INCOME TAX ACT, 1967

317 Interpretation.

317.—(1) In this Chapter—

“balancing charges” means balancing charges under Part XVI;

“capital allowances” means allowances, other than allowances falling to be made in computing profits or gains, under section 241 or Part XIV, XV, XVI or XVII;

“year of claim” means, in relation to any claim under section 307, the year of assessment for which the claim is made.

• (2) For the purposes of this Chapter—

• (a) where the end of the basis period for a year of assessment falls in or coincides with the end of any year of assessment, that year is the basis year for the first-mentioned year of assessment, but so that if a year of assessment would under the foregoing provision be the basis year both for that year itself and another year of assessment, it shall be the basis year for the year itself and not for the other year;

• (b) any reference to capital allowances or balancing charges for a year of assessment shall be construed as a reference to those falling to be made in charging the profits or gains of the trade for that year, excluding, in the case of allowances, amounts carried forward from an earlier year;

• (c) effect shall be deemed to be given in charging the profits or gains of the trade for a year of assessment to allowances carried forward from an earlier year before it is given to allowances for the year of assessment; and

• (d) any reference to an amount of capital allowances non-effective in a year of assessment shall be construed as referring to the amount to which by reason of an insufficiency of profits or gains effect cannot be given in charging the profits or gains of the trade for that year.

In paragraph (a) “the basis period for a year of assessment” means in relation to any trade the period on the profits or gains of which income tax for that year falls to be finally computed under Case I of Schedule D in respect of the trade or, where, by virtue of this Act, the profits or gains of any other period are to be taken to be the profits or gains of the said period, that other period.

318 Option to treat as creating or augmenting loss.

318.—(1) Subject to the provisions of this Chapter, any claim made under section 307, for relief in respect of a loss sustained in any trade, may require the amount of the loss to be determined as if an amount equal to the capital allowances for the year of assessment for which the year of claim is the basis year were to be deducted in computing the profits or gains or losses of the trade in the year of claim and a claim may be so made notwithstanding that apart from those allowances a loss has not been sustained in the trade in the year of claim.

• (2) Where on any claim made by virtue of this Chapter relief is not given under section 307 for the full amount of the loss determined as aforesaid, the relief shall be referred as far as may be to the loss sustained in the trade rather than to the capital allowances in respect of the trade.

319 Extent to which allowances to be taken into account.

319.—(1) The capital allowances for any year of assessment shall be taken into account under section 318 (1) only if and so far as they are not required to offset balancing charges for the year; and, where the capital allowances taken into account are allowances for the year of claim, relief shall not be given by reference to those allowances in respect of an amount greater than the amount non-effective in the year of claim.

• (2) For the purposes of subsection (1), the capital allowances for any year of assessment shall be treated as required to offset balancing charges for the year up to the amount on which the balancing charges fall to be made after deducting from that amount the amount, if any, of capital allowances for earlier years which is carried forward to that year and would, without the balancing charges, be non-effective in that year.

320 Effect of giving relief.

320.—Where for any year of claim relief is given under section 307 by reference to any capital allowances, then, for all the purposes of this Act, effect shall be deemed to have been given to those allowances up to the amount in respect of which relief is so given, and any relief previously given for a subsequent year on the basis that effect had not been given to the allowances as aforesaid shall be adjusted, where necessary, by additional assessment.

321 Grant of relief before passing of annual Act.

321.—Relief from tax may be given by virtue of section 318 (1) by reference to capital allowances for a year of assessment before the passing of any Act imposing income tax for that year, as if income tax had been imposed for the year without alteration; but if relief given to a person by virtue of section 318 (1) for any year of claim is affected by a subsequent alteration of the law, or by any discontinuance of the trade or other event occurring after the end of the year, any necessary adjustment may be made, and so much of any repayment of tax as exceeded the amount repayable in the events that happened shall, if not otherwise made good, be recovered from the person by assessment under Case IV of Schedule D; and for the purpose of such assessment the amount of capital allowances by reference to which the repayment was made, or an appropriate part of that amount, shall be deemed to be income chargeable under the said Case IV for the year of claim.

322 Application to professions, etc.

322.—This Chapter applies, with any necessary adaptations, in relation to a profession or employment and in relation to the occupation of lands for the purposes of husbandry only or of woodlands, where, in either case, profits or gains arising from the occupation are, for the year of claim and the year of assessment for which the year of claim is the basis year, chargeable under Schedule D, as it applies in relation to a trade.

Chapter III Payments by Companies to Associated Companies in Respect of Losses

323 Interpretation.

323.—In this Chapter—

“accounting period” means, in relation to a company, a period for which the accounts of the company have been made up;

“auxiliary company” means a company incorporated not earlier than the 14th day of December, 1961, and not later than the 31st day of March, 1965, being a company—

• (a) of whose ordinary share capital—

• (i) a part is held beneficially by each of two or more companies, and

• (ii) not less than 95 per cent. is held beneficially by companies, and

• (b) which does not hold any stock, share or security issued by a company holding beneficially a part of such ordinary share capital;

“capital allowances” means allowances, other than allowances falling to be made in computing profits or gains, under section 241 or Part XIV, XV, XVI or XVII;

“company” means a body corporate resident in the State and carrying on a trade;

“deficiency payment” means a payment made to an auxiliary company by one of its principal companies under an agreement providing for the principal company to bear, or share in, losses or a particular loss sustained by the auxiliary company in a trade carried on by it, not being a payment which, apart from this Chapter, would fall to be taken into account in computing profits or gains or losses of either company or would fall to be treated as income of the auxiliary company;

“ordinary share capital” means, in relation to a company, all the issued capital (by whatever name called) of the company, other than capital the holders whereof have a right to a dividend at a fixed rate or a rate fluctuating in accordance with the rate of income tax, but have no other right to share in the profits of the company;

“principal company” means, in relation to an auxiliary company a company which holds beneficially a part of the ordinary share capital of that company;

“trade” means a trade carried on wholly or partly in the State.

324 Treatment of deficiency payments as trading receipts and trading expenses.

324.—(1) Subject to the provisions of this Chapter, where an auxiliary company—

• (a) has a deficiency in a trade for an accounting period, and

• (b) receives in relation to the trade a deficiency payment in respect of that period, being a deficiency payment in relation to which this subsection applies,

then, in computing for the purposes of income tax the profits or gains or losses of the company and of the principal company from which the payment was received, the payment shall be treated as a trading receipt of the auxiliary company, receivable by that company on the last day of the period, and shall be allowed as a deduction to the principal company as if it were a trading expense incurred on that day.

• (2) A deficiency payment in respect of an accounting period shall be a deficiency payment in relation to which subsection (1) applies if (but only if)—

• (a) at all times during the period—

• (i) the payee company was an auxiliary company, and

• (ii) the paying company was, in relation to the payee company, a principal company, and

• (b) the payment is made not later than three years after the end of the period.

• (3) If an auxiliary company receives in respect of an accounting period a deficiency payment or deficiency payments from one or more principal companies and the payment or the aggregate of the payments exceeds the deficiency in its relevant trade for that period, the excess shall be disregarded for the purposes of this Chapter; and, where payments by more than one principal company are in question, the payments shall be treated as abating in such manner as may be agreed between all the companies concerned or, in default of agreement, as may be determined by the Revenue Commissioners.

• (4) Where a deficiency payment is made to an auxiliary company in respect of more than one accounting period of that company or is made by a principal company carrying on more than one trade, the apportioned part of the payment to be attributed for the purposes of this Chapter to any period or trade shall be determined by the Revenue Commissioners.

325 Meaning of “deficiency”.

325.—(1) For the purposes of this Chapter—

• (a) a company has a deficiency in a trade for an accounting period if (but only if) the aggregate amount of—

• (i) any loss sustained in the trade in the period (computed in like manner as profits or gains under the provisions, other than this Chapter, applicable to Case I of Schedule D),

• (ii) any amounts referable to the period of capital allowances falling to be made in charging the profits or gains of the trade for any year of assessment of which the whole or a part is within the period, and

• (iii) any payments to which section 433 or 434 applies (other than payments to which section 434 applies by virtue of section 288) being payments made wholly and exclusively for the purposes of the trade and not deductible in computing the profits or gains or losses of the trade,

exceeds the aggregate amount of—

• (I) any profits or gains arising from the trade in the period (computed in accordance with the provisions, other than this Chapter, applicable to Case I of Schedule D), and

• (II) any amounts referable to the period of balancing charges under Part XVI falling to be made in charging the profits or gains of the trade for any year of assessment of which the whole or a part is within the period, and

• (b) if there is such an excess, the amount of the deficiency shall be taken as being equal to the amount of the excess.

• (2) For the purposes of this section the amount of an allowance or charge referable to a period shall be taken to be the amount thereof to be taken into account in computing for the purposes of corporation profits tax the profits of the company for that period.

326 Adjustment of assessments in certain cases.

326.—(1) Where under the foregoing provisions of this Chapter a deficiency payment, or part of a deficiency payment, made by a principal company falls to be treated as an expense of a trade incurred in an accounting period of which the whole or a part—

• (a) falls within the company's basis periods for more than one year of assessment, or

• (b) does not fall within the company's basis period for any year of assessment,

then, such adjustments, if any, shall be made—

• (i) in a case within paragraph (a), of the assessment for any year mentioned in that paragraph other than the first, or

• (ii) in a case within paragraph (b), of the assessment for the year next following the end of the said accounting period or, where the trade has been permanently discontinued before the beginning of that year, for the year in which the said accounting period ends,

as may be necessary to secure that, so far as may be, the aggregate of the amounts which, disregarding this Chapter, would be the final assessments on the company is reduced by an amount neither more nor less than the amount of the deficiency payment.

• (2) For the purposes of this section a company's basis period for a year of assessment is the period on the profits or gains of which income tax for that year falls to be finally computed under Case I of Schedule D in respect of the trade in question.

327 Method of giving effect to this Chapter.

327.—There shall be made such additional assessments, reductions of assessments or repayments of tax as may in any case be required in order to give effect to this Chapter; and where a deficiency payment reduces or extinguishes a loss in respect of which a company has received repayment of tax under section 307 or 311, so much of the repayment as would not have been made if the deficiency payment had been taken into account shall, if not otherwise made good, be recovered from the company by assessment under Case IV of Schedule D; and for the purpose of such assessment the deficiency payment, or an appropriate part thereof, shall be deemed to be income chargeable under the said Case IV for the year of assessment for which the repayment was made.

328 Restriction of relief for losses of auxiliary companies.

328.—This Chapter shall not have effect in relation to a loss sustained by an auxiliary company during an accounting period beginning more than five years after the date on which the company first commenced to trade; and where, after a trade has been set up or commenced by an auxiliary company, the trade, or a part of the trade, becomes carried on by any other company, the other company shall, for the purposes of this section, be deemed to have first commenced to trade on the same day as the first-mentioned company.

PART XX Relief to Investors in Irish Securities

Chapter I Stocks, Shares, and Securities of Companies other than Manufacturing Companies

329 Relief to investors.

329.—(1) Where an individual who is resident in the State and is not resident elsewhere claims and proves to the satisfaction of the Special Commissioners that he is entitled to the beneficial ownership of any stock, shares, or security to which this section applies, the following provisions shall have effect, that is to say—

• (a) such individual shall be entitled to repayment of 20 per cent. of the income tax applicable to any dividend or interest received by him in respect of such stock, shares, or security, save in so far as relief or repayment in respect of such tax has been or is granted under any other provision of this Act;

• (b) in estimating the total income from all sources of such individual for the purposes of income tax and sur-tax the amount of any dividend or interest in respect of such stock, shares, or security shall be deemed to be diminished by 20 per cent.

• (2) Subject to Chapter II of this Part and to the provisions of sections 330 and 331, this section shall apply to all stocks, shares, and securities issued for public subscription after the 4th day of August, 1932, in respect of which the Minister for Finance certifies that he is satisfied, after consultation with the Minister for Industry and Commerce, that all the following conditions are complied with in relation to such stock, share, or security, that is to say—

• (a) such stock, share, or security is or was issued by a company which complies with the following provisions that is to say, such company—

• (i) is incorporated by or under the laws of the State, and

• (ii) is a company limited by shares within the meaning of the Companies Act, 1963, and

• (iii) is managed and controlled in the State, and

• (iv) carries on or (in the case of a company which has not commenced to carry on business) intends to carry on its business wholly or mainly in the State; and

• (b) the capital raised by the issue of such stock, share, or security is or is intended to be or has been devoted to the establishment or extension in the State of one or more industries as defined by this section; and

• (c) no part of the said capital so raised is intended to be or is being or has been used for the purpose of acquiring (directly or indirectly) an existing business or any share or interest in an existing business or of purchasing investments, or of paying off existing loans or debentures; and

• (d) such issue of stock, shares, or security is so described and designated that it is readily distinguishable from all other (if any) issues of such company.

• (3) Every warrant, cheque, or order drawn or made for the payment of any dividend or interest in respect of any stock, share, or security to which this section applies shall indicate clearly either (as the case may require)—

• (a) that the whole of the sum for which such warrant, cheque, or order is drawn or made is a payment of or on account of dividend or interest in respect of such stock, share, or security; or

• (b) that a part (the amount of which is separately stated) of such sum is a payment of or on account of such dividend or interest.

• (4) Any stock, share, or security to which this section applies shall cease to be a stock, share, or security (as the case may be) to which this section applies if and when the Minister for Finance certifies in relation to such stock, share, or security that he is satisfied, after consultation with the Minister for Industry and Commerce, either—

• (a) that the company by which such stock, share, or security was issued has ceased to comply with the provisions set forth in subsection (2) (a), or

• (b) that the capital raised by the issue of such stock, share, or security has been or is being devoted wholly or partly to purposes other than the establishment or extension in the State of one or more industries as defined by this section, or

• (c) that such capital is being used wholly or partly in contravention of subsection (2) (c), or

• (d) that such issue of stock, shares, or security has ceased to be described and designated in accordance with subsection (2) (d), or

• (e) that subsection (3) is not being complied with in relation to such stock, share, or security.

• (5) In this section “industry” means any trade or business whatsoever save and except the purchase and sale of imported coal, the manufacture or distribution of gas for lighting, heating, or power, the carrying on, organisation, or conduct of road transport, the provision of amusement or entertainment of any kind, the holding (otherwise than by way of investment of reserve or subsidiary funds) of or dealing in stocks, shares, or securities, whether of all kinds or of any particular class or classes or of one or more particular companies.

330 Restriction of section 329.

330.—(1) In this section—

“qualified person” means a person who is a citizen of Ireland, and

“qualified holding company” means a company of which—

• (i) the issued shares are, to an extent exceeding one-half (in nominal value) thereof in the beneficial ownership of a qualified person or persons, and

• (ii) at least two-thirds (in nominal value) of every class of shares issued and carrying voting rights (whether immediate or to arise in certain future circumstances) are in the beneficial ownership of a qualified person or persons.

• (2) Section 329 shall not apply to any stock, share, or security issued after the 30th day of July, 1935, unless the certificate of the Minister for Finance under subsection (2) of that section certifies that (in addition to the conditions set out in the said subsection (2)) the following conditions are complied with in relation to such stock, share, or security, that is to say that such stock, share, or security is or was issued by a company of which—

• (a) a majority of the directors (other than a managing director giving the whole of his time to his duties as such director) are qualified persons, and

• (b) unless the company is a company licensed under the Insurance Act, 1936, to carry on assurance business, the issued shares are, to an extent exceeding one-half (in nominal value) thereof in the beneficial ownership of a person who is, or of two or more persons each of whom is, either a qualified person or a qualified holding company, and

• (c) at least two-thirds (in nominal value) of every class of shares issued and carrying voting rights (whether immediate or to arise in certain future circumstances) are in the beneficial ownership of a person who is, or of two or more persons each of whom is, either a qualified person or a qualified holding company.

• (3) Without prejudice to the provisions of section 329 (4) any stock, share, or security issued after the 30th day of July, 1935, to which section 329 applies shall cease to be a stock, share, or security (as the case may be) to which that section applies if and when the Minister for Finance certifies in relation to such stock, share, or security that he is satisfied, after consultation with the Minister for Industry and Commerce, that the company by which such stock, share, or security was issued has ceased to comply with the conditions set out in subsection (2) of this section.

331 Shares, etc., deemed to be issued for public subscription.

331.—(1) Where—

• (a) a company has issued any stocks, shares, or securities in respect of which a certificate under section 329 (2) has been given and continues to have effect, and

• (b) the company subsequently issues any stocks, shares, or securities—

• (i) offered or allotted to the holders as such, at or about the time of such subsequent issue, of the first-mentioned stocks, shares, or securities or of a particular class thereof, and

• (ii) so offered or allotted on a basis calculated by reference to the respective holdings of those holders,

the stocks, shares, or securities which the company subsequently issues as aforesaid shall, for the purposes of section 329, be deemed to be issued for public subscription.

• (2) Notwithstanding anything contained in section 329 (2) (b) (c) a certificate may be given under section 329 (2) in respect of any stocks, shares, or securities of a company which were or are issued as fully paid up and which, by virtue of subsection (1) of this section, are deemed to be issued for public subscription.

• (3) Where a certificate is given under section 329 (2) in respect of any stocks, shares, or securities relief or repayment under section 329 (1) shall not be granted in respect of any dividend or interest on the stocks, shares, or securities which was payable before the date of the certificate.

Chapter II Stocks, Shares, and Securities of Manufacturing Companies

332 Relief to investors.

332.—(1) Where an individual who is resident in the State and is not resident elsewhere claims and proves to the satisfaction of the Special Commissioners that he is entitled to the beneficial ownership of any stock, shares, or security to which this section applies, the following provisions shall have effect, that is to say:—

• (a) such individual shall be entitled to repayment of 20 per cent. of the income tax applicable to any dividend or interest received by him in respect of such stock, shares, or security, save in so far as relief or repayment in respect of such tax has been or is granted under any other provision of this Act;

• (b) in estimating the total income from all sources of such individual for the purposes of income tax and sur-tax the amount of any dividend or interest in respect of such stock, shares, or security shall be deemed to be diminished by 20 per cent.

• (2) This section shall apply to all stocks, shares, and securities issued whether before or after the passing of this Act by a company whose trade or business consists wholly or mainly of the production for sale of manufactured goods, and in respect of which the Revenue Commissioners certify that they are satisfied that all the following conditions are complied with in relation to such stock, share, or security, that is to say:

• (a) such stock, share, or security is or was issued by a company which complies with the following provisions, that is to say, such company—

• (i) is incorporated by or under the laws of the State, and

• (ii) is a company limited by shares within the meaning of the Companies Act, 1963, and

• (iii) is managed and controlled in the State, and

• (iv) carries on or (in the case of a company which has not commenced to carry on business) intends to carry on its business wholly or mainly in the State; and

• (b) the stocks, shares, or securities—

• (i) have been issued for public subscription, or

• (ii) belong to a class of the company's stocks, shares, or securities that is quoted on a stock exchange in the State, and the number of individuals as described in subsection (1) who are beneficial owners of stocks, shares, or securities of that class is not less than fifty; and

• (c) such issue of stock, shares, or security is so described and designated that it is readily distinguishable from all other (if any) issues of such company.

• (3) Every warrant, cheque, or order drawn or made for the payment of any dividend or interest in respect of any stock, share, or security to which this section applies shall indicate clearly either (as the case may require)—

• (a) that the whole of the sum for which such warrant, cheque, or order is drawn or made is a payment of or on account of dividend or interest in respect of such stock, share, or security; or

• (b) that a part (the amount of which is separately stated) of such sum is a payment of or on account of such dividend or interest.

• (4) Any stock, share, or security to which this section applies shall cease to be a stock, share, or security (as the case may be) to which this section applies if and when the Revenue Commissioners certify in relation to such stock, share, or security that they are satisfied that the company's trade or business has ceased to consist wholly or mainly of the production for sale of manufactured goods or that, as respects the company, all or any of the conditions set forth in subsection (2) (a) or, as respects such stock, share, or security, all or any of the conditions set forth in subsection (2) (b) (c), or in subsection (3), have ceased to be complied with.

• (5) Where—

• (a) the company has issued any stocks, shares, or securities in respect of which a certificate under subsection (2) has been given and continues to have effect, and

• (b) the company subsequently issues any stocks, shares, or securities—

• (i) offered or allotted to the holders as such, at or about the time of such subsequent issue, of the first-mentioned stocks, shares, or securities or of a particular class thereof, and

• (ii) so offered or allotted on a basis calculated by reference to the respective holdings of those holders,

the stocks, shares, or securities which the company subsequently issues as aforesaid shall, for the purposes of this section, be deemed to be issued for public subscription.

• (6) Where—

• (a) a company (in this subsection referred to as the holding company) holds beneficially more than 90 per cent. (in nominal value) of the issued stocks, shares, and securities of any other company or companies,

• (b) all of such stocks, shares, or securities are such as would qualify for a certificate of the Revenue Commissioners under subsection (2) but for paragraph (b) of that subsection, and

• (c) such holding is the sole or main business of the holding company,

subsections (2) and (4) shall, so long as the foregoing conditions subsist, have effect in relation to stocks, shares, and securities issued by the holding company as if the holding company were a company whose trade or business consisted wholly or mainly of the production for sale of manufactured goods.

• (7) Nothing in this section shall—

• (a) affect the validity of any certificate under section 329 (2) issued before the 18th day of July, 1957, or

• (b) in a case in which such a certificate has been so issued, prevent the issue of a certificate under section 329 (4).

• (8) Where a certificate is given under subsection (2) relief or repayment under subsection (1) shall not be granted in respect of any dividend or interest on the stocks, shares, or securities which was payable before the date of the certificate.

PART XXI Charitable and Other Exemptions

333 Rents of property belonging to hospitals and other charities.

333.—(1) Exemption shall be granted—

• (a) from income tax chargeable under Schedule A or, by virtue of Chapter VI of Part IV, under Schedule D, in respect of the rents and profits of any property belonging to any hospital, public school or almshouse, or vested in trustees for charitable purposes, so far as the same are applied to charitable purposes only:

Provided that any assessment upon the respective properties shall not be vacated or altered, but shall be in force and levied, notwithstanding the allowance of any such exemption;

• (b) from income tax chargeable under Schedule C in respect of any interest, annuities, dividends or shares of annuities, and from income tax chargeable under Schedule D, in respect of any yearly interest or other annual payment forming part of the income of any body of persons or trust established for charitable purposes only, or which, according to the rules or regulations established by statute, charter, decree, deed of trust, or will, are applicable to charitable purposes only, and so far as the same are applied to charitable purposes only;

• (c) from income tax chargeable under Schedule C in respect of any interest, annuities, dividends or shares of annuities, in the names of trustees applicable solely towards the repairs of any cathedral, college, church or chapel, or any building used solely for the purposes of divine worship, and so far as the same are applied to those purposes.

• (2)
• (a) This subsection applies to every gift (within the meaning of the Charities Act, 1961) made before the 1st day of July, 1961, which, if it had been made on or after that day would, by virtue of section 50 of that Act (which relates to gifts for graves and memorials) have been, to the extent provided in that section, a gift for charitable purposes.

• (b) Subsection (1) shall have effect in relation to a gift to which this subsection applies as if the gift had been made on or after the 1st day of July, 1961.

334 Lands owned and occupied, and trades carried on, by charities.

334.—(1) Exemption shall be granted—

• (a) from income tax chargeable under Schedule A in respect of property owned and occupied by a charity, not being such lands, tenements, or hereditaments as are mentioned in section 27;

• (b) from income tax chargeable under Schedule B in respect of lands occupied by a charity:

Provided that the exemption under this paragraph shall not apply in the case of lands which are occupied for the purpose of husbandry unless the profits, if any arising therefrom are applied solely to the purposes of the charity;

• (c) from income tax chargeable under Schedule D in respect of the profits of a trade carried on by any charity, if the profits are applied solely to the purposes of the charity and either—

• (i) the trade is exercised in the course of the actual carrying out of a primary purpose of the charity, or

• (ii) the work in connection with the trade is mainly carried on by beneficiaries of the charity.

• (2) The exemption granted by subsections (1) (a) and (1) (b) shall not extend to tax in respect of any rent payable or other annual payment to be made by a charity in respect of the lands, tenements, or hereditaments, or to any parts of those lands, tenements, or hereditaments, which are in the use and enjoyment of a person whose total annual income from all sources estimated in accordance with the provisions of this Act amounts to not less than £150.

• (3) In this section “charity” means any body of persons or trust established for charitable purposes only.

335 Friendly societies.

335.—An unregistered friendly society whose income does not exceed £160 shall be entitled to exemption from tax, and a registered friendly society which is precluded, by statute or by its rules, from assuring to any person a sum exceeding £300 by way of gross sum, or £52 a year by way of annuity, shall be entitled to exemption from tax under Schedules A, C, and D.

336 Trade unions.

336.—A registered trade union which is precluded, by statute or by its rules, from assuring to any person a sum exceeding £600 by way of gross sum, or £250 a year by way of annuity, shall be entitled to exemption from tax under Schedules A, C, and D in respect of its interest and dividends which are applicable and applied solely for the purpose of provident benefits.

In this section, “provident benefits” includes any payment, expressly authorised by the registered rules of the trade union, which is made to a member during sickness or incapacity from personal injury or while out of work, or to an aged member by way of superannuation, or to a member who has met with an accident, or has lost his tools by fire or theft, and includes a payment in discharge or aid of funeral expenses on the death of a member, or the wife of a member, or as provision for the children of a deceased member.

337 Savings Banks.

337.—(1) Any savings bank certified under the Trustee Savings Bank Acts, 1863 to 1958, shall be entitled to exemption from tax in respect of its interest and dividends—

• (a) arising from investments with the National Debt Commissioners, and

• (b) arising from investments of moneys to the credit of the special account opened in pursuance of section 31 (3) of the Finance Act, 1940.

• (2) Any savings bank, whether certified under the Trustee Savings Bank Acts, 1863 to 1958, or not, shall be entitled to exemption from tax under Schedules C and D in respect of the income of its funds, so far as such income is applied in the payment or credit of interest to any depositor:

Provided that—

• (a) any such interest shall be chargeable under Case III of Schedule D; and

• (b) where the interest paid or credited to any depositor in the year for which exemption is claimed by the bank exceeds the sum of £5, the bank and any branch thereof shall make a return to the inspector for the district in which the bank or branch is situate of the name and place of residence of every depositor to whom any such sum has been paid or credited, and of the amount thereof, and unless such returns are duly made, the bank shall not be entitled to any relief in respect of any such sums. Any such return shall be made on or before the 1st day of May in the year following that in respect of which exemption is claimed.

338 Relief for income from investments under Social Welfare Act, 1952.

338.—The Minister for Finance shall be entitled to exemption from tax in respect of the income derived from investments made under section 39 of the Social Welfare Act, 1952.

339 Repayment claims.

339.—(1) Any claim under sections 333 and 335 to 337 shall be made to the Special Commissioners in writing, in such form as may be prescribed by the Revenue Commissioners, and the Special Commissioners on proof of the facts to their satisfaction shall allow such claim accordingly.

• (2) The Special Commissioners shall require every such claim to be verified by affidavit, and proof of the claim may be given by the treasurer, trustee, or any duly authorised agent.

• (3) Where the Special Commissioners allow a claim they shall issue an order for repayment.

• (4) A person who makes a false or fraudulent claim for exemption under the said sections in respect of any interest, annuities, dividends or shares of annuities charged or chargeable under Schedule C shall forfeit the sum of £100.

340 Military and other pensions, gratuities and allowances.

340.—(1) Income to which this section applies shall be exempt from tax and shall not be reckoned in computing income for the purposes of this Act.

• (2) This section applies to—

• (a) (i) all wound and disability pensions, and all increases in such pensions, granted under the Army Pensions Acts, 1923 to 1962, or those Acts and any subsequent Act together with which those Acts may be cited;

• (ii) all gratuities in respect of wounds or disabilities similarly granted:

Provided that, where the amount of any pension to which subparagraph (i) applies is not solely attributable to disability, the relief conferred by this section shall extend only to such part as is certified by the Minister for Defence to be attributable to disability;

• (b) military gratuities and demobilisation pay granted to officers of the National Forces or the Defence Forces of Ireland on demobilisation;

• (c) (i) deferred pay, within the meaning of any regulations under the Defence Act, 1954, which is credited to the pay account of a member of the Defence Forces;

• (ii) gratuities granted in respect of service with the Defence Forces;

• (d) (i) every allowance granted under section 8 of the Army Pensions Act, 1923, or under section 12 of the Army Pensions Act, 1932, as amended by the Army Pensions Act, 1927, by the Army Pensions Act, 1937, or by the Army Pensions (Increase) Act, 1949, to the widow or to any child or dependant of a person who was killed during the Rising of April and May, 1916;

• (ii) any allowance granted under section 4 of the Army Pensions Act, 1953, to the widow, parent, sister or brother of a person who was killed during the Rising of April and May, 1916;

• (iii) any allowance payable under section 3 of the Army Pensions Act, 1937;

• (iv) any allowance payable under section 45 of the Army Pensions Act, 1953;

• (e) any yearly sum payable under section 1 of the Griffith Settlement Act, 1923;

• (f) the pension payable under section 1 of the MacSwiney (Pension) Act, 1950;

• (g) a pension payable under the Pensions Act, 1952.

• (3) In subsection (2) (d), “killed” has the same meaning as it has in section 8 of the Army Pensions Act, 1923.

341 Exemption of Commonwealth representatives.

341.—(1) Subject to the provisions of this section, exemption shall be granted from tax in respect of the emoluments payable by a Government to which this section for the time being applies to any person employed by such Government as a diplomatic or trade representative or other like representative in the State or as a member of the staff in the State of such representative and no account shall be taken of any such emoluments in estimating the amount of the income of such person for the purposes of this Act.

• (2) Exemption shall be granted to a person under this section in respect only of a period during which such person is shown to the satisfaction of the Revenue Commissioners to have been resident in the State solely for the purpose of performing the duties in respect of which the said emoluments are payable to him and not to have been exercising in the State any other trade, employment, or vocation.

• (3) If any person has paid tax from which he would be entitled to be exempted under this section he shall be entitled to repayment of such tax.

• (4) This section applies to every Government of the several countries comprised in the British Commonwealth of Nations in respect of which the Revenue Commissioners are for the time being satisfied that it gives to diplomatic and trade representatives of the Government of Ireland and the members of their staffs a similar exemption to that given by this section to the diplomatic and trade representatives of the first-mentioned Government and the members of their staffs.

342 Exemption of consular representatives.

342.—(1) Subject to the provisions of this section, exemption shall be granted from tax in respect of the emoluments payable by a foreign state to which this section applies to any person who, being a citizen of such foreign state, is permanently employed in the consular service of such state and is appointed to serve in the State and in respect of any income arising outside the State accruing to any such person, and no account shall be taken of any such emoluments or income in estimating the amount of income of such person for the purposes of this Act.

• (2) If any person has paid tax from which he would be entitled to be exempted under this section he shall be entitled to repayment of such tax.

• (3) This section applies to every foreign state in respect of which the Revenue Commissioners are for the time being satisfied that it gives to persons permanently employed in the consular service of the State a similar exemption to that given by this section to persons permanently employed in the consular service of such foreign state.

343 Exemption of harbour authorities.

343.—Exemption shall be granted from tax under Schedule D in respect of so much of the profits or gains of an authority controlling a harbour situate within the State as arise from the provision in that harbour of such facilities and accommodation for vessels, goods and passengers as are ordinarily provided by authorities controlling harbours, situate within the State, in those harbours.

344 Exemption of interest on certain deposits.

344.—(1) Where the total income of an individual for the year of assessment includes, or would but for this section include, any sums (in this section referred to as the said sums) paid or credited in respect of interest on deposits with a trustee savings bank, with the Post Office Savings Bank or with any of the commercial banks, the said sums shall be disregarded for all the purposes of this Act if or in so far as the said sums do not exceed £50, but the provisions of this Act as regards the making by the individual of a return of his total income shall apply as if this section had not been enacted.

• (2) For the purposes of subsection (1) the question whether or how far the said sums exceed £50 shall, where by virtue of section 192, a woman's income is deemed to be her husband's, be determined separately as regards the part of his income which is his by virtue of that section and the part which is his apart from that section.

• (3) Where any sums arising to an individual are, by virtue of this section, to be disregarded, the individual shall not be treated, by reason of such disregarding, as having ceased to possess the whole of a single source within the meaning of section 75.

• (4) In this section—

“total income” means total income from all sources as estimated in accordance with the provisions of this Act;

“the commercial banks” means the Bank of Ireland, the Hibernian Bank, Limited, the Munster and Leinster Bank, Limited, The National Bank of Ireland Limited, the Northern Bank, Limited, the Provincial Bank of Ireland, Limited, the Royal Bank of Ireland, Limited, the Ulster Bank, Limited, Ansbacher & Company, Limited, the Commercial Banking Company, Limited, Guinness & Mahon and the National City Bank, Limited;

“trustee savings bank” has the same meaning as in the Trustee Savings Banks Acts, 1863 to 1958.

345 Exemption of interest on certain securities.

345.—Income tax or sur-tax shall not be chargeable in respect of the interest on securities which are issued by the Minister for Finance for the purpose of being used in payment of income tax or sur-tax and such interest shall not be reckoned in computing income for the purposes of this Act.

346 Exemption of sweepstake profits.

346.—(1) Exemption shall be granted from tax under Schedule D in respect of the profits of any sweepstake held under the Public Hospitals Act, 1933, which, but for this section, would have been assessable under Case I of the said Schedule D on the organisers (within the meaning of the said Public Hospitals Act, 1933) of such sweepstake or on the sweepstake committee appointed in pursuance of that Act for the purpose of such sweepstake by the said organisers thereof.

• (2) In this section, “sweepstake” has the meaning given to it by section 1 of the Public Hospitals Act, 1933, for the purposes of that Act.

347 Carrying out of voluntary health schemes—deeming not to be trade.

347.—The business of carrying out under section 4 of the Voluntary Health Insurance Act, 1957, schemes of voluntary health insurance shall, for all the purposes of this Act in relation to the Voluntary Health Insurance Board, be deemed not to be a trade, and accordingly, in particular and without prejudice to the generality of the foregoing, that Board shall be exempt from income tax under Case I of Schedule D in respect of profits or gains arising from that business:

Provided that that Board shall be entitled to relief under section 307, as if the foregoing provisions of this section had not been enacted.

348 Exemption of profits of agricultural societies.

348.—(1) Any profits or gains arising to an agricultural society from an exhibition or show held for the purposes of the society shall, if they are applied solely to the purposes of the society, be exempt from income tax.

• (2) In this section “agricultural society” means any society or institution established for the purpose of promoting the interests of agriculture, horticulture, live-stock breeding, or forestry.

349 Exemption of bodies established for promotion of athletic or amateur games or sports.

349.—Exemption shall be granted from income tax in respect of so much of the income of any body of persons established for the sole purpose of promoting athletic or amateur games or sports as is shown to the satisfaction of the Revenue Commissioners to be income which has been or will be applied to that purpose.

350 Exemption of profits from lotteries.

350.—Exemption from income tax shall be granted in respect of profits from a lottery to which a licence under Part IV of the Gaming and Lotteries Act, 1956, applies.

351 Exemption of sewers.

351.—(1) Income tax shall not be charged in respect of a sewer vested in a local authority:

Provided that the foregoing exemption shall not extend to any rent payable or other annual payment to be made by the local authority in respect of the sewer.

• (2) In this section—

“sewer” means a sewer maintained by a local authority in pursuance of their statutory duties in relation to the public health;

“local authority” means a public body having power under any enactment relating to the public health to construct and maintain sewers.

352 Exemption of air raid protection works.

352.—(1) Exemption shall be granted from tax under Schedule A in respect of any hereditament which is not let in whole or in part and, pursuant to subsection (3) of section 59 of the Air-raid Precautions Act, 1939, is not rated.

• (2) Where in ascertaining under the Valuation Acts the valuation of a hereditament which is a mill, factory, or other similar premises, no regard is, pursuant to subsection (2) of section 59 of the Air-raid Precautions Act, 1939, to be had to any room or other part of such hereditament or to any structural alterations or improvements to such hereditament, the amount of any deduction to be allowed under section 65 shall be increased by an amount equal to one-sixth of the difference between the annual value of such hereditament and the annual value of such hereditament estimated on the basis that regard is to be had to (as the case may be) such room or other part or such structural alterations or improvements.

353 Exemption of income from scholarships.

353.—(1) Income arising from a scholarship held by a person receiving full-time instruction at a university, college, school, or other educational establishment, shall be exempt from tax and no account shall be taken of any such income in computing the amount of income for the purposes of this Act.

• (2) In this section “scholarship” includes an exhibition, bursary, or any other similar educational endowment.

• (3) If any question arises whether any income is income arising from a scholarship held as aforesaid, the Revenue Commissioners may consult the Minister for Education.

354 Exemption of children's allowances.

354.—A children's allowance under the Social Welfare (Children's Allowances) Acts, 1944 to 1963, or those Acts and any subsequent Act together with which those Acts may be cited, shall be exempt from tax and shall not be reckoned in computing income for the purposes of this Act.

PART XXII Relief from Double Taxation

355 Agreements relating to Northern Ireland and Great Britain.

355.—(1) The confirmation, by section 2 of the Finance Act, 1926, section 8 of the Finance Act, 1928, section 2 of the Finance Act, 1948, section 10 of the Finance Act, 1959, and section 34 of the Finance Act, 1960, of the agreements in force at the commencement of this Act between the State and the United Kingdom which are set forth in Schedule 6, Part I, is not affected by the repeal, by this Act, of those sections.

• (2) Accordingly the first of the said agreements, as modified by the second, third, fourth and fifth of the said agreements, shall, for any year of assessment for which, under the law of the United Kingdom, it has effect with respect to exemption and relief from United Kingdom tax, have effect with respect to exemption or relief to be granted from Irish tax, and the references in the said agreements to enactments repealed by this Act shall be taken for that purpose to be references to the corresponding provisions of this Act:

Provided that, in Article 2(1) of the first of the said agreements, as amended by Article 2 of the second of the said agreements, the references to section 27 of the Finance Act, 1920, shall be taken for the said purpose to be references to Schedule 6, Part II, which re-enacts the provisions of the said section 27 with the amendments made therein by subsequent enactments and with certain omissions and adaptations of provisions and phrases which have become inapt or unnecessary.

• (3) For the purpose of giving effect to the said agreements, this Act, in relation to—

• (a) persons resident in the State, whether or not also resident in Northern Ireland or Great Britain; and

• (b) claims by persons resident in Northern Ireland or Great Britain,

shall, for any year for which the said agreements are in force, have effect subject to the modifications set out in Schedule 6, Part III.

• (4) For the purpose of carrying out any obligation under Article 2 of the Agreement of the 23rd June, 1960, set forth in Schedule 6, Part I, the Government may by order direct that any provisions of this Act specified in the order, being provisions affecting in any way exemptions from income tax of persons resident in the State, shall not affect, and be deemed not to have affected, exemptions from income tax which persons enjoy as not resident in the State but resident in the United Kingdom, and any such order shall have effect accordingly.

356 Further relief for certain double residents.

356.—Where the Revenue Commissioners are satisfied in respect of any person—

• (a) that such person is entitled under Article 2 of the Agreement made 25th April, 1928, set forth in Schedule 6, Part I, to be allowed relief from double taxation for any particular year, and

• (b) that the principal place of abode of such person for the said year was situate in Northern Ireland or Great Britain, and

• (c) that such person did not in the said year spend in the aggregate more than six months in the State, and

• (d) that the total amount of income tax and sur-tax (including British as well as Irish income tax and sur-tax) payable by such person for the said year after deduction of all such relief from double taxation as aforesaid exceeds the total amount of British income tax and sur-tax which would have been payable by such person for the said year if he had not been resident in the State for that year,

the Revenue Commissioners may grant to such person such further relief from Irish income tax and sur-tax as in their opinion is just, but not exceeding the amount by which the total amount of income tax and sur-tax (including British as well as Irish income tax and sur-tax) mentioned in paragraph (d) exceeds the total amount of British income tax and sur-tax mentioned in that paragraph.

357 Allowance of United Kingdom corporation tax as a credit against income tax.

357.—(1) In this section and Schedule 7—

“company” means any body corporate;

“corporation tax” means the tax in Northern Ireland and Great Britain known as corporation tax;

“profits” in relation to income tax means income.

• (2) Subject to the provisions of Schedule 7, corporation tax payable in respect of profits arising in Northern Ireland or Great Britain shall, to the extent to which it is to be taken into account for the purposes of this section, be allowed as a credit against the income tax chargeable for any year of assessment by reference to those profits.

• (3) Where a dividend is paid by a company resident in Northern Ireland or Great Britain to a company which beneficially owns, directly or indirectly, not less than three-quarters of the ordinary share capital of the former company, the credit shall take into account the corporation tax payable by the former company in respect of its profits.

• (4) The corporation tax payable in respect of any profits shall be taken into account for the purposes of this section—

• (a) where the profits are subject to corporation profits tax, only to the extent that it cannot, on due claim having been made in that behalf, be allowed as a credit against corporation profits tax, or

• (b) where the profits are not subject to corporation profits tax, only to the extent that it could not, on due claim having been made in that behalf, have been allowed as a credit against corporation profits tax if the profits had been subject to that tax as profits of a company incorporated by or under the laws of the State.

• (5) In a case in which relief is allowed under this section, section 363 (3) shall have effect in relation to a dividend paid before the passing of the Finance Act, 1966, as it has effect in relation to a dividend paid before the making by the Government of an order to which section 361 (1) relates.

358 Convention with United States of America.

358.—(1) The confirmation, by section 12 of the Finance Act, 1950, of the Convention set forth in Schedule 8 and concluded on the 13th day of September, 1949, between the Government of Ireland and the Government of the United States of America is not affected by the repeal, by this Act, of the said section 12.

• (2) For the purpose of giving effect to the Convention, the provisions set forth in Schedule 10 shall have effect.

• (3) The Revenue Commissioners may from time to time make regulations in relation to the granting of the reliefs specified in the Convention and may, in particular, by those regulations provide—

• (a) for securing that no such reliefs from taxation imposed by the laws of the United States of America as are provided for in the Convention shall enure to the benefit of persons not entitled thereto, and

• (b) for authorising, in cases where tax deductible from any periodical payment has, in order to comply with the terms of the Convention, not been deducted and it is discovered that the Convention does not apply to that payment, the recovery of the tax by assessment on the person entitled to the payment or by deduction from subsequent payments.

359 Relief in respect of ships documented under laws of United States of America.

359.—Exemption shall be granted from tax in respect of so much of the income of a citizen of the United States of America not resident in the State or of a corporation organised in the United States of America as is derived from the operation of a ship or ships documented under the laws of the United States of America.

360 Agreement with Canada.

360.—(1) The confirmation, by section 14 of the Finance Act, 1955, of the Agreement set forth in Schedule 9 and concluded on the 28th day of October, 1954, between the Government of Ireland and the Government of Canada is not affected by the repeal, by this Act, of the said section 14.

• (2) For the purpose of giving effect to the Agreement the provisions set forth in Schedule 10 shall have effect.

• (3) The Revenue Commissioners may from time to time make regulations in relation to the granting of the reliefs specified in the Agreement and may, in particular, by those regulations provide—

• (a) for securing that no such reliefs from taxation imposed by the laws of Canada as are provided for in the Agreement shall enure to the benefit of persons not entitled thereto, and

• (b) for authorising, in cases where tax deductible from any periodical payment has, in order to comply with the terms of the Agreement, not been deducted and it is discovered that the Agreement does not apply to that payment, the recovery of the tax by assessment on the person entitled to the payment or by deduction from subsequent payments.

361 Agreements for relief from double taxation of income.

361.—(1) If the Government by order declare that arrangements specified in the order have been made with the government of any territory outside the State in relation to affording relief from double taxation in respect of income tax, sur-tax or corporation profits tax and any taxes of a similar character, imposed by the laws of the State or by the laws of that territory, and that it is expedient that those arrangements should have the force of law, then, subject to the provisions of this Part, the arrangements shall, notwithstanding anything in any enactment, have the force of law.

• (2) The provisions of Schedule 10 shall have effect where arrangements which have the force of law by virtue of this section provide that tax payable under the laws of the territory concerned shall be allowed as a credit against tax payable in the State.

• (3) Any arrangements to which the force of law is given under this section may include provision for relief from tax for periods before the passing of this Act or before the making of the arrangements and provisions as to income which is not itself subject to double taxation, and the preceding provisions of this section shall have effect accordingly.

• (4) For the purposes of subsection (1), arrangements made with the head of a foreign state shall be regarded as made with the government thereof.

• (5) Any order made under this section may be revoked by a subsequent order and any such revoking order may contain such transitional provisions as appear to the Government to be necessary or expedient.

• (6) Where an order is proposed to be made under this section, 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.

• (7) Where any arrangements have the force of law by virtue of this section, the obligation as to secrecy imposed by any enactment shall not prevent the Revenue Commissioners or any authorised officer of the Revenue Commissioners from disclosing to any authorised officer of the government with which the arrangements are made such information as is required to be disclosed under the arrangements.

• (8) The Revenue Commissioners may from time to time make regulations generally for carrying out the provisions of this section or any arrangements having the force of law thereunder and may, in particular, but without prejudice to the generality of the foregoing, by those regulations provide—

• (a) for securing that relief from taxation imposed by the laws of the territory to which any such arrangements relate does not enure to the benefit of persons not entitled thereto, and

• (b) for authorising, in cases where tax deductible from any periodical payment has, in order to comply with any such arrangements, not been deducted and it is discovered that the arrangements do not apply to that payment, the recovery of the tax by assessment on the person entitled to the payment or by deduction from subsequent payments.

362 Relief on profits from business of sea or air transport.

362.—(1) In this section—

“business of sea or air transport” means the business of transporting persons, goods or mail carried on by the owner or charterer of ships or aircraft;

“arrangement to which this section applies” means an arrangement entered into by the Government with the government of a foreign state with a view to affording relief from double taxation in cases where income derived from the business of sea or air transport is chargeable both in the State and in the foreign state to income tax, or to any tax corresponding to income tax, or to any other tax on profits, whether such arrangement is to afford relief as from the date when it is entered into, a date after that date or a date before that date.

• (2) For the purposes of this section, an arrangement made with the head of a foreign state shall be regarded as made with the government thereof.

• (3) Subject to subsections (4) and (5), the Government may by order confirm and give the force of law to an arrangement to which this section applies.

• (4) Where an order is proposed to be made under this section, 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.

• (5) Where an order is made under this section, the arrangement to which it relates shall have the force of law only if and so long as such arrangement, in so far as it relates to the relief to be granted by the foreign state, has the force of law in that state.

363 Treatment of dividends for double taxation relief in certain cases.

363.—(1) In this section—

“dividend” means a dividend from which deduction of tax is authorised by section 456;

“the company” means a body of persons paying a dividend;

“double taxation relief” means any credit for tax (other than British income tax) payable in any territory outside the State, which is allowable against Irish income tax by virtue of section 357 or of any international agreement having the force of law, including any such credit which has been taken into account in relation to any dividends receivable by the company;

“the reduced Irish rate” means the rate of Irish income tax payable directly or by deduction by the company after taking double taxation relief into account.

• (2)
• (a) Notwithstanding anything in this Act, no relief or repayment in respect of the tax deducted or authorised to be deducted from any dividend shall, in a case in which there is double taxation relief, be allowed at a rate exceeding the reduced Irish rate.

• (b) Where the reduced Irish rate falls to be computed in relation to a dividend, the particulars to be given by the company in the statement required by sections 457 and 458 shall (in addition to the particulars required to be given apart from this section) include particulars of the reduced Irish rate.

• (3) Where (whether before or after the passing of this Act) a dividend has been paid before the making by the Government of an order to which section 361 (1) relates, and any double taxation relief would have fallen to be taken into account in relation to that dividend if this section had applied thereto, that relief shall be taken into account as far as possible in determining the reduced Irish rate in relation to the first dividend payable by the company after the making of the order, and any part of that relief which cannot be so taken into account shall as far as possible be taken into account in relation to the next succeeding dividend, and so on.

• (4) Where the whole or any part of any annual payment is payable out of a dividend, and the rate of relief or repayment allowable in respect of the tax deducted or authorised to be deducted from the dividend is affected by double taxation relief, the annual payment, or that part thereof, as the case may be, shall be deemed to be paid out of profits or gains not brought into charge to tax and section 434 shall apply accordingly, but the tax recoverable under section 434 from the person making the payment shall be reduced by an amount equal to tax on the payment or part of the payment at the reduced Irish rate applicable to the dividend.

364 Determination of “reduced Irish rate” for section 363.

364.—(1) In this section, “the reduced Irish rate”, “double taxation relief”, “the company” and “dividend” have the same meaning as in section 363.

• (2) The reduced Irish rate in relation to any dividend shall be taken to be the rate which is produced by deducting—

• (a) the rate of double taxation relief for the period for which the dividend is paid, from

• (b) the rate of tax authorised to be deducted from the dividend by section 456.

• (3) Subject to any adjustment which is required by section 363 (3) or by subsection (4) of this section, the rate of double taxation relief for the period for which the dividend is paid shall be taken to be—

• (a) in the case of a dividend paid for a period which falls wholly within any year of assessment, the rate which is produced by dividing the double taxation relief for that year of assessment by a sum consisting of the total income of the company as computed for income tax purposes for that year reduced by the amount of any income the income tax upon which the company is entitled, otherwise than under section 456, to charge against any other person;

• (b) in the case of a dividend paid for a period which falls partly within one year of assessment and partly within another year of assessment or other years of assessment, the rate which is produced by determining, in relation to each of those years,—

• (i) the rate which would have been applicable if the dividend had been paid for a period falling wholly within that year, and

• (ii) the portion of that rate which bears the same proportion to that rate as the part of the period for which the dividend is paid which falls within that year bears to the whole period,

and then aggregating the portions so determined.

• (4) Where any matter affecting the calculation of the rate of double taxation relief has not been fully determined at the time when the reduced Irish rate falls to be determined in relation to any dividend, the rate of double taxation relief shall be estimated according to the best of the information available at the time, and, if it is subsequently found that the rate so estimated was excessive or deficient, the appropriate adjustment shall be made in determining the reduced Irish rate applicable to the next subsequent dividend on the occasion of which it is practicable to make the adjustment, and shall be made by reducing or, as the case may be, increasing the rate of double taxation relief, as calculated for the purposes of that subsequent dividend in accordance with the foregoing subsection, by a rate which bears the same proportion to the excess or deficiency in the rate applicable to the first-mentioned dividend as the total amount of the first-mentioned dividend bears to the total amount of that subsequent dividend.

• (5) Where the double taxation relief for any year of assessment includes any credit which has been taken into account for the purposes of determining the reduced Irish rate applicable to any dividends received by the company, the amount of that credit shall be taken to be the sum of the amounts which are produced by applying to each such dividend the rate which represents the excess of the rate of tax authorised to be deducted from that dividend by section 456 over the reduced Irish rate applicable to that dividend.

• (6) For the purposes of this section, a dividend which is not expressed to be paid for any specified period shall be deemed to be paid for the last period for which accounts of the company were made up which ended before the dividend became payable.

365 Relief for foreign income tax in certain cases.

365.—(1) Where an individual has paid under this Act by deduction or otherwise, or is liable under this Act to pay, income tax, or income tax and sur-tax, for any year of assessment in respect of any part of his income arising in a country to which this section applies and shows to the satisfaction of the Revenue Commissioners—

• (a) that he has paid external income tax in the said country in respect of the said part of his income, and

• (b) that he was, prior to the said year of assessment, resident in the said country to which this section applies for a continuous period of not less than ten years or for a number of discontinuous periods amounting in the aggregate to not less than ten years or, where the said part of his income arises in any one (hereinafter referred to as the particular country) of the countries coming under the description lastly set forth in subsection (3), that he was, prior to the said year of assessment, resident in any two or more, one of which is the particular country, of the countries coming under the said description for periods amounting in the aggregate to not less than ten years, and