrue, whichever is the earlier;

"lease payments" means the lease payments over the term of the lease to be paid to the lessor in relation to the leased asset and includes any residual amount which is to be paid to the lessor at or after the end of the term of the lease and which is guaranteed by the lessee or by a person who is connected with the lessee or under the terms of any scheme or arrangement between the lessee and any other person;

"lessee" and "lessor" have the meaning assigned to them by section 40 of the Finance Act, 1984 ;

"predictable useful life", in relation to an asset, means the useful life of the asset, estimated at the inception of the lease, having regard to the purpose for which the asset was acquired and on the assumption that—

(i) its life will end when it ceases to be useful for the purpose for which it was acquired, and

(ii) it is going to be used in the normal manner and to the normal extent throughout its life;

"relevant lease payment" means—

(i) the amount of any lease payment as provided under the terms of the lease, or

(ii) where the lease provides for the amount of any lease payment to be determined by reference to a rate known as a Dublin Interbank Offered Rate and a record of which is kept by the Central Bank of Ireland, or a similar rate, the amount calculated by reference to that rate if the rate per cent. at the inception of the lease were the rate per cent. at the time of the payment;

"relevant lease payments related to a chargeable period or its basis period" means relevant lease payments under the lease or the amounts which are treated as the relevant lease payments and which, if they were the actual amounts payable under the lease, would fall to be taken into account in computing the income of the lessor for that chargeable period or its basis period or any earlier such period;

"relevant period" means the period beginning at the inception of the lease and ending at the earliest time at which the aggregate of amounts of the discounted present value at the inception of the lease of relevant lease payments which are payable at or before that time, amounts to an amount equal to 90 per cent. or more of the fair value of the leased asset or, if it is earlier, at the end of the predictable useful life of the asset, and, for the purposes of this definition, relevant lease payments shall be discounted at a rate which, when applied at the inception of the lease to the amount of the relevant lease payments, produces discounted present values the aggregate of which equals the amount of the fair value of the leased asset at the inception of the lease:

Provided that where the duration of the relevant period determined in accordance with this definition, other than this proviso, is more than 7 years, the relevant period shall not be the period so determined but shall be the period which would be determined in accordance with this definition if for "90 per cent." there were substituted "95 per cent.".

(b) For the purposes of this section—

(i) a lease of an asset shall be a relevant lease unless—

(I) as respects any chargeable period or its basis period of the lessor which falls wholly or partly into the relevant period, the aggregate of the amounts of relevant lease payments related to the chargeable period or its basis period and the amounts of relevant lease payments related to any earlier chargeable period or its basis period is not less than an amount calculated by the formula—

[image not available: a39y1997s404-1anda13y1994s30-1.bmp]

where—

P is the aggregate of the amounts of relevant lease payments payable by the lessee in relation to the leased asset in the relevant period, and

W is an amount determined by the formula—

[image not available: a39y1997s404-2anda13y1994s30-2.bmp]

where—

E is the length of the part of the relevant period which has expired at the end of the chargeable period or its basis period, and

R is the length of the relevant period, and

(II) except for an amount of relevant lease payments which is inconsequential, the excess of the total relevant lease payments under the lease over the aggregate of the relevant lease payments in the relevant period is payable to the lessor, or would be so payable if the relevant lease payments were the actual amounts payable under the lease, within a period the duration of which does not exceed—

( A ) where the proviso to the definition of relevant period does not apply, one seventh of the duration of the relevant period, and

(B ) where the said proviso does apply, one ninth of the duration of the relevant period,

or one year, whichever is the greater, and which commences immediately after the end of the relevant period,

(ii) a lease the duration of the relevant period in respect of which exceeds 10 years and which, apart from this subparagraph, would be a relevant lease shall not be a relevant lease if it is a lease of an asset, being an asset—

(I) which is provided for the purposes of a project, specified in the list referred to in subsection (3A) ( b ) (iv) of section 84A of the Corporation Tax Act, 1976 , which has been approved for grant aid by the Industrial Development Authority, the Shannon Free Airport Development Company Limited or Údarás na Gaeltachta, and

(II) to which section 81 of the Finance Act, 1990 , applies by virtue of subsection (1) ( a ) of that section and to which section 51 of the Finance Act, 1988 , does not apply,

and it would not be a relevant lease if for clauses (1) and (II) of subparagraph (i) there were substituted the following:

"(I) the aggregate of the relevant lease payments related to a chargeable period or its basis period of the lessor which falls wholly or partly into the period (hereafter in this subsection referred to as the 'first period') of 3 years beginning at the inception of the lease is not less than an amount calculated by the formula—

[image not available: a39y1997s404-3a13y1994s30-3.bmp]

where—

D is the rate per cent. at the inception of the lease of the rate known as the six month Dublin Interbank Offered Rate, a record of which is maintained by the Central Bank of Ireland, expressed as a rate per annum,

M is the number of months in the chargeable period or its basis period, and

V is the fair value of the asset at the inception of the lease,

(II) as respects any chargeable period or its basis period of the lessor which falls wholly or partly into the period (hereafter in this subsection referred to as the 'second period'), commencing immediately after the first period and ending at the end of the relevant period, the aggregate of the amounts of relevant lease payments related to the chargeable period or its basis period and the amounts of relevant lease payments related to any earlier chargeable period or its basis period falling wholly or partly into the second period is not less than an amount calculated by the formula—

[image not available: a39y1997s404-4anda13y1994s30-3.bmp]

where—

E is the length of the part of the second period which has expired at the end of the chargeable period or its basis period,

P is the aggregate of the amounts of relevant lease payments payable by the lessee in relation to the leased asset in the second period, and

R is the length of the second period, and

(III) except for an amount of relevant lease payments which is inconsequential, the excess of the total relevant lease payments under the lease over the aggregate of the relevant lease payments in the relevant period is payable to the lessor, or would be so payable if the relevant lease payments were the actual amounts payable under the lease, within a period of one year after the end of the relevant period.",

(iii) an amount of relevant lease payments shall be treated as inconsequential if the aggregate of amounts, estimated at the inception of the lease, of discounted value, at the end of the period specified in clause (II) of subparagraph (i) or clause (III) of the said subparagraph (construed in accordance with subparagraph (ii)), as the case may be, of the relevant lease payments after that time does not exceed 5 per cent. of the fair value of the leased asset or £2,000, whichever is the lesser, and, for the purposes of this subparagraph, relevant lease payments shall be discounted at the rate specified in the definition of "relevant period", and

(iv) where a chargeable period or its basis period, being an accounting period of a company, begins before, and ends after, a date, being the commencement of the relevant period, the first period or the second period or the end of such a period, as the case may be, it shall be divided into one part, beginning on the day on which the accounting period begins and ending at the beginning or the end, as the case may be, of the relevant period, the first period or the second period, and another part beginning immediately after that time and ending on the day on which the accounting period ends, and both parts shall be treated as if they were separate accounting periods.

( 2 ) ( a ) Where, in the course of a trade, an asset is provided by a person for leasing under a relevant lease, the letting of the asset under that relevant lease shall be treated as a separate trade of leasing (hereafter in this subsection referred to as a "specified leasing trade") distinct from all other activities, including other leasing activities, of the person, and section 40 of the Finance Act, 1984 , apart from subsections (5), (6), (7), (7A) (inserted by section 61 of this Act) and (8) thereof, shall apply and have effect in relation to a specified leasing trade as it applies and has effect in relation to a trade of leasing within the meaning of the said section 40.

( b ) The proviso to subsection (1) of section 296 of the Income Tax Act, 1967 , and sections 14 (6) and 116 (2) of the Corporation Tax Act, 1976 , shall not have effect in relation to capital allowances—

(i) in respect of expenditure incurred on the provision of an asset, or

(ii) on account of the wear and tear of an asset,

which is provided by a person for leasing under a relevant lease.

(3) Notwithstanding paragraph ( b ) of subsection (1), a lease of an asset which consists of agricultural machinery or plant shall not be a relevant lease unless it would be such a lease if the amounts of relevant lease payments related to any chargeable period or its basis period were taken to be an amount equal to one-half of the aggregate of the amounts of relevant lease payments related to that chargeable period or its basis period and the amounts of relevant lease payments related to a period equal in length to, and ending immediately before the commencement of, that period.

( 4 ) ( a ) Where, at any time after the 11th day of April, 1994, either of the following events occurs:

(i) the terms of a lease of an asset entered into before that day are altered, or

(ii) a lessor and a lessee agree to terminate a lease of an asset and, at or about that time, a further agreement to lease the asset is entered into by the lessor and the lessee or an agreement is entered into by the lessor and a person connected with the lessee, by the lessee and a person connected with the lessor or by a person connected with the lessor and a person connected with the lessee,

such that the aggregate of the amounts of the lease payments which are payable, or which would be payable if the relevant lease payments were the actual amounts payable under the lease, after any time exceeds the aggregate of the amounts of such relevant lease payments which would have been payable after that time if the events in subparagraph (i) or (ii) had not taken place then, notwithstanding paragraph ( a ) of the proviso to subsection (7), unless it is shown that the change or the termination was effected for bona fide commercial reasons, the lease (including the terminated lease) shall be treated as if it were at all times a relevant lease and relief given, under Part XVI or Part XIX of the Income Tax Act, 1967 , or section 14, section 16 or 116 of the Corporation Tax Act, 1976 , which would not have been given if the lease was a relevant lease, shall be withdrawn.

( b ) The withdrawal of an allowance or relief under paragraph ( a ) shall be made—

(i) for the chargeable period related to the event giving rise to the withdrawal of the relief, and

(ii) in accordance with the provisions of paragraph ( c ),

and both—

(I) details of the event giving rise to the withdrawal of the allowance or relief, and

(II) the amount to be treated as income under paragraph ( c ),

shall be included in the return required to be made by the lessor under section 10 of the Finance Act, 1988 , for that chargeable period.

( c ) (i) Notwithstanding any other provision of the Tax Acts, where relief falls to be withdrawn under paragraph ( a ) in respect of—

(I) the amount of any loss which was treated by virtue of a claim under section 307 of the Income Tax Act, 1967 , as reducing income, or

(II) any amount which was set off against income under section 296 of the Income Tax Act, 1967 , or

(III) the amount of any loss which was set off under section 14 , 16 or 116 of the Corporation Tax Act, 1976 , against profits,

and which would not have been so treated or set off if the lease were a relevant lease, such amount (hereafter in this subsection referred to as "the relevant amount") as would not have been so treated or set off, increased in accordance with subparagraph (ii), shall be treated as income arising in the chargeable period specified in paragraph (b) (i).

(ii) The amount by which the relevant amount is to be increased under subparagraph (i) is an amount determined by the formula—

[image not available: a39y1997s404-5anda13y1994s30-5.bmp]

where—

A is the relevant amount,

M is the number of months in the period beginning on the date on which tax for the chargeable period in which the losses were treated as reducing income, or set off against profits, as the case may be, was due and payable and ending on the date on which tax for the chargeable period for which the withdrawal of relief falls to be made is due and payable, and

R is the rate per cent. specified in subsection (1) of section 550 of the Income Tax Act, 1967 .

(5) Notwithstanding paragraph ( b ) of subsection (1), where, at any time on or after the 11th day of April, 1994, a person (hereafter in this subsection referred to as the "lessor") acquires an asset from another person who before the said 11th day of April, 1994, was the owner of the asset and at or about that time the lessor or a person connected with the lessor leases the asset to the other person or a person connected with the other person then, unless—

( a ) the asset is new and unused, or

( b ) the lease would not be a relevant lease if—

(i) for the first formula in paragraph (b) (i) (I), of subsection (1) there were substituted "W x P", and

(ii) paragraph (b) (ii) of subsection (1) had not been enacted,

the lease shall be a relevant lease for the purposes of this section.

(6) Section 157 of the Corporation Tax Act, 1976 , shall apply for the purposes of this section, save that, for the purposes of determining whether a person is connected with another person whose profits or gains are chargeable to income tax, the provisions of section 16 (3) of the Finance (Miscellaneous Provisions) Act, 1968 , shall apply.

(7) This section shall apply and have effect as on and from the 23rd day of December, 1993:

Provided that a lease of an asset shall not be a relevant lease if—

( a ) a binding contract in writing for the letting of the asset was concluded before that day,

( b ) the leasing of the asset is carried on in the course of relevant trading operations within the meaning of section 39A or 39B of the Finance Act, 1980 , or

( c ) subject to subsections (4) and (5)—

(i) the relevant period does not exceed 5 years,

(ii) the fair value of the asset does not exceed £50,000 and, except where the assets are separate and distinct assets used independently of each other and the use of one is not an integral part of the use of the other, the fair value of an asset which is leased by a lessor to a lessee shall be treated for the purposes of this subparagraph as exceeding £50,000 if the aggregate of the fair value of such an asset and the fair value of any other asset leased by the lessor to the lessee in the period of 12 months ending at the inception of the lease of such an asset, exceeds £50,000, and

(iii) it provides for lease payments to be made at annual, or more frequent, regular intervals throughout the period of the lease such that none of those payments, other than a payment which consists of the consideration for the disposal of the asset for an amount equal to its market value (being its market value if it were not subject to any lease) at the time of disposal, is significantly greater than any of the lease payments payable before it.

Amendment of section 49 (tax treatment of foreign trusts) of Finance Act, 1993 .

31.— Section 49 of the Finance Act, 1993 , is hereby amended in paragraph (i) (III) of the definition of "relevant person" in subsection (1) ( a ) by the deletion of "(being a trustee to whom subparagraph (I) or (II) of this definition relates)".

Exemption of certain non-commercial state-sponsored bodies from certain tax provisions.

32.—(1) In this section "non-commercial state-sponsored body" means a body specified in the Second Schedule.

(2) For the purposes of this section the Minister for Finance may by order amend the Second Schedule by the addition thereto of any body or the deletion therefrom of any body standing specified.

(3) Where an order is proposed to be made under subsection (2), a draft thereof shall be laid before Dáil Éireann and the order shall not be made until a resolution approving of the draft has been passed by Dáil Éireann.

(4) Notwithstanding any provision of the Tax Acts other than the provisions (apart from section 35 (1) ( c )) of Chapter IV of Part I of the Finance Act, 1986 , income arising to a non-commercial state-sponsored body—

( a ) which income would, but for this section, have been chargeable to tax under Case III, Case IV or Case V of Schedule D,

and

( b ) from the date that such body was incorporated under the Companies Acts, 1963 to 1990, or was established by or under any other enactment,

shall be disregarded for the purposes of the Tax Acts:

Provided that a non-commercial state-sponsored body—

(i) which has paid income tax or corporation tax shall not be entitled to repayment of that tax, and

(ii) shall not be treated as—

(I) a company which is within the charge to corporation tax in respect of interest for the purposes of paragraph (ee) of the definition of "relevant deposit" in section 31 of the Finance Act, 1986 , and

(II) a person to whom the provisions of section 39 of the said Act of 1986 apply.

(5) As respects disposals made on or after the 6th day of April, 1974, section 23 of the Capital Gains Tax Act, 1975 , shall apply to a gain accruing to—

( a ) Eolas — The Irish Science and Technology Agency,

( b ) Forbairt,

( c ) Forfás,

( d ) The Industrial Development Agency (Ireland),

( e ) The Industrial Development Authority,

( f ) Shannon Free Airport Development Company Limited, or

( g ) Údarás na Gaeltachta,

as it does to a gain accruing to a body specified in that section:

Provided that where a body specified in this subsection has paid capital gains tax, such tax shall not be refunded.

Amendment of section 36A (special investment policies) of Corporation Tax Act, 1976 .

33.—Section 36A of the Corporation Tax Act, 1976 , is hereby amended in subsection (2)—

( a ) by the substitution in subparagraph (ii) of paragraph (f)of "10 per cent." for "12 per cent.", and

( b ) by the substitution in subparagraph (ii) of paragraph (g)of "10 per cent." for "15 per cent.".

Amendment of Chapter IV (Taxation of Savings and Investment) of Part I of Finance Act, 1993 .

34.—Chapter IV of Part I of the Finance Act, 1993 , is hereby amended—

( a ) in subsection (2) of section 13—

(i) by the substitution in subparagraph (ii) of paragraph (d)of " 10 per cent. " for " 12 per cent. ", and

(ii) by the substitution in subparagraph (ii) of paragraph (e)of "10 per cent." for "15 per cent.",

( b ) in subsection (2) of section 14—

(i) by the substitution in subparagraph (ii) of paragraph (f)of " 10 per cent. " for " 12 per cent.", and

(ii) by the substitution in subparagraph (ii) of paragraph (g)of "10 per cent." for "15 per cent.",

( c ) in subparagraph (I) of paragraph (i) of the proviso to subsection (1) of section 16 by the substitution of "paragraph (e), or" for "paragraph (e), and,"

( d ) in paragraph (ii) of the proviso to subsection (1) of section 16 by the substitution for subparagraphs (I) and (II) of the following subparagraphs:

"(I) in two or three such investments, so long as those investments include a special savings account and an investment of a class mentioned in paragraph (b), ( c ) or (d), or

(II) in four such investments, being two special savings accounts and two other investments of a class (which need not be the same class for the two investments) mentioned in paragraph (b), ( c ) or (d), during a period throughout which—

(A ) as respects the special savings accounts, the condition specified in the said section 37A (1) ( e ) would be satisfied if '£25,000' were substituted for '£50,000' in the said paragraph (e), or

( B ) as respects the other investments, the condition specified in the said section 36A (3) ( b ) or section 13 (3) ( b ) or 14 (2) ( b ) relevant to each of those investments would be satisfied if £125,000' were substituted for '£50,000' in paragraph (b) of the appropriate provision aforesaid.",

( e ) by the insertion after subsection (1) of section 16 of the following subsection:

"(1A) So long as an individual, whether married or not, does not have a beneficial interest in an investment of a class mentioned in subsection (1) other than—

( a ) a beneficial interest, whether or not a joint interest, in one investment, or

( b ) a joint beneficial interest in two investments,

of a class (which need not be the same class where there are two investments) mentioned in paragraph (b), ( c ) or (d)of subsection (1), then the provisions of section 36A of the Corporation Tax Act, 1976 , and sections 13 and 14 shall apply to that one investment or those two investments, as the case may be, as if every reference to £50,000 in those provisions were a reference to £75,000.",

( f ) by the substitution for subsection (2) of section 16 of the following subsection:

"(2) Where an individual may hold a beneficial interest, whether jointly or otherwise, in an investment of a class mentioned in subsection (1) only for as long as a condition specified in the Tax Acts in respect of the investment would be satisfied if a reference to £25,000 were substituted for a reference to £50,000 in the condition so specified, then any provision of those Acts, which would, apart from this subsection, have the effect, at any time, of restricting the said investment to an investment the value of which does not exceed £50,000, shall apply to that investment as if the reference to £50,000 in the provision were a reference to £25,000.",

and

( g ) by the substitution for subsections (3) and (4) of section 16 of the following subsection:

"(3) Any declaration referred to in—

( a ) paragraph (b) of the definition of 'special investment policy' in section 36A (1) of the Corporation Tax Act, 1976 ,

( b ) paragraph (b) of the definition of 'special savings account' in section 31 (1) of the Finance Act, 1986 , or

( c ) paragraph (b) of the definition of 'special investment units' in section 13 (1) of the Finance Act, 1993 ,

shall contain—

(i) such information in relation to the beneficial interest, which the individual making the declaration holds, whether jointly or otherwise, at the time the declaration is made, in investments of a class mentioned in subsection (1), and

(ii) such undertakings, to the person to whom the declaration is made, to supply at any later time information in relation to such interests of the said individual at that later time,

as the Revenue Commissioners may reasonably require for the purposes of this section.".

CHAPTER III Urban Renewal Reliefs: Termination of Existing Scheme in Certain Areas and Certain Other Matters

Amendment of Chapter V (Urban Renewal: Relief from Income Tax and Corporation Tax) of Part I of Finance Act, 1986 .

35.—(1) Chapter V of Part I of the Finance Act, 1986 , is hereby amended—

( a ) in section 42—

(i) in subsection (1)—

(I) by the substitution of the following definition for the definition (including the proviso thereto) of "qualifying period" (as amended by section 30 (1) ( a ) (i) of the Finance Act, 1993 ):

"'qualifying period' means—

( a ) the period commencing on the 23rd day of October, 1985, and ending on the 31st day of July, 1994, or

( b ) where section 41 (2) applies, the specified period;",

and

(II) by the insertion of the following definition after the definition of "qualifying premises":

"'the relevant local authority', in relation to the construction of a qualifying premises, means the council of a county or the corporation of a county or other borough or, where appropriate, the urban district council, in whose functional area the qualifying premises is situated;",

and

(ii) by the addition of the following subsections after subsection (7):

"(8) ( a ) Where, in relation to the construction of a qualifying premises the site of which is wholly within a designated area other than the Custom House Docks Area, the relevant local authority gives a certificate in writing, on or before the 23rd day of February, 1994, to the person constructing the qualifying premises stating that it is satisfied that not less than 15 per cent. of the total cost of construction of the qualifying premises had been incurred prior to the 26th day of January, 1994, any capital expenditure incurred in respect of work on the construction of the qualifying premises which is carried out in the period from the 1st day of August, 1994, to the 31st day of December, 1994 (hereafter in this section referred to as 'the balance of capital expenditure') shall be treated, for the purposes of subsection (2), as having been incurred in the qualifying period.

( b ) Paragraph (a)shall apply and have effect notwithstanding subsection (7) or any other provision of the Tax Acts as to the time when any capital expenditure is, or is to be treated as, incurred.

( c ) In considering whether to give such a certificate as is referred to in paragraph (a), the relevant local authority shall have regard only to the guidelines in relation to the giving of such certificates entitled 'Extension of time limit for completion of developments' which were issued by the Department of the Environment on the 27th day of January, 1994.

(9) Where, by reason of subsection (2), an allowance is given under Chapter II of Part XV, or Chapter I of Part XVI, of the Income Tax Act, 1967 , in respect of the balance of capital expenditure, no allowance shall be given in respect of that expenditure under the said Chapter II or the said Chapter I by virtue of section 41 of the Finance Act, 1994 .",

( b ) by the deletion of section 43,

( c ) in section 44—

(i) in subsection (1) ( a )—

(I) by the substitution of the following definition for the definition (including the proviso thereto) of "qualifying period" (as amended by section 30 (1) ( b ) of the Finance Act, 1993 ):

"'qualifying period' means—

(i) the period commencing on the 23rd day of October, 1985, and ending on the 31st day of July, 1994, or

(ii) where section 41 (2) applies, the specified period;",

and

(II) by the insertion of the following definition after the definition of "refurbishment":

"'the relevant local authority', in relation to the construction or refurbishment of a qualifying premises, means the council of a county or the corporation of a county or other borough or, where appropriate, the urban district council, in whose functional area the qualifying premises is situated.",

(ii) in subsection (1) ( b )

(I) by the deletion of "as it applies to expenditure to which section 29 of the Finance Act, 1983 , applies,

(II) by the substitution of the following subparagraph for subparagraph (i):

"(i) in the definition of 'qualifying premises' in the said section 23—

(I) the reference in paragraph (ii) (I) to '75 square metres' were a reference to '90 square metres', and

(II) paragraph (iv) were deleted, and",

and

(III) by the insertion of the following proviso to that subsection:

"Provided that, as respects the application, for the purposes of this section, of the said provisions of the said section 23 in the case of the refurbishment of a qualifying premises the site of which is wholly within the Custom House Docks Area, the reference in paragraph (ii) (I) of the definition of 'qualifying premises' in the said section 23 to '75 square metres' shall be construed as a reference to '125 square metres'.",

(iii) by the insertion of the following proviso to subsection (1) ( c ):

"Provided that where, in relation to the construction or refurbishment of a qualifying premises the site of which is wholly within a designated area other than the Custom House Docks Area, the relevant local authority gives a certificate in writing, on or before the 23rd day of February, 1994, to the person constructing or refurbishing the qualifying premises stating that it is satisfied that not less than 15 per cent. of the total cost of construction or refurbishment of the qualifying premises had been incurred prior to the 26th day of January, 1994, any expenditure incurred in respect of work on the construction or refurbishment of the qualifying premises which is carried out in the period from the 1st day of August, 1994, to the 31st day of December, 1994 (hereafter in this subsection referred to as 'the balance of expenditure') shall be treated as having been incurred in the qualifying period.",

(iv) by the addition of the following paragraphs after paragraph (e)of subsection (1):

"( f ) In considering whether to give such a certificate as is referred to in the proviso to paragraph (c), the relevant local authority shall have regard only to the guidelines in relation to the giving of such certificates entitled 'Extension of time limit for completion of developments' which were issued by the Department of the Environment on the 27th day of January, 1994.

( g ) Where, by reason of the proviso to paragraph (c), a deduction is given under this section in respect of the balance of expenditure, no deduction shall be given in respect of that expenditure under section 46 of the Finance Act, 1994 .".

and

(v) by the insertion of the following proviso to subsection (2):

"Provided that, where the individual proves that there has been incurred by that individual qualifying expenditure on the refurbishment of a qualifying premises the site of which is wholly within the Custom House Docks Area, the aforesaid reference to 5 per cent. shall be construed as a reference to 10 per cent.",

and

( d ) in section 45—

(i) in subsection (1) ( a )—

(I) by the substitution, in the definition of "qualifying lease", of "granted in the qualifying period, or within the period of two years from the day next after the end of the qualifying period," for "granted in the qualifying period", and

(II) by the substitution of the following definition for the definition (including the proviso thereto) of "qualifying period" (as amended by section 30 (1) ( c ) (i) (II) of the Finance Act, 1993 ):

"'qualifying period' means—

(i) the period commencing on the 23rd day of October, 1985, and ending on the 31st day of July, 1994, or

(ii) where section 41 (2) applies, the specified period;",

(ii) by the substitution, in subsection (1) ( c ) (inserted by section 21 (1) ( a ) (iii) of the Finance Act, 1991 ), of "by that person or any other person" for "by that person or any person connected with that person", and

(iii) by the insertion of the following additional proviso to subsection (2):

"Provided also that where a person is entitled under the provisions of this section to a further deduction on account of rent in respect of a qualifying premises the person shall not be entitled to any deduction on account of that rent under section 42 of the Finance Act, 1994 .".

( 2 ) ( a ) Paragraph ( a ), subparagraphs (i), (iii) and (iv) of paragraph ( c ), and subparagraphs (i) and (iii) of paragraph (d), of subsection (1) shall be deemed to have come into operation as on and from the 26th day of January, 1994.

( b ) Subparagraphs (ii) (III) and (v) of paragraph ( c ) of subsection (1) shall apply and have effect as respects expenditure incurred on or after the 26th day of January, 1994.

( c ) Paragraph (d) (ii) of subsection (1) shall take effect as respects rent payable in relation to any qualifying premises under a qualifying lease entered into on or after the 11th day of April, 1994.

Amendment of section 27 (designated areas for urban renewal relief) of Finance Act, 1987 .

36.— Section 27 (1) of the Finance Act, 1987 , is hereby amended—

( a ) in paragraph (a)(i), by the substitution of "the definition of 'designated area' (apart from 'the Custom House Docks Area')" for "the definition of 'designated area'",

( b ) in paragraph (a)(ii), by the substitution of "the 31st day of July, 1994" for "the 24th day of January, 1997" (inserted by section 30 of the Finance Act, 1992 ),

( c ) by the substitution of the following paragraph for paragraph (b):

"( b ) (i) the definition of 'the Custom House Docks Area' contained in the said section 41 shall include such area or areas described in the order which, but for the order, would not be included in that definition,

(ii) as respects any such area so described in the order, the definition of 'the specified period' in the said section 41 shall be construed as a reference to such period as shall be specified in the order in relation to that area: provided that no such period specified in the order shall commence prior to the 26th day of January, 1994, or end after the 24th day of January, 1997,",

and

( d ) by the substitution of "the said definition of 'qualifying period' or 'the specified period', as the case may be," for "the said definition of 'qualifying period'".

Amendment of Chapter VII (Urban Renewal: Temple Bar and Other Areas) of Part I of Finance Act, 1991 .

37.—(1) Chapter VII (as amended by section 32 of the Finance Act, 1993 ) of Part I of the Finance Act, 1991 , is hereby amended—

( a ) in section 55—

(i) in subsection (1) ( b ), by the substitution of the following subparagraphs for subparagraphs (i), (ii) and (iii):

"(i) section 42 of the Finance Act, 1986 , other than—

(I) paragraph (a)of the definition of 'qualifying premises', and the definition of 'the relevant local authority' (inserted by section 35 (1) ( a ) (i) (II) of the Finance Act, 1994 ), in subsection (1) of the said section 42,

(II) the additional proviso (inserted by section 29 (b)(ii) of the Finance Act, 1992 ) to subsection (4) of the said section 42, and

(III) subsections (8) (inserted by section 35 (1) ( a ) (ii) of the Finance Act, 1994 ) and (9) (as so inserted) of the said section 42,

shall have effect as respects capital expenditure incurred on the construction of any such building and on the basis that subsection (4) (apart from the additional proviso thereto) of that section has effect as respects any qualifying building to which that section applies other than a multi-storey car-park;

(ii) section 44 of the Finance Act, 1986 , other than—

(I) the definition of 'the relevant local authority' (inserted by section 35 (1) (c) (i) (II) of the Finance Act, 1994 ) in paragraph (a)of subsection (1) of the said section 44,

(II) the proviso (inserted by section 35 (1) (c) (ii) (III) of the Finance Act, 1994 ) to paragraph (b) of subsection (1) of the said section 44,

(III) the proviso (inserted by section 35 (1) (c) (iii) of the Finance Act, 1994 ) to paragraph (c)of subsection (1) of the said section 44,

(IV) paragraphs (f)(inserted by section 35 (1) (c) (iv) of the Finance Act, 1994 ) and (g)(as so inserted) of subsection (1) of the said section 44, and

(V) the proviso (inserted by section 35 (1) (c) (v) of the Finance Act, 1994 ) to subsection (2) of the said section 44,

shall have effect as respects any qualifying expenditure (being qualifying expenditure for the purposes of that section) incurred on the construction but not on the refurbishment of any such building;

(iii) section 45 of the Finance Act, 1986 , other than—

(I) the definitions of 'market value' (inserted by section 30 (1) (c) (i) (II) of the Finance Act, 1993 ) and 'refurbishment' (inserted by section 30 (1) ( c ) (i) (IV) of the Finance Act, 1993 ), and the proviso (inserted by section 30 (1) ( c ) (i) (III) of the Finance Act, 1993 ) to the definition of 'qualifying premises', in paragraph (a)of subsection (1) of the said section 45, and

(II) the additional proviso (inserted by section 35 (1) (d) (iii) of the Finance Act, 1994 ) to subsection (2) of the said section 45,

shall have effect as respects rent payable in respect of any such building.",

and

(ii) in subsection (2) ( b ), by the substitution of the following subparagraphs for subparagraphs (i), (ii) and (iii):

"(i) section 42 of the Finance Act, 1986 , other than—

(II) subsections (4), (8) (inserted by section 35 (1) ( a ) (ii) of the Finance Act, 1994 ) and (9) (as so inserted) of the said section 42,

shall have effect as respects capital expenditure incurred on the refurbishment of any such building;

(ii) section 44 of the Finance Act, 1986 , shall have effect as respects qualifying expenditure (being qualifying expenditure for the purposes of that section) incurred on the refurbishment of any such building—

(I) as if the definition of 'the relevant local authority' (inserted by section 35 (1) (c) (i) (II) of the Finance Act, 1994 ) in paragraph (a)of subsection (1) of the said section 44 were deleted,

(II) as if the definition of 'refurbishment' in this subsection were substituted for the definition of 'refurbishment' in paragraph (a)of subsection (1) of the said section 44,

(III) as if, in the proviso (inserted by section 35 (1) (c) (ii) (III) of the Finance Act, 1994 ) to paragraph (b) of subsection (1) of the said section 44, the words 'the site of which is wholly within the Custom House Docks Area' were deleted,

(IV) as if the proviso (inserted by section 35 (1) (c) (iii) of the Finance Act, 1994 ) to paragraph (c)of subsection (1) of the said section 44 were deleted,

(V) as if paragraphs (f)(inserted by section 35 (1) (c) (iv) of the Finance Act, 1994 ) and (g)(as so inserted) of subsection (1) of the said section 44 were deleted, and

(VI) as if, in subsection (2) of the said section 44—

(A) the reference to '5 per cent.' were a reference to '10 per cent.', and

(B ) the proviso (inserted by section 35 (1) (c) (v) of the Finance Act, 1994 ) to that subsection were deleted;

(iii) section 45 of the Finance Act, 1986 , shall have effect as respects rent payable in respect of any such building—

(I) as if the definition of 'refurbishment' in this subsection were substituted for the definition of 'refurbishment' (inserted by section 30 (1) ( c ) (i) (IV) of the Finance Act, 1993 ) in paragraph (a)of subsection (1) of the said section 45, and

(II) as if the additional proviso (inserted by section 35 (1) (d) (iii) of the Finance Act, 1994 ) to subsection (2) of the said section 45 were deleted:",

( b ) in section 56—

(i) by the substitution of the following definition for the definition (including the proviso thereto) of "qualifying period" in paragraph (a)(ii) of subsection (1):

"'qualifying period' means the period commencing on the 30th day of January, 1991, and ending on the 31st day of July, 1994,",

(ii) by the substitution of the following paragraph for paragraph (b) of subsection (1):

"( b ) as if in the definition of 'qualifying premises' in the said subsection (1) ( a ) of the said section 23 '90 square metres' were substituted for '75 square metres':

Provided that, as respects expenditure to which the provisions of the said section 23 are applied by virtue of the provisions of section 24 of the Finance Act, 1981 , and which is incurred in an area to which subparagraph (i) or (iii) of paragraph (a)of this subsection relates, the aforesaid reference to 90 square metres shall be construed as a reference to 125 square metres,",

(iii) by the insertion of the following paragraph after paragraph (b) of subsection (1):

"( bb ) where relevant expenditure is incurred in any area to which subparagraph (ii) of paragraph (a)of this subsection relates—

(i) as if in subsection (1) ( a ) of the said section 23 the following definition were inserted before the definition of 'relevant period':

"'the relevant local authority", in relation to the construction of a qualifying premises, means the council of a county or the corporation of a county or other borough or, where appropriate, the urban district council, in whose functional area the qualifying premises is situated.',

(ii) as if in subsection (1) ( b ) of the said section 23 the following proviso were inserted after subparagraph (i):

'Provided that where, in relation to the construction of a qualifying premises, the relevant local authority gives a certificate in writing, on or before the 23rd day of February, 1994, to the person constructing the qualifying premises stating that it is satisfied that not less than 15 per cent. of the total cost of construction of the qualifying premises had been incurred prior to the 26th day of January, 1994, any expenditure incurred in respect of work on the construction of the qualifying premises which is carried out in the period from the 1st day of August, 1994, to the 31st day of December, 1994 (hereafter in this subsection referred to as "the balance of expenditure") shall be treated as having been incurred in the qualifying period.',

and

(iii) as if in subsection (1) ( b ) of the said section 23 the following subparagraphs were inserted after subparagraph (iii):

'(iv) In considering whether to give such a certificate as is referred to in the proviso to subparagraph (i), the relevant local authority shall have regard only to the guidelines in relation to the giving of such certificates entitled "Extension of time limit for completion of developments" which were issued by the Department of the Environment on the 27th day of January, 1994.

(v) Where, by reason of the proviso to subparagraph (i), a deduction is given under this section in respect of the balance of expenditure, no deduction shall be given in respect of that expenditure under section 43, 44 or 45 of the Finance Act, 1994 .',",

and

(iv) by the substitution of the following subsection for subsection (2) (apart from the proviso thereto):

"(2) In this section 'relevant expenditure' means expenditure on the construction of a qualifying premises (being a qualifying premises within the meaning of subsection (1) ( a ) of section 23 of the Finance Act, 1981 , subject to the provisions of subsection (1) ( b ) of this section) incurred in the qualifying period (being the qualifying period within the meaning of subsection (1) ( a ) of the said section 23, subject to the provisions of subsections (1) ( a ) and (bb) of this section):",

( c ) in section 57—

(i) by the substitution of the following paragraph for paragraph (c)of subsection (2):

"( c ) as if the reference in subsection (2) of section 29 of the Finance Act, 1983 , to '90 square metres' were a reference to '125 square metres' and as if the proviso to that subsection, and subsections (3) and (4) of the said section 29, were deleted.",

(ii) by the insertion of the following paragraph after paragraph (a)of subsection (3):

"( aa ) in the case of relevant expenditure within the meaning of subparagraph (i) of the said subsection (1) ( b ), as if the reference in subsection (2) of section 29 of the Finance Act, 1983 , to '90 square metres' were a reference to '125 square metres',",

and

(iii) by the substitution of the following paragraphs for paragraph (b) of subsection (3):

"( b ) in the case of relevant expenditure within the meaning of subparagraph (ii) of the said subsection (1) ( b ), as if for the definition of 'the principal section' in subsection (1) ( a ) of the said section 21 there were substituted the following definition:

'"the principal section" means section 23 of the Finance Act, 1981 , as it applies in the manner provided for by paragraph (bb) (inserted by section 37 (1) (b) (iii) of the Finance Act, 1994 ) of subsection (1) of section 56 of the Finance Act, 1991 ;',

( bb ) as if the proviso to subsection (2) of section 29 of the Finance Act, 1983 , were deleted, and",

and

( d ) in section 58—

(i) by the substitution of the following paragraph for paragraph (d)of subsection (2):

"( d ) as if the reference in section 29 (2) of the Finance Act, 1983 , to '90 square metres' were a reference to '125 square metres' and as if the proviso to that section, and section 30 of the Finance Act, 1983 , were deleted, and",

(ii) by the substitution of the following subparagraph for subparagraph (iii) of subsection (3) ( a ):

"(iii) as if the reference in section 29 (2) of the Finance Act, 1983 , to '90 square metres' were a reference to '125 square metres' and as if the proviso to that section, and section 30 of the Finance Act, 1983 , were deleted;",

and

(iii) by the substitution of the following subparagraph for subparagraph (ii) of subsection (3) ( b ):

"(ii) as if the following subsection were substituted for subsection (4) of the said section 22:

'(4) For the purposes of the application, by virtue of this section, of relief under section 23 of the Finance Act, 1981 , to any expenditure, that section shall have effect in the manner provided for by paragraph (bb) (inserted by section 37 (1) (b) (iii) of the Finance Act, 1994 ) of subsection (1) of section 56 of the Finance Act, 1991 , and as if the following definition were substituted for the definition of "qualifying period":

"'qualifying period' means the period commencing on the 30th day of January, 1991, and ending on the 31st day of July, 1994;"'".

( 2 ) ( a ) Paragraph ( a ), subparagraphs (i), (iii) and (iv) of paragraph ( b ), and paragraphs (c) (iii) and (d) (iii), of subsection (1) shall be deemed to have come into operation as on and from the 26th day of January, 1994.

( b ) Paragraph ( b ) (ii), subparagraphs (i) and (ii) of paragraph ( c ), and subparagraphs (i) and (ii) of paragraph (d), of subsection (1) shall apply and have effect as respects expenditure incurred on or after the 26th day of January, 1994.

CHAPTER IV Urban Renewal Reliefs: Introduction of New Scheme in Certain Areas

Interpretation (Chapter IV).

38.—(1) In this Chapter—

"designated area" and "designated street" mean, respectively, an area or areas or a street or streets designated by order under section 39;

"lease", "lessee", "lessor", "premium" and "rent" have the meanings respectively assigned to them by Chapter VI of Part IV of the Income Tax Act, 1967 ;

"market value", in relation to a building, structure or house, means the price which the unencumbered fee simple of the building, structure or house would fetch if sold in the open market in such manner and subject to such conditions as might reasonably be calculated to obtain for the vendor the best price for the building, structure or house:

Provided that the said price shall be reduced by the part of that price which would be attributable to the acquisition of, or of rights in or over, the land on which the building, structure or house is constructed;

"qualifying period" means, subject to section 39, the period commencing on the 1st day of August, 1994, and ending on the 31st day of July, 1997;

"refurbishment", in relation to a building or structure and other than for the purposes of sections 45 and 46, means any work of construction, reconstruction, repair or renewal, including the provision or improvement of water, sewerage or heating facilities, carried out in the course of the repair or restoration, or maintenance in the nature of repair or restoration, of the building or structure;

"street" includes part of a street and also the whole or part of any road, square, quay or lane.

(2) A person shall, for the purposes of this Chapter, be regarded as connected with another person if such person would be so regarded for the purposes of Part IV of the Finance (Miscellaneous Provisions) Act, 1968 , by virtue of section 16 (3) of that Act.

Designated area and designated street.

39.—(1) The Minister for Finance may, after consultation with the Minister for the Environment, by order direct that—

( a ) the area or areas, or street or streets, described in the order shall be a designated area or, as the case may be, a designated street for the purposes of this Chapter, and

( b ) as respects any such area, or any such street, so described in the order, the definition of "qualifying period" in section 38 (1) shall be construed as a reference to such period as shall be specified in the order in relation to that area or, as the case may be, that street, but no such period specified in the order shall commence prior to the 1st day of August, 1994, or end after the 31st day of July, 1997.

(2) Every order made by the Minister for Finance under subsection (1) shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the order is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the order is laid before it, the order shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.

Accelerated capital allowances in relation to construction or refurbishment of certain industrial buildings or structures.

40.—(1) This section shall apply to a building or structure the site of which is wholly within a designated area, or which fronts onto a designated street, and which is to be an industrial building or structure by reason of its use for a purpose specified in section 255 (1) ( a ) of the Income Tax Act, 1967 .

(2) Subject to subsection (4), section 254 of the Income Tax Act, 1967 , shall have effect in relation to capital expenditure which is incurred in the qualifying period on the construction or refurbishment of a building or structure to which this section applies—

( a ) as if, in paragraph (aa) (inserted by section 74 of the Finance Act, 1990 ) of subsection (2A) of the said section 254, the reference to "before the 1st day of April, 1992" were a reference to "before the 1st day of August, 1997", and

( b ) as if subsection (2B) (inserted by the said section 74) of the said section 254 were deleted.

(3) Subject to subsection (4), section 25 of the Finance Act, 1978 , shall have effect in relation to capital expenditure which is incurred in the qualifying period on the construction or refurbishment of a building or structure to which this section applies—

( a ) as if, in paragraph (b) of subsection (2) (inserted by section 48 of the Finance Act, 1988 ) of the said section 25—

(i) the reference in subparagraph (ii) (inserted by section 76 of the Finance Act, 1990 ) to "before the 1st day of April, 1991" were a reference to "before the 1st day of August, 1997", and

(ii) subparagraph (iii) (inserted by the said section 76) were deleted,

and

( b ) as if subsection (2A) (inserted by the said section 76) of the said section 25 were deleted.

(4) In the case of an industrial building or structure which fronts onto a designated street, subsections (2) and (3) shall apply only in relation to capital expenditure which is incurred in the qualifying period on the refurbishment of the industrial building or structure and only if the following conditions are also satisfied, that is to say—

( a ) the industrial building or structure is comprised in an existing building or structure (hereafter in this subsection referred to as "the existing building") as on the 1st day of August, 1994, which fronts onto the designated street, and

( b ) apart from the capital expenditure which is incurred in the qualifying period on the refurbishment of the industrial building or structure, expenditure is incurred on the existing building which is—

(i) conversion expenditure within the meaning of section 44, or

(ii) relevant expenditure within the meaning of section 45, or

(iii) qualifying expenditure within the meaning of section 46 (being qualifying expenditure on refurbishment within the meaning of that section),

and in respect of which a deduction has been given, or would, on due claim being made, be given, under section 44, 45 or 46, as the case may be:

Provided that subsections (2) and (3) shall not apply in relation to so much (if any) of the capital expenditure incurred in the qualifying period on the refurbishment of the industrial building or structure as exceeds the amount of the deduction, or the aggregate amount of the deductions, which has been given, or which would, on due claim being made, be given, under section 44, 45 or 46, as the case may be, in respect of the said conversion expenditure, the said relevant expenditure or, as the case may be, the said qualifying expenditure.

(5) For the purposes only of determining, in relation to a claim for an allowance under section 254 of the Income Tax Act, 1967 , or section 25 of the Finance Act, 1978 , as applied by this section, whether and to what extent capital expenditure incurred on the construction or refurbishment of an industrial building or structure is incurred or not incurred in the qualifying period, only such an amount of that capital expenditure as is properly attributable to work on the construction or, as the case may be, the refurbishment of the building or structure which was actually carried out during the qualifying period shall (notwithstanding any other provision of the Tax Acts as to the time when any capital expenditure is, or is to be treated as, incurred) be treated as having been incurred in that period.

Capital allowances in relation to construction or refurbishment of certain commercial premises.

41.—(1) In this section "qualifying premises" means a building or structure the site of which is wholly within a designated area, or which fronts onto a designated street, and which—

( a ) apart from this section, is not an industrial building or structure within the meaning of section 255 of the Income Tax Act, 1967 , and

( b ) (i) is in use for the purposes of a trade or profession, or

(ii) whether or not it is so used, is let on bona fide commercial terms for such consideration as might be expected to be paid in a letting of the building or structure which was negotiated on an arm's length basis,

but does not include any part of a building or structure in use as, or as part of, a dwelling-house or an office:

Provided that where part of a building or structure is a qualifying premises and part thereof (hereafter in this proviso referred to as "the second-mentioned part") is not a qualifying premises and—

(I) the second-mentioned part is in use as, or as part of, an office, and

(II) the capital expenditure which has been incurred in the qualifying period on the construction or refurbishment of the second-mentioned part is not more than one-tenth of the total capital expenditure which has been incurred in that period on the construction or refurbishment of the building or structure, then the building or structure and every part thereof shall be treated as a qualifying premises.

(2) Subject to subsection (3) and the modifications provided for in subsections (4) to (6), all the provisions of the Tax Acts (other than section 40) relating to the making of allowances or charges in respect of capital expenditure which is incurred on the construction or refurbishment of an industrial building or structure shall, notwithstanding anything to the contrary therein, apply—

( a ) as if a qualifying premises were, at all times at which it is a qualifying premises, a building or structure in respect of which an allowance falls to be made for the purposes of income tax or corporation tax, as the case may be, under Chapter II of Part XV, or Chapter I of Part XVI, of the Income Tax Act, 1967 , by reason of its use for a purpose specified in section 255 (1) ( a ) of that Act, and

( b ) where any activity carried on in the qualifying premises is not a trade, as if it were a trade:

Provided that an allowance shall be given by reason of this subsection in respect of any capital expenditure which is incurred on the construction or refurbishment of a qualifying premises only in so far as that expenditure is incurred in the qualifying period.

(3) In the case of a qualifying premises which fronts onto a designated street, subsection (2) shall apply only in relation to capital expenditure which is incurred in the qualifying period on the refurbishment of the qualifying premises and only if the following conditions are also satisfied, that is to say—

( a ) the qualifying premises are comprised in an existing building or structure (hereafter in this section referred to as "the existing building") as on the 1st day of August, 1994, which fronts onto the designated street, and

( b ) apart from the capital expenditure which is incurred in the qualifying period on the refurbishment of the qualifying premises, expenditure is incurred on the existing building which is—

(i) conversion expenditure within the meaning of section 44, or

(ii) relevant expenditure within the meaning of section 45, or

(iii) qualifying expenditure within the meaning of section 46 (being qualifying expenditure on refurbishment within the meaning of that section),

and in respect of which a deduction has been given, or would, on due claim being made, be given, under section 44, 45 or 46, as the case may be:

Provided that subsection (2) shall not apply in relation to so much (if any) of the capital expenditure incurred in the qualifying period on the refurbishment of the qualifying premises as exceeds the amount of the deduction, or the aggregate amount of the deductions, which has been given, or which would, on due claim being made, be given, under section 44, 45 or 46, as the case may be, in respect of the said conversion expenditure, the said relevant expenditure or, as the case may be, the said qualifying expenditure.

(4) For the purposes of the application by subsection (2) of section 254 of the Income Tax Act, 1967 , and section 25 of the Finance Act, 1978 , in relation to capital expenditure which is incurred in the qualifying period on the construction or refurbishment of a qualifying premises—

( a ) the said section 254 shall, notwithstanding section 22 of the Finance Act, 1991 , have effect—

(i) as if, in paragraph (a)of subsection (2A), the reference to "the 1st day of April, 1991" (as provided for in section 50 of the Finance Act, 1988 ) were a reference to "the 1st day of August, 1997",

(ii) as if paragraph (aa) (inserted by section 74 of the Finance Act, 1990 ) of subsection (2A) were deleted, and

(iii) as if subsection (2B) (inserted by the said section 74) were deleted,

and

( b ) the said section 25 shall have effect—

(i) as if paragraph (b)(as amended by section 76 of the Finance Act, 1990 ) of subsection (2) (inserted by section 48 of the Finance Act, 1988 ) were deleted, and

(ii) as if subsection (2A) (inserted by the said section 76) were deleted.

(5) Notwithstanding section 265 (1) of the Income Tax Act, 1967 , no balancing charge shall be made in relation to a qualifying premises by reason of any of the events specified in the said section 265 (1) which occurs—

( a ) more than 13 years after the qualifying premises were first used, or

( b ) in a case where section 26 of the Finance Act, 1991 , applies and has effect, more than 13 years after the capital expenditure on refurbishment of the qualifying premises was incurred.

( 6 ) ( a ) Notwithstanding subsections (2) to (5), any allowance or charge which, apart from this subsection, would fall to be made by reason of subsection (2) in respect of capital expenditure which is incurred on the construction or refurbishment of a qualifying premises shall be reduced to one-half of the amount which, apart from this subsection, would be the amount of that allowance or charge.

( b ) For the purposes of paragraph ( a ) the amount of an allowance or charge falling to be reduced to one-half thereof shall be computed as if—

(i) this subsection had not been enacted, and

(ii) effect had been given to all allowances taken into account in so computing that amount.

( c ) Nothing in this subsection shall affect the operation of section 265 (5) of the Income Tax Act, 1967 .

(7) For the purposes only of determining, in relation to a claim for an allowance by virtue of subsection (2), whether and to what extent capital expenditure incurred on the construction or refurbishment of a qualifying premises is incurred or not incurred in the qualifying period, only such an amount of that capital expenditure as is properly attributable to work on the construction or refurbishment of the premises which was actually carried out during the qualifying period shall (notwithstanding any other provision of the Tax Acts as to the time when any capital expenditure is, or is to be treated as, incurred) be treated as having been incurred in that period.

Double rent allowance in respect of rent paid for certain business premises.

42.—(1) In this section—

"qualifying lease" means a lease in respect of a qualifying premises granted in the qualifying period on bona fide commercial terms by a lessor to a lessee who is not connected with the lessor, or with any other person who is entitled to a rent in respect of the qualifying premises, whether under that lease or any other lease;

"qualifying premises" means, subject to subsection (5) ( a ), a building or structure the site of which is wholly within a designated area and—

( a ) (i) which is a building or structure in use for a purpose specified in section 255 (1) ( a ) of the Income Tax Act, 1967 , and in respect of which capital expenditure is incurred in the qualifying period for which an allowance falls, or will, by virtue of section 19 (as amended by section 23 of the Finance Act, 1991 ) of the Finance Act, 1970 , fall, to be made for the purposes of income tax or corporation tax, as the case may be, under section 254 of the Income Tax Act, 1967 , or section 25 of the Finance Act, 1978 , as applied by section 40, or

(ii) in respect of which an allowance falls, or will, by virtue of the said section 19, fall, to be made for the purposes of income tax or corporation tax, as the case may be, under Chapter II of Part XV of, or Chapter I of Part XVI of, the Income Tax Act, 1967 , by reason of section 41, or

(iii) which is a building or structure in use for the purposes specified in section 255 (1) ( d ) of the Income Tax Act, 1967 , and in respect of the construction or refurbishment of which capital expenditure is incurred in the qualifying period for which an allowance would, but for subsection (6), fall to be made for the purposes of income tax or corporation tax, as the case may be, under Chapter II of Part XV of, or Chapter I of Part XVI of, the Income Tax Act, 1967 ,

and

( b ) which is let on such terms as are referred to in paragraph (b)(ii) of the definition of "qualifying premises" in the said section 41:

Provided that where capital expenditure is incurred in the qualifying period on the refurbishment of a building or structure in respect of which an allowance falls, or will, by virtue of the said section 19, fall, or in respect of which an allowance would but for subsection (6) fall, to be made for the purposes of income tax or corporation tax, as the case may be, under any of the provisions referred to in paragraph (a)of this definition, the building or structure shall not be regarded as a qualifying premises unless the total amount of the expenditure so incurred is not less than an amount which is equal to 10 per cent. of the market value of the building or structure immediately before the said expenditure is incurred.

(2) For the purposes of this section, so much of a period, being a period when rent is payable by a person in relation to a qualifying premises under a qualifying lease, shall be a relevant rental period as does not exceed—

( a ) 10 years, or

( b ) the period by which 10 years exceeds—

(i) any preceding period, or

(ii) if there is more than one preceding period, the aggregate of preceding periods,

for which rent was payable by that person or any other person in relation to that premises under a qualifying lease.

(3) Subject to subsection (4), where, in the computation of the amount of the profits or gains of a trade or profession, a person is, apart from this section, entitled to any deduction (hereafter in this subsection referred to as "the first-mentioned deduction") on account of rent in respect of a qualifying premises occupied by such person for the purposes of that trade or profession which is payable by such person for a relevant rental period in relation to that qualifying premises under a qualifying lease, such person shall be entitled in that computation to a further deduction equal to the amount of the first-mentioned deduction.

(4) Where a person holds an interest in a qualifying premises out of which interest a qualifying lease is created, directly or indirectly, in respect of the qualifying premises and in respect of rent payable under the qualifying lease a claim for a further deduction under this section is made, and either such person or another person who is connected with such person—

( a ) takes under a qualifying lease a qualifying premises (hereafter in this subsection referred to as "the second-mentioned premises") which is occupied by such person or such other person, as the case may be, for the purposes of a trade or profession, and

( b ) is, apart from this section, entitled, in the computation of the amount of the profits or gains of that trade or profession, to a deduction on account of rent in respect of the second-mentioned premises,

then, unless such person or such other person, as the case may be, shows that the taking on lease of the second-mentioned premises was not undertaken for the sole or main benefit of obtaining a further deduction on account of rent under the provisions of this section, such person or such other person, as the case may be, shall not be entitled in the computation of the amount of the profits or gains of that trade or profession to any further deduction on account of rent in respect of the second-mentioned premises.

( 5 ) ( a ) A building or structure in use for the purposes specified in section 255 (1) ( d ) of the Income Tax Act, 1967 , shall not be a qualifying premises for the purposes of this section unless the person to whom an allowance under Chapter II of Part XV, or Chapter I of Part XVI, of that Act would but for subsection (6) 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 (6), 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.

( c ) An election under paragraph ( a ) shall be irrevocable.

( d ) A person who has made an election under paragraph ( 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 in respect of the qualifying premises 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 the qualifying premises.

(6) Where a person who has incurred capital expenditure in the qualifying period on the construction or refurbishment of a building or structure in use for the purposes specified in section 255 (1) ( d ) of the Income Tax Act, 1967 , makes an election under paragraph ( a ) of subsection (5), then, notwithstanding any other provision of the Tax Acts—

( 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,

( 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.

(7) For the purposes of determining, in relation to paragraph ( a ) (iii) of the definition of "qualifying premises" in subsection (1) and subsections (5) and (6), whether and to what extent capital expenditure incurred on the construction or refurbishment of a building or structure is incurred or not incurred in the qualifying period, only such an amount of that capital expenditure as is properly attributable to work on the construction or refurbishment of the building or structure which was actually carried out in the qualifying period shall (notwithstanding any other provision of the Tax Acts as to the time when any capital expenditure is, or is to be treated as, incurred) be treated as having been incurred in that period.

(8) Section 33 of the Finance Act, 1990 , is hereby amended—

( a ) in subsection (1), by the insertion after " section 45 of the Finance Act, 1986 " of ", or section 42 of the Finance Act, 1994 ", and

( b ) in subsection (2) ( a ), by the substitution of the following definition for the definition of "qualifying premises":

"'qualifying premises' means a qualifying premises within the meaning of section 45 of the Finance Act, 1986 , or section 42 of the Finance Act, 1994 ;".

Deduction for certain expenditure on construction of rented residential accommodation.

43.—(1) In this section—

"qualifying lease", in relation to a house, means, subject to section 47 (3), a lease of the house the consideration for the grant of which consists—

( a ) solely of periodic payments all of which are, or fall to be treated as, amounts by way of rent for the purposes of Chapter VI of Part IV of the Income Tax Act, 1967 , or

( b ) of payments of the kind mentioned in paragraph ( a ) together with a payment by way of a premium which does not exceed 10 per cent. of the relevant cost of the house;

"qualifying premises" means, subject to subsection (4), paragraphs ( a ) and (c)of subsection (5), and subsection (6), of section 47, a house—

( a ) the site of which is wholly within a designated area,

( b ) which is used solely as a dwelling,

( c ) the total floor area of which—

(i) is not less than 30 square metres and not more than 90 square metres in the case where the house is a separate self-contained flat or maisonette in a building of two or more storeys, or

(ii) is not less than 35 square metres and not more than 125 square metres in any other case,

( d ) in respect of which, if it is not a new house (within the meaning of section 4 of the Housing (Miscellaneous Provisions) Act, 1979 ) provided for sale, there is in force a certificate of reasonable cost, the amount specified in which in respect of the cost of construction of the house to which the certificate relates is not less than the expenditure actually incurred on such construction, and

( e ) which, without having been used, is first let in its entirety under a qualifying lease and thereafter throughout the remainder of the relevant period (save for reasonable periods of temporary disuse between the ending of one qualifying lease and the commencement of another such lease) continues to be let under such a lease;

"relevant cost", in relation to a house, means, subject to subsection (3), an amount equal to the aggregate of—

( a ) the expenditure incurred on the acquisition of, or of rights in or over, any land on which the house is constructed, and

( b ) the expenditure actually incurred on the construction of the house;

"relevant period", in relation to a qualifying premises, means the period of 10 years beginning with the date of the first letting of the premises under a qualifying lease.

(2) Where a person, having made a claim in that behalf, proves to have incurred expenditure on the construction of a qualifying premises, such person shall be entitled, in computing, for the purposes of subsection (4) of section 81 of the Income Tax Act, 1967 , the amount of a surplus or deficiency in respect of the rent from the said premises, to a deduction of so much (if any) of that expenditure as falls to be treated, under section 47 (8) or any of the provisions of this section, as having been incurred by such person in the qualifying period, and all the provisions of Chapter VI of Part IV of the said Act shall apply as if the said deduction were a deduction authorised by the provisions of subsection (5) of the said section 81:

Provided that, where any premium or other sum which is payable, directly or indirectly, under a qualifying lease, or otherwise under the terms subject to which the lease is granted, to or for the benefit of the lessor or to or for the benefit of any person connected with the lessor, or any part of such premium or sum, is not, or is not treated as, an amount by way of rent for the purposes of the said section 81, the expenditure falling to be treated as having been incurred in the qualifying period on the construction of the qualifying premises to which the qualifying lease relates shall be deemed, for the purposes of this subsection, to be reduced by the lesser of—

( a ) the amount of the said premium or sum or, as the case may be, the said part of such premium or sum, and

( b ) the amount which bears to the amount mentioned in paragraph ( a ) the same proportion as the amount of the expenditure actually incurred on the construction of the qualifying premises which falls to be treated under section 47 (8) as having been incurred in the qualifying period bears to the whole of the expenditure incurred on the said construction.

( a ) of the expenditure incurred on the construction of the said building or buildings, and

( b ) of the amount which would be the relevant cost in relation to the said building or buildings if the building or buildings, as the case may be, were a single qualifying premises,

for the purposes of determining the expenditure incurred on the construction of the qualifying premises and the relevant cost in relation to the qualifying premises.

(4) Where a house is a qualifying premises and at any time during the relevant period in relation to the premises either of the following events occurs:

( a ) the house ceases to be a qualifying premises, or

( b ) the ownership of the lessor's interest in the house passes to any other person but the house does not cease to be a qualifying premises,

then the person who, before the occurrence of the event, received or was entitled to receive a deduction under subsection (2) in respect of expenditure incurred on the construction of the qualifying premises shall be deemed to have received on the day before the day of the occurrence an amount by way of rent from the qualifying premises equal to the amount of the deduction.

( 5 ) ( a ) Where the event mentioned in subsection (4) ( b ) occurs in the relevant period in relation to a house which is a qualifying premises, the person to whom the ownership of the lessor's interest in the said house passes shall be treated, for the purposes of this section, as having incurred in the qualifying period an amount of expenditure on the construction of the said house equal to the amount which, under section 47 (8) or any of the provisions of this section, apart from the proviso to subsection (2), the said lessor was treated as having incurred in the qualifying period on the construction of the said house:

Provided that, in the case of a person who purchases such a house, the amount so treated as having been incurred by such person shall not exceed the relevant price paid by such person on the sale.

( b ) For the purposes of this subsection and subsection (6), the relevant price paid by a person on the sale of a house shall be the amount which bears to the net price paid by such person on that sale the same proportion as the amount of the expenditure actually incurred on the construction of the house which falls to be treated under section 47 (8) as having been incurred in the qualifying period bears to the relevant cost in relation to that house.

( 6 ) ( a ) Subject to paragraph ( b ), where expenditure is incurred on the construction of a house and before the house is used it is sold, the person who buys the house shall be treated, for the purposes of this section, as having incurred in the qualifying period expenditure on the construction of the house equal to the amount of such expenditure which falls to be treated under section 47 (8) as having been incurred in the qualifying period or the relevant price paid by such person on the sale, whichever is the lower:

Provided that, where the house is sold more than once before it is used, the provisions of this subsection shall have effect only in relation to the last of those sales.

( b ) Where expenditure is incurred on the construction of a house by a person carrying on a trade or part of a trade which consists, as to the whole or any part thereof, of the construction of buildings with a view to their sale and the house, before it is used, is sold in the course of that trade or, as the case may be, that part of that trade, the person who buys the house shall be treated, for the purposes of this section, as having incurred in the qualifying period expenditure on the construction of the house equal to the relevant price paid by such person on the said sale (hereafter in this paragraph referred to as "the first sale") and, in relation to any subsequent sale or sales of the house before the house is used, paragraph ( a ) shall have effect as if the reference to the amount of expenditure which falls to be treated as having been incurred in the qualifying period were a reference to the said relevant price paid on the first sale.

(7) The provisions of section 47 shall have effect for the purposes of supplementing this section.

Rented residential accommodation: deduction for expenditure on conversion.

44.—(1) In this section—

"conversion expenditure" means, subject to subsection (2), expenditure incurred on—

( a ) the conversion into a house of a building—

(i) the site of which is wholly within a designated area, or which fronts onto a designated street, and

(ii) which has not been previously in use as a dwelling,

and

( b ) the conversion into two or more houses of a building—

(i) the site of which is wholly within a designated area, or which fronts onto a designated street, and

(ii) which, prior to the conversion, had not been in use as a dwelling or had been in use as a single dwelling,

and references in this section and section 47 to "conversion", "conversion into a house" and "expenditure incurred on conversion" shall be construed accordingly;

"qualifying lease", in relation to a house, means, subject to section 47 (3), a lease of the house the consideration for the grant of which consists—

( a ) solely of periodic payments all of which are, or fall to be treated as, amounts by way of rent for the purposes of Chapter VI of Part IV of the Income Tax Act, 1967 , or

( b ) of payments of the kind mentioned in paragraph ( a ) together with a payment by way of a premium which does not exceed 10 per cent. of the market value of the house at the time the conversion is completed:

Provided that, in the case of a house which is part of a building and which is not saleable apart from the building of which it is a part, the market value of the house at the time the conversion is completed shall, for the purposes of paragraph ( b ), be taken to be an amount which bears to the market value of the building at that time the same proportion as the total floor area of the house bears to the total floor area of the building;

"qualifying premises" means, subject to subsection (4), paragraphs ( b ) and (c)of subsection (5), and subsection (6), of section 47, a house—

( a ) which is used solely as a dwelling,

( b ) the total floor area of which—

(i) is not less than 30 square metres and not more than 125 square metres in the case where the house is a separate self-contained flat or maisonette in a building of two or more storeys, or

(ii) is not less than 35 square metres and not more than 125 square metres in any other case,

( c ) in respect of which there is in force a certificate of reasonable cost the amount specified in which in respect of the cost of conversion in relation to the house to which the certificate relates is not less than the expenditure actually incurred on such conversion, and

( d ) which, without having been used subsequent to the incurring of the expenditure on the conversion, is first let in its entirety under a qualifying lease and thereafter throughout the remainder of the relevant period (save for reasonable periods of temporary disuse between the ending of one qualifying lease and the commencement of another such lease) continues to be let under such a lease;

"relevant period", in relation to a qualifying premises, means the period of 10 years beginning with the date of the first letting of the premises under a qualifying lease.

(2) For the purposes of this section, expenditure incurred on conversion of a building shall be deemed to include expenditure incurred, in the course of the conversion, on either or both the following, that is to say:

( a ) the carrying out of works of construction, reconstruction, repair or renewal, and

( b ) the provision or improvement of water, sewerage or heating facilities,

in relation to the building or any outoffice appurtenant thereto or usually enjoyed therewith, but shall not be deemed to include—

(i) any expenditure in respect of which any person is entitled to a deduction, relief or allowance under any other provision of the Tax Acts, or

(ii) any expenditure attributable to any part (hereafter in this section referred to as a "non-residential unit") of the building which, upon completion of the conversion, is not a house.

(3) For the purposes of paragraph (ii) of subsection (2), where expenditure is attributable to a building in general and not directly to any particular house or non-residential unit comprised in the building upon completion of the conversion, then such an amount of that expenditure shall be deemed to be attributable to a non-residential unit as bears to the whole of that expenditure the same proportion as the total floor area of the non-residential unit bears to the total floor area of the building.

(4) Where a person, having made a claim in that behalf, proves to have incurred conversion expenditure in relation to a house which is a qualifying premises, such person shall be entitled, in computing, for the purposes of subsection (4) of section 81 of the Income Tax Act, 1967 , the amount of a surplus or deficiency in respect of the rent from the said premises, to a deduction of so much (if any) of the expenditure as falls to be treated, under section 47 (8) or any of the provisions of this section, as having been incurred by such person in the qualifying period and all the provisions of Chapter VI of Part IV of the said Act shall apply as if the said deduction were a deduction authorised by the provisions of subsection (5) of the said section 81:

Provided that, where any premium or other sum which is payable, directly or indirectly, under a qualifying lease, or otherwise under the terms subject to which the lease is granted, to or for the benefit of the lessor or to or for the benefit of any person connected with the lessor, or any part of such premium or sum, is not, or is not treated as, an amount by way of rent for the purposes of the said section 81, the conversion expenditure falling to be treated as having been incurred in the qualifying period in relation to the qualifying premises to which the qualifying lease relates shall be deemed, for the purposes of this subsection, to be reduced by the lesser of—

( a ) the amount of the said premium or sum or, as the case may be, the said part of such premium or sum, and

( b ) the amount which bears to the amount mentioned in paragraph ( a ) the same proportion as the amount of the conversion expenditure actually incurred in relation to the qualifying premises which falls to be treated under section 47 (8) as having been incurred in the qualifying period bears to the whole of the conversion expenditure incurred in relation to the qualifying premises.

(5) Where a qualifying premises forms part of a building or is one of a number of buildings in a single development, or forms part of a building which is itself one of a number of buildings in a single development, there shall be made such apportionment as is necessary of the expenditure incurred on the conversion of the said building or buildings for the purposes of determining the conversion expenditure incurred in relation to the qualifying premises.

(6) Where a house is a qualifying premises and at any time during the relevant period in relation to the premises either of the following events occurs:

( a ) the house ceases to be a qualifying premises, or

( b ) the ownership of the lessor's interest in the house passes to any other person but the house does not cease to be a qualifying premises,

then the person who, before the occurrence of the event, received or was entitled to receive a deduction under subsection (4) in respect of conversion expenditure incurred in relation to the qualifying premises shall be deemed to have received on the day before the day of the occurence an amount by way of rent from the qualifying premises equal to the amount of the deduction.

(7) Where the event mentioned in subsection (6) ( b ) occurs in the relevant period in relation to a house which is a qualifying premises, the person to whom the ownership of the lessor's interest in the said house passes shall be treated, for the purposes of this section, as having incurred in the qualifying period an amount of conversion expenditure in relation to the said house equal to the amount of the conversion expenditure which, under section 47 (8) or any of the provisions of this section, apart from the proviso to subsection (4), the said lessor was treated as having incurred in the qualifying period in relation to the said house:

Provided that, in the case of a person who purchases such a house, the amount so treated as having been incurred by such person shall not exceed—

( a ) the net price paid by such person on the sale, or

( b ) in case only a part of the conversion expenditure incurred in relation to the house falls to be treated, under section 47 (8), as having been incurred in the qualifying period, the amount which bears to the said net price the same proportion as that part bears to the whole of the conversion expenditure incurred in relation to the house.

(8) Where conversion expenditure is incurred in relation to a house and before the house is used subsequent to the incurring of that expenditure it is sold, the person who buys the house shall be treated, for the purposes of this section, as having incurred in the qualifying period conversion expenditure in relation to the house equal to—

( a ) the amount of such expenditure which falls to be treated under section 47 (8) as having been incurred in the qualifying period, or

( b ) (i) the net price paid by such person on the sale, or

(ii) in case only a part of the conversion expenditure incurred in relation to the house falls to be treated, under section 47 (8), as having been incurred in the qualifying period, the amount which bears to the said net price the same proportion as that part bears to the whole of the conversion expenditure incurred in relation to the house,

whichever is the lower:

Provided that, where the house is sold more than once before it is used subsequent to the incurring of the conversion expenditure in relation to the house, the provisions of this subsection shall have effect only in relation to the last of those sales.

(9) This section shall not apply in the case of a conversion unless planning permission in respect of the conversion has been granted under the Local Government (Planning and Development) Acts, 1963 to 1993.

(10) The provisions of section 47 shall have effect for the purposes of supplementing this section.

Rented residential accommodation: deduction for expenditure on refurbishment.

45.—(1) In this section—

"qualifying lease", in relation to a house, means, subject to section 47 (3), a lease of the house the consideration for the grant of which consists—

( a ) solely of periodic payments all of which are, or fall to be treated as, amounts by way of rent for the purposes of Chapter VI of Part IV of the Income Tax Act, 1967 , or

( b ) of payments of the kind mentioned in paragraph ( a ) together with a payment by way of a premium—

(i) which is payable on or subsequent to the date of the completion of the refurbishment to which the relevant expenditure relates or which, if payable before that date, is so payable by reason of, or otherwise in connection with, the carrying out of the refurbishment, and

(ii) which does not exceed 10 per cent. of the market value of the house on the date of completion of the refurbishment to which the relevant expenditure relates:

Provided that, in the case of a house which is part of a building and which is not saleable apart from the building of which it is a part, the market value of the house on that date shall, for the purposes of paragraph ( b ), be taken to be an amount which bears to the market value of the building on that date the same proportion as the total floor area of the house bears to the total floor area of the building;

"qualifying premises" means, subject to subsection (4), paragraphs ( b ) and (c)of subsection (5), and subsection (6), of section 47, a house—

( a ) which is used solely as a dwelling,

( b ) the total floor area of which—

(i) is not less than 30 square metres and not more than 125 square metres in the case where the house is a separate self-contained flat or maisonette in a building of two or more storeys, or

(ii) is not less than 35 square metres and not more than 125 square metres in any other case,

( c ) in respect of which there is in force a certificate of reasonable cost the amount specified in which in respect of the cost of refurbishment in relation to the house to which the certificate relates is not less than the relevant expenditure actually incurred on such refurbishment, and

( d ) which, on the date of completion of the refurbishment to which the relevant expenditure relates, is let (or, if it is not let on that date, is, without having been used after that date, first let) in its entirety under a qualifying lease and thereafter throughout the remainder of the relevant period (save for reasonable periods of temporary disuse between the ending of one qualifying lease and the commencement of another such lease) continues to be let under such a lease;

"refurbishment", in relation to a building, means either or both of the following, that is to say:

( a ) the carrying out of any works of construction, reconstruction, repair or renewal, and

( b ) the provision or improvement of water, sewerage or heating facilities,

where the carrying out of such works, or the provision of such facilities, is certified by the Minister for the Environment, in any certificate of reasonable cost granted by that Minister in relation to any house contained in the building, to have been necessary for the purposes of ensuring the suitability as a dwelling of any house in the building and whether or not the number of houses in the building, or the shape or size of any such house, is altered in the course of such refurbishment;

"relevant expenditure" means expenditure incurred on the refurbishment of a specified building, other than expenditure attributable to any part (hereafter in this section referred to as a "non-residential unit") of the building which, upon completion of the refurbishment, is not a house; and, for the purposes of this definition, where expenditure is attributable to the specified building in general (and not directly to any particular house or non-residential unit comprised in the building upon completion of the refurbishment) such an amount of that expenditure shall be deemed to be attributable to a non-residential unit as bears to the whole of that expenditure the same proportion as the total floor area of the non-residential unit bears to the total floor area of the building;

"relevant period", in relation to a qualifying premises, means the period of 10 years beginning with the date of the completion of the refurbishment to which the relevant expenditure relates or, if the premises was not let under a qualifying lease on that date, the period of 10 years beginning with the date of the first such letting after the date of such completion;

"specified building" means a building—

( a ) the site of which is wholly within a designated area, or which fronts onto a designated street,

( b ) in which, prior to the refurbishment to which the relevant expenditure relates, there are two or more houses, and

( c ) which, upon completion of that refurbishment, contains (whether in addition to any non-residential unit or not) two or more houses.

(2) Where a person, having made a claim in that behalf, proves to have incurred relevant expenditure in relation to a house which is a qualifying premises, such person shall be entitled, in computing for the purposes of subsection (4) of section 81 of the Income Tax Act, 1967 , the amount of a surplus or deficiency in respect of the rent from the said premises, to a deduction of so much (if any) of the expenditure as falls to be treated, under section 47 (8) or any of the provisions of this section, as having been incurred by such person in the qualifying period and all the provisions of Chapter VI of Part IV of the said Act shall apply as if the said deduction were a deduction authorised by the provisions of subsection (5) of the said section 81:

Provided that, where any premium or other sum which is payable (directly or indirectly), on or subsequent to the date of the completion of the refurbishment to which the relevant expenditure relates (or which, if payable before that date, is so payable by reason of, or otherwise in connection with, the carrying out of the refurbishment), to or for the benefit of the lessor or to or for the benefit of any person connected with the lessor, or any part of such premium or sum, is not, or is not treated as, an amount by way of rent for the purposes of the said section 81, the relevant expenditure falling to be treated as having been incurred in the qualifying period in relation to the qualifying premises to which the qualifying lease relates shall be deemed, for the purposes of this subsection, to be reduced by the lesser of—

( a ) the amount of the said premium or sum or, as the case may be, the said part of such premium or sum, and

( b ) the amount which bears to the amount mentioned in paragraph ( a ) the same proportion as the amount of the relevant expenditure actually incurred in relation to the qualifying premises which falls to be treated under section 47 (8) as having been incurred in the qualifying period bears to the whole of the relevant expenditure incurred in relation to the qualifying premises.

(3) Where a qualifying premises forms part of a building or is one of a number of buildings in a single development, or forms part of a building which is itself one of a number of buildings in a single development, there shall be made such apportionment as is necessary of the relevant expenditure incurred on the said building or buildings for the purposes of determining the relevant expenditure incurred in relation to the qualifying premises.

(4) Where a house is a qualifying premises and at any time during the relevant period in relation to the premises either of the following events occurs:

( a ) the house ceases to be a qualifying premises, or

( b ) the ownership of the lessor's interest in the house passes to any other person but the house does not cease to be a qualifying premises,

then the person who, before the occurrence of the event, received or was entitled to receive a deduction under subsection (2) in respect of relevant expenditure incurred in relation to the qualifying premises shall be deemed to have received on the day before the day of the occurrence an amount by way of rent from the qualifying premises equal to the amount of the deduction.

(5) Where the event mentioned in subsection (4) ( b ) occurs in the relevant period in relation to a house which is a qualifying premises, the person to whom the ownership of the lessor's interest in the said house passes shall be treated, for the purposes of this section, as having incurred in the qualifying period an amount of relevant expenditure in relation to the said house equal to the amount of the relevant expenditure which, under section 47 (8) or any of the provisions of this section, apart from the proviso to subsection (2), the said lessor was treated as having incurred in the qualifying period in relation to the said house:

Provided that, in the case of a person who purchases such a house, the amount so treated as having been incurred by such person shall not exceed—

( a ) the net price paid by such person on the sale, or

( b ) in case only a part of the relevant expenditure incurred in relation to the house falls to be treated, under section 47 (8), as having been incurred in the qualifying period, the amount which bears to the said net price the same proportion as that part bears to the whole of the relevant expenditure incurred in relation to the house.

(6) Where relevant expenditure is incurred in relation to a house and before the house is used subsequent to the incurring of that expenditure it is sold, the person who buys the house shall be treated, for the purposes of this section, as having incurred in the qualifying period relevant expenditure in relation to the house equal to—

( a ) the amount of such expenditure which falls to be treated under section 47 (8) as having been incurred in the qualifying period, or

( b ) (i) the net price paid by such person on the sale, or

(ii) in case only a part of the relevant expenditure incurred in relation to the house falls to be treated, under section 47 (8), as having been incurred in the qualifying period, the amount which bears to the said net price the same proportion as that part bears to the whole of the relevant expenditure incurred in relation to the house,

whichever is the lower:

Provided that, where the house is sold more than once before it is used subsequent to the incurring of the relevant expenditure in relation to the house, the provisions of this subsection shall have effect only in relation to the last of those sales.

(7) This section shall not apply in the case of any refurbishment unless planning permission, in so far as it is required, in respect of the work carried out in the course of the refurbishment has been granted under the Local Government (Planning and Development) Acts, 1963 to 1993.

(8) Expenditure to which a person is entitled to relief under this section shall not include any expenditure in respect of which any person is entitled to a deduction, relief or allowance under any other provision of the Tax Acts.

(9) The provisions of section 47 shall have effect for the purposes of supplementing this section.

Residential accommodation: allowance to owner-occupiers in respect of expenditure on construction or refurbishment.

46.—(1) In this section—

"qualifying expenditure", in relation to an individual, means an amount equal to the amount of the expenditure incurred by the individual on the construction or, as the case may be, refurbishment of a qualifying premises which is a qualifying owner-occupied dwelling in relation to the individual after deducting from that amount of expenditure any sum in respect of or by reference to that expenditure, or in respect of or by reference to the qualifying premises or the construction or, as the case may be, refurbishment work in respect of which it was incurred, which the individual has received, or is entitled to receive, directly or indirectly, from the State, any board established by statute or any public or local authority;

"qualifying owner-occupied dwelling", in relation to an individual, means a qualifying premises which is first used, after the qualifying expenditure has been incurred, by such an individual as that individual's only or main residence;

"qualifying premises", in relation to the incurring of qualifying expenditure, means, subject to subsections (5) and (6) of section 47, a house—

( a ) the site of which is wholly within a designated area, or which fronts onto a designated street,

( b ) which is used solely as a dwelling,

( c ) in respect of which, if it is not a new house (within the meaning of section 4 of the Housing (Miscellaneous Provisions) Act, 1979 ) provided for sale, there is in force a certificate of reasonable cost the amount specified in which in respect of the cost of construction or, as the case may be, refurbishment of the house to which the certificate relates is not less than the expenditure actually incurred on such construction or refurbishment, as the case may be, and

( d ) the total floor area of which—

(i) is not less than 30 square metres and not more than 90 square metres in the case where the house is a separate self-contained flat or maisonette in a building of two or more storeys, or

(ii) is not less than 35 square metres and not more than 125 square metres in any other case:

Provided that where the qualifying expenditure has been incurred on refurbishment of the qualifying premises the reference in paragraph (d) (i) to "90 square metres" shall be construed as a reference to "125 square metres";

"refurbishment" has the same meaning as in section 45.

(2) Subject to subsection (3), where an individual, having made a claim in that behalf, proves to have incurred qualifying expenditure in a year of assessment, the individual shall be entitled, for that year of assessment and for any of the 9 immediately subsequent years of assessment in which the qualifying premises in respect of which the individual incurred the qualifying expenditure is the only or main residence of the individual, to have a deduction made from the individual's total income of an amount equal to—

( a ) in the case where the qualifying expenditure has been incurred on the construction of the qualifying premises, 5 per cent. of the amount of that expenditure, or

( b ) in the case where the qualifying expenditure has been incurred on the refurbishment of the qualifying premises, 10 per cent. of the amount of that expenditure:

Provided that a deduction shall be given under this section in respect of qualifying expenditure only in so far as that expenditure falls to be treated under section 47 (8) as having been incurred in the qualifying period.

(3) Notwithstanding subsection (2), where qualifying expenditure has been incurred in relation to a qualifying premises which fronts onto a designated street, a deduction shall be given under this section if, and only if, that expenditure has been incurred on the refurbishment of the qualifying premises.

(4) Where qualifying expenditure in relation to a qualifying premises is incurred by two or more persons, they shall be treated as having incurred the expenditure in the proportions in which they actually bore the expenditure and the expenditure shall be apportioned accordingly.

(5) 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 deductions under this section.

(6) Section 198 (inserted by section 18 of 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 (xiii) (inserted by section 35 of the Finance Act, 1987 ):

"(xiv) so far as it flows from relief under section 46 of the Finance Act, 1994, in the proportion in which they incurred the expenditure giving rise to the relief,".

(7) The provisions of section 47 shall have effect for the purposes of supplementing this section.

Provisions supplementary to sections 43 to 46.

47.—(1) In this section "certificate of reasonable value" has the meaning assigned to it by section 18 of the Housing (Miscellaneous Provisions) Act, 1979 .

(2) In sections 43 to 46—

"certificate of reasonable cost" means a certificate granted by the Minister for the Environment for the purposes of section 43, 44, 45 or 46, as the case may be, stating that the amount specified in the certificate in relation to the cost of construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of, the house to which the certificate relates appears to the Minister at the time of the granting of the certificate and on the basis of the information available to the Minister at that time to be reasonable, and section 18 of the Housing (Miscellaneous Provisions) Act, 1979 , shall, with any necessary modifications, apply to a certificate of reasonable cost as if it were a certificate of reasonable value;

"house" includes any building or part of a building used or suitable for use as a dwelling and any out-office, yard, garden or other land appurtenant thereto or usually enjoyed therewith;

"total floor area" means the total floor area of a house measured in the manner referred to in section 4 (2) ( b ) of the Housing (Miscellaneous Provisions) Act, 1979 .

(3) A lease shall not be a qualifying lease for the purposes of section 43, 44 or 45 if the terms of the lease contain any provisions enabling the lessee or any other person, directly or indirectly, at any time to acquire any interest in the house to which the lease relates for a consideration which is less than that which might be expected to be given at that time for the acquisition of the interest if the negotiations for that acquisition were conducted in the open market at arm's length.

(4) A house shall not be a qualifying premises for the purposes of section 43, 44 or 45 if it is occupied as a dwelling by any person who is connected with the person who is entitled, in relation to the expenditure incurred on the construction of, conversion into, or, as the case may be, refurbishment of, the house, to a deduction under section 43 (2), 44 (4) or 45 (2), as the case may be, and the terms of the qualifying lease in relation to the house are not such as might have been expected to be included in the lease if the negotiations for the lease had been at arm's length.

( 5 ) ( a ) A house shall not be a qualifying premises for the purposes of section 43 or, in so far as it applies to expenditure other than expenditure on refurbishment, section 46 unless it complies with such conditions, if any, as may be determined by the Minister for the Environment from time to time for the purposes of section 4 of the Housing (Miscellaneous Provisions) Act, 1979 , in relation to standards of construction of houses and the provision of water, sewerage and other services therein.

( b ) A house shall not be a qualifying premises for the purposes of section 44 or 45 or, in so far as it applies to expenditure on refurbishment, section 46 unless it complies with such conditions, if any, as may be determined by the Minister for the Environment from time to time for the purposes of section 5 of the Housing (Miscellaneous Provisions) Act, 1979 , in relation to standards for improvements of houses and the provision of water, sewerage and other services therein.

( c ) A house shall not be a qualifying premises for the purposes of section 43, 44, 45 or 46 unless the house or, in a case where the house is one of a number of houses in a single development, the development of which it is a part complies with such guidelines as may, from time to time, be issued by the Minister for the Environment, with the consent of the Minister for Finance, for the purposes of furthering the objectives of the Urban Renewal Act, 1986 , and, without prejudice to the generality of the foregoing, such guidelines may include provisions in relation to all or any one or more of the following:

(i) the design and the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of, houses,

(ii) the total floor area and dimensions of rooms within houses, measured in such manner as may be determined by the Minister for the Environment,

(iii) the provision of ancillary facilities and amenities in relation to houses, and

(iv) the balance to be achieved between houses of different types and sizes within a single development of two or more houses or within such a development and its general vicinity having regard to the housing existing or proposed in that vicinity.

(6) A house shall not be a qualifying premises for the purposes of section 43, 44, 45 or 46 unless persons authorised in writing by the Minister for the Environment for the purposes of those sections are permitted to inspect it at all reasonable times upon production, if so requested by a person affected, of their authorisations.

(7) For the purposes of sections 43, 44, 45 and 46 references therein to the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of, any premises shall be construed as including references to the development of the land on which the premises is situated or which is used in the provision of gardens, grounds, access or amenities in relation to the premises and, without prejudice to the generality of the foregoing, as including, in particular—

( a ) demolition or dismantling of any building on the land,

( b ) site clearance, earth moving, excavation, tunnelling and boring, laying of foundations, erection of scaffolding, site restoration, landscaping and the provision of roadways and other access works,

( c ) walls, power-supply, drainage, sanitation and water supply, and

( d ) the construction of any outhouses or other buildings or structures for use by the occupants of the premises or for use in the provision of amenities for the occupants.

( 8 ) ( a ) For the purposes of determining, in relation to any claim under section 43 (2), 44 (4), 45 (2) or 46 (2), as the case may be, whether and to what extent expenditure incurred on the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of, a qualifying premises is incurred or not incurred during the qualifying period, only such an amount of that expenditure as is properly attributable to work on the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of, the premises which was actually carried out during the qualifying period shall be treated as having been incurred during that period.

( b ) Where, by virtue of subsection (7), expenditure on the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of, a qualifying premises includes expenditure on the development of any land, paragraph ( a ) shall have effect, with any necessary modifications, as if the references therein to the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of, the qualifying premises were references to the development of such land.

( 9 ) ( a ) For the purposes of sections 43 and 44, other than for the purposes mentioned in subsection (8) ( a ), expenditure incurred on the construction of, or, as the case may be, conversion into, a qualifying premises shall be deemed to have been incurred on the date of the first letting of the premises under a qualifying lease.

( b ) For the purposes of section 45, other than for the purposes mentioned in subsection (8) ( a ), relevant expenditure incurred in relation to the refurbishment of a qualifying premises shall be deemed to have been incurred on the date of the commencement of the relevant period, in relation to the premises, determined as respects the refurbishment to which the relevant expenditure relates.

( c ) For the purposes of section 46, other than for the purposes mentioned in subsection (8) ( a ), expenditure incurred on the construction or refurbishment of a qualifying premises shall be deemed to have been incurred on the earliest date after the expenditure was actually incurred that the premises is in use as a dwelling.

(10) For the purposes of sections 43, 44 and 45, expenditure shall not be regarded as incurred by a person in so far as it has been or is to be met directly or indirectly by the State, by any board established by statute or by any public or local authority.

(11) Paragraph 5 of Schedule 1 to the Capital Gains Tax Act, 1975 , shall have effect as if a deduction under section 43 (2), 44 (4) or 45 (2), as the case may be, were a capital allowance and as if any amount by way of rent deemed to have been received by a person under section 43 (4), 44 (6) or 45 (4), as the case may be, were a balancing charge.

(12) An appeal to the Appeal Commissioners shall lie on any question arising under this section or under section 43, 44, 45 or 46, other than a question on which an appeal lies under section 18 of the Housing (Miscellaneous Provisions) Act, 1979 , in like manner as an appeal would lie against an assessment to income tax or corporation tax and the provisions of the Tax Acts relating to appeals shall apply and have effect accordingly.

CHAPTER V Corporation Tax

Amendment of section 39 (meaning of "goods") of Finance Act, 1980 .

48.—(1) Section 39 (as amended by the Finance Act, 1992 ) of the Finance Act, 1980 , is hereby amended in subsection (1A)—

( a ) by the deletion of "and" in paragraph (a) and by the deletion of paragraph (b), and

( b ) by the deletion of "and" in paragraph (i) and by the deletion of paragraph (ii).

(2) This section shall have effect as respects relevant accounting periods beginning on or after the 1st day of June, 1994.

(3) Subsections (2), (3), (4) and (5) of section 41 of the Finance Act, 1990 , shall apply for the purposes of this section as they would apply for the purposes of that section if "11th day of April, 1994" were substituted for "20th day of April, 1990".

Amendment of section 37 (application of section 84 (matters to be treated as distributions) of Corporation Tax Act, 1976 ) of Finance Act, 1988 .

49.— Section 37 of the Finance Act, 1988 , is hereby amended—

( a ) by the insertion in subsection (1) ( b ), in the definition of "qualified company" and "relevant trading operations" before "section 39B" of "section 39A (inserted by the Finance Act, 1981 ) and", and

( b ) by the insertion, after that definition, of the following proviso thereto:

"Provided that trading operations shall not be treated as relevant trading operations within the meaning of the said section 39A if they are not trading operations which could be certified by the Minister for Finance as relevant trading operations for the purposes of section 39B if they were carried out in the Area (within the meaning of the said section 39B) rather than in the airport (within the meaning of the said section 39A).".

Amendment of section 84A (limitation on meaning of "distribution") of Corporation Tax Act, 1976 .

50.—(1) Section 84A (as amended by section 45 of the Finance Act, 1993 ) of the Corporation Tax Act, 1976 , is hereby amended—

( a ) in subsection (3A)—

(i) by the substitution in paragraph (b) —

(I) for "in the period from the 31st day of January, 1990, to the 31st day of December, 1991" of "on or after the 31st day of January, 1990", and

(II) for "as is paid in respect of relevant principal specified in the list" of "as is paid for a specified period in respect of relevant principal advanced and which was, at the time the relevant principal was advanced, specified in the list",

(ii) by the addition, after subparagraph (ii) of paragraph (c), of the following subparagraph:

"(iii) where, at any time after an amount of relevant principal is specified in a list in accordance with subparagraph (iv) of paragraph (b) of subsection (3A) or subparagraph (ii) of paragraph (b) of subsection (3B), a company advances, or is treated as advancing, to a borrower relevant principal the interest in respect of which is treated, by virtue only of paragraph (b) of subsection (3A) or paragraph (b) of subsection (3B), as a distribution, the amount of relevant principal specified in the list shall be treated as reduced by the amount of relevant principal so advanced, or treated as advanced, and the amount so reduced shall be treated as the amount specified in the said list.",

(iii) by the addition, after paragraph (d), of the following paragraph:

"( e ) In this subsection and in subsection (3B), 'specified period', in relation to relevant principal, means the period commencing on the date on which the relevant principal was advanced and ending on the date on which the relevant principal falls to be repaid under the terms of the agreement to advance the said relevant principal or, if earlier—

(i) in the case of relevant principal advanced before the 11th day of April, 1994, the 11th day of April, 2001, and

(ii) in any other case, a date which is 7 years after the date on which the said relevant principal was advanced.",

and

( b ) in subsection (3B), by the substitution in paragraph (b)for "as is paid in respect of relevant principal specified in the list" of "as is paid for a specified period in respect of relevant principal advanced and which was, at the time the relevant principal was advanced, specified in the list".

( 2 ) ( a ) Where, at any time before the 7th day of December, 1993—

(i) relevant principal (hereafter referred to as the "first-mentioned relevant principal"), the interest in respect of which was treated, by virtue only of subsection (3A) ( b ) or (3B) ( b ) of section 84A of the Corporation Tax Act, 1976 , as a distribution, advanced by a company to a borrower was repaid by the borrower before the scheduled repayment date, and

(ii) a further amount, or further amounts, of relevant principal, the interest in respect of which falls to be treated, by virtue only of the said subsection (3A) ( b ) or (3B) ( b ), as a distribution, was or were advanced to that borrower,

subparagraph (iii) (inserted by this section) of subsection (3A) ( c ) of section 84A of the Corporation Tax Act, 1976 , shall not apply in relation to so much of—

(I) the further amount of relevant principal advanced as does not exceed the amount of relevant principal repaid, or

(II) where there are more further amounts advanced than one, the aggregate of the further amounts of relevant principal advanced as does not exceed the relevant principal repaid.

( b ) Where, by virtue of paragraph ( a ), the said subparagraph (iii) does not apply in relation to any amount of relevant principal advanced by a company, the company shall be treated as having—

(i) received a repayment of that amount of relevant principal, and

(ii) advanced a corresponding amount of relevant principal,

on the scheduled repayment date of the first-mentioned relevant principal.

( c ) For the purposes of this subsection, where there are more further advances of relevant principal than one, the amount to which subparagraph (iii) of subsection (3A) ( c ) of section 84A of the Corporation Tax Act, 1976 , does not apply shall be referable as far as possible to an earlier rather than a later such further advance.

( d ) In this subsection "scheduled repayment date", in relation to any relevant principal, means the date on which the relevant principal falls to be repaid under the terms of the agreement to advance the said relevant principal.

(3) This section shall—

( a ) apply for the purposes of determining whether interest paid in respect of relevant principal advanced, or treated as advanced, on or after the 7th day of December, 1993, is to be treated as a distribution,

( b ) take account of relevant principal advanced before the 7th day of December, 1993, and

( c ) be construed together with sections 84 and 84A of the Corporation Tax Act, 1976 :

Provided that interest which, but for this proviso, would not be treated as a distribution by virtue only of—

(i) subparagraph (iii) (inserted by this section) of subsection (3A) (c) of section 84A of the Corporation Tax Act, 1976 , may be treated as a distribution if it is paid in respect of relevant principal advanced before the 7th day of December, 1993, and

(ii) paragraph (e)(inserted by this section) of subsection (3A) of the said section 84A may be treated as a distribution if it is paid before the 11th day of April, 1994.

Amendment of section 56 (relief for gifts to The Enterprise Trust Ltd) of Finance Act, 1992 .

51.— Section 56 of the Finance Act, 1992 , is hereby amended by the substitution in paragraph (a)of subsection (2) of "31st day of December, 1996," for "31st day of March, 1994,".

Relief for payments to National Co-operative Farm Relief Services Ltd and grants made to its members.

52.—(1) In this section—

"the agreement" means the agreement in writing dated the 4th day of July, 1991, between the Minister for Agriculture, Food and Forestry and the National Co-operative for the provision of financial support for farm relief services together with every amendment of the agreement in accordance with Article 9.1 thereof;

"a member co-operative" means a society engaged in the provision of farm relief services which has been admitted to membership of the National Co-operative;

"the Minister" means the Minister for Agriculture, Food and Forestry;

"the National Co-operative" means the society registered on the 13th day of August, 1980, as National Co-operative Farm Relief Services Limited;

"society" means a society registered under the Industrial and Provident Societies Acts, 1893 to 1978.

(2) Notwithstanding any provision of the Corporation Tax Acts—

( a ) a grant made under Article 3.1 of the agreement by the Minister on or after the 1st day of April, 1993, to the National Co-operative, and

( b ) a transfer of monies under Article 3.6 of the agreement by the National Co-operative on or after the 1st day of April, 1993, to a member co-operative,

shall be disregarded for all the purposes of those Acts.

Amendment of section 39B (relief in relation to income from certain trading operations carried on in Custom House Docks Area) of Finance Act, 1980 .

53.—Section 39B of the Finance Act, 1980 , is hereby amended in subparagraph (ii) of paragraph (c) of subsection (6) by the deletion from clause (III) after "currencies," of "and" and by the substitution for clause (IV) of the following clauses:

"(IV) insurance and related activities, or

(V) the management of the whole or part of the investments and other activities of a specified collective investment undertaking within the meaning of section 18 (1) of the Finance Act, 1989 ,".

Amendment of Chapter VI (Corporation tax: relief in relation to certain income of manufacturing companies) of Finance Act, 1980 .

54.—Chapter VI of Part I of the Finance Act, 1980 , is hereby amended, as respects accounting periods ending on or after the 1st day of May, 1994—

( a ) by the insertion after section 39B (inserted by the Finance Act, 1987 ) of the following section—

"Credit for foreign tax

39C.—(1) ( a ) In this section—

'an amount receivable from the sale of goods' means an amount which—

(i) being an amount receivable from the sale of computer software, or

(ii) by virtue of subsection (1CC) ( b) (ii) of section 39, subsection (7) (b) of section 39A or subsection (8) (b) of section 39B,

is regarded as receivable from the sale of goods for the purposes of relief under this Chapter;

'relevant foreign tax', where borne by a company in respect of an amount receivable from the sale of goods, means tax—

(i) which, under the laws of any foreign territory, has been deducted from that amount,

(ii) which has not been repaid to the company, and

(iii) for which credit is not allowable under arrangements within the meaning of Schedule 10 to the Income Tax Act, 1967 ;

'the total amount receivable from the sale of goods', in relation to a company in the course of a trade in a relevant accounting period, means the aggregate of amounts, receivable by the company in the course of the trade in the relevant accounting period, which are regarded by virtue of any provision of this Chapter as receivable from the sale of goods for the purposes of relief under this Chapter.

( b ) For the purposes of this section—

(i) so much of the corporation tax which would, apart from this section, be payable by a company for a relevant accounting period shall be treated as attributable to an amount receivable from the sale of goods in the course of a trade as would not be so payable if that amount receivable, and the income referable to it, were to be disregarded for the purposes of the Corporation Tax Acts;

(ii) the amount of any income of a company referable to an amount receivable from the sale of goods in the course of a trade in a relevant accounting period shall be taken to be such sum as bears to the total amount of the income of the company from the sale of goods in the course of the trade for the relevant accounting period the same proportion as the said amount receivable from the sale of goods bears to the total amount receivable by the company from the sale of goods in the course of the trade in the relevant accounting period;

(iii) the total amount of income of a company from the sale of goods in the course of a trade in a relevant accounting period shall be taken to be the sum referred to in subsection (3) of section 41 which is to be taken to be the income of the trade for the relevant accounting period referred to in the expression 'the income from the sale of those goods' in subsection (2) of the said section.

(2) The amount of corporation tax which would, apart from this subsection, be payable by a company for a relevant accounting period shall be reduced by nine-tenths of so much of any relevant foreign tax borne by the company in respect of an amount receivable from the sale of goods in that period in the course of a trade as does not exceed the corporation tax which would be so payable and which is attributable to the amount receivable from the sale of goods.",

and

( b ) in subsection (1) of section 41 (as amended by the Finance Act, 1992 ) by the insertion in paragraph (a)after "section" of "and section 39C".

Amendment of section 44 (group dividends) of Finance Act, 1983 .

55.— Section 44 of the Finance Act, 1983 , is hereby amended as respects distributions made in an accounting period ending on or after the 31st day of December, 1993, by the addition after subsection (7) of the following subsection:

"(8) References in this section to dividends shall be construed as including references to distributions on the redemption, repayment or purchase by a company of its own shares or on the acquisition of those shares by another company which is a subsidiary (within the meaning of section 155 of the Companies Act, 1963 ) of the company, and references to the receipt of dividends or to the payment of dividends shall be construed accordingly.".

Amendment of Part II (Corporation Tax) of Corporation Tax Act, 1976 .

56.—Part II of the Corporation Tax Act, 1976 , is hereby amended as follows—

( a ) as respects accounting periods beginning on or after the 1st day of January, 1995, by the insertion after section 12 of the following section:

"Foreign currency: computation of income and chargeable gains.

12A.—(1) ( a ) In this section—

'profit and loss account' means—

(i) in the case of a company (hereafter in this definition referred to as the 'resident company') resident in the State, the account of that company, and

(ii) in the case of a company (hereafter in this definition referred to as the 'non-resident company') which is not resident in the State but which is carrying on a trade in the State through a branch or agency, the account of the business of the company carried on through or from such branch or agency,

which in the opinion of the auditor appointed under section 160 of the Companies Act, 1963 , or under the law of the State in which the resident company or non-resident company, as the case may be, is incorporated and which corresponds to that section, presents a true and fair view of the profit or loss of the resident company or the said business of the non-resident company, as the case may be;

'rate of exchange' means a rate at which two currencies might reasonably be expected to be exchanged for each other by persons dealing at arm's length or, where the context so requires, an average of such rates;

'relevant contract', in relation to a company, means any contract entered into by the company for the purpose of eliminating or reducing the risk of loss being incurred by the company due to a change in the value of a relevant monetary item, being a change resulting directly from a change in a rate of exchange;

'relevant monetary item', in relation to a company, means money held or payable by the company for the purposes of a trade carried on by it.

( b ) The treatment of a contract entered into by a company as a relevant contract for the purposes of this section shall be ignored for any other purposes of the Tax Acts.

(2) Notwithstanding section 11, for the purposes of corporation tax the amount of any gain or loss, whether realised or unrealised, which—

( a ) is attributable to any relevant monetary item or relevant contract of a company,

( b ) results directly from a change in a rate of exchange, and

( c ) is properly credited or debited, as the case may be, to the profit and loss account of the company,

shall be brought into account in computing the trading income of the company.

(3) Notwithstanding section 13, for the purposes of corporation tax, where any gain or loss arises to a company in respect of—

( a ) a relevant contract of the company, or

( b ) money held by the company for the purposes of a trade carried on by it,

so much of that gain or loss as results directly from a change in a rate of exchange shall not be a chargeable gain or an allowable loss, as the case may be, of the company:

Provided that this subsection shall not have effect as respects any gain or loss arising to a company carrying on life business within the meaning of section 50 (2), being a company which is not charged to corporation tax in respect of that business under Case I of Schedule D.",

and

( b ) as respects accounting periods beginning on or after the 1st day of January, 1994, by the insertion after section 14 of the following section:

"Foreign currency: capital allowances and trading losses

14A.—(1) ( a ) In this section—

'functional currency' means

(i) in relation to a company which is resident in the State, the currency of the primary economic environment in which the company operates, and

(ii) in relation to a company which is not resident in the State, the currency of the primary economic environment in which the company carries on trading activities in the State:

Provided that where the profit and loss account of a company for any period of account has been prepared in terms of the currency of the State, that currency shall be the functional currency of the company for that period;

'profit and loss account' and 'rate of exchange' have the meanings assigned to them, respectively, in section 12A;

'representative rate of exchange' means a rate of exchange of a currency for another currency equal to the mid-market rate at close of business recorded by the Central Bank of Ireland, or by a similar institution of another State, for those two currencies.

(b) For the purposes of this section the currency of the primary economic environment of a company shall be determined—

(i) in the case of a company which is resident in the State, with reference to the currency in which—

(I) revenues and expenses of the company are primarily generated, and

(II) the company primarily borrows and lends, and

(ii) in the case of a company which is not so resident and which carries on trading activities in the State, with reference to the currency in which—

(I) revenues and expenses of those activities are primarily generated, and

(II) the company primarily borrows and lends for the purposes of those activities.

(c) For the purposes of this section the day on which any expenditure is incurred shall be taken to be the day on which the sum in question becomes payable.

(2) The amount, which may be nil, of any allowance or charge which falls to be made for any accounting period—

( a ) in taxing a trade of a company, and

( b ) by reference to capital expenditure incurred by the company on or after the 1st day of January, 1994,

shall be—

(i) computed in terms of the functional currency of the company by reference to amounts expressed in that currency, and

(ii) given effect, in accordance with section 14 (2) ( a ), by being treated as a trading expense or receipt, as the case may be, of the trade in computing the trading income or loss, expressed in that functional currency, of the trade for that accounting period:

Provided that—

(I) for the purposes of the computation of an allowance or charge which falls to be made for an accounting period (hereafter in this proviso referred to as the 'first-mentioned period') by reference to capital expenditure incurred by a company on or after the 1st day of January, 1994, and

(II) without prejudice to any allowance made by reference to that expenditure for an accounting period earlier than the first-mentioned period,

where the said expenditure was incurred, or an allowance referable to it was computed, in terms of a currency other than the functional currency of the company for the first-mentioned period, then that expenditure or allowance, as the case may be, shall be expressed in terms of that functional currency by reference to a representative rate of exchange of the said functional currency for the other currency for the day on which the said expenditure was incurred.

(3) For the purposes of sections 16 and 18, the amount, which may be nil, of any set-off due to a company against income or profits of an accounting period in respect of a loss from a trade incurred by the company in an accounting period beginning on or after the 1st day of January, 1994, shall—

( a ) be computed in terms of the company's functional currency by reference to amounts expressed in that currency, and

( b ) then be expressed in terms of the currency of the State by reference to the rate of exchange which—

(i) is used to express in terms of the currency of the State the amount of the income from the trade for the accounting period in which the loss is to be set off, or

(ii) would be so used if there were such income:

Provided that—

(I) for the purposes of the computation of any set-off due to a company against income or profits of an accounting period (hereafter in this proviso referred to as the 'first-mentioned period') in respect of a loss from a trade incurred by the company in an accounting period beginning on or after the 1st day of January, 1994, and

(II) without prejudice to any set-off made against the income or profits of an accounting period earlier than the first-mentioned period by reference to that loss,

where that loss, or any set-off referable to that loss, was computed in terms of a currency other than the functional currency of the company for the first-mentioned period in this proviso, then that loss or set-off, as the case may be, shall be expressed in terms of that functional currency by reference to a rate of exchange of the said functional currency for the other currency, being an average of representative rates of exchange of that functional currency for the other currency during the accounting period in which the loss was incurred.".

Corporate unitholders in undertakings for collective investment.

57.—Chapter IV of Part I of the Finance Act, 1993 , is hereby amended—

( a ) in subsection (7) of section 17, by the insertion after "Capital Gains Tax Acts" of "other than section 18 (as amended by the Finance Act, 1994) of this Act", and

( b ) in section 18—

(i) by the substitution for subsection (1) of the following subsections:

"(1) Subject to the provisions of this section, as respects a payment made on or after the 6th day of April, 1994, in money or money's worth, to a unitholder by reason of rights conferred on the holder as a result of holding units in an undertaking for collective investment—

( a ) where the holder is not a company, the payment shall not be reckoned in computing the total income of the holder for the purposes of the Income Tax Acts, and

( b ) where, apart from this paragraph, the said payment would be brought into account for the purposes of computing income chargeable to corporation tax, such payment shall be treated as if it were the net amount of an annual payment, chargeable to tax under Case IV of Schedule D, from the gross amount of which income tax has been deducted at the standard rate.

(1A) ( a ) This subsection applies to a payment which—

(i) is made on or after the 6th day of April, 1994, in money or money's worth, by reason of rights conferred on a unitholder as a result of holding units in an undertaking for collective investment, and

(ii) apart from subsection (1), would be charged to corporation tax under Case I of Schedule D.

( b ) Subsection (1) shall not apply to a payment to which this subsection applies.

( c ) For the purposes of the Tax Acts other than paragraphs (d) and (e)of this subsection—

(i) the income, for a chargeable period, attributable to a payment to which this subsection applies shall be increased by an amount determined by reference to paragraph (d), and

(ii) the amount so determined shall be deemed to be an amount of income tax which shall—

(I) be set off against corporation tax assessable on the unitholder for the chargeable period, or

(II) in so far as it cannot be set off in accordance with clause (I), be repaid to the unitholder.

( d ) The amount referred to in paragraph (c), by which the income attributable to a payment to which this subsection applies is to be increased, shall be determined by the formula—

[image not available: a39y1997s739-1anda13y1994s57-3.bmp]

where—

I is the said income, and

A is the standard rate per cent. for the year of assessment in which the payment is made.

( e ) For the purposes of this subsection, in computing income attributable to a payment—

(i) an amount shall be deducted from the payment if the payment arises on a sale or other transfer of ownership, or on a cancellation, redemption or repurchase by the undertaking for collective investment, of units or an interest in units, and an amount shall not be deducted otherwise,

(ii) subject to the following provisions of this paragraph, the amount of the consideration in money or money's worth given by, or on behalf of, the unitholder for the acquisition of units, or an interest in units, for which the payment is made, and not any other amount, shall be deducted from the payment,

(iii) where units are acquired by the unitholder before the 6th day of April, 1994, in an undertaking for collective investment which was carrying on business on the 25th day of May, 1993, the consideration for the acquisition of the units shall be deemed to be the amount of their market value (within the meaning of section 49 of the Capital Gains Tax Act, 1975 ) on the 6th day of April, 1994, if that amount is greater than the consideration given, or deemed by virtue of subparagraph (iv) to be given, by the unitholder for their acquisition,

(iv) where units are acquired by a unitholder for a consideration which is less than the market value (within the meaning of section 49 of the said Act) of the units on the day the unitholder acquired them, the consideration given by the unit holder for those units shall be deemed to be that market value, and

(v) the amount of consideration given for units shall be determined in accordance with paragraph 4 of Schedule 1 to the Capital Gains Tax (Amendment) Act, 1978 .",

(ii) by the insertion in subsection (2)—

(I) after "collective investment" of "by a person other than a company",

(II) after " Capital Gains Tax (Amendment) Act, 1978 )" in subparagraph (ii) of "and applying subsection (5) of section 31 of the Capital Gains Tax Act, 1975 " and

(III) after "for the purposes of this subsection" of "and subsection (2A)",

(iii) by the substitution in subsection (2) for "the provisions of the subsection" of "the provisions of this subsection and subsection (2A)",

(iv) by the insertion after subsection (2) of the following subsection:

"(2A) Subject to subsections (3) and (4), as respects a disposal by a company on or after the 6th day of April, 1994, of units in an undertaking for collective investment, for the purposes of the Corporation Tax Acts—

( a ) any chargeable gain accruing on the disposal shall, notwithstanding subsection (3) of section 1 of the Corporation Tax Act, 1976 , be treated as if it were the net amount of a gain from the gross amount of which capital gains tax has been deducted at the standard rate of income tax,

( b ) the amount to be brought into account in respect of the chargeable gain in computing, in accordance with section 13 of the Corporation Tax Act, 1976 , the company's chargeable gains, for the accounting period in which the company disposes of the units, shall be the said gross amount, and

( c ) the capital gains tax treated as deducted from the gross amount of the chargeable gain shall—

(i) be set off against the corporation tax assessable on the company for the said accounting period, or

(ii) in so far as it cannot be set off in accordance with subparagraph (i), be repaid to the company:

Provided that—

(I) as respects a disposal by a company of units, which it acquired before the 6th day of April, 1994, in an undertaking for collective investment which was carrying on business on the 25th day of May, 1993, this subsection shall only apply to so much of the chargeable gain accruing to the company on that disposal of units as does not exceed the chargeable gain which would have accrued on the said disposal had the company sold and immediately reacquired those units on the 5th day of April, 1994, at their market value on that day, and

(II) this subsection shall be ignored for the purposes of section 12 (1) of the Capital Gains Tax Act, 1975 ",

and

(v) in subsection (4) by the substitution in paragraph (a)for " (1) and (2)" of "(1), (1A), (2) and (2A)".

Life assurance and companies.

58.—Part IV of the Capital Gains Tax Act, 1975 , is hereby amended by the insertion after section 20A (inserted by section 24 of the Finance Act, 1993 ) of the following section:

"20B.—(1) ( a ) In this section—

'relevant policy' means a policy of life assurance, or contract for a deferred annuity on the life of any person, entered into or acquired by a company on or after the 11th day of April, 1994, which is not a policy to which subsection (2) of section 20A (as inserted by section 24 of the Finance Act, 1993 ) applies;

'relevant disposal' means a disposal of, or an interest in, the rights under any relevant policy, other than—

(i) a disposal by a person who is not the original beneficial owner of those rights and who acquired them, or an interest in them, for a consideration in money or money's worth, or

(ii) a disposal resulting directly from the death, disablement or disease of a person, or one of a class of persons, specified in the terms of the policy;

'relevant gain' means a chargeable gain arising on a relevant disposal.

( b ) (i) For the purposes of this section, a policy of assurance, or contract for a deferred annuity on the life of any person, entered into by a company before the 11th day of April, 1994, shall be treated as a policy or contract, as the case may be, entered into on or after that date if there is a variation of the policy or contract on or after that date which directly or indirectly increases the benefits secured by, or extends the term of, the policy or contract, as the case may be.

(ii) For the purposes of subparagraph (i), if a policy or contract entered into by a company before the 11th day of April, 1994, provides an option to have another policy or contract substituted for it or to have any of its terms changed, then any change in the terms of the policy or contract which is made in pursuance of the option shall be deemed to be a variation of the policy or contract, as the case may be.

( c ) Subject to subsection (2), this section shall be construed together with subsections (3) and (4) of section 20, as if the said subsection (3) were not subject to subsection (2) of section 20.

(2) Section 20 (2) shall not have effect in respect of any relevant disposal.

(3) ( a ) For the purposes of the Corporation Tax Acts (within the meaning of section 155 of the Corporation Tax Act, 1976 )—

(i) any relevant gain arising to a company shall be treated as if it were the net amount of a gain from the gross amount of which corporation tax has been deducted at the standard rate (within the meaning of section 1 of the Income Tax Act, 1967 ) of income tax,

(ii) the amount to be brought into account in respect of the relevant gain in computing, in accordance with section 13 of the Corporation Tax Act, 1976 , the company's chargeable gains, for the accounting period in which the relevant gain arises, shall be the said gross amount, and

(iii) the corporation tax treated as deducted from that gross amount shall—

(I) be set off against the corporation tax assessable on the company for the said accounting period, or

(II) in so far as it cannot be set off in accordance with clause (I), be repaid to the company:

Provided that this paragraph shall be ignored for the purposes of section 12 (1) of this Act.

( b ) This subsection shall be construed together with the Corporation Tax Act, 1976 .

(4) For the purposes of this section, a contract, being a policy of life assurance or a contract for a deferred annuity on the life of any person, shall be treated as having been entered into by a company before the 11th day of April, 1994, if—

( a ) (i) a document referable to the contract was served on the company in pursuance of section 52 of the Insurance Act, 1989 , before the 11th day of April, 1994, and

(ii) the company entered into the contract on or before the 22nd day of April, 1994,

( b ) (i) the contract was entered into before the 30th day of June, 1994, by the company,

(ii) before the 11th day of April, 1994—

(I) there was in existence a binding agreement in writing under which the company was obliged to acquire land, and

(II) preliminary commitments or agreements had been entered into by the company—

(A) to obtain a loan, which was to be secured on the land, to defray money applied in acquiring the land, and

(B) to enter into the contract primarily for the purpose of repaying the loan, and

(iii) the agreement under which the loan was advanced obliges the company to apply any payment made to it under the contract to the repayment of the loan before any other application by it of such payment.".

Amendment of section 25 (attribution of distributions to accounting periods) of Finance Act, 1989 .

59.—As respects distributions made on or after the 1st day of June, 1994, section 25 (as amended by section 37 of the Finance Act, 1992 ) of the Finance Act, 1989 , is hereby amended by the substitution for subsection (1) of the following subsection:

"(1) ( a ) Notwithstanding sections 64 , 76 , 93 and 170 of the Corporation Tax Act, 1976 , and subsection (1A) of section 45 (as amended by this Act) of the Finance Act, 1980 , but subject to subsections (2) and (3) of this section, where a company which makes a distribution on or after the 6th day of April, 1989, specifies, by notice in writing given to the inspector within 6 months of the end of the accounting period in which the distribution is made, the extent to which the distribution is to be treated, for the purposes of the said sections 64, 76, 93, 170 and the said section 45, as made for any accounting period or periods, the distribution shall be so treated for those purposes, irrespective of the period of account for which it was made.

( b ) A part of a distribution treated under the provisions of paragraph (a)as made for an accounting period shall be treated for the purposes of sections 64 , 76 , 93 and 170 of the Corporation Tax Act, 1976 , and subsections (1), (1A) and (2) of the said section 45 as a separate distribution.".

Amendment of section 35 (profits of life business) of Corporation Tax Act, 1976 .

60.— Section 35 of the Corporation Tax Act, 1976 , is hereby amended by the insertion of the following proviso to subsection (1A):

"Provided that, in applying the definition of foreign life assurance business in section 36 of the Finance Act, 1988 , for the purposes of this subsection, section 39B (inserted by the Finance Act, 1987 ) of the Finance Act, 1980 , shall apply as if there were deleted from subsection (2) 'and any certificate so given shall, unless it is revoked under subsection (4), (5) or (5A), remain in force until the 31st day of December, 2005'.".

Amendment of section 40 (capital allowances for certain leased assets) of Finance Act, 1984 .

61.—(1) Section 40 of the Finance Act, 1984 , is hereby amended—

( a ) in the definition of "the specified capital allowances" (as amended by section 53 of the Finance Act, 1986 ) in subsection (1), by the substitution of "subsection (6), (7), (7A) or (8)" for "subsection (6), (7) or (8)", and

( b ) by the insertion of the following subsection after subsection (7) (inserted by section 53 of the Finance Act, 1986 ):

"(7A) The reference in the definition of 'the specified capital allowances' in subsection (1) to machinery or plant to which this subsection applies is a reference to machinery or plant provided for leasing by a lessor to a lessee in the course of the carrying on by the lessor of relevant trading operations within the meaning of section 39A (inserted by the Finance Act, 1981 ), or section 39B (inserted by the Finance Act, 1988 ), of the Finance Act, 1980 , and—

( a ) in respect of the expenditure on which no allowance has been, or will be, made under Chapter I of Part XV of the Income Tax Act, 1967 , or

( b ) in respect of which no allowance on account of wear and tear falling to be made under section 241 of the Income Tax Act, 1967 , has been, or will be, increased under section 11 of the Finance Act, 1967 , or under section 26 of the Finance Act, 1971 .".

(2) Subsection (1) shall apply and have effect as respects accounting periods ending on or after the 31st day of December, 1993.

Amendment of section 28 (relief in relation to income from shipping trade) Finance Act, 1987 .

62.—Subsection (1) of section 28 of the Finance Act, 1987 is hereby amended by the insertion after "tug" in subparagraph (ii) of the definition of "qualifying ship" of "other than a tug in respect of which a certificate has been given by the Minister for the Marine certifying that, in the opinion of the Minister, the tug is capable of operating in seas outside the portion of the seas which are, for the purposes of the Maritime Jurisdiction Act, 1959 (as amended by the Maritime Jurisdiction (Amendment) Act, 1988 ), the territorial seas of the State".

CHAPTER VI Capital Gains Tax

Amendment of Schedule 4 (administration) to Capital Gains Tax Act, 1975 .

63.—(1) Schedule 4 to the Capital Gains Tax Act, 1975 , is hereby amended by the substitution, in subparagraph (6) of paragraph 4, of "£5,000" for "two thousand pounds".

(2) Subsection (1) shall apply and have effect as respects transactions effected on or after the 6th day of April, 1994.

Amendment of section 31 (unit trusts) of Capital Gains Tax Act, 1975 .

64.—(1) Section 31 of the Capital Gains Tax Act, 1975 , is hereby amended, as respects any disposal of units in a unit trust on or after the 6th day of April, 1994, by the deletion of subsection (5).

(2) Subject to subsection (1), section 31 of the Capital Gains Tax Act, 1975 , shall have effect, as respects any disposal of units in a unit trust on or after the 1st day of September, 1993, as if there were substituted for subsection (5) the following subsection:

"(5) If throughout a year of assessment all the assets of a unit trust are assets, whether mentioned in section 19, or in any other provision of this Act, or of any other enactment relating to capital gains tax, to which section 19 applies, the units in the unit trust shall for that year be deemed not to be chargeable assets for the purposes of this Act.".

(3) Where there is a disposal in the year 1994-95, or any subsequent year of assessment, of units in a unit trust—

( a ) not being an undertaking for collective investment (within the meaning of section 17 of the Finance Act, 1993 ) which began carrying on business on or after the 25th day of May, 1993,

( b ) all the assets of which were, throughout the year of assessment 1993-94, assets, whether mentioned in section 19 or in any other provision of the Capital Gains Tax Acts, to which section 19 applies, and

( c ) the person disposing of the units acquired the units before the 6th day of April, 1994,

then the chargeable gain on the disposal shall be computed as if the units had been sold and immediately reacquired by that person on the 5th day of April, 1994, at their market value at that date:

Provided that this subsection shall not apply in relation to the disposal of units—

(i) if, as a consequence of the application of this subsection, a gain would accrue on that disposal to the person making the disposal and either a smaller gain or loss would so accrue if this subsection did not apply, or

(ii) if, as a consequence of the application of this subsection, a loss would so accrue and either a smaller loss or a gain would accrue if this subsection did not apply,

and, accordingly, in a case to which paragraph (i) or (ii) of this proviso applies, the amount of the gain or loss accruing on the disposal shall be computed without regard to the provisions of this subsection (other than this proviso) but, in a case where this proviso would otherwise substitute a loss for a gain or a gain for a loss, it shall be assumed, in relation to the disposal, that the units were acquired by the person disposing of them for a consideration such that neither a gain nor a loss accrued to that person on making the disposal.

Amendment of section 27 (relief for individuals on certain reinvestment) of Finance Act, 1993 .

65.— Section 27 of the Finance Act, 1993 , is hereby amended—

( a ) in subsection (5), by the insertion of the following proviso to that subsection:

"Provided that where the disposal of the original holding is made at any time in the period beginning on the 6th day of May, 1993, and ending on the 5th day of April, 1994, the reference in paragraph (a)to "ending on the date which is one year after the date of the disposal of the original holding' shall be construed as a reference to 'ending on the 5th day of April, 1995'.",

and

( b ) by the substitution of the following subsection for subsection (7):

"(7) ( a ) In this subsection 'qualifying trading operations', in relation to a trade, means all the operations of the trade excluding those of dealing in shares, securities, land, currencies, futures or traded options.

( b ) A trade shall be a qualifying trade for the purposes of subsection (6) if, throughout the specified period—

(i) it is conducted on a commercial basis and with a view to the realisation of profits, and

(ii) it consists wholly or mainly of qualifying trading operations:

Provided that a trade which, during the specified period, consists partly of qualifying trading operations and partly of other trading operations shall be regarded for the purposes of this subsection as a trade which consists wholly or mainly of qualifying trading operations if, but only if, the total amount receivable in the specified period by the company carrying on the trade from sales made and services rendered in the course of qualifying trading operations is not less than 75 per cent. of the total amount receivable by the company from all sales made and services rendered in the course of the trade in the specified period.".

Reduced rate of capital gins tax on certain disposals of shares by individuals.

66.—(1) In this section—

"disposal" does not include a relevant disposal within the meaning of section 36 (1) of the Finance Act, 1982 ;

"ordinary share capital", in relation to a company, has the meaning assigned to it in section 155 of the Corporation Tax Act, 1976 ;

"ordinary shares" means shares forming part of a company's ordinary share capital;

"period of ownership", in relation to an individual making a disposal of qualifying shares, means the individual's period of continuous ownership of the shares, in the same capacity, ending with the date of such disposal and, for the purposes of this definition, where the shares were acquired by the individual on the death of that individual's spouse so that the individual's period of ownership would, apart from this definition, be treated as having commenced on the date of that death, the individual's period of ownership shall be deemed to be extended to include the individual's spouse's period of ownership ending on that date;

"qualifying company" shall be construed in accordance with subsection (2);

"qualifying shares", in relation to a company, means ordinary shares of the company which are fully paid up and which carry no present or future preferential rights to dividends or to the company's assets on its winding up and no present or future preferential right to be redeemed;

"qualifying trade" shall be construed in accordance with subsection (4);

"qualifying trading operations", in relation to a trade, means all the operations of the trade excluding those of dealing in shares, securities, land, currencies, futures or traded options;

"the specified period", in relation to the disposal of qualifying shares, means the period of 5 years immediately preceding the date of the disposal of those shares;

"trade" includes a profession and "qualifying trade" and "qualifying trading operations" shall be construed accordingly;

"unquoted company" means a company none of whose shares, stocks or debentures are listed in the official list of a stock exchange or dealt in on an unlisted securities market.

(2) For the purposes of this section a company shall be a qualifying company in relation to the disposal of qualifying shares where—

( a ) at the date of acquisition of those shares, it is an unquoted company which is resident in the State and not resident elsewhere and which has an issued share capital the market value of which is not more than £25,000,000, and

( b ) throughout the specified period, it is a company which is resident in the State and not resident elsewhere and—

(i) which exists wholly or mainly for the purposes of the carrying on of one or more qualifying trades, or

(ii) the business of which consists—

(I) wholly or mainly of the holding of shares in one or more connected companies, or

(II) wholly or mainly of both the holding of such shares and the carrying on of one or more qualifying trades.

( 3 ) ( a ) A company shall be regarded as having satisfied the condition referred to in subparagraph (i) of paragraph ( b ) of subsection (2) if, but only if, throughout the specified period, not less than 75 per cent. of the market value of all the issued share capital of the company derives from the carrying on by the company of one or more qualifying trades.

( b ) A company shall be regarded as having satisfied the condition referred to in clause (I) or (II), as the case may be, of subparagraph (ii) of paragraph ( b ) of subsection (2) if, but only if, throughout the specified period, not less than 75 per cent. of the market value of all the issued share capital of the company derives from the carrying on of one or more qualifying trades by the connected companies or, as the case may be, by the company and the connected companies.

( c ) In a case where a connected company (hereafter in this paragraph referred to as "the first-mentioned company") is a company whose business consists of the holding of shares in one or more companies, references in paragraph ( b ) to the connected companies shall be construed as including references to the companies which are connected with the first-mentioned company.

(4) For the purposes of this section a trade shall be a qualifying trade if, throughout the specified period, it consists of qualifying trading operations and where, during that period, a trade consists partly of qualifying trading operations and partly of other trading operations, the part of the trade which consists of other trading operations shall be treated as a separate trade.

(5) For the purposes of this section where a company (hereafter in this subsection referred to as "the first-mentioned company") holds shares in another company that other company shall be regarded as connected with the first-mentioned company if—

( a ) at the date of the acquisition of those shares by the first-mentioned company, it was an unquoted company,

( b ) it is resident in the State and not resident elsewhere, and

( c ) the voting rights in the company are exercisable by the first-mentioned company as respects not less than 20 per cent. of the total voting rights.

(6) As respects chargeable gains accruing to an individual on the disposal of qualifying shares in a qualifying company in a case where the individual's period of ownership of those shares is not less than 5 years, subsection (3) (inserted by section 60 of the Finance Act, 1992 ) of section 3 of the Capital Gains Tax Act, 1975 , shall apply and have effect as if the reference therein to 40 per cent. were a reference to 27 per cent.

( 7 ) ( a ) In this subsection and in subsection (8) "original shares" and "new holding" have, respectively, the meanings assigned to them in paragraph 2 of Schedule 2 to the Capital Gains Tax Act, 1975 .

( b ) If the time when an individual acquires qualifying shares would be determined under any of the provisions of Schedule 2 to the Capital Gains Tax Act, 1975 , it shall be determined in the same way for the purposes of this section where the following conditions are satisfied, that is to say:

(i) both the original shares and the new holding constitute qualifying shares, and

(ii) the individual is not treated under subparagraph (3) of paragraph 2 of the said Schedule as giving or becoming liable to give any consideration, other than the original shares, for the acquisition of the new holding.

( 8 ) ( a ) In a case where paragraph ( b ) of subsection (7) applies and has effect and the new holding is held for a period which is not less than 5 years, subsection (2) shall apply—

(i) as if the reference in paragraph ( a ) of subsection (2) to "at the date of acquisition of those shares" were a reference to "at the date of acquisition of the original shares",

(ii) where the company in which the new holding subsists is not the company in which the original shares subsisted, as if the reference in paragraph ( a ) of subsection (2) to "it is" were a reference to "the company in which the original shares subsisted is", and

(iii) as if the reference in paragraph ( b ) of subsection (2) to "it is" were a reference to "the company in which the new holding subsists is".

( b ) In a case where paragraph ( b ) of subsection (7) applies and has effect and the new holding is held for a period which is less than 5 years, subsection (2) shall apply—

(i) as if the reference in paragraph ( a ) of subsection (2) to "at the date of acquisition of those shares" were a reference to "at the date of acquisition of the original shares", and

(ii) where the company in which the new holding subsists is not the company in which the original shares subsisted—

(I) as if the reference in paragraph ( a ) of subsection (2) to "it is" were a reference to "the company in which the original shares subsisted is",

(II) as if the reference in paragraph ( b ) of subsection (2) to "throughout the specified period, it is" were a reference to "throughout that part of the specified period commencing on the date of the acquisition of the new holding, the company in which the new holding subsists is", and

(III) as if the conditions referred to in paragraph ( b ) of subsection (2) applied also to the company in which the original shares subsisted but only in relation to the part of the specified period which does not include the part of that period mentioned in clause (II).

(9) This section shall apply and have effect as respects disposals made on or after the 6th day of April, 1994.

PART II CUSTOMS AND EXCISE

CHAPTER I Excise Duty on Cigarettes — Introduction of Tax Stamps

Interpretation (Chapter I).

67.—In this Chapter—

"the Principal Act" means the Finance (Excise Duty on Tobacco Products) Act, 1977 ;

"the Regulations of 1992" means the European Communities (Customs and Excise) Regulations, 1992, ( S.I. No. 394 of 1992 ).

Amendment of section 1 (interpretation) of Principal Act.

68.—Section 1 of the Principal Act is hereby amended—

( a ) by the insertion in subsection (1) of the following definition after the definition of "smoking tobacco" (inserted by the Imposition of Duties (No. 243) (Excise Duty on Tobacco Products) Order, 1979 ( S.I. No. 296 of 1979 )):

"'tax stamp' means a label issued by the Revenue Commissioners under section 2A of this Act for the purpose of collecting the duty of excise imposed by section 2 of this Act.",

and

( b ) by the insertion of the following subsection after subsection (1):

"(1A) In this Act 'authorised warehousekeeper', 'duty-suspension arrangement', 'tax representative' and 'tax warehouse' have the same meanings, respectively, as they have in Chapter II of Part II of the Finance Act, 1992 .".

Liability for duty to be paid by tax stamps.

69.—The Principal Act is hereby amended by the insertion of the following section after section 2:

"2A.—(1) The duty of excise imposed by section 2 of this Act shall, in respect of cigarettes, be paid by means of the purchase of tax stamps issued by the Revenue Commissioners:

Provided that the Revenue Commissioners may, in exceptional circumstances, permit payment of the duty to be subject to the provisions of subsection (4) of this section.

(2) Liability for duty in respect of tax stamp purchases shall arise at the time the tax stamps are issued by the Revenue Commissioners to the purchaser.

(3) Subject to section 3 (3) of this Act, the Revenue Commissioners shall only issue tax stamps on payment of the appropriate amount of duty.

(4) Liability for duty in respect of other tobacco products shall arise at the time the goods are manufactured in the State or imported into the State or when they cease to be warehoused without payment of duty under section 4 whichever is the later.".

Sale of cigarettes.

70.—The Principal Act is hereby amended by the insertion of the following section after section 2A (inserted by section 69):

"2B.—(1) With the exception of—

( a ) cigarettes to which the provisions of subsection (2) of section 106 of the Finance Act, 1992 , apply,

( b ) cigarettes being held or delivered under a duty-suspension arrangement, and

( c ) cigarettes to which the proviso to subsection (1) of section 2A of this Act apply,

cigarettes intended for sale, delivery or consumption in the State shall have affixed by the manufacturer, to each pack in which the cigarettes are intended to be put up for retail sale, a tax stamp in respect of which the duty appropriate to the pack of cigarettes has been paid:

Provided that cigarettes intended for sale or delivery in accordance with the provisions of Regulation 4 of the Regulations of 1992 shall not have tax stamps affixed.

(2) ( a ) Tax stamps affixed in the State to packs of cigarettes shall be affixed in a tax warehouse and in such manner as the Revenue Commissioners may prescribe in regulations made under section 8 of this Act.

( b ) Where packs of cigarettes are brought into the State with tax stamps affixed they shall be affixed in such manner as the Revenue Commissioners may prescribe in regulations made under section 8 of this Act.".

Amendment of section 3 (repayment, remission and deferment of payment) of Principal Act.

71.—Section 3 of the Principal Act is hereby amended—

( a ) by the insertion of the following subsection after subsection (1):

"(1A) The Revenue Commissioners may, subject to compliance with such conditions as they consider appropriate to impose, repay or remit duty paid by means of tax stamps where it is shown to their satisfaction that the tax stamps have been destroyed or are damaged or otherwise unsuitable for the use for which they were issued.",

and

( b ) by the substitution of the following subsection for subsection (3):

"(3) The Revenue Commissioners may, subject to compliance with such conditions for securing payment of the duty as they may think fit to impose—

( a ) in respect of the duty on cigarettes (other than cigarettes referred to in the proviso to subsection (1) of section 2A) and where duty liability arises in a period beginning on and including the fourth last day of a month up to and including the fifth last day of the subsequent month, permit payment of the duty imposed by section 2 of this Act to be deferred to a day not later than the last day of the second month following that subsequent month:

Provided that, where duty liability arises during the period beginning on and including the 28th day of October and ending on and including the 27th day of the subsequent December, the duty arising up to and including the 30th day of November and half the duty arising in the said period thereafter, as determined by the Revenue Commissioners, shall be paid not later than the subsequent 31st day of December.

( b ) in respect of the duty on other tobacco products:

(i) other than on the last day in the month of December, where duty liability arises on a day in that month but such day is not a Saturday or a Sunday, permit payment of the duty imposed by section 2 of this Act to be deferred, as to one half, as determined by the Revenue Commissioners, of the duty, to a day not later than the last day of that month and, as to the remainder of the duty, to a day not later than the last day of the next following month of January, and

(ii) in any other case, permit payment of the duty imposed by section 2 of this Act to be deferred to a day not later than the last day of the month immediately following that in which liability arises.".

Amendment of section 7 (ascertainment of retail prices of tobacco products) of Principal Act.

72.—Section 7 of the Principal Act is hereby amended in subsection (3) by the insertion of the following paragraph after paragraph (b):

"( c ) A person shall not invite an offer to treat, offer for sale or sell by retail any packet of cigarettes at a price which is higher than the price on the basis of which that part of the excise duty imposed by section 2 of this Act which is chargeable by reference to the price at which the cigarettes are sold by retail has been charged on the cigarettes in question and any person who so invites, offers or sells shall be guilty of an offence and shall be liable on conviction to an excise penalty of £50 in respect of each such offence.".

Amendment of section 8 (regulations) of Principal Act.

73.—Section 8 of the Principal Act is hereby amended in subsection (2) by the insertion of the following paragraphs after paragraph (h):

"(i) prescribe the form of tax stamps to be used to collect the excise duty imposed on cigarettes by section 2 of this Act,

( j ) govern the printing, transportation, storage, sale, release and supply of tax stamps,

( k ) prescribe the manner in which tax stamps are to be affixed,

( l ) specify the records to be kept by tobacco manufacturers, importers, authorised warehousekeepers and tax representatives in relation to tax stamps which are either or both obtained and held by each one of them.".

Offences in relation to tax stamps.

74.—The Principal Act is hereby amended by the insertion of the following section after section 10:

"10A.—(1) Subject to the provisions of Regulation 4 of the Regulations of 1992 and with the exception of cases referred to in the proviso to subsection (1) of section 2A of this Act, any person who offers for sale or delivery, where such sale or delivery does not take place under a duty-suspension arrangement, in the State cigarettes otherwise than in a pack or packs to which a tax stamp, on which duty at the appropriate amount has been paid, is affixed in the prescribed manner shall be guilty of an offence and the cigarettes in respect of which the offence has been committed and any goods which are packed with or used to conceal the said cigarettes shall be liable to forfeiture and, where the cigarettes are found in, on, or in any manner attached to, any vehicle or conveyance, the said vehicle or other conveyance shall be deemed to have been made use of in the conveyance of the said cigarettes and shall also be liable to forfeiture.

(2) Any person who counterfeits, alters or otherwise makes fraudulent use of, or who is knowingly concerned in holding, selling or dealing in a counterfeited or altered tax stamp shall be guilty of an offence.

(3) A person who is guilty of an offence under subsection (1) or (2) of this section shall be liable on conviction to a penalty of £1,000 in respect of each such offence.

(4) In a prosecution for an offence under subsection (1) of this section, it shall be presumed until the contrary is shown that duty had not been paid in respect of any pack or packs which do not have a tax stamp affixed thereto.".

Amendment of section 11 (offences) of Principal Act.

75.—Section 11 of the Principal Act is hereby amended by the substitution of "£1,000 in respect of each such offence" for "£500".

Amendment of section 18 (power to refuse delivery of goods) of Finance Act, 1939 .

76.— Section 18 of the Finance Act, 1939 , is hereby amended—

( a ) in subsection (1) by the substitution of "one or more" for "either or both",

( b ) by the insertion of the following paragraph after paragraph (a)of subsection (1):

"( aa )to refuse to allow, during the said period, the issue of tax stamps to manufacturers or importers of cigarettes or to any other person where the quantity applied for appears to the Revenue Commissioners to exceed the quantity which is reasonable having regard to the circumstances, and",

and

( c ) by the insertion of the following subsection after subsection (1):

"(1A) In subsection (1) of this section—

'cigarettes' has the meaning (inserted by Regulation 26 of the European Communities (Customs and Excise) Regulations, 1992 ( S.I. No. 394 of 1992 )) it has in section 1 of the Finance (Excise Duty on Tobacco Products) Act, 1977 ;

'tax stamps' has the same meaning (inserted by section 68 of the Finance Act, 1994 ) it has in section 1 of the Finance (Excise Duty on Tobacco Products) Act, 1977 .".

Commencement (Chapter I).

77.—This Chapter shall come into operation on such day as the Minister for Finance may appoint by order, and different days may be so appointed for different provisions or for different purposes.

CHAPTER II Miscellaneous

Interpretation (Chapter II).

78.—In this Chapter—

"the Act of 1992"' means the Finance Act, 1992 ;

"the Act of 1993" means the Finance Act, 1993 ;

"the Order of 1975" means the Imposition of Duties (No. 221) (Excise Duties) Order, 1975 ( S.I. No. 307 of 1975 );

"the Regulations of 1992" means the European Communities (Customs and Excise) Regulations, 1992 ( S.I. No. 394 of 1992 ).

Tobacco products.

79.—(1) In this section and in the Third Schedule—

"the Act of 1977" means the Finance (Excise Duty on Tobacco Products) Act, 1977 ;

"cigarettes", "cigars" and "fine-cut tobacco for the rolling of cigarettes" have the same meanings as they have in the Act of 1977, as amended by the Imposition of Duties (No. 243) (Excise Duty on Tobacco Products) Order, 1979 ( S.I. No. 296 of 1979 ), and by Regulations 26 and 29 of the Regulations of 1992.

(2) The duty of excise on tobacco products imposed by section 2 of the Act of 1977, shall, in lieu of the several rates specified in the Second Schedule to the Act of 1993, be charged, levied and paid, as on and from the 27th day of January, 1994, at the several rates specified in the Third Schedule.

Beer.

80.—The duty of excise on beer imposed by section 90 (1) of the Act of 1992, shall, in lieu of the rate specified in section 73 of the Act of 1993, be charged, levied and paid, as on and from the 27th day of January, 1994, at the rate of £15.65 per hectolitre per cent. of alcohol in the beer.

Spirits.

81.—(1) In this section "alcohol" means pure ethyl alcohol.

(2) The duty of excise on spirits imposed by paragraph 4 (2) of the Order of 1975, shall be charged, levied and paid, as on and from the 27th day of January, 1994, at the rate of £21.83 per litre of alcohol in the spirits in lieu of the rate specified in the said paragraph 4 (2) as amended by Regulation 18 (a) of the Regulations of 1992.

Cider and perry.

82.—(1) In the Fourth Schedule—

"actual alcoholic strength by volume" means the number of volumes of pure alcohol contained at a temperature of 20°C in 100 volumes of the product at that temperature;

"% vol" means alcoholic strength by volume.

(2) The duty of excise on cider and perry imposed by paragraph 8 (2) of the Order of 1975, shall be charged, levied and paid, as on and from the 27th day of January, 1994, at the several rates specified in the Fourth Schedule in lieu of the several rates specified in the Third Schedule to the Act of 1993.

Wine and made wine.

83.—(1) In the Fifth Schedule—

"actual alcoholic strength by volume" means the number of volumes of pure alcohol contained at a temperature of 20°C in 100 volumes of the product at that temperature;

"% vol" means alcoholic strength by volume.

(2) The duties of excise on wine and made wine imposed by paragraphs 5 (2) and 6 (2), respectively, of the Order of 1975, shall be charged, levied and paid, as on and from the 27th day of January, 1994, at the several rates specified in the Fifth Schedule in lieu of the several rates specified in the Fourth Schedule to the Act of 1993.

Hydrocarbons.

84.—(1) The duty of excise on mineral hydrocarbon light oil imposed by paragraph 11 (1) of the Order of 1975, shall, in lieu of the rate specified in section 150 (1) of the Act of 1992, be charged, levied and paid, as on and from the 27th day of January, 1994, at the rate of £299.39 per 1,000 litres.

(2) For the purposes of the rebate of duty on mineral hydrocarbon light oil provided for in section 56 (3) of the Finance Act, 1988 , section 89 of the Finance Act, 1990 , shall apply as on and from the 27th day of January, 1994, as if the reference therein to section 40 (1) of the Finance Act, 1989 , which, by virtue of section 150 (2) of the Act of 1992, is construed as a reference to section 150 (1) of the Act of 1992, were instead a reference to subsection (1) of this section.

(3) The duty of excise on hydrocarbon oil imposed by paragraph 12 (1) of the Order of 1975, shall, in lieu of the rate specified in section 56 (4) of the Finance Act, 1988 , be charged, levied and paid, as on and from the 27th day of January, 1994, at the rate of £235.49 per 1,000 litres.

(4) Subject to the provisions of the Imposition of Duties (No. 265) (Excise Duty on Hydrocarbon Oils) Order, 1983 ( S.I. No. 126 of 1983 ), the amount of the rebate allowed under paragraph 12 (3) of the Order of 1975, shall, in respect of fuel oil within the meaning of paragraph 3 of the Imposition of Duties (No. 256) (Excise Duty on Hydrocarbon Oils) Order, 1981 (S.I. No. 404 of 1981), which is imported or delivered from the premises of a refiner of hydrocarbon oil or from a tax warehouse on or after the 27th day of January, 1994, and in lieu of the rate specified in section 69 (1) of the Act of 1993, be the amount of duty chargeable less an amount calculated at the rate of £10.60 per 1,000 litres.

(5) The duty of excise on used hydrocarbon oil imposed by Regulation 24 (2) ( a ) of the Regulations of 1992, shall not be charged or levied on or after the 27th day of January, 1994.

(6) Section 21 (15) of the Finance Act, 1935 , is hereby amended—

( a ) in the definition of "motor vehicle" (as amended by section 74 (4) of the Finance Act, 1991 ) by the insertion after "1952" of ", or a mobile crane or mobile well drilling equipment or mobile concrete pumping equipment", and the said definition, as so amended, is set out in the Table to this subsection, and

( b ) by the insertion after the interpretation of "combustion in the engine of a motor vehicle" of the following definitions:

"the expression 'mobile concrete pumping equipment' means a vehicle which is designed, constructed or adapted solely for pumping concrete and which is not used for any purpose on roads other than for travel or for pumping concrete;

the expression 'mobile crane' means a vehicle which is designed, constructed or adapted solely for lifting or elevating goods and which is not used for any purpose on roads other than for travel or for lifting or elevating goods;

the expression 'mobile well drilling equipment' means a vehicle which is designed, constructed or adapted solely for well drilling purposes and which is not used for any purpose on roads other than for travel or for well drilling;".

TABLE

the expression "motor vehicle" means a mechanically propelled vehicle which is designed, constructed, and suitable for use on roads, but does not include a tractor which is designed and constructed for use for agricultural purposes or a road roller or a vehicle referred to in paragraph 2 ( b ) of Part I (inserted by the Finance Act, 1991 ) of the Schedule to the Finance (Excise Duties) (Vehicles) Act, 1952 , or a mobile crane or mobile well drilling equipment or mobile concrete pumping equipment.

Amendment of section 132 (charge of excise duty) of Finance Act, 1992 .

85.—(1) As respects vehicle registration tax charged, levied and paid as on and from the 27th day of January, 1994, subsection (3) (inserted by the Finance (No. 2) Act, 1992 ) of section 132 of the Act of 1992, is hereby amended—

( a ) in paragraph (a), by the substitution of "29.25 per cent." for "31.8 per cent.",

( b ) in paragraph (b), by the substitution of "23.2 per cent." for "25.75 per cent.", and

( c ) in paragraph( f )—

(i) by the substitution in subparagraphs (i) and (ii) of "£2 per cubic centimetre" for "£2.50 per cubic centimetre", and

(ii) by the substitution in subparagraph (ii) of "£1 per cubic centimetre" for "£1.25 per cubic centimetre".

(2) As respects vehicle registration tax charged, levied and paid as on and from the date of the passing of this Act, paragraph (a)of subsection (3) (inserted by the Finance (No. 2) Act, 1992 ) of section 132 of the Act of 1992 is hereby amended by the substitution of "2,500 cubic centimetres" for "2,012 cubic centimetres".

Amendment of Section 60 (records) of Finance Act, 1993 .

86.— Section 60 of the Finance Act, 1993 , is hereby amended by the substitution of the following subsections for subsection (2):

"(2) ( a ) The Minister and all the licensing authorities may jointly establish and maintain records in relation to licences under the Act of 1952, trade licences under section 21 of the Finance (No. 2) Act, 1992 , licences under section 10 of the Road Traffic Act, 1968 , driving licences under Part III of the Act of 1933 and driving licences and provisional licences under Part III of the Act of 1961.

( b ) Records established under this section may contain information derived from registers established under section 6 of the Act of 1920 and shall contain such other information in relation to the licences aforesaid, the holders of the licences, the duties of excise payable thereon and the vehicles licensed under the Act of 1952 as the Minister may determine.

( c ) Records referred to in paragraph (a) shall be established and maintained in such form as the Minister may determine including a form that is not legible if it is capable of being converted into a legible form.

(2A) A licensing authority shall furnish to the Minister or another licensing authority such information, in such form and at such times as he directs for the purpose of the establishment and maintenance of records under this section.".

Amendment of section 61 (evidence) of Finance Act, 1993 .

87.— Section 61 of the Finance Act, 1993 , is hereby amended by the substitution of the following subsections for subsections (1) and (2):

"(1) In any proceedings a certificate signed by an officer of the Minister authorised by the Minister for the purposes of this section and containing only—

( a ) information stated to be taken from—

(i) records maintained by the Minister under subsection (1) of section 60,

(ii) records maintained jointly by the Minister and all the licensing authorities under subsection (2) of that section, or

(iii) records relating to vehicles or drivers of vehicles maintained by the Minister under any other provision of or made under any statute, or,

( b ) information obtained by the Minister under section 131 (7) of the Act of 1992,

shall be sufficient evidence of the facts stated in the certificate until the contrary is proved.

(2) In any proceedings a certificate signed by an officer of a licensing authority authorised by the authority for the purposes of this section and containing only information stated to be taken from—

( a ) records maintained by the authority under subsection (1) of section 60,

( b ) records maintained jointly by the Minister and all the licensing authorities under subsection (2) of that section, or

( c ) records relating to vehicles or drivers of vehicles maintained by the authority under any other provisions of or made under any statute,

shall be sufficient evidence of the facts stated in the certificate until the contrary is proved.".

Amendment of section 123 (rates of duty) of Finance Act, 1992 .

88.—Section 123 of the Act of 1992, is hereby amended in paragraph (c)(inserted by the Act of 1993) by the substitution of the following proviso for the proviso to the paragraph:

"Provided that the licence is expressed to relate only to Saturdays, Sundays and public holidays (within the meaning of the Holidays (Employees) Act, 1973 ) in the periods from—

(I) where appropriate, the 1st day of March or the date the licence is granted, whichever is the later, to the 30th day of March in the year concerned, and

(II) the 1st day of October or the date the licence is granted, whichever is the later, to the last day of February in the year concerned.".

Exemption from duty on certain bets.

89.—(1) The duty on bets to which section 24 of the Finance Act, 1926 , relates shall not be charged or levied on bets entered into on or after the commencement of this subsection where such bets—

( a ) are entered into—

(i) during a meeting at which a series of horse races is held, and

(ii) at the place at which such meeting is held,

and

( b ) are in respect of one or more than one event taking place at a place other than at such meeting.

(2) Subsection (1) shall come into operation on such day as the Minister for Finance may, by order, appoint.

PART III VALUE-ADDED TAX

Interpretation (Part III).

90.—In this Part—

"The Principal Act" means the Value-Added Tax Act, 1972 ;

"the Act of 1978" means the Value-Added Tax (Amendment) Act, 1978 ;

"the Act of 1982" means the Finance Act, 1982 ;

"the Act of 1989" means the Finance Act, 1989 ;

"the Act of 1992" means the Finance Act, 1992 .

Amendment of Section 1 (interpretation) of Principal Act.

91.—Section 1 of the Principal Act is hereby amended in subsection (1), in subparagraph (b) of the definition of "new means of transport" (inserted by the Act of 1992):

( a ) by the substitution of the following clause for clause (i):

"(i) which in the case of vessels and aircraft were supplied three months or less after the date of first entry into service and in the case of land vehicles were supplied six months or less after the date of first entry into service, or",

and

( b ) by the substitution in clause (ii) of "6,000 kilometres" for "3,000 kilometres—.

Amendment of section 3 (supply of goods) of Principal Act.

92.—Section 3 of the Principal Act is hereby amended in subparagraph (ii) of paragraph (g)(inserted by the Act of 1992) of subsection (1) by the insertion after "( va )" of ", ( vb )".

Person liable to pay tax in relation to certain supplies of immovable goods.

93.—The Principal Act is hereby amended by the insertion of the following section after section 4:

"4A.—(1) Subject to the provisions of subsection (3), where tax is chargeable in respect of the letting of immovable goods which is deemed to be a supply of goods in accordance with section 4 and the lessee would, but for the operation of this section, have been entitled to claim a deduction under section 12 (1) ( a ) (i) for all the said tax borne in relation to that supply, the lessor shall not be liable to pay the said tax and, in that case, the lessee shall be liable to pay the said tax as if the lessee had supplied the goods in the course or furtherance of business.

(2) Where, in relation to a supply, the lessor and the lessee wish the provisions of subsection (1) to apply they shall—

( a ) complete such application form as may be provided by the Revenue Commissioners for that purpose,

( b ) certify the particulars shown on such form to be correct, and

( c ) submit to the Revenue Commissioners the completed and certified application form, together with such further information in support of the application as may be requested by the said Commissioners.

(3) Where, in relation to a supply of goods referred to in subsection (1), the lessor and lessee have furnished the particulars referred to in subsection (2), the Revenue Commissioners shall, where they are satisfied that it is in order to apply the provisions in subsection (1) in relation to that supply, notify the lessor and the lessee by notice in writing that the provisions of subsection (1) are to be applied in relation to that supply.

(4) Where the provisions of subsection (1) apply in relation to a supply, the invoice issued by the lessor in accordance with section 17 shall show the following endorsement in lieu of the amount of tax chargeable:

'In accordance with section 4A of the Value-Added Tax Act, 1972 , the lessee is liable for the value-added tax of £X.',

and, in that endorsement, the lessor shall substitute the amount of tax chargeable in respect of that supply of goods for '£X'.

(5) Every notification received by a taxable person, which has been issued to that person by the Revenue Commissioners in accordance with subsection (3), shall be part of the records which that person is required to keep in accordance with section 16.

(6) For the purposes of this section, and subject to the direction and control of the Revenue Commissioners, any power, function or duty conferred or imposed on them may be exercised or performed on their behalf by an officer of the Revenue Commissioners.

(7) In this section—

'lessee' means the person who receives the goods referred to in subsection (1);

'lessor' means the person who supplies the goods referred to in subsection (1).".

Amendment of section 8 (taxable persons) of Principal Act.

94.—Section 8 of the Principal Act is hereby amended—

( a ) in subparagraph (iii) of paragraph (e)of subsection (1A) (inserted by the Finance Act, 1993 ) by the substitution of "specified in the First Schedule" for "specified in paragraph (vi), (vii), (xxii) or (xxiii) of the First Schedule",

( b ) in subsection (3) (inserted by the Act of 1992) by the substitution—

(i) in paragraph (a)of "£20,000" for "£15,000",

(ii) in paragraph (b)(ii) of the following clause for clause (II):

"(II) supplies of other goods and services the total consideration for which is such that such person would not, because of the provisions of paragraph (c)or (e), be a taxable person if such supplies were the only supplies made by such person,",

(iii) in paragraph (c)(i) of "£40,000" for "£32,000", and

(iv) in paragraph (e)of "£20,000" for "£15,000",

( c ) in subsection (3A) (inserted by the Act of 1982) by the substitution of "£20,000" for "£15,000" (inserted by the Act of 1989), and

( d ) in subsection (9) (inserted by the Act of 1978), in paragraph (b) of the definition of "farmer" (inserted by the Act of 1982)—

(i) by the substitution in subparagraph (ii) of "£20,000" for "£15,000" (inserted by the Act of 1989),

and

(ii) by the substitution of the following subparagraph for subparagraph (iii):

"(iii) supplies of goods and services other than those referred to in subparagraphs (i) and (ii) or paragraph (a), the total consideration for which is such that such person would not, because of the provisions of paragraph (c)or (e)of subsection (3), be a taxable person if such supplies were the only supplies made by such person.".

Amendment of section 10 (amount on which tax is chargeable) of Principal Act.

95.—Section 10 of the Principal Act is hereby amended in paragraph (c)of subsection (3) by the insertion of the following proviso to that paragraph:

"Provided that in any event this paragraph shall not apply in the case of the letting of immovable goods which is a taxable supply of goods in accordance with section 4.".

Amendment of section 12 (deductions for tax borne or paid) of Principal Act.

96.—Section 12 of the Principal Act is hereby amended—

( a ) in paragraph (a)of subsection (1) by the insertion of the following subparagraph after subparagraph (iiia ) (inserted by the Finance Act, 1991 ):

"(iiib ) the tax chargeable during the period, being tax for which he is liable by virtue of section 4A (1), in respect of goods received by him,",

and

( b ) in subsection (3)—

(i) in paragraph (a)by the insertion of the following subparagraph after subparagraph (i):

"( ia ) expenditure incurred by the taxable person on food or drink, or accommodation or other entertainment services, where such expenditure forms all or part of the cost of providing an advertising service in respect of which tax is due and payable by the taxable person,",

and

(ii) by the insertion of the following paragraphs after paragraph (b):

"( c ) In subparagraph (i) of paragraph (a), reference to the provision of accommodation includes expenditure by the taxable person on a building, including the fitting out of such building, to provide such accommodation.

( d ) In subparagraph (ii) of paragraph (a), 'entertainment expenses' includes expenditure on a building or facility, including the fitting out of such building or facility, to provide such entertainment.".

Amendment of section 14 (determination of tax due by reference to cash receipts) of Principal Act.

97.—Section 14 (inserted by the Act of 1978) of the Principal Act is hereby amended—

( a ) by the substitution of the following subsection for subsection (1):

"(1) A person who satisfies the Revenue Commissioners that—

( a ) taking one period with another, not less than 90 per cent. of such person's turnover is derived from taxable supplies to persons who are not registered persons, or

( b ) the total consideration which such person is entitled to receive in respect of such person's taxable supplies has not exceeded and is not likely to exceed £250,000 in any continuous period of twelve months,

may, in accordance with regulations, be authorised to determine the amount of tax which becomes due by such person during any taxable period (or part thereof) during which the authorisation has effect by reference to the amount of the moneys which such person receives during such taxable period (or part thereof) in respect of taxable supplies.",

and

( b ) in subsection (2)—

(i) by the deletion of "paragraph (a)of", and

(ii) by the substitution of "that subsection" for "the said paragraphs (a)".

Amendment of section 27 (fraudulent returns, etc) of Principal Act.

98.—Section 27 of the Principal Act is hereby amended by the insertion in subsection (9A) (inserted by the Act of 1992) after paragraph (3) of the following:

"(4) For the purposes of subparagraph (b) of paragraph (1), 'the declaration of an incorrect registration number' means—

( a ) the declaration by a person of another person's registration number,

( b ) the declaration by a person of a number which is not an actual registration number which he purports to be his registration number,

( c ) the declaration by a person of a registration number which was obtained from the Revenue Commissioners by supplying incorrect information, or

( d ) the declaration by a person of a registration number which was obtained from the Revenue Commissioners for the purposes of acquiring goods without payment of value-added tax referred to in Council Directive No. 77/388/EEC of 17 May, 1977, and not for any bona fide business purpose.".

Amendment of First Schedule to Principal Act.

99.—The First Schedule (inserted by the Act of 1978) to the Principal Act is hereby amended—

( a ) in paragraph (ix) by the insertion after "excluding" of "the services of loss adjusters and excluding", and

( b ) in paragraph (xv) (inserted by the Finance Act, 1980 ) by the insertion after "the Finance Act, 1926 ," of "of bets of the kind referred to in section 89 of the Finance Act, 1994 ,".

Amendment of Second Schedule to Principal Act.

100.—The Second Schedule (inserted by the Finance Act, 1976 ) to The Principal Act is hereby amended by the substitution of the following paragraph for paragraph ( ia ) (inserted by the Act of 1992):

"( ia ) subject to such conditions and in such amounts as may be specified in regulations, the supply of goods—

( a ) to travellers departing the State, in a tax-free shop approved by the Revenue Commissioners, or

( b ) to travellers on board vessels or aircraft, where the goods are deemed to be supplied in the State in accordance with section 3 (6) ( cc );".

Amendment of Sixth Schedule to Principal Act.

101.—The Sixth Schedule (inserted by the Act of 1992) to the Principal Act is hereby amended—

( a ) by the substitution of the following paragraph for paragraph (vii):

"(vii) amusement services of the kind normally supplied in fairgrounds or amusement parks:

Provided that this paragraph shall not apply to—

(I) services consisting of dances,

(II) services consisting of circuses,

(III) services consisting of gaming, as defined in section 2 of the Gaming and Lotteries Act, 1956 (including services provided by means of a gaming machine of the kind referred to in section 43 of the Finance Act, 1975 ), or

(IV) services provided by means of an amusement machine of the kind referred to in section 120 of the Finance Act, 1992 ;",

( b ) in paragraph (x) by the insertion after "services" of "of a kind", and

( c ) in paragraph (xi) by the substitution in subparagraph ( ai) of "(other than farm accountancy or farm management services)" for "(not being services of the kind specified in paragraph (xxii) of the Seventh Schedule)".

PART IV STAMP DUTIES

Definitions (Part IV).

102.—In this Part—

"the Act of 1891" means the Stamp Act, 1891;

"the First Schedule" means the First Schedule (as amended by the Finance Act, 1970 , and subsequent enactments) to the Act of 1891.

Amendment of section 103 (provision relating to voluntary disposition inter vivos, etc.) of Finance Act, 1991 .

103.—(1) Section 103 of the Finance Act, 1991 , is hereby amended in subsection (1)—

( a ) by the substitution in paragraph (a)of "15 per cent. 5" for "10 per cent." and of "25 per cent." for "50 per cent.",

( b ) by the substitution in paragraph (b) of "equal to 50 per cent. of the total duty" for "equal to the total duty", and

( c ) by the substitution in paragraph (c)of "the total duty" for "double the total duty".

(2) Subsection (4) of section 103 of the Finance Act, 1991 , is hereby repealed.

(3) This section shall have effect as respects instruments executed after the passing of this Act.

Amendment of section 105 (valuation of property chargeable with stamp duty) of Finance Act, 1991 .

104.—(1) Section 105 of the Finance Act, 1991 , is hereby amended in subsection (1) by the substitution of "section 15" for "sections 15, 16 and 17".

(2) This section shall have effect as respects instruments executed after the passing of this Act.

Amendment of section 206 (exemption from stamp duty of certain stocks and marketable securities of Finance Act, 1992 .

105.— Section 206 of the Finance Act, 1992 , is hereby amended—

( a ) by the addition of the following paragraph after paragraph (a):

"( aa ) units in a collective investment scheme which is incorporated or otherwise formed under the law of a territory outside the State:

Provided that such conveyance or transfer of units does not relate to—

(i) any immovable property situate in the State or any right over or interest in such property, or

(ii) any stocks or marketable securities of a company, other than a company which is a collective investment undertaking within the meaning of section 18 of the Finance Act, 1989 , which is registered in the State, or",

( b ) by the deletion of the words "and which are dealt in and quoted on a recognised stock exchange" in paragraph (c),

( c ) by the substitution of the following paragraph for paragraph (ii) of the proviso to paragraph (c):

"(ii) any stocks or marketable securities of a company, other than a company which is a collective investment undertaking within the meaning of section 18 of the Finance Act, 1989 , which is registered in the State,",

and

( d ) by the addition of the following provisions after the existing provisions (as amended by paragraphs ( a ), (b) and (c) ):

"and in paragraph (aa) —

'collective investment scheme' means a scheme which is an arrangement made for the purpose, or having the effect, solely or mainly, of providing facilities for the participation by the public or other investors, as beneficiaries, in profits or income arising from the acquisition, holding, management or disposal of securities or any other property whatsoever;

'units' includes shares and any other instruments granting an entitlement to shares in the investments or income of, or receive a distribution from, a collective investment scheme.".

Amendment of section 106 (exemption from stamp duty of certain loan capital and securities) of Finance Act, 1993 .

106.— Section 106 of the Finance Act, 1993 , is hereby amended—

( a ) by the substitution of the following subsection for subsection (1):

"(1) In this section 'loan capital' means any debenture stock, bonds or funded debt, by whatever name known, or any capital raised which is borrowed or has the character of borrowed money, whether in the form of stock or in any other form.",

( b ) by the substitution of the words "on the transfer of loan capital of a company or other body corporate" for the words "on the issue or transfer of" in subsection (2), and

( c ) by the addition of the following subsection after subsection (2):

"(3) Stamp duty shall not be chargeable on the issue, whether in bearer form or otherwise, of—

( a ) any Government loan within the meaning assigned by section 134 (10) of the Finance Act, 1990 , or

( b ) any other loan capital which is not a charge or incumbrance upon property situate in the State.".

Particulars to be delivered in cases of transfers and leases.

107.—(1) It shall be the duty of the transferor or lessor, on the occasion of any transfer of the fee simple of any land or of any interest in land or on the grant of any lease of any land for a term exceeding 14 years (whether the transfer or lease is on sale or as a voluntary disposition inter vivos), to present to the Commissioners such particulars in relation to such class or category of transfer or lease as they may prescribe by regulations and, without prejudice to the generality of the foregoing, the regulations may make provision in relation to all or any of the following matters—

( a ) the form in which the particulars are to be delivered;

( b ) the time limits within which the particulars are to be delivered;

( c ) the manner in which the land is to be described or classified;

( d ) the furnishing of tax reference numbers of the parties to the instrument.

(2) For the purposes of section 14 of the Act of 1891 and notwithstanding anything in section 12 of that Act, any transfer or lease to which regulations made pursuant to subsection (1) apply shall not be deemed duly stamped unless it is stamped with a stamp denoting that all particulars requested by the Commissioners have been delivered.

(3) If the transferor or lessor fails to comply with this provision, such person shall be guilty of an offence and shall be liable on summary conviction to a fine not exceeding £500.

(4) The provisions of this section shall apply to any instrument executed on and from the date on which the regulations under subsection (1) shall first have effect.

(5) Section 4 of the Finance (1909-10) Act, 1910, shall cease to have effect other than in respect of any instrument executed before the date on which regulations under subsection (1) first have effect.

(6) In this section "transferor", "lessor", "fee simple", "interest", "land" and "lease" have the same meanings, respectively, as they have in section 41 of the Finance (1909-10) Act, 1910.

Stamp duty and value-added tax.

108.—(1) As respects any instrument executed on or after the 11th day of April, 1994, the consideration or rent chargeable under the Heading—

( a ) "CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance", or

( b ) "LEASE"

in the First Schedule shall exclude any value-added tax chargeable under section 2 of the Value-Added Tax Act, 1972 , on such sale or lease.

(2) Any instrument of sale or lease stamped prior to the 11th day of April, 1994 (whether or not the Commissioners have expressed their opinion with reference to it under the provisions of section 12 of the Act of 1891) shall, notwithstanding that it does not bear stamp duty in respect of any value-added tax charged under section 2 of the Value-Added Tax Act, 1972 , on such sale or lease, as respects such unpaid duty, be deemed duly stamped in accordance with the law in force at the time when it was first executed.

Right of appeal of persons dissatisfied with assessment.

109.—(1) The Act of 1891 is hereby amended by the substitution of the following section for section 13:

"13.—(1) In this section—

'Appeal Commissioners' has the meaning assigned to it by section 156 of the Income Tax Act, 1967 ;

'appellant' means a person who appeals to the Appeal Commissioners under subsection (2) of this section;

'assessment' means an expression by the Commissioners of their opinion pursuant to section 12 of this Act and includes a decision of the Commissioners relating to the value, for the purposes of this Act or under Chapter II of Part IV of the Finance Act, 1973 , of any stocks, shares or other securities which are not dealt with on a stock exchange and where such a decision leads to such an expression by the Commissioners of their opinion.

(2) Any person who is dissatisfied with the assessment of the Commissioners and who is an accountable person in relation to such assessment may, on payment of duty in conformity therewith, appeal to the Appeal Commissioners against the assessment and the appeal shall be heard and determined by the Appeal Commissioners whose determination shall be final and conclusive unless the appeal is required to be reheard by a judge of the Circuit Court or a case is required to be stated in relation to it for the opinion of the High Court on a point of law.

(3) A person who intends to appeal under this section against an assessment shall, within 30 days after the date of the assessment, give notice in writing to the Commissioners of such intention.

(4) Subject to the provisions of this section, the provisions of Part XXVI (Appeals) of the Income Tax Act, 1967 , shall, with any necessary modifications, apply as they apply for the purpose of income tax.".

(2) Section 19 of the Finance Act, 1923 , shall cease to apply to the valuation for the purposes of the Act of 1891 of any stocks, shares or other securities which are not dealt in on a stock exchange.

(3) Section 36 of the Finance Act, 1972 , and paragraph (a)of section 74 of the Finance Act, 1973 , are hereby repealed.

(4) This section shall have effect as respects instruments executed after the passing of this Act.

Exemption from stamp duty on certain transfers to Irish Stock Exchange.

110.—(1) In this section—

"the Exchange" means a limited company incorporated or to be incorporated in the State to operate as the Irish Stock Exchange;

"International Stock Exchange" means the International Stock Exchange of the United Kingdom and Republic of Ireland Limited and its subsidiaries.

(2) Stamp duty shall not be chargeable on any agreement, transfer, conveyance, assignment or lease whereby any business, assets or liabilities owned by the International Stock Exchange in connection with the carrying on of its business as a stock exchange is or are transferred or agreed to be transferred, in whole or in part, to the Exchange:

Provided that such agreement, transfer, conveyance, assignment or lease arises from or is in consequence of the establishment in the State of a stock exchange as a separate legal entity to the International Stock Exchange.

Exemption from stamp duty of stocks, etc., of foreign governments.

111.—Stamp duty shall not be chargeable on any conveyance or transfer of stocks or other securities of the government of any territory outside the State.

Relief from stamp duty in respect of transfers to young trained farmers.

112.—(1) In this section and the Sixth Schedule—

"land" means agricultural land and includes such farm buildings, farm houses and mansion houses (together with the lands occupied therewith) as are of a character appropriate to the land;

"Teagasc" means Teagasc — The Agricultural and Food Development Authority;

"an interest in land" means an interest which is not subject to any power (whether or not contained in the instrument) on the exercise of which the land, or any part of or any interest in the land, may be revested in the person from whom it was conveyed or transferred or in any person on behalf of such person;

"young trained farmer" means a person in respect of whom it is shown to the satisfaction of the Commissioners—

( a ) that such person had not attained the age of 35 years on the date on which the instrument, as respect which relief is being claimed under this section, was executed, and

( b ) (i) that such person is the holder of a qualification set out in the Sixth Schedule and, in the case of a qualification set out in subparagraph ( c ), (d), ( e ), (f) or (g)of paragraph 3 or paragraph 4 of the said Schedule, is also the holder of a certificate issued by Teagasc certifying that such person has satisfactorily attended a course of training in farm management, the aggregate duration of which exceeded 80 hours, or

(ii) (I) that such person has satisfactorily attended full-time a course at a third-level institution in any discipline for a period of not less than 2 years' duration, and

(II) is the holder of a certificate issued by Teagasc certifying satisfactory attendance at a course of training in either or both agriculture and horticulture, the aggregate duration of which exceeded 180 hours,

(iii) if born before the 1st day of January, 1968, that such person is the holder of a certificate issued by Teagasc certifying that such person—

(I) has had farming as the principal occupation for a period of not less than 3 years, and

(II) has satisfactorily attended a course of training in either or both agriculture and horticulture, the aggregate duration of which exceeded 180 hours:

Provided that where Teagasc certifies that any other qualification corresponds to a qualification which is set out in the Sixth Schedule, the Commissioners shall, for the purposes of this section, treat that other qualification as if it were the corresponding qualification so set out.

(2) The amount of stamp duty chargeable under or by reference to the Heading "CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance" in the First Schedule on any instrument to which this section applies shall be reduced by an amount equal to two-thirds of the amount which would otherwise have been chargeable:

Provided that where the amount so obtained is a fraction of a pound that amount shall be rounded up to the next pound.

(3) This section applies to any instrument which operates as a conveyance or transfer (whether on sale or as a voluntary disposition inter vivos) of an interest in land to a young trained farmer where—

( a ) the instrument contains a certificate that the provisions of this section apply, and

( b ) a declaration made in writing by the young trained farmer, or each of them if there is more than one, is furnished to the Commissioners when the instrument is presented for stamping, confirming, to the satisfaction of the Commissioners, that it is the intention of such person, or each such person, for a period of not less than 5 years from the date of execution of the instrument to—

(i) spend not less than 50 per cent. of that person's normal working time farming the land, and

(ii) retain ownership of the land, and

( c ) the identifying reference number, known as the Revenue and Social Insurance (RSI) Number, of the young trained farmer, or each of them if there is more than one, is furnished to the Commissioners when the instrument is presented for stamping:

Provided that this section shall apply where the property is conveyed or transferred into joint ownership where all the joint owners are young trained farmers or where any of the joint owners is a spouse of another joint owner who is a young trained farmer.

(4) Where this section would have applied to the instrument, except for the fact that a person to whom the land is being conveyed or transferred is not a young trained farmer on the date when the instrument was executed, by reason of not being the holder of one of the qualifications, or an equivalent qualification, specified in the Sixth Schedule or, in the case of the requirement in paragraph (b)(ii) (I) of the definition of "young trained farmer" in subsection (1), not having attended full-time for the required 2 years' duration, but that such person had completed on that date at least one academic year of the prescribed course leading to an award of such qualification, or the course prescribed in paragraph (b)(ii) (I) of the said definition, then—

( a ) if such person afterwards becomes a holder of such qualification, or satisfactorily attends such course full-time for a period of 2 years, within a period of 3 years from the date of execution of the instrument, the Commissioners shall, upon production of the stamped instrument to them within 6 months after the date when such person became the holder of such qualification, or completed the required 2 years' attendance on such course, and upon furnishing satisfactory evidence of compliance with the provisions of this subsection, the declaration and the Revenue and Social Insurance (RSI) Number, as provided for in subsection (3), cancel and refund, without payment of interest thereon, such duty as would not have been chargeable had this section applied to the instrument when it was first presented for stamping, and

( b ) the period of 5 years provided for in subsection (3) in relation to the declaration to be made by such person, as it applies to normal working time, shall be reduced by the period of time that elapsed between the date of the instrument and the date on which such person became the holder of such qualification or completed the required 2 years' attendance on such course.

(5) An instrument to which this section applies and which is stamped with an amount of duty less than the amount which, but for the provisions of this section, would be chargeable thereon shall be deemed not to be duly stamped unless the Commissioners have expressed their opinion thereon in accordance with section 12 of the Act of 1891.

( 6 ) ( a ) If and to the extent that any person to whom land was conveyed or transferred by any instrument in respect of which relief from duty under this section was allowed—

(i) disposes of such land, or part of such land, within a period of 5 years from the date of execution of the instrument, and

(ii) does not replace such land with other land within a period of 1 year from the date of such disposal,

then such person or, where there is more than one such person, each such person, jointly and severally, shall become liable to pay to the Commissioners a fine equal to the difference between the amount of the duty which would have been charged in the first instance if the land disposed of had been conveyed or transferred by an instrument to which this section had not applied and the amount of duty which was actually charged, together with interest on the amount of such difference as may so become payable charged at a rate of 1.25 per cent. per month or part of a month from the date when the instrument was executed to the date the fine is remitted:

Provided that, where relief under this section was allowed in respect of any instrument, a disposal by a young trained farmer of part of the land to a spouse for the purpose of creating a joint tenancy in the land, or where the instrument conveyed or transferred the land to joint owners, a disposal by one joint owner to another of any part of the land, shall not be regarded as a disposal to which the provisions of this subsection apply, but upon such disposal, such part of the land shall be treated for the purposes of this subsection as if it had been conveyed or transferred immediately to the spouse or other joint owner by the instrument in respect of which relief from duty under this section was allowed in the first instance.

( b ) Where any claim for relief from duty under this section has been allowed and it is subsequently found that a declaration made, or a certificate contained in the instrument, in accordance with the provisions of subsection (3) was—

(i) untrue in any material particular which would have resulted in the relief afforded by this section not being granted, and

(ii) was made, or was included, knowing same to be untrue or in reckless disregard as to whether it was true or not,

then any person who made such a declaration, or where a false certificate has been included, the person or persons to whom the land is conveyed or transferred by the instrument, jointly and severally, shall be liable to pay to the Commissioners as a fine an amount equal to the difference between 125 per cent. of the duty which would have been charged on the instrument in the first instance had all the facts been truthfully declared and certified and the amount of duty which was actually charged, together with interest on the amount of such difference as may so become payable charged at a rate of 1.25 per cent. per month or part of a month from the date when the instrument was executed to the date the fine is remitted:

Provided that—

(I) a person shall not be liable to more than one fine under paragraph (b),

(II) a person shall not be liable to a fine under paragraph ( a ) if and to the extent that such person has paid a fine under paragraph ( b ), and

(III) a person shall not be liable to a fine under paragraph ( b ) if and to the extent that such person has paid a fine under paragraph ( a ).

(7) This section shall have effect as respects instruments executed on or after the 7th day of January, 1994, and on or before the 31st day of December, 1996.

PART V RESIDENTIAL PROPERTY TAX

Definition (Part V).

113.—In this Part "the Act of 1983" means the Finance Act, 1983 .

Application (Part V).

114.—This Part shall apply and have effect where tax is chargeable on a valuation date (as defined by section 95 (1) of the Act of 1983) in relation to any year commencing with the year 1994.

Amendment of section 95 (interpretation) of Act of 1983.

115.—Section 95 of the Act of 1983 is hereby amended in subsection (1)—

( a ) as respects any valuation date (within the meaning assigned by the said subsection (1)) commencing with the year 1983, in the definition of "income"—

(i) by the substitution in paragraph (a)of "sections 340, 353, 354 and 463" for "sections 340, 353 and 354",

(ii) by the insertion in paragraph (a)of " section 18 of the Finance Act, 1970 ," after " section 37 of the Finance Act, 1968 ,", and

(iii) by the insertion of the following paragraph after paragraph (e) —

"( ee ) income arising from savings bonds duly issued under section 54 of the Finance Act, 1970 ,",

and the said definition, as so amended, is set out in the Table to this section,

( b ) by the insertion, in the definition of "relevant person" of "a person who has attained the age of 65 years and is not an assessable person, or a person who is permanently incapacitated by reason of mental or physical infirmity from maintaining himself and is not an assessable person, or" after "other than", and the said definition, as so amended, is set out in the Table to this section, and

( c ) by the insertion, in the definition of "residential property" of ",where the Commissioners are satisfied that reasonable access is afforded to the public having regard to subsection (4) ( b ) (ii) of the said section 19 as amended by the Finance Act, 1994 " after " Finance Act, 1982 " and the said definition, as so amended, is set out in the Table to this section.

TABLE

"income" means total income from all sources as estimated in accordance with the provisions of the Income Tax Acts but without regard to—

( a ) any of those of those Acts (apart from sections 340 , 353 , 354 and 463 of the Income Tax Act, 1967 , section 37 of the Finance Act, 1968 , section 18 of the Finance Act, 1970 , section 19 of the Finance Act, 1973 , and section 9 of the Finance Act, 1982 ) which provide that any income is exempt from income tax or that any income is to be disregarded for the purposes of those Acts or which otherwise provide that any amount of income or any part thereof is not subject to Irish income tax,

( b ) sections 89 , 236 , 251 , 254 and 496 of the Income Tax Act, 1967 ,

( c ) Chapter I of Part IX of the Income Tax Act, 1967 .

( d ) Chapter I of Part XIX of the Income Tax Act, 1967 ,

( e ) section 11 of the Finance Act, 1967 ,

( ee ) income arising from savings bonds duly issued under section 54 of the Finance Act, 1970 ,

( f ) section 26 of the Finance Act, 1971 ,

( g ) Chapter II of Part I of the Finance Act, 1972 ,

( h ) section 14 of the Finance Act, 1977 ,

( i ) section 25 of the Finance Act, 1978 , and

( j ) sections 23 and 24 of the Finance Act, 1981 ;

"relevant person ", in relation to an assessable person, means, as respect any valuation date, any person (other than a person who has attained the age of 65 years and is not an assessable person, or a person who is permanently incapacitated by reason of mental or physical infirmity from maintaining himself and is not an assessable person, or a person who is an employee of the assessable person and whose employment is wholly or mainly connected with the relevant residential property) who in the year ended on that date normally resided at any relevant residential property of the assessable person and who, or whose spouse,—

( a ) made no payment of rent or other like payment in respect of such residence, or

( b ) made a payment of rent or other like payment in respect of that residence of such amount that, if it had been paid by a person to whom subsection (2) ( b ) (iv) applies in respect of the relevant residential property under a lease, agreement or licence referred to in subsection (2) ( b ) (iv), that last-mentioned person would, by virtue of subsection (2) ( b ) (iv), be the owner in relation to the relevant residential property;

"residential property" means—

( a ) a building or part of a building used or suitable for use as a dwelling, and

( b ) land (other than a garden such as is specified in section 39 (1) of the Finance Act, 1978 ) which the occupier of a building or part of a building used as a dwelling has for his own occupation and enjoyment with the said building or part as its garden or grounds of an ornamental nature,

but does not include an approved building within the meaning of section 19 of the Finance Act, 1982 , where the Commissioners are satisfied that reasonable access is afforded to the public having regard to subsection (4) ( b ) (ii) of the said section 19 as amended by the Finance Act, 1994 ;

Amendment of section 96 (charge of residential property tax) of Act of 1983.

116.—Section 96 of the Act of 1983 is hereby amended, as respects any valuation date commencing with the year 1994, by the deletion of "the rate of tax shall be one and one-half per cent. of that net market value" and the substitution of "the tax chargeable on that net market value shall be computed in accordance with the Seventh Schedule to the Finance Act, 1994 ".

Amendment of section 98 (market value of property) of Act of 1983.

117.—Section 98 of the Act of 1983 is hereby amended by the insertion of the following subsection after subsection (2):

"(2A)( a ) Notwithstanding the provisions of subsections (1) and (2), in estimating the market value of any property on the relevant valuation date, a reduction may be made in respect of such value which is attributable on that date to qualifying improvements.

( b ) 'Qualifying improvements' for the purposes of this subsection, means necessary improvements or alterations to the property for the purposes only of accommodating or facilitating a person who is permanently incapacitated by reason of mental or physical infirmity from maintaining himself.

( c ) A reduction shall not be available by virtue of this subsection unless the incapacitated person concerned normally resided at the property in the year ended on the relevant valuation date.".

Amendment of section 100 (market value exemption limit) of Act of 1983.

118.—Section 100 of the Act of 1983 is hereby amended in subsection (1) by the substitution in the definition of "general exemption limit of "£75,000" for "£90,000" (inserted by the Finance Act, 1992 ) and of "1994" for "1992" (as so inserted).

Amendment of section 101 (income exemption limit) of Act of 1983.

119.—Section 101 of the Act of 1983 is hereby amended—

( a ) by the insertion of the following proviso to subsection (1):

"Provided that the income of a relevant person (other than a person who is an assessable person) shall be disregarded in computing aggregate relevant income—

( a ) where, in relation to a valuation date, a unit of residential property is comprised in the relevant residential property of one or more persons, and—

(i) any of those persons has attained the age of 65 years, or

(ii) any of those persons is permanently incapacitated by reason of mental or physical infirmity from maintaining himself and the relevant person resides in the unit of residential property as a consequence of that infirmity;

( b ) where, in relation to a valuation date, the assessable person is a widowed person and the relevant person resides in the relevant residential property as a consequence of the assessable person having a qualifying child.",

and

( b ) by the substitution in subsection (2) of "£25,000" for "£27,500" (inserted by the Finance Act, 1992 ) and of "1994" for "1992" (as so inserted).

Amendment of section 102 (marginal reliefs) of Act of 1983.

120.—Section 102 of the Act of 1983 is hereby amended in subsection (1)—

( a ) by the substitution of "£10,000" for "£5,000" and of "10,000" for "5,000" in the formula, and

( b ) by the addition of the following provisos:

"Provided that—

( a ) where, in relation to a valuation date, a unit of residential property is comprised in the relevant residential property of one or more persons and any of those persons has attained the age of 65 years, "£15,000" shall be substituted for "£10,000" and "15,000" shall be substituted for "10,000" in the formula, and

( b ) where the amount of the aggregate relevant income is not a multiple of £1,000, it shall, for the purposes of relief under this section, be rounded down to the next £1,000.",

and the said subsection (1), as so amended, is set out in the Table to this section.

TABLE

(1) Where an assessable person makes a claim in that behalf and proves that his aggregate relevant income as respects any valuation date does not exceed an amount equal to the aggregate of the income exemption limit applying on that valuation date and £10,000, he shall be entitled to have the tax, if any, payable by him in respect of the net market value of his relevant residential property on that valuation date reduced to an amount equal to the amount determined by the formula—

[image not available: a13y1994s120-table.bmp]

where—

A is the amount of the aggregate relevant income,

E is the income exemption limit, and

T is the tax which, apart from this subsection and subsection (2), would be payable:

Provided that—

( b ) where the amount of the aggregate relevant income is not a multiple of £1,000, it shall, for the purposes of relief under this section, be rounded down to the next £1,000.

Amendment of section 104 (assessment and payment of tax) of Act of 1983.

121.—Section 104 of the Act of 1983 is hereby amended by the insertion after subsection (1) of the following subsections:

"(1A)( a ) Notwithstanding the provisions of subsection (1) and subject to such regulations as the Commissioners may make in accordance with section 115 (1A), tax which is due and payable in accordance with this section may, at the option of the person delivering the return, be discharged by making an initial payment of 25 per cent. of the tax due on the 1st day of October immediately following the valuation date to which the return relates and the balance of the tax due, together with an amount equal to 5 per cent. of that balance, shall be paid in ten equal monthly instalments, the first of which shall be due on the 15th day of November immediately following such valuation date and the remaining instalments shall be due on the 15th day of each subsequent month.

( b ) In the event that a person exercising the option under subsection (1A) ( a ) fails to make an initial payment by the due date or any subsequent instalment payment in accordance with such regulations as the Commissioners may make under section 115 (1A), the provisions of section 110 of the Finance Act, 1983 , as to the recovery of tax shall apply to the outstanding balance of the tax liability as if the said person had not exercised the said option.

( c ) This subsection shall not have effect in respect of any tax or additional tax due under an assessment of tax or an amended assessment of tax made by the Commissioners under subsections (2) or (3).

(1B) Where the Commissioners are satisfied that tax payable in respect of any relevant residential property cannot without excessive hardship be paid in accordance with subsection (1) or (1A), as the case may be, they may allow payment to be postponed for such period, to such extent and on such terms as they think fit.

(1C) Where, in the opinion of the Commissioners, the complication of circumstances affecting any relevant residential property are such as to justify them in doing so, they may compound the tax payable on the relevant residential property upon such terms as they shall think fit.".

Amendment of section 105 (interest on tax) of Act of 1983.

122.—Section 105 of the Act of 1983 is hereby amended by the insertion after subsection (1) of the following subsection:

"(1A) Notwithstanding the provisions of subsection (1), interest shall not be chargeable where tax is paid in accordance with the provisions of section 104 (1A) ( a ) and such regulations as the Commissioners may make under section 115 (1A).".

Amendment of section 115 (regulations) of Act of 1983.

123.—Section 115 of the Act of 1983 is hereby amended by the insertion after subsection (1) of the following subsection:

"(1A) Without prejudice to the generality of subsection (1), the Commissioners may make such regulations as seem to them to be necessary for the purpose of giving effect to the payment of tax by instalments under section 104 (1A) (a).".

PART VI CAPITAL ACQUISITIONS TAX

CHAPTER I Business Relief

Interpretation (Chapter I).

124.—(1) In this Chapter—

"agricultural property" has the meaning assigned to it by section 19 of the Principal Act (as amended by the Finance Act, 1994 );

"associated company" has the meaning assigned to it by section 16 (1) ( b ) of the Companies (Amendment) Act, 1986 ;

"business" includes a business carried on in the exercise of a profession or vocation, but does not include a business carried on otherwise than for gain;

"excepted asset shall be construed in accordance with section 134;

"full-time working officer or employee", in relation to one or more companies, means any officer or employee who devotes substantially the whole of his time to the service of that company, or those companies taken together, in a managerial or technical capacity;

"holding company" and "subsidiary" have the meanings assigned to them, respectively, by section 155 of the Companies Act, 1963 ;

"the Principal Act" means the Capital Acquisitions Tax Act, 1976 ;

"quoted", in relation to any shares or securities, means quoted on a recognised stock exchange and "unquoted", in relation to any shares or securities, means not so quoted;

"relevant business property" shall be construed in accordance with section 127.

(2) In this Chapter a reference to a gift shall be construed as a reference to a taxable gift and a reference to an inheritance shall be construed as a reference to a taxable inheritance.

(3) For the purposes of this Chapter a company and all its subsidiaries and any associated company of that company or of any of those subsidiaries and any subsidiary of such an associated company are members of a group.

Application (Chapter I).

125.—The provisions of this Chapter shall have effect in relation to gifts and inheritances taken on or after the 11th day of April, 1994, but those provisions shall not have effect in relation to an inheritance taken by a relevant trust by virtue of section 110 (1) of the Finance Act, 1993 , or to an inheritance taken by a discretionary trust by virtue of section 106 (1) of the Finance Act, 1984 , or section 103 (1) of the Finance Act, 1986 .

Business relief.

126.—(1) Where the whole or part of the taxable value of any gift or inheritance is attributable to the value of any relevant business property, the whole or that part of the taxable value shall, subject to the other provisions of this Chapter, be treated as being reduced—

( a ) by 25 per cent., and

( b ) by a further 25 per cent. or £62,500, whichever is the lesser.

(2) In relation to the deduction referred to at paragraph ( b ) of subsection (1), the total amount deductible under that paragraph shall not exceed £62,500, in respect of the aggregate of all gifts and inheritances, which consist in whole or in part of relevant business property, taken on or after the 11th day of April, 1994, by the same person, as donee or successor.

Relevant business property.

127.—(1) In this Chapter and subject to the following provisions of this section and to sections 128, 130 and 134 (3) "relevant business property" means, in relation to a gift or inheritance, any one or more of the following, that is to say:

( a ) property consisting of a business or interest in a business;

( b ) unquoted shares in or securities of a company incorporated in the State to which paragraph ( c ) does not relate, and which on the valuation date (either by themselves alone or together with other shares or securities in that company in the absolute beneficial ownership of the donee or successor on that date) give control of powers of voting on all questions affecting the company as a whole which if exercised would yield more than 25 per cent. of the votes capable of being exercised thereon;

( c ) unquoted shares in or securities of a company incorporated in the State which on the valuation date (either by themselves alone or together with other shares or securities in that company in the absolute beneficial ownership of the donee or successor on that date) have an aggregate nominal value which represents 10 per cent. or more of the aggregate nominal value of the entire share capital and securities of the company, if but only if the company (after the taking of the gift or inheritance) is on that date a company controlled by the donee or successor within the meaning of section 16 of the Principal Act;

( d ) unquoted shares in or securities of a company incorporated in the State which do not fall within paragraph ( b ) or (c) and which on the valuation date (either by themselves alone or together with other shares or securities in that company in the absolute beneficial ownership of the donee or successor on that date) have an aggregate nominal value which represents 10 per cent. or more of the aggregate nominal value of the entire share capital and securities of the company:

Provided that the donee or successor has been a full-time working officer or employee of the company, or if that company is a member of a group, of one or more companies which are members of the group, throughout the period of 5 years ending on the date of the gift or inheritance;

( e ) in so far as is situated in the State, any land or building, machinery or plant which, immediately before the gift or inheritance was used wholly or mainly for the purposes of a business carried on by a company of which the disponer then had control or by a partnership of which the disponer then was a partner and for the purposes of this paragraph a person shall be deemed to have control of a company at any time if he then had control of powers of voting on all questions affecting the company as a whole which if exercised would have yielded a majority of the votes capable of being exercised thereon;

( f ) quoted shares in or securities of a company which, but for the fact that they are quoted, would be shares or securities to which paragraph ( b ), (c) or (d) would relate:

Provided that such shares or securities, or other shares in or securities of the same company which are represented by those shares or securities, were in the beneficial ownership of the disponer immediately prior to the disposition and were unquoted at the date of the commencement of that beneficial ownership or at the date of the passing of this Act, whichever is the later date.

(2) Where a company has shares or securities of any class giving powers of voting limited to either or both—

( a ) the question of winding-up the company, and

( b ) any question primarily affecting shares or securities of that class,

the reference in subsection (1) to all questions affecting the company as a whole shall have effect as a reference to all such questions except any in relation to which those powers are capable of being exercised.

(3) A business or interest in a business, or shares in or securities of a company, shall not be relevant business property in relation to a gift or inheritance if, on the date of the gift or inheritance, the business or, as the case may be, the business carried on by the company was wholly or mainly carried on outside the State, and where the business concerned was carried on by a holding company, the business of that holding company shall be treated as having been carried on wholly or mainly outside the State on that date if that business and the business carried on by any subsidiary of that holding company were, taken as a whole, carried on wholly or mainly outside the State.

(4) A business or interest in a business, or shares in or securities of a company, shall not be relevant business property if the business or, as the case may be, the business carried on by the company consists wholly or mainly of one or more of the following, that is to say, dealing in currencies, securities, stocks or shares, land or buildings, or making or holding investments.

(5) Subsection (4) shall not apply to shares in or securities of a company if the business of the company consists wholly or mainly in being a holding company of one or more companies whose business does not fall within that subsection.

(6) Any land, building, machinery or plant in the beneficial ownership of the disponer and used wholly or mainly for the purposes of a business carried on as mentioned in subsection (1) (e) shall not be relevant business property in relation to a gift or inheritance taken by a donee or successor, unless the disponer's interest in the business is, or shares in or securities of the company carrying on the business immediately before the gift or inheritance are, relevant business property in relation to that gift or inheritance or in relation to a simultaneous gift or inheritance taken by that donee or successor from the same disponer.

Minimum period of ownership.

128.—In relation to a gift or an inheritance, property shall not be relevant business property unless it was comprised in the disposition continuously—

( a ) in the case of an inheritance, which is taken on the date of death of the disponer, for a period of two years immediately prior to the date of the inheritance, or

( b ) in any other case, for a period of five years immediately prior to the date of the gift or inheritance,

and any period immediately before the date of the disposition during which the property was continuously in the beneficial ownership of the disponer, or of the spouse of the disponer, shall be deemed, for the purposes of this Chapter, to be a period or part of a period immediately before the date of the gift or inheritance during which it was continuously comprised in the disposition.

Replacements.

129.—(1) Property shall be treated as complying with section 128 if—

( a ) the property replaced other property and the said property, that other property and any property directly or indirectly replaced by that other property were comprised in the disposition for periods which together comprised—

(i) in a case referred to at paragraph ( a ) of section 128, at least two years falling within the three years immediately preceding the date of the inheritance, or

(ii) in a case referred to at paragraph ( b ) of section 128, at least five years falling within the six years immediately preceding the date of the gift or inheritance, and

( b ) any other property concerned was such that, had the gift or inheritance been taken immediately before it was replaced, it would, apart from section 128, have been relevant business property in relation to the gift or inheritance.

(2) In a case to which subsection (1) relates, relief under this Chapter shall not exceed what it would have been had the replacement or any one or more of the replacements not been made.

(3) For the purposes of subsection (2) changes resulting from the formation, alteration or dissolution of a partnership, or from the acquisition of a business by a company controlled (within the meaning of section 16 of the Principal Act) by the former owner of the business, shall be disregarded.

Succession.

130.—For the purposes of sections 128 and 129, where a disponer became beneficially entitled to any property on the death of another person the disponer shall be deemed to have been beneficially entitled to it from the date of that death.

Successive benefits.

131.—(1) Where—

( a ) a gift or inheritance (in this section referred to as "the earlier benefit") was eligible for relief under this Chapter or would have been so eligible if such relief had been capable of being given in respect of gifts and inheritances taken at that time, and

( b ) the whole or part of the property which, in relation to the earlier benefit was relevant business property became, through the earlier benefit, the property of the person or of the spouse of the person who is the disponer in relation to a subsequent gift or inheritance (in this section referred to as "the subsequent benefit"), and

( c ) that property, or part, or any property directly or indirectly replacing it, would, apart from section 128, have been relevant business property in relation to the subsequent benefit, and

( d ) the subsequent benefit is an inheritance taken on the death of the disponer,

then the property which would have been relevant business property but for section 128 shall be relevant business property notwithstanding that section.

(2) Where the property which, by virtue of subsection (1), is relevant business property replaced the property or part referred to in subsection (1) ( c ), relief under this Chapter shall not exceed what it would have been had the replacement or any one or more of the replacements not been made, and section 129 (3) shall apply with the necessary modifications for the purposes of this subsection.

(3) Where, in relation to the earlier benefit, the amount of the taxable value of the gift or inheritance which was attributable to the property or part referred to in subsection (1) ( c ) was part only of its value, a like part only of the value which, apart from this subsection, would fall to be reduced under this Chapter by virtue of this section shall be so reduced.

Value of business.

132.—For the purposes of this Chapter—

( a ) the value of a business or of an interest in a business shall be taken to be its net value;

( b ) subject to paragraph ( c ), the net value of a business shall be taken to be the market value of the assets used in the business (including goodwill) reduced by the aggregate market value of any liabilities incurred for the purposes of the business;

( c ) in ascertaining the net value of an interest in a business, no regard shall be had to assets or liabilities other than those by reference to which the net value of the entire business would fall to be ascertained.

Value of certain shares and securities.

133.—(1) Where a company is a member of a group and the business of any other company which is a member of the group falls within section 127 (4), then, unless that business consists wholly or mainly in the holding of land or buildings wholly or mainly occupied by members of the group whose business does not fall within section 127 (4), the value of shares in or securities of the company shall be taken for the purposes of this Chapter to be what it would be if that other company were not a member of the group.

( 2 ) ( a ) In this subsection "shares" include securities and "shares in a company" include other shares in the same company which are represented by those shares.

( b ) Where unquoted shares in a company which is a member of a group are comprised in a gift or inheritance and shares in another company which is also a member of the group are quoted on the valuation date, the value of the first-mentioned shares shall be taken, for the purpose of this Chapter, to be what it would be if that other company were not a member of the group, unless those unquoted shares were in the beneficial ownership of the disponer immediately prior to the disposition and those quoted shares were—

(i) unquoted at some time prior to the gift or inheritance when they were in the beneficial ownership of the disponer or a member of that group, while being a member of such group, or

(ii) at the date of the passing of this Act,

whichever is the later date.

Exclusion of value of excepted assets.

134.—(1) In determining for the purposes of this Chapter what part of the taxable value of a gift or inheritance is attributable to the value of relevant business property, so much of the last-mentioned value as is attributable to—

( a ) agricultural property,

( b ) any excepted assets within the meaning of subsection (2), or

( c ) any excluded property within the meaning of subsection (7),

shall be left out of account.

(2) An asset shall be an excepted asset in relation to any relevant business property if it was not used wholly or mainly for the purposes of the business concerned throughout the whole or the last two years of the relevant period, but where the business concerned is carried on by a company which is a member of a group, the use of an asset for the purposes of a business carried on by another company which at the time of the use and immediately prior to the gift or inheritance was also a member of that group shall be treated as use for the purposes of the business concerned, unless that other company's membership of the group falls to be disregarded under section 133:

Provided that the use of an asset for the purposes of farming (within the meaning of section 13 of the Finance Act, 1974 ) or for the purposes of a business to which section 127 (4) relates shall not be treated as use for the purposes of the business concerned.

(3) Subsection (2) shall not apply in relation to an asset which is relevant business property by virtue only of section 127 (1) (e), and an asset shall not be relevant business property by virtue only of that provision unless either—

( a ) it was used in the manner referred to in that provision—

(i) in the case where the disponer's interest in the business or the shares in or securities of the company carrying on the business are comprised in an inheritance taken on the date of death of the disponer, throughout the two years immediately preceding the date of the inheritance, or

(ii) in any other case, throughout the five years immediately preceding the date of the gift or inheritance,

( b ) it replaced another asset so used and it and the other asset and any asset directly or indirectly replaced by that other asset were so used for periods which together comprised—

(i) in the case referred to at paragraph ( a ) (i), at least two years falling within the three years immediately preceding the date of the inheritance, or

(ii) in any other case, at least five years falling within the six years immediately preceding the date of the gift or inheritance;

but where section 131 applies paragraphs ( a ) and (b) shall be deemed to be complied with if the asset, or that asset and the asset or assets replaced by it, was or were so used throughout the period between the earlier and the subsequent benefit mentioned in that section, or throughout the part of that period during which it or they were in the beneficial ownership of the disponer or the disponer's spouse.

(4) Where part but not the whole of any land or building is used exclusively for the purposes of any business and the land or building would, but for this subsection, be an excepted asset, or, as the case may be, prevented by subsection (3) from being relevant business property, the part so used and the remainder shall for the purposes of this section be treated as separate assets, and the value of the part so used shall (if it would otherwise be less) be taken to be such proportion of the value of the whole as may be just.

(5) For the purposes of this section the relevant period, in relation to any asset, shall be the period immediately preceding the gift or inheritance during which the asset or, if the relevant business property is an interest in a business, a corresponding interest in the asset, was comprised in the disposition (within the meaning of section 128) or, if the business concerned is that of a company, was beneficially owned by that company or any other company which immediately before the gift or inheritance was a member of the same group.

(6) For the purposes of this section an asset shall be deemed not to have been used wholly or mainly for the purposes of the business concerned at any time when it was used wholly or mainly for the personal benefit of the disponer or of a relative of the disponer.

(7) Where, in relation to a gift or an inheritance—

( a ) relevant business property consisting of shares in or securities of a company are comprised in the gift or inheritance on the valuation date, and

( b ) property consisting of a business, or interest in a business, not falling within section 127 (4) (hereinafter in this section referred to as "company business property") is on that date beneficially owned by that company or, where that company is a holding company of one or more companies within the same group, by any company within that group,

that company business property shall, for the purposes of subsection (1), be excluded property in relation to those shares or securities unless it would have been relevant business property if—

(i) it had been the subject matter of that gift or inheritance, and

(ii) it and any other company business property directly or indirectly replaced by it had been comprised in the disposition for the periods during which they were in the beneficial ownership of any member of that group, while being such a member, or actually comprised in the disposition,

and shares in or securities of a company which replace, or which are replaced by, other such shares or company business property shall be treated as company business property for the purposes of this section if the company was the beneficial owner of the company business property and a member of that group at the time of the replacement:

Provided that where, by virtue of the provisions of this subsection, company business property would have been excluded property but for the conditions of paragraphs (i) and (ii) having been complied with, the provisions of subsection (2) of section 129 shall, with any necessary modifications, apply to that company business property as to a case to which subsection (1) of section 129 relates.

Withdrawal of relief.

135.—(1) In this section "relevant period", in relation to relevant business property comprised in a gift or inheritance, means the period of six years after the valuation date or the period between the date of the gift or inheritance and the date of a subsequent gift or inheritance consisting of the same property or of property representing that property, whichever is the lesser period.

(2) The reduction which would fall to be made under section 126 in respect of relevant business property comprised in a gift or inheritance shall cease to be applicable if and to the extent that the property, or any property which directly or indirectly replaces it—

( a ) would not be relevant business property (apart from section 128 and the provisos to paragraphs ( d ) and (f)of subsection (1) of section 127 and other than by reason of bankruptcy or a bona fide winding-up on grounds of insolvency) in relation to a notional gift of such property taken by the same donee or successor from the same disponer at any time within the relevant period, unless it would be relevant business property (apart from section 128 and the provisos to paragraphs ( d ) and (f)of subsection (1) of section 127) in relation to another such notional gift taken within a year after the first-mentioned notional gift;

( b ) is sold, redeemed or compulsorily acquired within the relevant period and is not replaced, within a year of the sale, redemption or compulsory acquisition, by other property (other than quoted shares or securities or unquoted shares or securities to which section 133 (2) ( b ) relates) which would be relevant business property (apart from section 128 and the proviso to section 127 (1) ( d ) in relation to a notional gift of that other property taken by the same donee or successor from the same disponer on the date of the replacement,

and tax shall be chargeable in respect of the gift or inheritance as if the property were not relevant business property:

Provided that any land, building, machinery or plant which are comprised in the gift or inheritance and which qualify as relevant business property by virtue of section 127 (1) (e) shall, together with any similar property which has replaced such property, continue to be relevant business property for the purposes of this section for so long as they are used for the purposes of the business concerned.

CHAPTER II Miscellaneous

Interpretation (Chapter II).

136.—In this Chapter "the Principal Act" means the Capital Acquisitions Tax Act, 1976 .

Amendment of section 109 (interpretation) of Finance Act, 1993 .

137.—(1) Section 109 of the Finance Act, 1993 , is hereby amended by the insertion of the following definitions after the definition of "the Act of 1965":

"'agricultural property' has the same meaning as it has in section 19 (as amended by the Finance Act, 1994 ) of The Principal Act but excluding farm machinery, livestock and bloodstock;

'agricultural value' means the market value of agricultural property reduced by 30 per cent. of that value;".

(2) This section shall have effect in relation to persons dying after the 17th day of June, 1993.

Amendment of section 111 (application of Principal Act) of Finance Act, 1993 .

138.—(1) Section 111 of the Finance Act, 1993 , is hereby amended—

( a ) by the deletion of "and" in subparagraph (ii) of paragraph (g) and by the insertion after that subparagraph of the following subparagraph:

"( iia ) in so far as the inheritance consists of agricultural property, the reference to market value in subsection (1) of the said section 18 were a reference to agricultural value, and",

( b ) by the insertion of the following proviso to subparagraph (iii) of paragraph (g)of that section—

"Provided that nothing in this subparagraph shall have effect so as to reduce the tax which would but for this subparagraph be borne by property which at the date of death of the deceased represented the share in the estate of the deceased of a person who was not on that date a dependent child or a dependent relative of the deceased;".

(2) Paragraph ( a ) of subsection (1) shall have effect in relation to persons dying after the 17th day of June, 1993.

Amendment of section 112 (exemptions) of Finance Act, 1993 .

139.—(1) Section 112 of the Finance Act, 1993 , is hereby amended—

( a ) by the deletion of paragraph (c)of that section, and

( b ) by the substitution of the following paragraph for paragraph (d)of that section:

"( d ) the dwelling-house comprised in an inheritance which, on the date of death of the deceased, is taken under the will or other testamentary disposition or under the intestacy of the deceased, by a person who was on that date a dependent child of the deceased or a dependent relative of the deceased and whose place of normal residence was on that date the dwelling-house:

Provided that—

(i) the total income from all sources of that dependent child or that dependent relative, for income tax purposes, in the year of assessment ending on the 5th day of April next before that date, did not exceed the 'specified amount' referred to in subsection (1A) of section 142 of the Income Tax Act, 1967 ,

(ii) the amount of the exemption shall (subject, with any necessary modifications, to the provisions of Section 18(4) ( a ) of the Principal Act in the case of a limited interest, and to the provisions of section 20 of that Act in the case of a contingency) be the whole or, as the case may be, the appropriate part (within the meaning of section 5 (5) of the Principal Act) of the net market value of the dwelling-house, and

(iii) the amount of the exemption shall not be reduced by virtue of the provisions of section 20 of the Principal Act where an entitlement ceasing within the meaning of that section ceases because of an enlargement of that entitlement.".

(2) This section shall have effect in relation to persons dying on or after the date of the passing of this Act.

Abatement and postponement of tax.

140.—(1) Chapter I of Part VI of the Finance Act, 1993 , is hereby amended by the insertion after section 115 of the following section—

"115A.—(1) Where the spouse of a deceased survives the deceased, probate tax chargeable by virtue of section 110 which is borne by property which, at the date of death of the deceased, represents the share of that spouse in the estate of the deceased, shall be abated to a nil amount:

Provided that—

( a ) where the same property represents more than one person's share in the estate of the deceased and that spouse's interest in that property at that date is not a limited interest to which paragraph (b)relates, only a proportion of the probate tax borne by that property shall be abated to a nil amount and that proportion shall be the proportion which the value of that interest at that date bears to the total value of the property at that date, and for this purpose the value of that interest at that date shall not include the value of any interest in expectancy created by the will or other testamentary disposition of the deceased;

( b ) where a limited interest to which that spouse became beneficially entitled in possession on that date was created by the will or other testamentary disposition of the deceased, probate tax borne by the property in which that limited interest subsisted on that date shall not be abated to a nil amount, but, notwithstanding section 117 (a), that tax shall not become due and payable until the date of the cesser of that limited interest and every person who (on the cesser of that limited interest) takes an inheritance which consists of all or part of the property in which that limited interest subsisted immediately prior to that cesser (hereinafter in this proviso referred to as 'the said property') and every trustee or other person in whose care the said property or the income therefrom is placed at the date of that cesser and every person in whom the said property is vested after that date, other than a bona fide purchaser or mortgagee for full consideration in money or money's worth, or a person deriving title from or under such a purchaser or mortgagee shall, notwithstanding any other provision to the contrary, be the only persons accountable for the payment of that tax and that tax shall be a charge on the said property in all respects as if the date of the inheritance in respect of which that tax is chargeable were the date of such cesser and the said property were property of which, for the purpose of section 47 of the Principal Act, that inheritance consisted at that date;

( c ) if consideration in money or money's worth is paid to that spouse on the coming to an end of the limited interest referred to in paragraph (b) of this proviso before the event on which that interest was limited to cease, an appropriate proportion of the probate tax borne by the said property shall be abated to a nil amount and that proportion shall be the proportion which the value of that consideration bears to the value of the said property at the date of the cesser.

(2) Where the spouse of a deceased survives the deceased, probate tax chargeable by virtue of section 110 which is borne by the dwelling-house, or by any part thereof, shall, notwithstanding subsection (1) and section 117 ( a ), not become due and payable until the date of death of that spouse and, notwithstanding any provision to the contrary, the only persons who shall be accountable for that tax shall be the following, that is to say

( a ) any person who takes an inheritance under the will or other testamentary disposition of the deceased which consists in whole or in part of the dwelling-house, or part thereof, or which consists of property which represents that dwelling-house or part; and

( b ) any trustee in whom the property comprised in any such inheritance is vested at the date of death of that spouse or at any time thereafter and any other person in whom the property comprised in any such inheritance becomes vested for a beneficial interest in possession at any time thereafter, other than a bona fide purchaser or mortgagee for full consideration in money or money's worth, or a person deriving title from or under such a purchaser or mortgagee.

(3) Where the date upon which tax becomes due and payable is postponed by virtue of subsection (1) (b) or subsection (2), then, notwithstanding paragraph (b) of section 117, interest upon that tax shall not be payable in respect of the period commencing on the valuation date and ending 9 months after the date on which that tax actually becomes due and payable.".

(2) This section shall have effect in relation to persons dying after the 17th day of June, 1993.

Amendment of section 19 (value of agricultural property) of Principal Act.

141.—(1) Section 19 of the Principal Act is hereby amended—

( a ) by the substitution of the following definition for the definition of "agricultural property":

"'agricultural property' means agricultural land, pasture and woodland situate in the State and crops, trees and underwood growing on such land and also includes such farm buildings, farm houses and mansion houses (together with the lands occupied therewith) as are of a character appropriate to the property, and farm machinery, livestock and bloodstock thereon;",

( b ) by the substitution of the following definition for the definition of "agricultural value":

"'agricultural value' means—

( a ) in the case of farm machinery, livestock and bloodstock, 75 per cent. of the market value of such property,

( b ) in the case of a gift of agricultural property, other than farm machinery, livestock and bloodstock, 70 per cent. of the market value of the agricultural property comprised in the gift reduced by 50 per cent. of that market value or by a sum of £150,000, whichever is the lesser, and

( c ) in the case of an inheritance of agricultural property, other than farm machinery, livestock and bloodstock, 70 per cent. of the market value of the agricultural property comprised in the inheritance reduced by 35 per cent. of that market value or by a sum of £105,000, whichever is the lesser;",

( c ) by the substitution of the following subsection for subsection (4):

"(4) In relation to the deduction, in respect of agricultural property, of—

( a ) in the case of a gift, 50 per cent. of its market value, or £150,000, whichever is the lesser, and

( b ) in the case of an inheritance, 35 per cent. of its market value, or £105,000, whichever is the lesser,

the amount deductible shall not exceed £150,000 in the case of a gift and £105,000 in the case of an inheritance, in respect of the aggregate of—

(i) all taxable gifts taken on or after the 28th day of February, 1969, and

(ii) all taxable inheritances taken on or after the 1st day of April, 1975, which consist in whole or in part of agricultural property, taken by the same person, as donee or successor, from the same disponer.",

( d ) by the substitution of the following definition for the definition of "farmer":

"'farmer', in relation to a donee or successor, means an individual who is domiciled and ordinarily resident in the State and in respect of whom not less than 80 per cent. of the market value of the property to which the individual is beneficially entitled in possession is represented by the market value of property in the State which consists of agricultural property, and, for the purposes of this definition, no deduction shall be made from the market value of property for any debts or incumbrances.",

and

( e ) in subsection (5), by the substitution of the following paragraph for paragraph (a):

"( a ) The agricultural value shall cease to be applicable to agricultural property, other than crops, trees or underwood, if and to the extent that such property, or any agricultural property which directly or indirectly replaces such property—

(i) is sold or compulsorily acquired within the period of six years after the date of the gift or the date of the inheritance; and

(ii) is not replaced, within a year of the sale or compulsory acquisition, by other agricultural property,

and tax shall be chargeable in respect of the gift or inheritance as if the property were not agricultural property:

Provided that this paragraph shall not have effect where the donee or successor dies before the property is sold or compulsorily acquired.".

(2) This section shall have effect in relation to gifts or inheritances taken on or after the 11th day of April, 1994.

Amendment of Second Schedule (computation of tax) to Principal Act.

142.—(1) The Second Schedule to the Principal Act is hereby amended by the substitution of the following Part for Part II (inserted by section 115 of the Finance Act, 1991 ):

"PART II

TABLE

Portion of Value	Rate of tax
	Per cent.
The threshold amount	Nil
The next £10,000	20
The next £30,000	30
The balance	40

(2) This section shall have effect in relation to gifts and inheritances taken on or after the 11th day of April, 1994.

Amendment of section 109 (computation of tax) of Finance Act, 1984 .

143.—(1) In this section—

"earlier relevant inheritance" means a relevant inheritance deemed to be taken on the date of death of the disponer;

"later relevant inheritance" means a relevant inheritance which, after the date of death of the disponer, is deemed to be taken by a discretionary trust by virtue of there ceasing to be a principal object of that trust who is under the age of 21 years;

"relevant inheritance" means an inheritance which, by virtue of section 106 (1) of the Finance Act, 1984 , is, on or after the 11th day of April, 1994, deemed to be taken by a discretionary trust;

"the relevant period" means—

( a ) in relation to an earlier relevant inheritance, the period of five years commencing on the date of death of the disponer, and

( b ) in relation to a later relevant inheritance, the period of five years commencing on the latest date on which a later relevant inheritance was deemed to be taken from the disponer;

"the appropriate trust", in relation to a relevant inheritance, means the trust by which that inheritance was deemed to be taken.

(2) Section 109 of the Finance Act, 1984 , is hereby amended by the substitution of "six per cent." for "three per cent.":

Provided that where, in the case of each and every earlier relevant inheritance or each and every later relevant inheritance, as the case may be, taken from one and the same disponer, one or more objects of the appropriate trust became beneficially entitled in possession before the expiration of the relevant period to an absolute interest in the entire of the property of which that inheritance consisted on and at all times after the date of that inheritance (other than property which ceased to be subject to the terms of the appropriate trust by virtue of a sale or exchange of an absolute interest in that property for full consideration in money or money's worth), then, in relation to all such earlier relevant inheritances or all such later relevant inheritances, as the case may be, this section shall cease to apply and tax shall be computed accordingly in accordance with the provisions of the said section 109 as if this section had not been enacted.

(3) Where two or more persons are together beneficially entitled in possession to an absolute interest in property, those persons shall not, by reason only that together they are beneficially so entitled in possession, be regarded for the purposes of subsection (2) as beneficially so entitled in possession.

(4) Notwithstanding the provisions of section 46 of the Principal Act, interest shall not be payable on any repayment of tax which arises by virtue of the provisions of this section.

Amendment of section 117 (reduction in estimated value of certain dwellings) of Finance Act, 1991 .

144.—(1) Section 117 of the Finance Act, 1991 , is hereby amended by the substitution in subsection (1) of "60 per cent." for "50 per cent." and "£60,000" for "£50,000".

(2) This section shall have effect in relation to inheritances taken on or after the 11th day of April, 1994.

Amendment of section 128 (amendment of Second Schedule (computation of tax) to Principal Act) of Finance Act, 1990 .

145.— Section 128 of the Finance Act, 1990 , is hereby amended by the substitution of the following subsection for subsection (1) (including the proviso thereto):

"(1) In computing in accordance with the provisions of the Second Schedule to the Principal Act the tax chargeable on the taxable value of a taxable gift or a taxable inheritance taken by a donee or successor on or after 11th day of April, 1994, the class threshold, as defined in paragraph 1 (inserted by section 111 of the Finance Act, 1984 ) of Part I of that Schedule, in respect of each taxable gift or taxable inheritance included in any aggregate of taxable values referred to in paragraph 3 (inserted by the said section 111) of Part I shall be adjusted by multiplying each such class threshold by the figure, rounded to the nearest third decimal place, determined by dividing by 133.5 the consumer price index number for the year immediately preceding the year in which that taxable gift or taxable inheritance is taken, and the references to the class threshold (including the reference to the class thresholds) in the definition of 'revised class threshold' and the proviso thereto in the said paragraph 1 shall be construed accordingly.".

Certificate relating to registration of title based on possession.

146.—(1) After the passing of this Act a person shall not be registered as owner of property in a register of ownership maintained under the Act of 1964 on foot of an application made to the Registrar on or after the 11th day of April, 1994, which is—

( a ) based on possession, and

( b ) made under the Rules of 1972, or any other rule made for carrying into effect the objects of the Act of 1964, unless the applicant produces to the Registrar a certificate issued by the Commissioners to the effect that the Commissioners are satisfied—

(i) that the property did not become charged with gift tax or inheritance tax during the relevant period, or

(ii) that any charge for gift tax or inheritance tax to which the property became subject during that period has been discharged, or will (to the extent that it has not been discharged) be discharged within a time considered by the Commissioners to be reasonable.

(2) In the case of an application for registration in relation to which a solicitor's certificate is produced for the purpose of rule 19 (3), 19 (4) or 35 of the Rules of 1972, the Registrar may accept that the application is not based on possession if the solicitor makes to the Registrar a declaration in writing to that effect.

(3) Where, on application to them by the applicant for registration, the Commissioners are satisfied that they may issue a certificate for the purpose of subsection (1), they shall issue a certificate for that purpose, and the certificate and the application therefor shall be on a form provided by the Commissioners.

(4) A certificate issued by the Commissioners for the purpose of subsection (1) shall be in such terms and subject to such qualifications as the Commissioners think fit, and shall not be a certificate for any other purpose.

(5) In this section—

"the Act of 1964" means the Registration of Title Act, 1964 ;

"the Registrar" means the Registrar of Titles;

"relevant period", in relation to a person's application to be registered as owner of property, means the period commencing on the 28th day of February, 1974, and ending on the date as of which the registration was made:

Provided that—

( a ) where the certificate referred to in subsection (1) is a certificate for a period ending prior to the date of the registration, the period covered by the certificate shall be deemed to be the relevant period if, at the time of the registration, the Registrar had no reason to believe that a death relevant to the application for registration occurred after the expiration of the period covered by the certificate, and

( b ) where the registration of the person (if any) who, at the date of that application, was the registered owner of the property had been made as of a date after the 28th day of February, 1974, the relevant period shall commence on the date as of which that registration was made;

"the Rules of 1972" means the Land Registration Rules, 1972 ( S.I. No. 230 of 1972 ).

Provision relating to section 5 (gift deemed to be taken) of Principal Act and section 121 of Finance Act, 1993 .

147.—Without prejudice to the meaning of section 5 of the Principal Act as enacted, that section shall have effect and be deemed always to have had effect as if the provisions of section 121 of the Finance Act, 1993 , had not been enacted, except where the consideration referred to in the said section 5, being consideration in relation to a disposition, could not reasonably be regarded (taking into account the disponer's position prior to the disposition) as representing full consideration to the disponer for having made such a disposition.

Provision relating to section 11 (inheritance deemed to be taken) of Principal Act and section 123 of Finance Act, 1993 .

148.—Without prejudice to the meaning of section 11 of the Principal Act as enacted, that section shall have effect and be deemed always to have had effect as if the provisions of section 123 of the Finance Act, 1993 , had not been enacted, except where the consideration referred to in the said section 11, being consideration in relation to a disposition, could not reasonably be regarded (taking into account the disponer's position prior to the disposition) as representing full consideration to the disponer for having made such a disposition.

PART VII MISCELLANEOUS

CHAPTER I Provisions Relating to Residence of Individuals

Interpretation (Chapter I).

149.—In this Part—

"the Acts" means—

( a ) the Income Tax Acts,

( b ) the Corporation Tax Acts,

( c ) the Capital Gains Tax Acts, and

( d ) the Capital Acquisitions Tax Act, 1976 , and the enactments amending or extending that Act,

and any instrument made thereunder;

"authorised officer" means an officer of the Revenue Commissioners authorised by them in writing for the purposes of this Chapter;

"present in the State", in relation to an individual, means the personal presence of the individual in the State;

"tax" means any tax payable in accordance with any provision of the Acts.

Residence.

150.—(1) For the purposes of the Acts, an individual is resident in the State for a year of assessment if the individual is present in the State—

( a ) at any one time or several times in the year of assessment for a period in the whole amounting to 183 days or more, or

( b ) at any one time or several times—

(i) in the year of assessment, and

(ii) in the preceding year of assessment,

for a period (being a period comprising in the aggregate the number of days on which the individual is present in the State in the year of assessment and the number of days on which the individual was present in the State in the preceding year of assessment) in the whole amounting to 280 days or more:

Provided that, notwithstanding paragraph ( b ), where for a year of assessment an individual is present in the State at any one time or several times for a period in the whole amounting to not more than 30 days—

( a ) the individual shall not be resident in the State for the year of assessment, and

( b ) no account shall be taken of the period for the purposes of the aggregate mentioned in paragraph ( b ).

( 2 ) ( a ) Notwithstanding subsection (1), an individual—

(i) who is not resident in the State for a year of assessment, and

(ii) to whom paragraph ( b ) applies,

may, at any time, elect to be treated as resident in the State for that year and, where an individual so elects, the individual shall, for the purposes of the Acts, be deemed to be resident in the State for that year.

( b ) This paragraph applies to an individual who satisfies an authorised officer that the individual is in the State—

(i) with the intention, and

(ii) in such circumstances,

that the individual will be resident in the State for the following year of assessment.

(3) For the purposes of this section, an individual shall be deemed to be present in the State for a day if the individual is present in the State at the end of the day.

Ordinary residence.

151.—(1) For the purposes of the Acts, an individual is ordinarily resident in the State for a year of assessment if the individual has been resident in the State for each of the 3 years of assessment preceding that year.

(2) An individual who is ordinarily resident in the State shall not, for the purposes of the Acts, cease to be ordinarily resident in the State for a year of assessment unless the individual has not been resident in the State in each of the 3 years of assessment preceding that year.

Application of Part III (Schedule C) and section 52 (Schedule D) of Income Tax Act, 1967 .

152.—(1) Where an individual is not resident but is ordinarily resident in the State, Part III and section 52 of the Income Tax Act, 1967 , shall apply and have effect as if the individual were resident in the State:

Provided that this section shall not apply in respect of the income of an individual derived from one or more of the following, that is to say, a trade or profession, no part of which is carried on in the State or an office or employment all the duties of which are performed outside the State.

(2) In determining for the purposes of subsection (1) whether the duties of an office or employment are performed outside the State, any duties performed in the State, the performance of which is merely incidental to the performance of the duties of the office or employment outside the State, shall be treated for the purposes of this section as having been performed outside the State.

Split year residence.

153.—(1) For the purposes of a charge to tax on any income, profits or gains from an employment, where, during a year of assessment ("the relevant year")—

( a ) (i) an individual who has not been resident in the State for the preceding year of assessment, satisfies an authorised officer that the individual is in the State—

(I) with the intention, and

(II) in such circumstances,

that the individual will be resident in the State for the following year of assessment, or

(ii) an individual who is resident in the State, satisfies an authorised officer that the individual is leaving the State, other than for a temporary purpose,

(I) with the intention, and

(II) in such circumstances,

that the individual will not be resident in the State for the following year of assessment,

and

( b ) the individual would, but for the provisions of this section, be resident in the State for the relevant year,

subsection (2) shall apply in relation to the individual.

( 2 ) ( a ) An individual to whom paragraphs ( a ) (i) and (b) of subsection (1) apply, shall be deemed to be resident in the State for the relevant year only from the date of his or her arrival in the State.

( b ) An individual to whom paragraphs ( a ) (ii) and (b) of subsection (1) apply, shall be deemed to be resident in the State for the relevant year only up to and including the date of his or her leaving the State.

(3) Where, by virtue of this section, an individual is resident in the State for part of a year of assessment, all the provisions of the Acts shall apply as if—

( a ) income arising during that part of the year or, in a case to which the provisions of section 76 (3) of the Income Tax Act, 1967 , apply, amounts received in the State during that part of the year, were income arising or amounts received for a year of assessment in which the individual is resident in the State, and

( b ) income arising or, as the case may be, amounts received in the remaining part of the year, were income arising or amounts received in a year of assessment in which the individual is not resident in the State.

Deduction for income earned outside the State.

154.—(1) Where for any year of assessment an individual who is resident in the State makes a claim in that behalf to and satisfies an authorised officer that—

( a ) the duties of an office or employment to which this section applies of the individual are performed wholly or partly outside the State, and

( b ) either—

(i) the number of days in that year which are qualifying days in relation to the office or employment (together with any days which are qualifying days in relation to any other such office or employment of the individual), or

(ii) the number of such days as aforesaid in a relevant period in relation to that year,

amounts to at least 90 days,

there shall be deducted from the income, profits or gains from the office or employment to be assessed under Schedule D or Schedule E, as may be appropriate, an amount equal to the specified amount.

(2) In this section—

"a qualifying day", in relation to an office or employment of an individual, is a day which is—

( a ) one of at least 14 consecutive days on which the individual is absent from the State for the purposes of the performance of the duties of that office or employment or of those duties and the duties of other offices or employments of the individual outside the State and which (taken as a whole) are substantially devoted to the performance of such duties as aforesaid, and

( b ) one of which the individual concerned is absent from the State at the end of the day:

Provided that no day shall be counted more than once as a qualifying day;

"relevant period", in relation to a year of assessment, means a continuous period of 12 months—

( a ) part only of which is comprised in that year of assessment, and

( b ) no part of which is comprised in another relevant period;

"the specified amount is an amount determined by the formula—

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where—

D is the number of qualifying days in the year of assessment concerned,

E is all the income, profits or gains from offices or employments to which this section applies (including income from offices or employments, the duties of which are performed in the State) of an individual in that year, and

N is—

( a ) if subsection (1) (b) (i) applies, 15, or

( b ) if subsection (1) (b) (ii) applies, a number which bears the same proportion to 15 as the number of qualifying days in the part of the relevant period comprised in the year of assessment bears to the number of qualifying days in that relevant period.

(3) This section applies to—

( a ) an office of director of a company which is within the charge to corporation tax or would be within the charge to corporation tax if it were resident in the State and which carries on a trade or profession,

( b ) an employment other than—

(i) an employment the emoluments of which are paid out of the revenue of the State, or

(ii) an employment with any board, authority or other similar body established by or under statute:

Provided that this section shall not apply in any case where the income from an office or employment—

( a ) is chargeable to tax in accordance with the provisions of section 76 (3) of the Income Tax Act, 1967 , or

( b ) (i) is subject to the provisions of Part III of Schedule 6 to the Income Tax Act, 1967 , or

(ii) would be so subject, if the employment were deemed to be property situated where the employment is exercised, or

( c ) is income to which section 153 applies.

(4) Nothwithstanding anything contained in the Acts, the income, profits or gains from an office or employment shall, for the purposes of this section, be deemed not to include any amounts paid in respect of expenses incurred wholly, exclusively and necessarily in the performance of the duties of the office or employment.

Non-residents.

155.— Section 153 of the Income Tax Act, 1967 , is hereby amended—

( a ) in subsection (2) by the substitution of the following paragraph for paragraph (c):

"( c ) that he is a citizen, subject or national of another Member State of the European Union or of a country of which the citizens, subjects or nationals are for the time being exempted by an order under section 10 of the Aliens Act, 1935 , from any provision of, or of an aliens order under, that Act, or",

and

( b ) by the insertion of the following subsection after subsection (2):

"(3) Notwithstanding subsection (2), where an individual who is not resident in the State proves to the satisfaction of the Revenue Commissioners that the individual is a resident of another Member State of the European Union and that the proportion which the portion of the individual's income which is subject to Irish tax bears to the individual's total income from all sources (including income which is not subject to Irish tax) is three-fourths or greater, subsection (1) or, as the case may be, subsection (2) shall not apply to that individual and he or she shall be entitled to the allowance, deduction or other benefit mentioned in subsection (1).".

Appeals.

156.—(1) An individual who is aggrieved by the decision of an authorised officer on any question arising under those provisions of this Chapter which require an individual to satisfy an authorised officer on such a question may, by notice in writing to that effect given to the authorised officer within two months from the date on which notice of the decision is given to the individual, make an application to have the question heard and determined by the Appeal Commissioners.

(2) Where an application is made under subsection (1), the Appeal Commissioners shall hear and determine the question concerned in like manner as an appeal made to them against an assessment and all the provisions of the Acts relating to such an appeal (including the provisions relating to the rehearing of an appeal and to the statement of a case for the opinion of the High Court on a point of law) shall apply accordingly with any necessary modifications.

Repeals.

157.—(1) Sections 76 (4), 199 and 206 of the Income Tax Act, 1967 , and section 4 of the Finance Act, 1987 , are hereby repealed.

(2) Where the Revenue Commissioners are satisfied that the repeal of section 76 (4) of the Income Tax Act, 1967 , would give rise to hardship in the case of income derived in the manner mentioned in the said section 76 (4), they may, for the year 1994-95 and for that year of assessment only, grant such relief as in their opinion is just.

Commencement (Chapter I).

158.—(1) Subject to subsection (2), this Chapter shall apply as respects the year 1994-95 and subsequent years of assessment.

(2) Where in any case an individual—

( a ) was resident in the State for the year of assessment 1991-92 but not resident in the State for the years of assessment 1992-93 and 1993-94, or

( b ) was resident in the State for the year of assessment 1992-93 but not resident in the State for the year of assessment 1993-94, or

( c ) was resident in the State for the year of assessment 1993-94 and would not, but for section 150, be resident in the State in the year of assessment 1994-95, or

( d ) left the State in the years of assessment 1992-93 or 1993-94 for the purpose of commencing a period of ordinary residence outside the State and did not recommence ordinary residence in the State prior to the end of the year of assessment 1993-94,

section 150 and section 157, in so far as it relates to the repeal of section 4 of the Finance Act, 1987 , shall apply as respects the year 1995-96 and subsequent years of assessment in that case.

CHAPTER II General

Capital Services Redemption Account.

159.—(1) In this section—

"the 1993 amending section" means section 135 of the Finance Act, 1993 ;

"capital services" has the same meaning as it has in the principal section;

"the forty-fourth additional annuity" means the sum charged on the Central Fund under subsection (4);

"the principal section" means section 22 of the Finance Act, 1950 .

(2) In relation to the twenty-nine successive financial years commencing with the financial year ending on the 31st day of December, 1994, subsection (4) of the 1993 amending section shall have effect with the substitution of "£63,399,051" for "£60,543,110".

(3) Subsection (6) of the 1993 amending section shall have effect with the substitution of "£47,996,485" for "£46,534,800".

(4) A sum of £68,241,818 to redeem borrowings, and interest thereon, in respect of capital services shall be charged annually on the Central Fund or the growing produce thereof in the thirty successive financial years commencing with the financial year ending on the 31st day of December, 1994.

(5) The forty-fourth additional annuity shall be paid into the Capital Services Redemption Account in such manner and at such times in the relevant financial year as the Minister for Finance may determine.

(6) Any amount of the forty-fourth additional annuity, not exceeding £52,452,200 in any financial year, may be applied towards defraying the interest on the public debt.

(7) The balance of the forty-fourth additional annuity shall be applied in any one or more of the ways specified in subsection (6) of the principal section.

Establishment of Small Savings Reserve Fund.

160.—(1) In this section—

"the Fund" means the Small Savings Reserve Fund established by subsection (2);

"the Minister" means the Minister for Finance;

"small savings" means savings certificates (being savings to which section 30 of the Finance Act, 1940 , relates), national instalment savings (being savings to which section 53 of the Finance Act, 1970 , relates) and savings bonds (being savings to which section 54 of the Finance Act, 1970 , relates).

(2) There is hereby established a fund, to be known as the Small Savings Reserve Fund, which shall be under the control of the Minister.

(3) The Minister shall pay into the Fund in the year 1994, the sum of £60,000,000, and in each year thereafter such sums, if any, as the Minister may decide.

(4) Where in any calendar year interest payments on encashments of small savings exceed 11 per cent. of the total interest accrued on such savings at the end of the immediately preceding calendar year, the resources of the Fund may be applied towards meeting so much of those interest payments which, as a percentage of the said total interest accrued, exceed 11 per cent.

(5) The resources of the Fund shall be made available, without payment of interest, to the Exchequer by way of repayable ways and means advances.

(6) Accounts prepared under section 12 of the National Treasury Management Agency Act, 1990 , shall include an account of payments into and out of the Fund and a statement of the resources in the Fund—

( a ) on the 1st day of January of the calendar year in which the financial year of the said accounts commences, and

( b ) on the 31st day of December in that calendar year.

(7) The functions of the Minister referred to in the First Schedule to the National Treasury Management Agency Act, 1990 , for the purposes of section 5 of that Act shall be construed as if there were included in that Schedule for those purposes a reference to the functions of the Minister under this section.

Securities of International Bank for Reconstruction and Development.

161.—(1) This section applies to any stock or other form of security issued by the International Bank for Reconstruction and Development.

(2) Any stock or other form of security to which this section applies shall be deemed—

( a ) to be a security issued under the authority of the Minister for Finance within the meaning of section 466 of the Income Tax Act, 1967 , and

( b ) to be a security to which section 63 of the Finance Act, 1969 , applies,

and those sections shall apply and have effect accordingly.

(3) Section 474 of the Income Tax Act, 1967 , is hereby amended in subsection (1) by the insertion of ", or section 161 of the Finance Act, 1994" after " section 92 of the Finance Act, 1973 ".

(4) The First Schedule (as amended by the Finance Act, 1970 , and subsequent enactments) to the Stamp Act, 1891, is hereby amended by the insertion in paragraph 1 of the Heading "GENERAL EXEMPTIONS FROM ALL STAMP DUTIES" of the following subparagraph after subparagraph ( ia ) (inserted by the Finance Act, 1973 ):

"( ib ) any stock or other form of security to which section 161 of the Finance Act, 1994, applies,".

(5) Section 66 (as amended by the Finance Act, 1989 ) of the Finance Act, 1984 , is hereby amended by the insertion after "Steel Community," of "the International Bank for Reconstruction and Development,".

Amendment of section 486 (power of Collector and authorised officers to sue) of Income Tax Act, 1967 .

162.—(1) Section 486 of the Income Tax Act, 1967 , is hereby amended by the substitution of the following subsections for subsections (1) and (2):

"(1) Where the amount due (whether before or after the passing of this Act) in respect of income tax does not exceed the amount which is the monetary limitation on the jurisdiction of the Circuit Court provided for in an action founded on quasi-contract at reference number 1 of the Third Schedule to the Courts (Supplemental Provisions) Act, 1961 , the Collector or other officer of the Revenue Commissioners, duly authorised to collect the said tax may sue in that officer's own name in the Circuit Court for the said amount so due as a debt due to the Minister for Finance.

(2) Where the amount so due does not exceed the amount which is the monetary limitation on the jurisdiction of the District Court provided for in an action founded on contract by clause (i) of paragraph A of section 77 of the Courts of Justice Act, 1924 , the Collector or other officer of the Revenue Commissioners duly authorised to collect the said tax may sue in that officer's own name in the District Court for the said amount so due as a debt due to the Minister for Finance.".

(2) Subsection (1) shall be deemed to have come into force and shall take effect as on and from the 15th day of August, 1991.

Amendment of section 1 (interpretation) of Waiver of Certain Tax, Interest and Penalties Act, 1993 , and related matters.

163.—(1) Section 1 of the Waiver of Certain Tax, Interest and Penalties Act, 1993 , is hereby amended in paragraph (a)by the substitution in the definition of "the specified period" of "21st day of December" for "30th day of November".

(2) As respects the year of assessment 1992-93 the following provisions of the Tax Acts shall be construed as if references in those provisions to the 31st day of January were references to the 28th day of February—

( a ) section 236 (11) of the Income Tax Act, 1967 ,

( b ) section 48 (1) ( a ) of the Finance Act, 1986 , in subparagraph ( IIa ) of paragraph (i) of the definition of "specified date", and

( c ) section 9 (1) of the Finance Act, 1988 , and sections 226 (1) and 230 (1) of the Finance Act, 1992 , in the definitions of "specified return date for the chargeable period".

(3) This section shall be deemed to have come into operation on the 14th day of July, 1993.

Tax treatment of expenses of members of the Judiciary.

164.—(1) In this section, "a member of the Judiciary" means—

( a ) a judge of the Supreme Court,

( b ) a judge of the High Court,

( c ) a judge of the Circuit Court, or

( d ) a judge of the District Court.

(2) An allowance payable by way of an annual sum to a member of the Judiciary in accordance with the provisions of section 5 of the Courts of Justice Act, 1953 , and which has been determined, in accordance with the provisions of paragraph (c)of subsection (2) of the said section 5, by the Minister for Justice in consultation with the Minister for Finance to be in full settlement of the expenses which such a person is obliged to incur in the performance of his duties as a member of the Judiciary and which are not otherwise reimbursed either directly or indirectly out of moneys provided by the Oireachtas, shall be exempt from income tax and shall not be reckoned in computing income for the purposes of the Income Tax Acts.

(3) The provisions of rules 3 and 4 of Schedule 2 to the Income Tax Act, 1967 , shall not apply or have effect in relation to expenses in full settlement of which an allowance referred to in subsection (2) is payable and no claim shall lie under those rules in respect of those expenses.

Care and management of taxes and duties.

165.—All taxes and duties imposed by this Act are hereby placed under the care and management of the Revenue Commissioners.

Short title, construction and commencement.

166.—(1) This Act may be cited as the Finance Act, 1994 .

(2) Parts I and VII (so far as relating to income tax) shall be construed together with the Income Tax Acts and (so far as relating to corporation tax) shall be construed together with the Corporation Tax Acts and (so far as relating to capital gains tax) shall be construed together with the Capital Gains Tax Acts.

(3) Part II (so far as relating to customs) shall be construed together with the Customs Acts and (so far as relating to duties of excise) shall be construed together with the statutes which relate to the duties of excise and to the management of those duties.

(4) Part III shall be construed together with the Value-Added Tax Acts, 1972 to 1993, and may be cited together therewith as the Value-Added Tax Acts, 1972 to 1994.

(5) Part IV shall be construed together with the Stamp Act, 1891, and the enactments amending or extending that Act.

(6) Part V shall be construed together with Part VI of the Finance Act, 1983 , and the enactments amending or extending that Part.

(7) Parts VI and VII (so far as relating to capital acquisitions tax) shall be construed together with the Capital Acquisitions Tax Act, 1976 , and the enactments amending or extending that Act.

(8) Part I shall, save as is otherwise expressly provided therein, be deemed to have come into force and shall take effect as on and from the 6th day of April, 1994.

(9) In relation to Part III:

( a ) paragraphs ( b ), ( c ) and (d)of section 94, section 97 and paragraphs ( a ) and (b) of section 101 shall take effect as on and from the 1st day of July, 1994;

( b ) paragraph ( a ) of section 99 shall take effect as on and from the 1st day of September, 1994;

( c ) section 91 shall take effect as on and from the 1st day of January, 1995;

( d ) section 93 and paragraph ( a ) of section 96 shall take effect as on and from such date as the Minister for Finance may, by order, appoint;

( e ) paragraph ( b ) of section 99 shall take effect as on and from the commencement of section 89;

( f ) the provisions of this Part, other than those specified in paragraphs ( a ) to (e), shall have effect as on and from the date of passing of this Act.

(10) Any reference in this Act to any other enactment shall, except so far as the context otherwise requires, be construed as a reference to that enactment as amended by or under any other enactment including this Act.

(11) In this Act, a reference to a Part, section or Schedule is to a Part or section of, or Schedule to, this Act, unless it is indicated that reference to some other enactment is intended.

(12) In this Act, a reference to a subsection, paragraph, subparagraph, clause or subclause is to the subsection, paragraph, subparagraph, clause or subclause of the provision (including a Schedule) in which the reference occurs, unless it is indicated that reference to some other provision is intended.

Section 3.

FIRST SCHEDULE

AMENDMENTS CONSEQUENTIAL ON CHANGES IN PERSONAL RELIEFS

The Income Tax Act, 1967 , is hereby amended in accordance with the following provisions:

( a ) in section 138—

(i) in paragraph (a), by the substitution of "£4,700" for "£4,350" (inserted by the Finance Act, 1993 ),

(ii) in paragraph (b)(as amended by the Finance Act, 1988 ), by the substitution of "£2,85" and "£4,700", respectively, for "£2,675" and "£4,350" (inserted by the Finance Act, 1993 ), and

(iii) in paragraph (c), by the substitution of "£2,350" for "£2,175" (inserted by the Finance Act, 1993 ),

and

( b ) in section 138A (2) (inserted by the Finance Act, 1985 ), by the substitution of "£1,850" and "£2,350", respectively, for "£1,675" and "£2,175" (inserted by the Finance Act, 1993 ).

Section 32

SECOND SCHEDULE

EXEMPTION OF SPECIFIED NON-COMMERCIAL STATE-SPONSORED BODIES FROM CERTAIN TAX PROVISIONS

1. Agency for Personal Service Overseas.

2. Beaumont Hospital Board.

3. Blood Transfusion Service Board.

4. Board for Employment of the Blind.

5. An Bord Altranais.

6. Bord Fáilte Éireann.

7. An Bord Glas.

8. An Bord Iascaigh Mhara.

9. Bord na Gaeilge.

10. Bord na Leabhar Gaeilge.

11. Bord na Radharcmhastóirí.

12. An Bord Pleanála.

13. Bord Scoláireachtaí Comalairte.

14. An Bord Tráchtála — The Irish Trade Board.

15. An Bord Uchtála.

16. Building Regulations Advisory Body.

17. The Central Fisheries Board.

18. CERT Limited.

19. The Chester Beatty Library.

20. An Chomhairle Ealaíon.

21. An Chomhairle Leabharlanna.

22. Coiste An Asgard.

23. Combat Poverty Agency.

24. Comhairle na Nimheanna.

25. Comhairle na n-Ospidéal.

26. Córas Beostoic agus Feola.

27. Cork Hospitals Board.

28. Criminal Injuries Compensation Tribunal.

29. Dental Council.

30. Drug Treatment Centre Board.

31. Dublin Dental Hospital Board.

32. Dublin Institute for Advanced Studies.

33. Eastern Regional Fisheries Board.

34. Economic and Social Research Institute.

35. Employment Equality Agency.

36. Environmental Protection Agency — An Ghníomhaireacht um Chaomhnú Comhshaoil.

37. Eolas — The Irish Science and Technology Agency.

38. Federated Dublin Voluntary Hospitals.

39. Fire Services Council.

40. An Foras Áiseanna Saothair.

41. Forbairt.

42. Forfás.

43. The Foyle Fisheries Commission.

44. Garda Síochána Appeal Board.

45. Garda Síochána Complaints Board.

46. General Medical Services (Payments) Board.

47. Health Research Board — An Bord Taighde Sláinte.

48. Higher Education Authority.

49. Hospital Bodies Administrative Bureau.

50. Hospitals Trust Board.

51. The Independent Radio and Television Commission — An Coimisiún um Raidio agus Teilifís Neamhspleách.

52. The Industrial Development Agency (Ireland).

53. The Industrial Development Authority.

54. Institiúid Teangeolaíochta Éireann.

55. Institute of Public Administration.

56. The Irish Film Board.

57. The Labour Relations Commission.

58. Law Reform Commission.

59. The Legal Aid Board.

60. Leopardstown Park Hospital Board.

61. Local Government Computer Services Board — An Bord Seirbhísí Ríomhaire Rialtais Aitiúil.

62. Local Government Staff Negotiations Board — An Bord Comhchaibidlí Foirne Rialtais Aitiúil.

63. The Marine Institute.

64. Medical Bureau of Road Safety — An Lia-Bhiúró Shábháiltacht ar Bhóithre.

65. The Medical Council.

66. The National Authority for Occupational Safety and Health—An tUdarás Náisiúnta um Shábháilteachta agus. Sláinte Ceirde.

67. National Cancer Registry.

68. The National Concert Hall Company Limited — An Ceoláras Náisiúnta.

69. National Council for Educational Awards.

70. National Council for the Elderly.

71. National Drugs Advisory Board.

72. The National Economic and Social Council.

73. The National Economic and Social Forum.

74. National Health Council.

75. National Heritage Council — Comhairle Na hOidhreacha Náisiúnta.

76. National Rehabilitation Board.

77. The National Roads Authority — An tÚdarás um Bóithre Náisiúnta.

78. National Safety Council — Comhairle Sábháiltacht Náisiúnta.

79. National Social Services Board.

80. The Northern Regional Fisheries Board.

81. The North Western Regional Fisheries Board.

82. Office of the Data Protection Commissioner.

83. The Pensions Board.

84. Postgraduate Medical and Dental Board.

85. The Radiological Protection Institute of Ireland.

86. The Refugee Agency.

87. Rent Tribunal.

88. Royal Hospital Kilmainham Company.

89. Saint James's Hospital Board.

90. Saint Luke's and St. Anne's Hospital Board.

91. Salmon Research Agency of Ireland Incorporated.

92. Shannon Free Airport Development Company Limited.

93. The Shannon Regional Fisheries Board.

94. The Southern Regional Fisheries Board.

95. The South Western Regional Fisheries Board.

96. Tallaght Hospital Board.

97. Teagasc.

98. Temple Bar Renewal Limited.

99. Údarás na Gaeltachta.

Section 79.

THIRD SCHEDULE

RATES OF EXCISE DUTY ON TOBACCO PRODUCTS

Description of Product	Rate of Duty
Cigarettes	£53.25 per thousand together with an amount equal to 16.83 per cent. of the price at which the cigarettes are sold by retail
Cigars	£81.702 per kilogram
Fine-cut tobacco for the rolling of cigarettes	£68.944 per kilogram
Other smoking tobacco	£56.682 per kilogram

Section 82.

FOURTH SCHEDULE

RATES OF EXCISE DUTY ON CIDER AND PERRY

Description of Cider and Perry	Rate of Duty
Still and Sparkling:
Of an actual alcoholic strength by volume not exceeding 6% vol	£35.03 per hectolitre
Of an actual alcoholic strength by volume exceeding 6% vol but not exceeding 8.5% vol	£151.59 per hectolitre
Still:
Of an actual alcoholic strength by volume exceeding 8.5% vol but not exceeding 15% vol	£215.01 per hectolitre
Of an actual alcoholic strength by volume exceeding 15% vol	£311.97 per hectolitre
Sparkling:
Of an actual alcoholic strength by volume exceeding 8.5% vol	£430.02 per hectolitre

Section 83.

FIFTH SCHEDULE

RATES OF EXCISE DUTY ON WINE AND MADE WINE

Description of Wine and Made Wine	Rate of Duty
Still and Sparkling:
Of an actual alcoholic strength by volume not exceeding 5.5% vol	£71.66 per hectolitre
Still:
Of an actual alcoholic strength by volume exceeding 5.5% vol but not exceeding 15% vol	£215.01 per hectolitre
Of an actual alcoholic strength by volume exceeding 15% vol	£311.97 per hectolitre
Sparkling:
Of an actual alcoholic strength by volume exceeding 5.5% vol	£430.02 per hectolitre

Section 112.

SIXTH SCHEDULE

QUALIFICATIONS FOR APPLYING FOR RELIEF FROM STAMP DUTY IN RESPECT OF TRANSFERS

TO YOUNG TRAINED FARMERS

1. Qualifications awarded by Teagasc:

( a ) Certificate in Farming;

( b ) Diploma in Commercial Horticulture;

( c ) Diploma in Amenity Horticulture;

( d ) Diploma in Pig Production;

( e ) Diploma in Poultry Production.

2. Qualifications awarded by the Farm Apprenticeship Board:

( a ) Certificate in Farm Management;

( b ) Certificate in Farm Husbandry;

( c ) Trainee Farmer Certificate.

3. Qualifications awarded by a third-level institution:

( a ) Degree in Agricultural Science awarded by the National University of Ireland through University College Dublin;

( b ) Degree in Horticultural Science awarded by the National University of Ireland through University College Dublin;

( c ) Degree in Veterinary Science awarded by the National University of Ireland through University College Dublin;

( d ) Degree in Rural Science awarded by the National University of Ireland through University College Cork or by the University of Limerick;

( e ) Diploma in Rural Science awarded by the National University of Ireland through University College Cork;

( f ) Degree in Dairy Science awarded by the National University of Ireland through University College Cork;

( g ) Diploma in Dairy Science awarded by the National University of Ireland through University College Cork.

4. Certificates awarded by the National Council for Educational Awards:

( a ) National Certificate in Agricultural Science studied through Kildalton Agricultural College and Waterford Regional Technical College;

( b ) National Certificate in Business Studies (Agri-business) studied through the Franciscan Brothers Agricultural College, Mountbellew, and Galway Regional Technical College.

Section 116.

SEVENTH SCHEDULE

COMPUTATION OF RESIDENTIAL PROPERTY TAX

1. In this Schedule—

M is the market value exemption limit, and

G is the general exemption limit.

2. Subject to the provisions of paragraph 3, tax chargeable on the net market value shall be computed in accordance with the rates specified in column (2) of the following Table:

TABLE

Net Market Value	Rates
(1)	(2)
The first £25,000 x	1 per cent.
The next £50,000 x	1.5 per cent.
The remainder	2 per cent.

3. Where the net market value, when multiplied by [image not available: a13y1994sch7th-2.bmp] does not exceed £25,000, tax chargeable on the net market value shall be computed in accordance with the following Table:

TABLE

Net Market Value	Tax Chargeable
(1)	(2)
Does not exceed £5,000 x	£25 x
Exceeds £5,000 x and does not exceed £10,000 x	£75 x
Exceeds £10,000 x and does not exceed £15,000 x	£125 x
Exceeds £15,000 x and does not exceed £20,000 x	£175 x
Exceeds £20,000 x and does not exceed £25,000 x	£225 x

ACTS REFERRED TO

Aliens Act, 1935	1935, No. 14
Capital Acquisitions Tax Act, 1976	1976, No. 8
Capital Gains Tax Act, 1975	1975, No. 20
Capital Gains Tax (Amendment) Act, 1978	1978, No. 33
Companies Act, 1963	1963, No. 33
Companies Acts, 1963 to 1990
Companies (Amendment) Act, 1986	1986, No. 25
Corporation Tax Act, 1976	1976, No. 7
Courts of Justice Act, 1924	1924, No. 10
Courts of Justice Act, 1953	1953, No. 32
Courts (Supplemental Provisions) Act, 1961	1961, No. 39
Finance (1909-10) Act, 1910	10 Edw. 7, c. 8
Finance Act, 1923	1923, No. 21
Finance Act, 1926	1926, No. 35
Finance Act, 1935	1935, No. 28
Finance Act, 1939	1939, No. 18
Finance Act, 1940	1940, No. 14
Finance Act, 1950	1950, No. 18
Finance Act, 1967	1967, No. 17
Finance Act, 1968	1968, No. 33
Finance Act, 1969	1969, No. 21
Finance Act, 1970	1970, No. 14
Finance Act, 1971	1971, No. 23
Finance Act, 1972	1972, No. 19
Finance Act, 1973	1973, No. 19
Finance Act, 1974	1974, No. 27
Finance Act, 1975	1975, No. 6
Finance Act, 1976	1976, No. 16
Finance Act, 1977	1977, No. 18
Finance Act, 1978	1978, No. 21
Finance Act, 1980	1980, No. 14
Finance Act, 1981	1981, No. 16
Finance Act, 1982	1982, No. 14
Finance Act, 1983	1983, No. 15
Finance Act, 1984	1984, No. 9
Finance Act, 1985	1985, No. 10
Finance Act, 1986	1986, No. 13
Finance Act, 1987	1987, No. 10
Finance Act, 1988	1988, No. 12
Finance Act, 1989	1989, No. 10
Finance Act, 1990	1990, No. 10
Finance Act, 1991	1991, No. 13
Finance Act, 1992	1992, No. 9
Finance (No. 2) Act, 1992	1992, No. 28
Finance Act, 1993	1993, No. 13
Finance (Excise Duties on Tobacco Products) Act, 1977	1977, No. 32
Finance (Excise Duties) (Vehicles) Act, 1952	1952, No. 24
Finance (Miscellaneous Provisions) Act, 1968	1968, No. 7
Gaming and Lotteries Act, 1956	1956, No. 2
Holidays (Employees) Act, 1973	1973, No. 25
Housing (Miscellaneous Provisions) Act, 1979	1979, No, 27
Income Tax Act, 1967	1967, No. 6
Industrial and Provident Societies Acts, 1893 to 1978
Insurance Act, 1989	1989, No. 3
Local Government (Planning and Development) Acts, 1963 to 1993
Maritime Jurisdiction Act, 1959	1959, No. 22
Maritime Jurisdiction (Amendment) Act, 1988	1988, No. 9
National Treasury Management Agency Act, 1990	1990, No. 18
Regional Technical Colleges Act, 1992	1992, No. 16
Registration of Title Act, 1964	1964, No. 16
Road Traffic Act, 1968	1968, No. 25
Social Welfare (Consolidation) Act, 1993	1993, No. 27
Stamp Act, 1891	54 & 55 Vict., c. 39
Urban Renewal Act, 1986	1986, No. 19
Value-Added Tax Act, 1972	1972, No. 22
Value-Added Tax (Amendment) Act, 1978	1978, No. 34
Vocational Education Act, 1930	1930, No. 29
Waiver of Certain Tax, Interest and Penalties Act, 1993	1993, No. 24

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Irish Legislation

Finance Act, 1994