Income Tax Act , 1967

(2) Notwithstanding that subsection (2) of the said section 11 no longer has effect, section 387 shall apply to a dividend paid by the company after the commencement of this Act in a case in which the dividend is paid out of profits the net income tax on which has been reduced by virtue of the said section 11.

(3) For the purpose of applying section 387 to any such dividend the day on which the company commenced to carry on the trade of working the existing mine or the 6th day of April, 1954 (whichever is the later) shall be taken to be the commencement day.

(4) (a) There shall be excluded from the application of section 387 any dividend paid by the company out of profits of the existing mine as respects which the dividend period is a period prior to the 6th day of April, 1956, and, in the case of any such dividend as respects which the dividend period consists of a part prior to the 6th day of April, 1956, and a part subsequent to the 5th day of April, 1956, there shall be excluded from the application of that section such part of the dividend as is referable to the part of the dividend period prior to the 6th day of April, 1956, but the foregoing provisions of this paragraph are without prejudice to the entitlement of the company to deduct income tax from any such dividend or any such part of a dividend.

(b) In paragraph (a) “dividend period” means the period out of profits of which a dividend is paid.

392 Change of company.

392.—Where—

(a) a company (hereafter in this section referred to as the original company) ceases after the 5th day of April, 1956, to carry on the trade of working a qualifying mine to profits of which this Chapter had applied immediately prior to the date of cessation, and

(b) another company (hereafter in this section referred to as the later company) subsequently commences to carry on such a trade in relation to the mine,

the later company, if it is incorporated in the State and resident therein for the purposes of income tax, shall be given relief, from the payment of its net income tax referable to its profits from the said trade, to the same extent (but only to the same extent), and for the same years (but only for the same years), as would have been proper if the original company had not ceased to carry on the said trade and if the said net income tax, instead of being chargeable on the later company, were chargeable on the original company, and the provisions of this Chapter shall, for the purposes of this section, apply with any necessary modifications.

Chapter III Profits from Coal-Mining Operations

393 Definitions.

393.—In this Chapter—

“coal-mining operations” means coal-mining operations (by underground or opencast excavation) within the State, whether before or after the passing of this Act, but only in so far as the production of coal results or has resulted therefrom;

“existing coal-mining operations” means coal-mining operations which, at any time during the period of one year ending on the 30th day of September, 1956, have resulted in the production of coal;

“production” means production in reasonable commercial quantities with a view to the realisation of profits.

394 General restriction on relief.

394.—Relief under this Chapter shall be given in respect only of income or profits of a company, incorporated in the State and resident therein for the purposes of income tax, derived from existing coal-mining operations.

395 Relief—existing coal-mining operations.

395.—(1) For each relevant year of assessment, income tax payable in respect of income, computed in accordance with this Act, from existing coal-mining operations, in so far as such income is referable to the income tax excess, shall be reduced by 50 per cent.

(2) In computing, for the purpose of assessment to income tax, the amount of the profits from existing coal-mining operations, any corporation profits tax which, by virtue of section 8 (2) of the Finance (Miscellaneous Provisions) Act, 1956, is not payable, shall be deemed to have been paid.

(3) (a) In this section—

“basis period” means the period on the profits or gains of which income tax in respect of the existing coal-mining operations is finally computed under Case I of Schedule D for the relevant year of assessment;

“income tax excess” means the excess of the volume of output of coal resulting from the existing coal-mining operations in the basis period for a relevant year of assessment over the standard output of coal;

“relevant year of assessment” means each of the ten consecutive years of assessment of which the first is such one of the three years of assessment commencing on the 6th day of April, 1957, the 6th day of April, 1958, and the 6th day of April, 1959, respectively, as the company in question elects or, in default of election, the year commencing on the 6th day of April, 1959, subject to the proviso that, in any case in which the standard output of coal is the volume of output of coal in the twelve months ending on the 30th day of September, 1956, the year of assessment commencing on the 6th day of April, 1957, shall not be a relevant year of assessment if the basis period in relation thereto commences on a day prior to the 1st day of October, 1955;

“standard output of coal” means the volume of output of coal from the existing coal-mining operations in the twelve months ending on the 30th day of September, 1956, or, if the company in question so elects, in the twelve months ending on the 30th day of September, 1955.

(b) Where, for the purpose of ascertaining the income tax excess, it is necessary to compare, with the standard output of coal, the volume of output of coal in a period of less than twelve months, the standard output of coal shall, for the purpose of the comparison, be deemed to be such part thereof as bears to the whole the same proportion as that period bears to twelve months.

396 Dividends.

396.—(1) Where, under section 456, a company is entitled to deduct income tax from any dividend, tax shall not in any case be deducted at a rate exceeding the rate of the income tax as reduced by any relief from that tax given under this Chapter or section 7 of the Finance (Miscellaneous Provisions) Act, 1956, or section 32 of the Finance Act, 1960, and the provisions of section 457 shall apply accordingly, with any necessary modifications.

(2) The rate of income tax at which any repayment of income tax for any year of assessment falls to be made shall be subject to such adjustments as may be proper in cases in which relief is given under or by virtue of this Chapter or section 7 of the Finance (Miscellaneous Provisions) Act, 1956, or section 32 of the Finance Act, 1960.

(3) No relief from income tax shall be granted under this Chapter in respect of any income the income tax on which a company is, otherwise than under section 456, entitled to charge against any other person or to deduct, retain or satisfy out of any payment to any other person.

(4) Where, by virtue of subsection (1), income tax is deducted from a dividend at a reduced rate, the amount to be included in respect of the dividend in any return for the purpose of sur-tax shall be an amount which bears the same proportion to the amount of the dividend as the rate of income tax deducted therefrom bears to the rate which would have been authorised to be deducted if this section had not been enacted.

397 Appeals.

397.—An appeal to the Special Commissioners shall lie on any question arising under this Chapter in like manner as an appeal would lie against an assessment to income tax, and the provisions of this Act relating to appeals shall apply and have effect accordingly.

Chapter IV Profits from Export of Certain Goods

398 Definitions generally.

398.—In this Chapter—

“basis period” means the period on the profits or gains of which income tax in respect of a company's trade is finally computed under Case I of Schedule D for the year of claim;

“company” means (save for the purposes of the proviso to section 399 (1)) a body corporate which in the course of its trade exports goods out of the State.

399 Meaning of “goods”.

399.—(1) In this Chapter, “goods” means goods manufactured within the State by the person who exports them or some of them and who in relation to the relevant basis period is the company claiming relief under this Chapter:

Provided that where there are two companies one of which manufactures goods and the other of which exports them and where one of the companies holds more than 90 per cent. of the ordinary shares in the other company or where persons who have a controlling interest in one company hold, either directly or indirectly, more than 90 per cent. of the ordinary shares in the other company, the goods manufactured by one of the companies shall, when exported by the other company, be deemed to be manufactured by that other company.

(2) The definition of “goods” contained in subsection (1) shall include—

(a) fish produced within the State on a fish farm; and

(b) cultivated mushrooms, cultivated within the State,

and, in a case in which books or greeting cards are printed within the State otherwise than by their publisher and they or some of them are exported by their publisher (not being a case to which the proviso to subsection (1) applies), the books or greeting cards, as the case may be, shall be regarded, for the purposes of subsection (1), as having been manufactured within the State by their publisher.

(3) (a) The definition of “goods” contained in subsection (1) shall include goods manufactured within the State which do not come within that definition and which are exported by the person who in relation to the relevant basis period is the company claiming relief under this Chapter where the selling by such person of the goods so exported is selling by wholesale.

(b) “Selling by wholesale” in paragraph (a) means selling goods of any class to a person who carries on a business of selling goods of that class or who uses goods of that class for the purposes of a trade or undertaking carried on by him.

400 Ship building and repair.

400.—(1) In the case of a company carrying on the trade of building or repairing ships, the following provisions shall apply for the purposes of relief from income tax under this Chapter:

(a) repairs carried out within the State to a ship shall be regarded as the manufacture within the State of goods and, to the extent to which any such repairs have been carried out within the State to a ship which is wholly owned by persons who are not ordinarily resident in the State, the ship shall be regarded as goods which are manufactured within the State and exported by the person who manufactures them and any amount receivable in payment for repairs carried out within the State to a ship shall be regarded as an amount receivable from the sale of goods;

(b) where, as respects any year of assessment, the company, by notice in writing given to the inspector within twelve months after the end of that year, so elects, this Chapter shall apply in the case of that year—

(i) as if all ships built by the company within the State had been exported by the company,

(ii) as if all ships to which repairs were carried out by the company within the State were, to the extent of such repairs, goods exported by the company, and

(iii) as if amounts receivable by the company in payment for the building within the State or of the repair within the State of ships were amounts receivable from the sale of goods exported by the company out of the State.

(2) In subsection (1) (a) (b) any reference to repair or building includes a reference to repair or building effected at any time.

401 Goods exported by the Pigs and Bacon Commission and An Bord Bainne.

401.—(1) Where, whether before or after the passing of this Act—

(a) a company, in compliance with a requirement under section 23 of the Pigs and Bacon (Amendment) Act, 1961, sells bacon to the Pigs and Bacon Commission, and

(b) the bacon is exported out of the State by or on behalf of the Commission,

this Chapter shall apply as if the bacon had been exported out of the State by the company, and any amount receivable by the company from the sale of the bacon to the Commission shall be deemed for the purposes of this Chapter to be an amount receivable from the sale of goods so exported.

(2) Where, whether before or after the passing of this Act—

(a) by virtue of an order under section 57 of the Dairy Produce Marketing Act, 1961, a company which manufactures a milk product within the meaning of that Act other than butter—

(i) is totally prohibited from exporting the product, or

(ii) is prohibited from exporting the product to any specified country or countries,

(b) the product is sold by the company to An Bord Bainne (hereafter in this subsection referred to as the Board), and

(c) in a case in which paragraph (a) (i) applies, the product is exported by the Board or, in a case in which paragraph (a) (ii) applies, the product is exported by the Board to the specified country or any of the specified countries, this Chapter shall apply as if the product had been exported out of the State by the company, and any amount receivable by the company from the sale of the product to the Board shall be deemed for the purposes of this Chapter to be an amount receivable from the sale of goods so exported.

(3) For the purposes of subsection (2), exportation shall be deemed not to be prohibited unless the Minister for Agriculture and Fisheries certifies that he is not prepared to license it.

402 Year of claim.

402.—In this Chapter “year of claim” means each of ten consecutive years of assessment of which the first is such one of the three years of assessment commencing on the 6th day of April, 1957, the 6th day of April, 1958, and the 6th day of April, 1959, respectively, as elected by the company or, in default of election, the year commencing on the 6th day of April, 1959, but, in any case in which the standard period is the period of one year ending on the 30th day of September, 1956, the year of assessment commencing on the 6th day of April, 1957, shall not be a year of claim if the basis period in relation thereto commenced on a day prior to the 1st day of October, 1955:

Provided that—

(a) in relation to a company which exports goods on or after the 6th day of April, 1960, and has not exported goods before that date, “year of claim” means each of ten consecutive years of assessment of which the first is either the earliest year of assessment for which income tax under Case I of Schedule D in respect of the company's trade is finally computed on the profits or gains of a period in which the company exports goods or the next succeeding year of assessment, as elected by the company, or, in default of election, the said succeeding year of assessment, but the year 1980-81 or any subsequent year of assessment shall in no case be a year of claim, and

(b) in relation to a company which—

(i) exports goods,

(ii) is not a company referred to in paragraph (a) of this proviso,

(iii) has not made and would not have been entitled to make a claim under subsections (1) to (4) of section 404 in respect of the year 1959-60 or any earlier year of assessment, and

(iv) would not, but for section 399 (3), be entitled to make a claim under subsections (1) to (4) of section 404,

“year of claim” means each of ten consecutive years of assessment of which the first is either the year 1960-61 or the year 1961-62, as elected by the company, or, in default of election, the year 1961-62.

403 Standard period.

403.—The standard period in relation to a company's trade shall, for the purposes of this Chapter, be the period of one year ending on the 30th day of September, 1956, or, if so elected by the company, the period of one year ending on the 30th day of September, 1955, and that standard period shall be applicable in relation to the trade whether or not, during the whole or part of that standard period, the trade was carried on by a person other than the company by which it is carried on in the year of claim or separate parts of the trade were carried on by different persons, but that standard period shall not be applicable where the trade was not in existence before the end of that standard period.

404 Basis of relief from tax.

404.—(1) Where a company claims and proves as respects any year of claim—

(a) that, during the standard period in relation to the trade, goods were, in the course of the trade, exported out of the State,

(b) that, during the basis period, goods were, in the course of the trade, exported out of the State, and

(c) that the total amount receivable from the sale of the last-mentioned goods was in excess of the total amount receivable from the sale of the goods exported during the standard period,

income tax payable by the company for the year of claim, so far as it is referable to the profit attributable to the said excess, shall be reduced to nil.

(2) Subject to subsection (5), “the profit attributable to the said excess” shall, for the purposes of subsection (1), be taken to be such sum as bears to the amount of the company's profits for the year of claim, computed in accordance with this Act, which is attributable to the sale of goods (whether exported or not), the same proportion as the amount of the said excess bears to the total amount receivable by the company from such sale in the basis period.

(3) Where a company claims and proves as respects any year of claim—

(a) that, during the standard period in relation to the trade, no goods were, in the course of the trade, exported out of the State or that the standard period is not applicable, and

(b) that, during the basis period, goods were, in the course of the trade, exported out of the State,

income tax payable by the company for the year of claim, so far as it is referable to the profit on the sale of the goods so exported shall be reduced to nil.

(4) Subject to subsection (5), “the profit on the sale of the goods so exported” shall, for the purposes of subsection (3), be taken to be such sum as bears to the amount of the company's profits for the year of claim, computed in accordance with this Act, which is attributable to the sale of goods (whether exported or not), the same proportion as the amount receivable in the basis period from the sale of goods exported bears to the total amount receivable by the company from the sale of goods (whether exported or not) in the basis period.

(5) In a case in which the preceding provisions of this section apply, and the export out of the State in the relevant basis period consisted of or included goods with respect to which section 399 (3) provides for the inclusion thereof in the definition of “goods”, this Chapter shall have effect subject to the insertion, in subsections (2) and (4), of “and of merchandise (whether exported or not) other than such goods” after “goods (whether exported or not)” wherever the latter words occur.

(6) In relation to a company which has obtained relief under subsection (1) or (3), this section shall apply as respects the five consecutive years of assessment the first of which is the year of assessment immediately following the company's last year of claim as if—

(a) each of those years were a year of claim, and

(b) for “shall be reduced to nil” in subsections (1) and (3) there were substituted—

(i) in the case of the first of those years, “shall be reduced by 80 per cent.”,

(ii) in the case of the second of those years, “shall be reduced by 65 per cent.”,

(iii) in the case of the third of those years, “shall be reduced by 50 per cent.”,

(iv) in the case of the fourth of those years, “shall be reduced by 35 per cent”, and

(v) in the case of the fifth of those years, “shall be reduced by 15 per cent.”.

(7) Where, apart from the provisions of this subsection and subsection (8), a company is entitled to claim relief under this Chapter, by virtue of subsection (6), in respect of the year 1974-75 or any earlier year of assessment, the company may, in lieu of such relief, claim relief under subsection (1) or subsection (3) as if that year of assessment were a year of claim within the meaning of section 402.

(8) Where a company has obtained relief under this Chapter by virtue of subsection (7) and is subsequently entitled to relief under subsection (6), the last-mentioned relief shall be granted as if the last year of assessment in respect of which relief is due by virtue of subsection (7) was the company's last year of claim within the meaning of section 402:

Provided that no relief shall be given in respect of any year of assessment after the fourteenth year of assessment after the first year of claim or in respect of any year of assessment after the year 1979-80.

(9) In computing, for the purpose of assessment to income tax, the amount of the profits or gains from a company's trade, any corporation profits tax which, by virtue of section 13 of the Finance (Miscellaneous Provisions) Act, 1956, is not payable, shall be deemed to have been paid.

405 Alternative relief on total exports.

405.—(1) In this section “year of claim” has the same meaning as in section 402, with the substitution of “five” for “ten” where it first occurs, and the omission of the proviso.

(2) (a) Income tax payable by a company for a year of claim other than the year of assessment commencing on the 6th day of April, 1957, so far as such income tax is referable to profit on the sale of goods exported out of the State may, notwithstanding anything contained in section 404, be reduced by 25 per cent., but such reduction shall be in substitution for and not in addition to any reduction of income tax, under section 404, for the year of claim.

(b) For the purposes of this subsection “profit on the sale of goods exported out of the State” shall be taken to be such sum as bears to the amount of the company's profits for the year of claim, computed in accordance with this Act, which is attributable to the sale of goods (whether exported or not), the same proportion as the amount receivable in the basis period from the sale of goods exported bears to the total amount receivable by the company from the sale of goods (whether exported or not) in the basis period.

(3) In a case in which the provisions of this section apply, and the export out of the State in the relevant basis period consisted of or included goods with respect to which section 399 (3) provides for the inclusion thereof in the definition of “goods”, this Chapter shall have effect subject to the insertion, in subsection (2) (b) of “and of merchandise (whether exported or not) other than such goods” after “goods (whether exported or not)” wherever the latter words occur.

(4) Subsection (2) shall apply to each of the five consecutive years of assessment, the first of which is the year of assessment immediately following the company's last year of claim for the purposes of that subsection as if—

(a) each of those years were a year of claim, and

(b) for “reduced by 25 per cent.” in subsection (2) (a) there were substituted—

(i) in the case of the first of those years, “reduced by 20 per cent.”,

(ii) in the case of the second of those years, “reduced by 15 per cent.”,

(iii) in the case of the third of those years, “reduced by 10 per cent.”,

(iv) in the case of the fourth and fifth of those years, “reduced by 5 per cent.”.

406 Certain manufacturing services.

406.—(1) In the case of a body corporate carrying on a trade which consists of or includes the rendering to another person of services by way of subjecting commodities or materials belonging to that person to any process of manufacturing, the following provisions shall, if the body corporate so elects, apply for the purposes of relief from income tax under this Chapter:

(a) the body corporate shall be regarded as being a company where it would not otherwise be so regarded;

(b) the rendering in the State of such services shall be regarded as the manufacture of goods and any amount receivable in payment therefor shall be regarded as an amount receivable from the sale of goods, and

(c) where—

(i) such services are rendered to a person who is not resident in the State in relation to commodities or materials which have been imported into the State, and

(ii) after the services have been rendered, the commodities or materials, or the products or articles into which they have been converted, are exported out of the State while continuing to belong to that person,

the body corporate shall be regarded as having exported goods out of the State and any payment receivable by it for the services shall be regarded as an amount receivable from the sale of goods so exported.

(2) Any election under subsection (1) shall be made by notice in writing delivered to the inspector and shall have effect as respects every year of claim for which relief under this Chapter is, or has been, claimed by the body corporate by which it is made.

(3) The Revenue Commissioners may by notice in writing require a body corporate claiming relief from tax by virtue of subsection (1) to furnish them with such information or particulars as may be necessary for the purpose of giving effect to that subsection, and section 404 (1) shall have effect as if the matters of which proof is required thereby included the information or particulars specified in a notice under this subsection.

(4) Subsection (1) shall have effect as from the 27th day of December, 1956, and relief from tax may be given accordingly by repayment or otherwise as the Revenue Commissioners think proper:

Provided that where, before an election was made by it under this section, a body corporate has paid a dividend and the amount of income tax which it was entitled to deduct from the dividend exceeds the amount which, under section 410 (2), it would have been entitled to deduct if the election had been made before the dividend was paid, any relief from income tax which would otherwise have been allowable shall be reduced by the amount of the excess.

(5) Where for any year of assessment the income of any person consists of, or includes, a dividend in relation to which the proviso to subsection (4) has had effect, the person shall be entitled to claim such repayment, if any, of income tax and sur-tax as will reduce his total liabilities to those taxes to what those liabilities would have been if income tax had been deducted from the dividend at the rate at which it would have been deductible if subsection (1) had had effect in relation to the body corporate at the time when the dividend was paid.

407 Changes of proprietorship.

407.—For the purposes of section 404 (1), where, in a year of claim, there is a succession to a trade, the total amount receivable from the sale of the goods exported during the standard period shall be apportioned between the predecessor and the successor in proportion to the lengths of the respective periods in the year of claim during which they carried on the trade.

408 Discontinuance of trade.

408.—Where, in the year of claim, the trade is permanently discontinued, the total amount receivable from the sale of the goods exported during the standard period shall, for the purposes of section 404 (1), be deemed to be such part thereof as bears to the whole the same proportion as the period in the year of claim during which the trade was carried on bears to twelve months.

409 Transfer of part of trade.

409.—Where, on or after the day on which the standard period commenced, any change takes place whereby a part of a trade becomes transferred to any person, the total amount receivable from the sale of the goods exported during the standard period shall, as respects any year of claim in which, or prior to which, the change occurs, be apportioned for the purposes of section 404 (1) and every such apportionment shall be made in such manner as the Revenue Commissioners consider just, having regard to all the circumstances.

410 Exclusions, dividends, etc.

410.—(1) A reduction shall not be made under this Chapter—

(a) in respect of income tax which a company is, otherwise than under section 456, entitled to charge against any other person or to deduct, retain or satisfy out of any payment to any other person, or

(b) in respect of income tax payable on profits from any mining operations.

(2) Where, under section 456, a body corporate is entitled to deduct income tax from any dividend, tax shall not in any case be deducted at a rate exceeding the rate of the income tax as reduced by any relief from that tax given under this Chapter, and the provisions of section 457 shall apply accordingly, with any necessary modifications.

(3) The rate of income tax at which any repayment of income tax for any year of assessment falls to be made shall be subject to such adjustments as may be proper in cases in which relief is given under or by virtue of this Chapter.

(4) Where, by virtue of subsection (2), income tax is deducted from a dividend at a reduced rate, the amount to be included in respect of the dividend in any return for the purpose of sur-tax shall be an amount which bears the same proportion to the amount of the dividend as the rate of income tax deducted therefrom bears to the rate which would have been authorised to be deducted if this section had not been enacted.

411 Adjustments of certain amounts.

411.—(1) Where a company claims relief pursuant to this Chapter and it appears to the Revenue Commissioners that, in the case of goods of a particular class, the relationship between the amount receivable from the sale in any period of goods exported and the amount receivable from the sale in that period of goods not exported is affected by the payment by the company of any duty in respect of the goods or the materials used in their manufacture, the Revenue Commissioners may direct that subsection (2) or subsection (3), whichever appears to them to be appropriate, shall apply in arriving at an amount receivable from the sale in that period of such goods, and where any such direction has been given, any relief to the company by reference to the sale of goods in that period shall be computed in accordance with it.

(2) (a) An amount receivable from the sale of goods exported out of the State shall be deemed to be increased by the amount of any drawback, rebate or repayment of duty, being duty payable in the State, received by the company in respect of such goods and to be reduced by the amount of any duty paid in any territory outside the State by the company in respect of the import of such goods into that territory.

(b) An amount receivable from the sale of goods not exported shall be deemed to be increased by the amount of any rebate or repayment of duty, being duty payable in the State, received by the company in respect of such goods.

(3) (a) An amount receivable from the sale of goods exported out of the State shall be deemed to be reduced by the amount of any duty paid in any territory outside the State by the company in respect of the import of such goods into that territory.

(b) An amount receivable from the sale of goods not exported shall be deemed to be reduced by the amount of any duty, being duty payable in the State, paid by the company in respect of such goods.

(4) The Revenue Commissioners may by notice in writing require the company to furnish them with such information or particulars as may be necessary for the purpose of giving effect to this section, and section 404 (1) shall have effect as if the matters of which proof is required by that subsection included the information or particulars specified in a notice under this subsection.

412 Transactions between associated persons and company succeeding to trade of another company.

412.—(1) Where a company claiming relief under this Chapter (hereafter in this subsection referred to as the buyer) buys from another person (hereafter in this subsection referred to as the seller) and—

(a) the seller has control over the buyer or, the seller being a body corporate or partnership, the buyer has control over the seller or some other person has control over both the seller and the buyer, and

(b) the price in the transaction is less than that which might have been expected to obtain if the parties to the transaction had been independent parties dealing at arm's length,

then, the profits of the buyer which are attributable to sales shall, for the purposes of this Chapter, be computed as if the price in the transaction had been that which would have obtained if the transaction had been a transaction between independent persons dealing as aforesaid.

(2) In subsection (1) “control” has the meaning assigned to it by section 299 (6).

(3) Where a company (hereafter in this subsection referred to as the succeeding company) succeeds to a trade or a part of a trade which, on or after the 6th day of April, 1960, was carried on by another company (hereafter in this subsection referred to as the original company) and the original company has or could have made a claim to relief under this Chapter, then, relief in so far as such relief relates to the trade or the part of the trade in question, shall be granted to the succeeding company only as respects the remaining years of claim for which such relief might have been claimed by the original company if it had continued to carry on the trade or the part of the trade in question.

(4) The Revenue Commissioners may by notice in writing require the company to furnish them with such information or particulars as may be necessary for the purposes of this section, and section 404 (1) and 404 (3) shall have effect as if the matters of which proof is required by those subsections included the information or particulars specified in a notice under this subsection.

(5) Where a company claims relief under this Chapter otherwise than by virtue of the provisions of section 399 (3), the foregoing provisions of this section shall have effect only in respect of transactions and successions occurring after the 19th day of April, 1961.

413 Production of documents and records.

413.—(1) Upon request made to him by an authorised officer at any premises of a company claiming relief under this Chapter, any person employed by the company at the premises shall produce to the authorised officer all such invoices, accounts, books and other documents and records whatsoever relating to purchase and sale of goods by the company as may be in such person's power, possession and procurement and, on production thereof, shall permit the authorised officer to examine them and take copies thereof or extracts therefrom.

(2) If a person requested under subsection (1) does not comply with the requirements of that subsection, he shall be liable to a penalty of £50.

(3) All penalties under this section 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.

(4) Where, in pursuance of this section, an authorised officer requests production of any documents or records, he shall, on request, show his authorisation for the purposes of this section to the person concerned.

(5) In this section, “authorised officer” means an officer of the Revenue Commissioners authorised by them in writing for the purposes of this section.

414 Appeals.

414.—An appeal to the Special Commissioners shall lie on any question arising under this Chapter in like manner as an appeal would lie against an assessment to income tax, and the provisions of this Act relating to appeals shall apply and have effect accordingly.

PART XXVI Appeals

415 Prohibition on alteration of assessment except on appeal.

415.—Save where expressly authorised by this Act, an assessment shall not be altered before the time for hearing and determining appeals, and then only in cases of assessments appealed against, and in accordance with such determination; and if any person makes, causes, or allows to be made, in any assessment, any unauthorised alteration, he shall incur a penalty of £50.

416 Appeals against assessment.

416.—(1) A person aggrieved by any assessment to income tax made upon him by the inspector or such other officer as the Revenue Commissioners shall appoint in that behalf (hereafter in this section referred to as “other officer”) shall be entitled to appeal to the Special Commissioners on giving, within twenty-one days after the date of the notice of assessment or of the notice under section 180 that assessments have been made (as the case may be), notice in writing to the inspector or other officer.

(2) (a) The Special Commissioners shall from time to time appoint times and places for the hearing of appeals against assessments and the Clerk to the Special Commissioners shall give notice of such times and places to the inspector or other officer.

(b) The inspector or other officer shall give notice in writing to each person who has given notice of appeal of the time and place appointed for the hearing of his appeal, but—

(i) notice under this paragraph shall not be given in a case in which subsection (3) (b) has effect either consequent upon an agreement referred to in that paragraph or consequent upon a notice referred to in subsection (3) (d), and

(ii) in a case in which it appears to the inspector or other officer that an appeal may be settled by agreement under subsection (3), he may refrain from giving notice under this paragraph or may by notice in writing withdraw a notice already given.

(3) (a) This subsection applies to any assessment in respect of which notice of appeal has been given, not being an assessment the appeal against which has been determined by the Special Commissioners or which has become final and conclusive under subsection (6).

(b) Where, in relation to an assessment to which this subsection applies, the inspector or other officer and the appellant come to an agreement, whether in writing or otherwise, that the assessment is to stand good, is to be amended in a particular manner or is to be discharged or cancelled, the inspector or other officer shall give effect to the agreement and thereupon, if the agreement is that the assessment is to stand good or is to be amended, the assessment or the amended assessment, as the case may be, shall have the same force and effect as if it were an assessment in respect of which no notice of appeal had been given.

(c) An agreement which is not in writing shall be deemed not to be an agreement for the purposes of paragraph (b) unless—

(i) the fact that an agreement was come to, and the terms agreed upon, are confirmed by notice in writing given by the inspector or other officer to the appellant or by the appellant to the inspector or other officer, and

(ii) twenty-one days have elapsed since the giving of that notice without the person to whom it was given giving notice in writing to the person by whom it was given that he desires to repudiate or withdraw from the agreement.

(d) Where an appellant gives notice in writing to the inspector or other officer that he desires not to proceed with his appeal against an assessment to which this subsection applies, paragraph (b) shall have effect as if the appellant and the inspector or other officer had, on the appellant's notice being received, come to an agreement in writing that the assessment should stand good.

(e) The references in this subsection to an agreement being come to with an appellant and the giving of notice to or by an appellant include references to an agreement being come to with, and the giving of notice to or by, a person acting on behalf of the appellant in relation to the appeal.

(4) All appeals against assessments to income tax shall be heard and determined by the Special Commissioners, and their determination on any such appeal shall be final and conclusive, unless the person assessed requires that his appeal shall be reheard under section 429 or unless under this Act a case is required to be stated for the opinion of the High Court.

(5) An appeal against an assessment may be heard and determined by one Special Commissioner and the powers conferred on the Special Commissioners by subsections (7) and (8) may be exercised by one Special Commissioner.

(6) In default of notice of appeal by a person to whom notice of assessment has been given or in case of the neglect or refusal of a person, who has given notice of appeal, to attend before the Special Commissioners at the time and place appointed for the purpose of hearing appeals, the assessment made on him shall be final and conclusive.

(7) (a) A notice of appeal not given within the time limited by subsection (1) shall be regarded as having been so given where, on an application in writing having been made to him in that behalf, the inspector or such other officer as aforesaid, being satisfied that, owing to absence, sickness or other reasonable cause, the applicant was prevented from giving notice of appeal within the time limited and that the application was made thereafter without unreasonable delay, notifies the applicant in writing that his application has been allowed.

(b) If on an application under paragraph (a) the inspector or other officer is not satisfied as aforesaid, he shall by notice in writing inform the applicant that his application has been refused.

(c) Within fifteen days after the date of a notice under paragraph (b) the applicant may by notice in writing require the inspector or other officer to refer his application to the Special Commissioners and, in relation to any application so referred, paragraphs (a) and (b) shall have effect as if for every reference therein to the inspector or other officer there was substituted a reference to the Special Commissioners.

(8) In a case in which a person who has given notice of appeal does not attend before the Special Commissioners at the time and place appointed for the hearing of his appeal, subsection (6) shall not have effect if—

(a) at the said time and place another person attends on behalf of the appellant and the Special Commissioners consent to hear that person, or

(b) on an application in that behalf having been made to them in writing or otherwise at or before the said time, the Special Commissioners postpone the hearing, or

(c) on an application in writing having been made to them after the said time the Special Commissioners, being satisfied that, owing to absence, sickness or other reasonable cause, the appellant was prevented from appearing before them at the said time and place and that the application was made without unreasonable delay, direct that the appeal be treated as one the time for the hearing of which has not yet been appointed.

(9) (a) Where action for the recovery of tax charged by an assessment, being action by way of the institution of proceedings in any court or the issue of a certificate under section 485 has been taken, neither subsection (7) nor subsection (8) shall, unless the Revenue Commissioners otherwise direct, apply in relation to that assessment until the said action has been completed.

(b) Where, in a case coming within the foregoing paragraph, an application under subsection (7) (a) is allowed or, on an application under subsection (8) (c), the Special Commissioners direct as therein provided, the applicant shall in no case be entitled to repayment of any sum paid or borne by him in respect of costs of any such court proceedings as aforesaid or, as the case may be, of any fees or expenses charged by the county registrar or sheriff executing a certificate under section 485.

(10) Every rehearing of an appeal by the Circuit Court under section 429 shall be held in camera, and every hearing by the High Court or the Supreme Court of a case stated under section 428 or 430 shall, if the person whose chargeability to tax is the subject of the case so desires, be held in camera.

(11) This section shall apply with the necessary modifications to appeals against assessments to sur-tax.

417 Provision as to appeals.

417.—Whenever an appeal is made against an assessment, the appellant shall in the notice of appeal specify the grounds of the appeal, but this subsection shall not preclude the Special Commissioners from allowing the appellant on the hearing of the appeal to go into any ground of appeal which was not specified in the notice of appeal and the omission of which from such notice was in the opinion of the Special Commissioners not wilful or unreasonable.

418 Power of Special Commissioners to order payment of tax in assessments under appeal.

418.—(1) Where, on an appeal against an assessment to income tax being brought before them for hearing, the Special Commissioners—

(a) on the oral or written application of the appellant, postpone the hearing, or

(b) having commenced the hearing, adjourn it,

they may order that there shall be paid, notwithstanding the appeal, so much of the tax in the assessment as in their opinion, on the basis of the information available, is likely to become payable on or after the determination of the appeal.

(2) In relation to a case in which an order is made under subsection (1) in the absence of the appellant, the following provisions shall have effect:

(a) the inspector or other officer of the Revenue Commissioners shall give notice in writing to the appellant of the making of the order;

(b) the appellant if aggrieved by the order may, within fourteen days after the date of the notice referred to in paragraph (a), make representations in writing to the Special Commissioners in regard to the order;

(c) the Special Commissioners, having considered any representations made to them in accordance with paragraph (b), may either confirm the order or make a revised order, and any such revised order shall supersede the first-mentioned order.

(3) Where the appeal brought before the Special Commissioners for hearing relates to an assessment to income tax (hereafter in this subsection referred to as the relevant assessment) that is one of a number of assessments (hereafter in this subsection referred to as the aggregated assessments) the tax in which is stated in one sum under section 183 (1), the amount of tax in the relevant assessment shall, for the purposes of subsection (1) of this section, be arrived at by deducting from the said one sum the amount of tax, if any, which is payable under section 183 (3); and, where appeals against two or more of the aggregated assessments are brought before the Special Commissioners, the total amount of tax in those assessments shall be arrived at in like manner and the provisions of this section shall apply as if that total amount were an amount of tax in a single assessment.

(4) Where in relation to any assessment an amount of tax has been ordered to be paid under the foregoing provisions of this section—

(a) that amount shall be collected, paid and carry interest as if the appeal against the assessment had been determined when the order was made and the amount of tax specified by the order were the amount of tax chargeable in accordance with the determination, and

(b) on the determination of the appeal against the assessment, any balance of tax chargeable in accordance with the determination shall be paid, or any tax overpaid shall be repaid, as the case may require,

and, in a case to which subsection (2) applies, the order shall, for the purposes of paragraph (a), be deemed to have been made on the date of the notice under subsection (2) (a).

(5) Every reference in this section to an appellant includes a reference to a person acting on behalf of the appellant in relation to the appeal.

(6) Any of the powers conferred on the Special Commissioners by this section may be exercised by one Special Commissioner.

419 Agreement as to amount of tax not in dispute on an appeal against an assessment.

419.—(1) Where, in a case in which notice of appeal has been given against an assessment to income tax or sur-tax, the appellant and an inspector, or other officer of the Revenue Commissioners, come to an agreement as to the amount of tax charged by the assessment which should be paid notwithstanding the appeal, that amount shall be collected, paid and carry interest in all respects as if it were tax charged by an assessment in respect of which no appeal was pending and, on the determination of the appeal, any balance of tax chargeable in accordance with the determination shall be payable or any tax overpaid shall be repaid, as the case may require.

(2) The reference in subsection (1) to an agreement being come to with an appellant includes a reference to an agreement being come to with a person acting on behalf of the appellant in relation to the appeal.

420 Publication of reports of cases stated.

420.—The holding in camera in pursuance of section 416 (10) of the hearing of a case stated relative to income tax or sur-tax shall not preclude the publication, in the law reports published by the Incorporated Council of Law Reporting for Ireland or in any other recognised law reports or in any reports printed with the permission of the said Incorporated Council, of a report of the proceedings before, or the judgments given by, the High Court or the Supreme Court, but no such report shall disclose the name of the person whose chargeability to tax is the subject of the case.

421 Procedure on appeals.

421.—(1) The inspector may attend every appeal, and shall be entitled—

(a) to be present during all the time of the hearing and at the determination of the appeal; and

(b) to produce any lawful evidence in support of the assessment; and

(c) to give reasons in support of the assessment.

(2) Upon any appeal the Special Commissioners shall permit any barrister or solicitor to plead before them on behalf of the appellant or officers, either viva voce or in writing, and shall hear any accountant, being any person who has been admitted a member of an incorporated society of accountants.

(3) If, on an appeal, it appears to the Commissioners by whom the appeal is heard, or to a majority of such Commissioners, by examination of the appellant on oath or affirmation, or by other lawful evidence, that the appellant is overcharged by any assessment, the Commissioners shall abate or reduce the assessment accordingly, but otherwise the assessment shall stand good.

(4) If, on any appeal, it appears to the Commissioners that the person assessed ought to be charged in an amount exceeding the amount contained in the assessment, they shall charge him with the excess.

422 Power to issue precepts.

422.—(1) Where notice of appeal has been given against an assessment, the Special Commissioners may, whenever it appears to them to be necessary for the purposes of this Act, issue a precept to the appellant ordering him to deliver to them, within the time limited by the precept, a schedule containing such particulars, for their information, as they may demand under the authority of this Act respecting—

(a) the property of the appellant; or

(b) the trade, profession or employment carried on or exercised by him; or

(c) the amount of his profits or gains, distinguishing the particular amounts derived from each separate source; or

(d) any deductions made in arriving at his profits or gains.

(2) The Special Commissioners may issue further precepts whenever they consider it necessary for the purposes aforesaid, until complete particulars have been furnished to their satisfaction.

(3) A precept may be issued by one Special Commissioner.

(4) A person to whom a precept is issued shall deliver the schedule required, within the time limited.

(5) Any inspector may, at all reasonable times, inspect and take copies of, or extracts from, any schedule.

423 Objection by inspector to schedules.

423.—(1) The inspector may, within a reasonable time to be allowed by the Special Commissioners after examination by him of any schedule, object to the schedule or any part thereof, and in that case shall state in writing the cause of his objection, according to the best of his knowledge or information.

(2) In every such case he shall give notice in writing of his objection to the person chargeable in order that he may, if he thinks fit, appeal against it.

The notice shall be under cover and sealed, and addressed to the person chargeable.

(3) No assessment shall be confirmed or altered until any appeal against the objection has been heard and determined.

424 Confirmation and amendment of assessments.

424.—If—

(a) the Special Commissioners see cause to disallow an objection of the inspector to a schedule; or

(b) on the hearing of an appeal, the Special Commissioners are satisfied with the assessment, or if, after the delivery of a schedule, they are satisfied therewith and have received no information as to its insufficiency,

they shall confirm or alter the assessment in accordance with the schedule, as the case may require.

425 Questions as to assessments or schedules.

425.—(1) Whenever the Special Commissioners are dissatisfied with a schedule or require further information relating thereto, they may, at any time and from time to time, by precept, put any questions in writing concerning the schedule, or any matter which is contained or ought to be contained therein, or concerning any deductions made in arriving at the profits or gains, and the particulars thereof, and may require true and particular answers in writing, signed by the person chargeable, to be given within seven days after the service of the precept.

(2) The person chargeable shall, within the time limited, either answer any such questions in writing signed by him, or shall tender himself to be examined orally before the Commissioners, and may object to, and refuse to answer, any question, but the substance of any answer given by him orally shall be taken down in writing in his presence and be read over to him, and after he has had liberty to amend any such answer he may be required to verify the answer on oath to be administered to him by any one of the Commissioners, and the oath shall be subscribed by the person by whom it is made.

(3) Where any clerk, agent or servant of the person chargeable tenders himself, on behalf of that person, to be examined orally before the Commissioners, the same provisions shall apply to his examination as in the case of the person chargeable who tenders himself to be examined orally.

426 Summoning and examination of witnesses.

426.—(1) The Special Commissioners may summon any person whom they think able to give evidence respecting an assessment made on another person to appear before them to be examined, and may examine such person on oath. The clerk, agent, servant or other person confidentially employed in the affairs of a person chargeable shall however be examined in the same manner, and subject to the same restrictions, as in the case of a person chargeable who tenders himself to be examined orally.

(2) The oath shall be that the evidence to be given, touching the matter in question, by the person sworn shall be the truth, the whole truth and nothing but the truth, and the said oath shall be subscribed by the person by whom it is made.

(3) A person who after being duly summoned—

(a) neglects or refuses to appear before the Commissioners at the time and place appointed for that purpose; or

(b) appears, but refuses to be sworn or to subscribe the oath; or

(c) refuses to answer any lawful question touching the matters under consideration,

shall forfeit a sum not exceeding £20:

Provided that the penalty imposed in respect of any offence under paragraph (b) or (c) shall not apply to any clerk, agent, servant or other person as aforesaid.

427 Determination of liability in cases of default.

427.—If—

(a) a person has neglected or refused to deliver a schedule in accordance with a precept of the Special Commissioners; or

(b) any clerk, agent or servant of, or any person confidentially employed by, a person chargeable, having been summoned, has neglected or refused to appear before the Commissioners to be examined; or

(c) the person himself or his clerk, agent or servant or other person as aforesaid, has declined to answer any question put to him by the Commissioners; or

(d) an objection has been made to a schedule, and the objection has not been appealed against; or

(e) the Commissioners decide to allow any objection made by the inspector,

the Commissioners shall ascertain and settle, according to the best of their judgment, the sum in which the person chargeable ought to be charged.

428 Statement of case for High Court.

428.—(1) Immediately after the determination of an appeal by the Special Commissioners, the appellant or the inspector, if dissatisfied with the determination as being erroneous in point of law, may declare his dissatisfaction to the Commissioners who heard the appeal.

(2) The appellant or inspector, as the case may be, having declared his dissatisfaction, may, within twenty-one days after the determination, by notice in writing addressed to the Clerk to the Commissioners, require the Commissioners to state and sign a case for the opinion of the High Court thereon.

(3) The party requiring the case shall pay to the Clerk to the Commissioners a fee of twenty shillings for and in respect of the same, before he is entitled to have the case stated.

(4) The case shall set forth the facts and the determination of the Commissioners, and the party requiring it shall transmit the case, when stated and signed, to the High Court within seven days after receiving it.

(5) At or before the time when he transmits the case to the High Court, the party requiring it shall send notice in writing of the fact that the case has been stated on his application, together with a copy of the case, to the other party.

(6) The High Court shall hear and determine any question or questions of law arising on the case, and shall reverse, affirm or amend the determination in respect of which the case has been stated, or shall remit the matter to the Commissioners with the opinion of the Court thereon, or may make such other order in relation to the matter, and may make such order as to costs as to the Court may seem fit.

(7) The High Court may cause the case to be sent back for amendment, and thereupon the case shall be amended accordingly, and judgment shall be delivered after it has been amended.

(8) An appeal shall lie from the decision of the High Court to the Supreme Court.

(9) Notwithstanding that a case has been required to be stated or is pending, tax shall be paid in accordance with the determination of the Special Commissioners or the Circuit Court as the case may be:

Provided that, if the amount of the assessment is altered by the order or judgment of the Supreme Court or the High Court, then—

(a) if too much tax has been paid, the amount overpaid shall be refunded with such interest, if any, as the Court may allow; or

(b) if too little tax has been paid, the amount unpaid shall be deemed to be arrears of tax (except so far as any penalty is incurred on account of arrears), and shall be paid and recovered accordingly.

429 Appeal to Circuit Court.

429.—(1) Any person who is aggrieved by the determination of the Special Commissioners in any appeal against an assessment made upon him may, on giving notice in writing to the inspector, within ten days after such determination, require that his appeal shall be reheard by the judge of the Circuit Court in whose circuit is situate, in the case of—

(a) a person who is not resident in the State,

(b) the estate of a deceased person,

(c) an incapacitated person, or

(d) a trust,

the place where the assessment was made, and, in any other case, the place to which the notice of assessment was addressed, and the Special Commissioners shall transmit to the said judge, any statement or schedule in their possession which was delivered to them for the purposes of the appeal.

(2) The said judge shall, with all convenient speed, rehear and determine the appeal, and shall have and exercise the same powers and authorities in relation to the assessment appealed against, the determination, and all matters consequent thereon, as the Special Commissioners might have and exercise, and his determination thereon shall, subject to section 430, be final and conclusive.

(3) The judge shall make a declaration in the form of the declaration required to be made by a Special Commissioner as set out in Schedule 17, Part I.

430 Extension of section 428.

430.—(1) Section 428 shall, subject to the provisions of this section, apply to a determination given by a judge pursuant to section 429 in like manner as it applies to a determination by the Special Commissioners.

(2) The notice in writing required under section 428 (2) to be addressed to the Clerk to the Commissioners shall, in every case in which a judge is under the authority of this section required by any person to state and sign a case for the opinion of the High Court thereon, be addressed by such person to the county registrar.

(3) The fee required under section 428 (3) to be paid to the Clerk to the Commissioners shall in any such case as aforesaid be paid to the county registrar.

431 Communication of decision of Special Commissioners.

431.—(1) Where the Special Commissioners have entertained an appeal against an assessment for any year of assessment and, after hearing argument on the appeal, have postponed giving their determination either for the purpose of considering the argument or for the purpose of affording to the appellant an opportunity of submitting in writing further evidence or argument, the Special Commissioners may, unless they consider a further hearing to be necessary, cause their determination to be sent by post to the parties to the appeal.

(2) Where the determination of an appeal by the Special Commissioners is sent to the parties by post under this section, a declaration of dissatisfaction under section 428 (1) or a notice requiring a rehearing under section 429 (1) may be made or given in writing within twelve days after the day on which the determination is so sent to the person making the declaration or giving the notice.

432 Making of claims, etc., and appeals and rehearings.

432.—(1) Notwithstanding any other provision of this Act—

(a) all claims of exemption or for any allowance or deduction under this Act,

(b) all claims for repayment of tax under this Act, and

(c) (i) all claims to relief under this Act where the relief is measured in the provision under which it is given, and

(ii) all matters and questions relating to any relief so measured,

in relation to which a right of appeal from a decision of the Special Commissioners is, otherwise than by this section, not specifically provided,

shall be stated in such manner and form as the Revenue Commissioners may prescribe and shall be submitted to and determined by the Revenue Commissioners or such officer of the Revenue Commissioners (including an inspector) as they may authorise in that behalf, but any person aggrieved by any determination on any such claim, matter or question may, on giving notice in writing to the Revenue Commissioners or the officer within twenty-one days after notification to the person aggrieved of the determination, appeal to the Special Commissioners.

(2) The Special Commissioners shall hear and determine an appeal to them under subsection (1) as if it were an appeal against an assessment to income tax, and the provisions of this Act relating to the rehearing of an appeal and the statement of a case for the opinion of the High Court on a point of law shall apply accordingly with any necessary modifications.

(3) Where—

(a) a right of appeal to the Special Commissioners is given by any provision (other than section 203 or paragraph 2 of Schedule 16) of this Act, and

(b) such provision, while applying the provisions of this Act relating to appeals against assessments, does not apply the provisions thereof relating to rehearing of appeals,

such provision shall be deemed to apply the said provisions relating to rehearing of appeals.

(4) In a case in which—

(a) a notice of appeal is not given within the time limited by subsection (1), or

(b) a person who has given notice of appeal does not attend before the Special Commissioners at the time and place appointed for the hearing of his appeal,

the provisions of section 416 (5), (7), (8) and (9) shall apply, with any necessary modifications.

PART XXVII Annual Payments

433 Yearly interest, etc., payable wholly out of taxed profits.

433.—(1) Where any yearly interest of money, annuity, or any other annual payment (whether payable within or outside the State, either as a charge on any property of the person paying the same by virtue of any deed or will or otherwise, or as a reservation thereout, or as a personal debt or obligation by virtue of any contract, or whether payable half-yearly or at any shorter or more distant periods), is payable wholly out of profits or gains brought into charge to tax, no assessment shall be made upon the person entitled to such interest, annuity, or annual payment, but the whole of those profits or gains shall be assessed and charged with tax on the person liable to the interest, annuity, or annual payment, without distinguishing the same, and the person liable to make such payment, whether out of the profits or gains charged with tax or out of any annual payment liable to deduction, or from which a deduction has been made, shall be entitled, on making such payment, to deduct and retain thereout a sum representing the amount of the tax thereon at the rate or rates of tax in force during the period through which the said payment was accruing due.

The person to whom such payment is made shall allow such deduction upon the receipt of the residue of the same, and the person making such deduction shall be acquitted and discharged of so much money as is represented by the deduction, as if that sum had been actually paid.

(2) Where any royalty, or other sum, is paid in respect of the user of a patent, wholly out of profits or gains brought into charge to tax, the person paying the royalty or sum shall be entitled, on making the payment, to deduct and retain thereout a sum representing the amount of the tax thereon at the rate or rates of tax in force during the period through which the royalty or sum was accruing due.

434 Interest, etc., not payable out of taxed profits.

434.—(1) Upon payment of any interest of money, annuity, or other annual payment charged with tax under Schedule D, or of any royalty or other sum paid in respect of the user of a patent, not payable, or not wholly payable, out of profits or gains brought into charge, the person by or through whom any such payment is made shall deduct thereout a sum representing the amount of the tax thereon at the rate of tax in force at the time of the payment.

(2) Where any such payment as aforesaid is made by or through any person, that person shall forthwith deliver to the Revenue Commissioners an account of the payment, or of so much thereof as is not made out of profits or gains brought into charge, and of the tax deducted out of the payment or out of that part thereof, and the inspector shall assess and charge the payment of which an account is so delivered on that person.

(3) The inspector may, where any person has made default in delivering an account required by this section, or where he is not satisfied with the account so delivered, make an assessment according to the best of his judgment.

(4) In subsections (2) and (3) “the inspector” means such inspector as the Revenue Commissioners may direct.

(5) All the provisions of this Act relating—

(a) to persons who are to be chargeable with income tax and to income tax assessments;

(b) to appeals against such assessments;

(c) to the collection and recovery of income tax; and

(d) to the rehearing of appeals and to cases to be stated for the opinion of the High Court,

shall, so far as they are applicable, apply to the charge, assessment, collection and recovery of income tax under this section.

(6) The amount of annuities which an assurance company carrying on the business of granting annuities is entitled, for the purposes of this section, to treat as having been paid out of profits or gains brought into charge to tax, shall not exceed the amount of the taxed income of its annuity fund.

(7) The provisions of this section shall, subject to any necessary modifications, apply in the case of a payment which has been made before the passing of this Act unless at such passing the tax deducted out of the payment stands paid to the Revenue Commissioners.

435 Annual payment payable out of dividend from which income tax is not deductible or is deductible at reduced rate.

435.—(1) Where the whole or any part of any annual payment is payable out of a dividend from which, by virtue of section 387, 396 or 410, income tax either is not deductible or is deductible at a reduced rate—

(a) a payment of the annual payment, or that part thereof, as the case may be, shall be treated as not having been paid out of profits or gains brought into charge to tax and, subject to paragraph (b), section 434 shall apply accordingly,

(b) the amount of tax recoverable from the payer shall be tax on the payment which he has made calculated—

(i) if income tax was not deductible from the dividend—at the standard rate of income tax, and

(ii) if income tax was deductible from the dividend at a reduced rate—at a rate arrived at by deducting from the standard rate of income tax the rate of tax deductible from the dividend.

(2) In subsection (1) “annual payment” means any payment from which, apart from any insufficiency of profits or gains of the person making it, tax is deductible under section 433.

436 Payments subject to deduction for local rates.

436.—Where a person liable to tax under Schedule A is authorised under this Act to retain tax from any annual payment made by him from which he is by law entitled to deduct any sum on account of the county rate or of the proportion applicable to the relief of the poor of the municipal rate, the tax to be retained shall be calculated by reference to the net sum payable by him, after the allowance for the county rate or of the proportion applicable to the relief of the poor of the municipal rate.

437 Disputes between tenants, landlords and others.

437.—(1) If a difference arises—

(a) between tenant and landlord or any other persons with regard to the deduction on account of tax to be made from any annual sum; or

(b) between the occupier for the time being and any former occupier of lands, tenements or hereditaments, his executors, administrators, or assigns, with regard to the proportion of tax to be paid or allowed by either of them respectively;

the Special Commissioners shall settle the proportion of the payments or deductions to be made according to the provisions of this Act, and, in default of payment, shall levy the same as if the proportions settled by them had been charged upon the respective persons, and shall pay over the same to the Collector or to the proper person, as the case may require.

(2) In any such case the determination of the Special Commissioners shall be final.

(3) In this section “annual sum” means any interest, annuity, rent, rentcharge, fee-farm rent, quitrent, or other rent or annual payment.

PART XXVIII Special Provisions for Taxation of Settlors, etc., in Respect of Settled or Transferred Income

Chapter I Revocable Dispositions, Dispositions for Short Periods and Certain Dispositions in Favour of Children

438 Income under revocable dispositions.

438.—(1) Any income of which any person is able, or has, at any time since the 5th day of April, 1922, been able, without the consent of any other person by means of the exercise of any power of appointment, power of revocation or otherwise howsoever by virtue or in consequence of a disposition made directly or indirectly by himself, to obtain for himself the beneficial enjoyment shall be deemed for the purposes of this Act to be the income of the person who is or was able to obtain the beneficial enjoyment thereof, and not to be the income of any other person.

(2) Where any such power as aforesaid can be exercised by a person with the consent of the wife or the husband of that person, the power shall, for the purposes of subsection (1), be deemed to be exercisable without the consent of another person, except where the husband and wife are living apart either by agreement or under an order of a court of competent jurisdiction.

(3) Where any such power as aforesaid is exercisable by the wife or the husband of the person who made the disposition, the power shall, for the purposes of subsection (1), be deemed to be exercisable by the person who made the disposition.

439 Income under dispositions for short periods.

439.—(1) Any income which, by virtue of or in consequence of any disposition made, directly or indirectly, by any person (other than a disposition made for valuable and sufficient consideration) is payable to or applicable for the benefit of any other person, but excluding any income which—

(i) arises from capital of which the disponor by the disposition has divested absolutely himself in favour of or for the benefit of the said other person, or

(ii) being payable to any university or college, being a university or college in the State, for the purpose of enabling such university or college to carry on research, is so payable for a period which is or may be three years or longer, or

(iii) being payable to a person who is an individual for his own use, is so payable for a period which exceeds or may exceed six years, or

(iv) being applicable for the benefit of a named person who is an individual, is so applicable for a period which exceeds or may exceed six years,

shall be deemed for the purposes of this Act to be the income of the person, if living, by whom the disposition was made and not to be the income of any other person.

(2) (a) The reference in subsection (1) to income payable to any university or college, being a university or college in the State, for the purpose of enabling such university or college to carry on research shall include references to income payable—

(i) to any university, college or school, being a university, college or school in the State for the purpose of assisting such university, college or school to teach the natural sciences or any of them, or

(ii) to a fund, being a fund within the meaning of this subsection.

(b) For the purposes of this subsection “fund” means a fund—

(i) held upon irrevocable trusts under the law of the State,

(ii) administered in the State, and

(iii) having for its sole purpose the granting of financial or other aid to universities, colleges or schools in the State in order to assist such universities, colleges or schools to teach the natural sciences or any of them.

440 Income of dispositions in favour of infants.

440.—(1) Subject to the provisions of this section, any income which, by virtue or in consequence of any disposition made, directly or indirectly, by any person after the 5th day of April, 1914, is payable to or applicable for the benefit of a child of that person for some period less than the life of the child shall, if and so long as the child is an infant and unmarried, be deemed for the purposes of this Act to be the income of the person, if living, by whom the disposition was made and not to be the income of any other person.

(2) This section shall not apply in respect of any settlement to which Chapter II applies.

(3) This section shall not apply as regards any income which is derived from capital which, at the end of the period during which that income is payable to or applicable for the benefit of the child, is required by the disposition to be held on trust absolutely for, or to be transferred to, the child, or any income which is payable to or applicable for the benefit of a child during the whole period of the life of the person by whom the disposition was made.

(4) Income shall not be deemed for the purposes of this section to be payable to or applicable for the benefit of a child for some period less than its life by reason only that the disposition contains a provision for the payment to some other person of the income in the event of the bankruptcy of the child, or of an assignment thereof, or a charge thereon being executed by the child.

441 Recovery of tax from trustee and payment to trustee of excess tax recoupment.

441.—(1) Where by virtue of section 439 or 440 any income tax or sur-tax becomes chargeable on and is paid by the person by whom the disposition was made, that person shall be entitled to recover from any trustee or other person to whom the income is payable by virtue or in consequence of the disposition the amount of the tax so paid, and for that purpose to require the Revenue Commissioners to furnish to him a certificate specifying the amount of the income in respect of which he has so paid tax and the amount of the tax so paid, and any certificate so furnished shall be conclusive evidence of the facts appearing thereby.

(2) Where any person obtains in respect of any allowance or relief a repayment of income tax in excess of the amount of the repayment to which he would, but for the provisions of section 439 or 440 have been entitled, an amount equal to the excess shall be paid by him to the trustee or other person to whom the income is payable by virtue or in consequence of the disposition, or where there are two or more such persons shall be apportioned among those persons as the case may require.

If any question arises as to the amount of any payment or as to any apportionment to be made under this subsection, that question shall be decided by the Special Commissioners whose decision thereon shall be final.

(3) Any income which is deemed by virtue of this Chapter to be the income of any person shall be deemed to be the highest part of his income.

442 Definitions.

442.—In this Chapter, unless the context otherwise requires—

“child” includes a stepchild or illegitimate child;

“disposition” includes any trust, covenant, agreement or arrangement.

Chapter II Settlements on Children Generally

443 Income settled on children.

443.—(1) Where, by virtue or in consequence of a settlement and during the life of the settlor, any income is, in any year of assessment, paid or payable or accumulated to or for the benefit of a child of the settlor, such income shall, if at the beginning of such year such child is under the age of twenty-one years and is unmarried, be treated for the purposes of this Act as income of the settlor for that year and not as income of any other person.

(2) This Chapter applies to every settlement, wheresoever made or entered into and whether it was made or entered into before or after the passing of this Act.

(3) This Chapter shall not apply in relation to any income arising under a settlement in any year of assessment for which the settlor is not chargeable to income tax as a resident in the State, and references in this Chapter to income shall be construed accordingly.

(4) This Chapter shall not apply to any income which, by virtue or in consequence of a settlement and during the life of the settlor, is in any year of assessment paid or payable or accumulated to or for the benefit of a child of the settlor if the settlor proves to the satisfaction of the Revenue Commissioners—

(a) that the aggregate amount of such income so paid, payable, or accumulated in such year does not exceed £60, and

(b) that at the beginning of such year such child is over the age of sixteen years and is permanently incapacitated by mental or physical infirmity from maintaining himself and from receiving full-time instruction at a university, college, school, or other educational establishment, and

(c) that such child is not entitled for such year to income exceeding in the aggregate £40, exclusive of income to which this Chapter would have applied if this subsection had not been enacted.

444 Irrevocable instruments.

444.—Where by virtue of an irrevocable instrument property is vested in or held by trustees upon such trusts that, in any year of assessment, section 443 (1) would (but for this section) apply to the income of such property, the following provisions shall apply and have effect, that is to say:

(a) section 443 (1) shall not apply in respect of any part of such income which is, in the said year of assessment, accumulated for the benefit of a child (being a child who, at the beginning of such year, is under the age of twenty-one years and is unmarried) of the settlor nor in respect of income arising in the said year of assessment from accumulations of the income hereinbefore mentioned;

(b) whenever in any year of assessment any sum whatsoever is paid under the trusts of such irrevocable instrument out of such property or the accumulations of the income thereof or out of the income of such property or the income of the said accumulations to or for the benefit of a child (being a child who, at the beginning of such year, is under the age of twenty-one years and is unmarried) of the settlor, such sum shall be deemed for the purposes of this Chapter to be paid as income, but subject to the limitation that this paragraph shall not apply to so much of such sum as is equal to the amount by which the aggregate of such sum and all other (if any) sums paid after the 5th day of April, 1937, under the trusts of such irrevocable instrument to or for the benefit of the said child or any other child (being a child who, at the beginning of the year of assessment in which such other sum was paid, was under the age of twenty-one years and unmarried) of the settlor exceeds the aggregate amount of the income arising after the 5th day of April, 1937, from such property together with the income arising after the said date from the said accumulations.

In this section “property” does not include any annual or other periodical payment secured by the covenant of the settlor, or by a charge made by the settlor on the whole or any part of his property or the whole or any part of his future income, or by both such covenant and such charge.

445 Meaning of “irrevocable instrument”.

445.—The following provisions shall have effect in relation to the construction of “irrevocable instrument” in this Chapter:

(a) an instrument shall not be an irrevocable instrument for the purposes of this Chapter if the trusts thereof provide for all or any one or more of the following matters:

(i) the payment or application to or for the settlor for his own benefit of any capital or income or accumulations of income in any circumstances whatsoever during the life of a child of the settlor to or for the benefit of whom any income or accumulations of income is or are or may be payable or applicable under the trusts of the instrument;

(ii) the payment or application during the life of the settlor to or for the wife or husband of the settlor for her or his own benefit of any capital or income or accumulations of income in any circumstances whatsoever during the life of any such child as aforesaid of the settlor;

(iii) the termination of the trusts of the instrument by the act or on the default of any person;

(iv) the payment by the settlor of a penalty in the event of his failing to comply with the provisions of the instrument;

(b) an instrument shall not be prevented from being an irrevocable instrument for the purposes of this Chapter by reason only that the trusts thereof include any one or more of the following provisions:

(i) a provision whereunder any capital or income or accumulations of income will or may become payable to or applicable for the benefit of the settlor, or the wife or the husband of the settlor, on the bankruptcy of a child of the settlor to or for the benefit of whom any income or accumulations of income is or are or may be payable or applicable under the trusts of the instrument;

(ii) a provision whereunder any capital or income or accumulations of income will or may become payable to or applicable for the benefit of the settlor, or the wife or the husband of the settlor, in the event of any such child as aforesaid of the settlor making an assignment of or charge on such capital or income or accumulations of income;

(iii) a provision for the termination of the trusts of the instrument in such circumstances or manner that such termination would not, during the life of any such child as aforesaid of the settlor, benefit any person other than such child or his or her wife, husband, or issue;

(c) “irrevocable instrument” includes instruments made before, as well as instruments made after, the passing of this Act.

446 Recovery of tax from trustee and payment to trustee of excess tax recoupment.

446.—(1) Where, by virtue of this Chapter, any income tax or sur-tax becomes chargeable on and is paid by a settlor, such settlor shall be entitled to recover from any trustee or other person to whom the income is payable by virtue or in consequence of the settlement the amount of the tax so paid, and for that purpose to require the Revenue Commissioners to furnish to him a certificate specifying the amount of the income in respect of which he has so paid tax and the amount of the tax so paid, and every certificate so furnished shall be conclusive evidence of the matters of fact stated therein.

(2) Where a person obtains, in respect of any allowance or relief, a repayment of income tax in excess of the amount of the repayment to which he would, but for this Chapter, have been entitled, an amount equal to the excess shall be paid by him to the trustee or other person to whom the income is payable by virtue or in consequence of the settlement and, where there are two or more such trustees or other persons, in such proportions as the circumstances may require.

If any question arises as to the amount of any payment or as to any apportionment to be made under this subsection, such question shall be decided by the Special Commissioners, whose decision thereon shall be final.

(3) Any income which by virtue of this Chapter is treated as income of any person shall be deemed to be the highest part of his income.

(4) No repayment shall be made under section 154 on account of tax paid in respect of any income which has by virtue of this Chapter been treated as income of a settlor.

447 Definitions.

447.—In the preceding provisions of this Chapter—

“child” includes a stepchild, an adopted child, and an illegitimate child;

“settlement” includes any disposition, trust, covenant, agreement, or arrangement, and any transfer of money or other property or of any right to money or other property;

“income” (except where, in sections 443 (1), 444 (b) and 446 (3) (4), it is immediately preceded by “as” or “his”) includes any income chargeable to income tax by deduction or otherwise and any income which would have been so chargeable if it had been received in the State by a person resident or ordinarily resident in the State.

448 Transfer of interests in trade to children.

448.—(1) Where by any means whatsoever (including indirect means or means consisting of a series of operations and whether adopted before or after the passing of this Act), a trade, which at any time before the adoption of such means was carried on by any person solely or in partnership, becomes a trade carried on by one or more than one child of such person or by way of a partnership in which such person and one or more than one child of such person are partners, the following provisions shall have effect:

(a) such means shall, for the purposes of this Chapter, be deemed to constitute a settlement as respects which such person shall be deemed to be the settlor,

(b) the profits or gains arising from the trade after the adoption of such means, in so far as they arise to (as the case may be) one or more than one child of such person or such person and one or more than one child of such person, shall for the purposes of this Chapter, be deemed to be the same income as would have arisen to such person had such means not been adopted, and

(c) “income” where it first occurs in section 443 shall be deemed to include the said profits or gains in so far as they arise to one or more than one child of such person.

(2) In subsection (1), the word “child” includes a stepchild, an adopted child, and an illegitimate child.

(3) The amount of the income of a person from the profits or gains of a trade which is to be deemed by virtue of subsection (1) to be income of another person shall, if the first-mentioned person is engaged actively in the carrying on of the trade, be the full amount of the said income reduced by a sum (in subsection (4) referred to as the appropriate sum) equal to the amount which would have been allowed in computing the said profits or gains in respect of the first-mentioned person if he, instead of being a person engaged in the carrying on of the trade, had been a person employed by a person or persons carrying on the trade.

(4) The appropriate sum shall be deemed to be profits or gains arising to the first-mentioned person referred to in subsection (3) from the exercise of an office or employment within the meaning of Schedule E.

Chapter III Transfers of Income Arising from Securities

449 Transfer of right to receive interest.

449.—(1) Where in any year of assessment the owner (in this section referred to as the owner) of any securities sells or transfers the right to receive any particular interest payable (whether before or after such sale or transfer) in respect of the said securities without selling or transferring the said securities, then and in every such case the following provisions shall apply and have effect, that is to say:—

(a) for all the purposes of this Act, the said interest (whether it would or would not be chargeable to tax if this section had not been enacted)—

(i) shall be deemed to be the income of the owner or, where the owner is not the beneficial owner of the said securities and some other person (in this section referred to as the beneficiary) is beneficially entitled to the income arising from the said securities, the income of the beneficiary, and

(ii) shall be deemed to be income of the owner or the beneficiary (as the case may be) for the said year of assessment, and

(iii) shall not be deemed to be income of any other person, and

(iv) shall, where the proceeds of the said sale or transfer are chargeable to tax under Schedule C or under Part XXXI be deemed to be equal in amount to the amount of the said proceeds;

(b) where the said right to receive the said particular interest is subsequently sold, transferred, or otherwise realised, the proceeds of such subsequent sale, transfer, or other realisation shall not be deemed, for any of the purposes of this Act, to be income of the person by or on whose behalf such subsequent sale, transfer, or other realisation is made or effected;