LegalizeFinance Act , 1990
PART I Income Tax, Corporation Tax and Capital Gains Tax
Chapter I Income Tax
1 Amendment of provisions relating to exemption from income tax.
1.—As respects the year 1990-91 and subsequent years of assessment, the Finance Act, 1980, is hereby amended—
(a) in section 1, by the substitution—
(i) in paragraph (b) of subsection (1), of “53 per cent.” for “60 per cent.”,
(ii) in subsection (2) (inserted by the Finance Act, 1989), of “£6,500” for “£6,000”, and “£3,250” for “£3,000”, and
(iii) in paragraph (a) of subsection (3) (inserted by the Finance Act, 1989), of “£300” for “£200”,
and
(b) in section 2, by the substitution—
(i) in subsection (3), of “53 per cent.” for “60 per cent.”, and
(ii) in subsection (6) (inserted by the Finance Act, 1989), of “£7,500” for “£6,800”, “£8,700” for “£8,000”, “£3,750” for “£3,400”, and “£4,350” for “£4,000”,
and the said paragraph (b), the said subsection (2), the said paragraph (a) and the said subsections (3) and (6), as so amended, are set out in the Table to this section.
TABLE
(b) an individual makes a claim for the purpose, makes a return in the prescribed form of his total income for that year and proves that it does not exceed a sum equal to twice the specified amount, he shall be entitled to have the amount of income tax payable in respect of his total income for that year, if that amount would, but for the provisions of this subsection, exceed a sum equal to 53 per cent. of the amount by which his total income exceeds the specified amount, reduced to that sum.
(2) In this section “the specified amount” means, subject to subsection (3)—
(a) in a case where the individual would, apart from this section, be entitled to a deduction specified in section 138 (a) of the Income Tax Act, 1967, £6,500, and
(b) in any other case, £3,250.
(a) For the purposes of this section and section 2, where a claimant proves that he has living, at any time during a year of assessment, any qualifying child, then, subject to subsection (4), the specified amount (within the meaning of this section or section 2, as the case may be) shall be increased, for that year of assessment, by £300 in respect of each such child.
(3) Where an individual to whom this section applies proves that his total income for a year of assessment for which this section applies does not exceed a sum equal to twice the specified amount, he shall be entitled to have the amount of income tax payable in respect of his total income for that year, if that amount would, but for the provisions of this subsection, exceed a sum equal to 53 per cent. of the amount by which his total income exceeds the specified amount, reduced to that sum.
(6) In this section “the specified amount” means, subject to subsection (3) of section 1—
(a) in a case where the individual would, apart from this section, be entitled to a deduction specified in section 138 (a) of the Income Tax Act, 1967, £7,500:
Provided that, if at any time during the year of assessment either the individual or his spouse was of the age of seventy-five years or upwards, “the specified amount” means £8,700, and
(b) in any other case, £3,750:
Provided that, if at any time during the year of assessment the individual was of the age of seventy-five years or upwards, “the specified amount” means £4,350.
2 Alteration of rates of income tax.
2.—Section 2 of the Finance Act, 1984, is hereby amended, as respects the year 1990-91 and subsequent years of assessment, by the substitution of the following Table for the Table to the said section:
“TABLE
PART I
| Part of taxable income | Rate of tax | Description of rate |
|---|---|---|
| (1) | (2) | (3) |
| The first £6,500 | 30 per cent. | the standard rate |
| The next £3,100 | 48 per cent. | the higher rates |
| The remainder | 53 per cent. |
PART II
| Part of taxable income | Rate of tax | Description of rate |
|---|---|---|
| (1) | (2) | (3) |
| The first £13,000 | 30 per cent. | the standard rate |
| The next £6,200 | 48 per cent. | the higher rates |
| The remainder | 53 per cent.”. |
3 Amendment of section 6 (special allowance in respect of P.R.S.I. for 1982-83) of Finance Act, 1982.
3.—Section 6 of the Finance Act, 1982, shall have effect for the purpose of ascertaining the amount of income on which an individual referred to therein is to be charged to income tax for the year 1990-91, as if in subsection (2)—
(a) “1990-91” were substituted for “1982-83”, and
(b) “£286” were substituted for “£312” in each place where it occurs.
4 Amendment of section 3 (employed person taking care of incapacitated individual) of Finance Act, 1969.
4.—As respects the year 1990-91 and subsequent years of assessment, section 3 of the Finance Act, 1969, is hereby amended, in subsection (1), by the substitution of “£5,000” for “£2,500” (inserted by the Finance Act, 1985) in each place where it occurs, and the said subsection (1), as so amended, is set out in the Table to this section.
TABLE
(1) Subject to the provisions of this section, an individual who, in the manner prescribed by the Income Tax Acts makes a claim in that behalf, makes a return in the prescribed form of his total income and proves—
(a) (i) that, throughout the year of assessment, he was totally incapacitated by physical or mental infirmity, or
(ii) that, being a husband, who, for the relevant year of assessment, is assessed to tax in accordance with the provisions of section 194 of the Income Tax Act, 1967, his wife was, throughout that year, totally incapacitated by physical or mental infirmity, and
(b) that for the year of assessment he has employed a person for the purpose of having the care of the person (being the individual or his wife) who is so incapacitated,
shall, in computing the amount of his taxable income, be entitled to have a deduction made from his total income of £5,000, if the amount ultimately borne by him in the year of assessment in employing the employed person is not less than £5,000, or the amount so borne, if it is less than £5,000.
5 Payments in respect of personal injuries.
5.—(1) This section applies to any payment which is made—
(a) to, or in respect of, an individual who is permanently and totally incapacitated by reason of mental or physical infirmity from maintaining himself, and
(b) following the institution by, or on behalf of, the individual of a civil action for damages in respect of personal injury giving rise to that mental or physical infirmity.
(2) Income which arises to a person, to or in respect of whom payments to which this section applies are made, from the investment, in whole or in part, of such payments or of income therefrom, being income consisting of dividends or other income which would, but for this section, be chargeable to tax under Schedule C or under Case III, IV (by virtue of section 4 of the Finance Act, 1974) or V of Schedule D or under Schedule F, shall be exempt from tax and shall not be reckoned in computing total income for the purposes of the Income Tax Acts but the provisions of those Acts in relation to the making of returns of total income shall apply as if this section had not been enacted:
Provided that this section shall not apply in a case unless the income so arising (hereinafter in this proviso referred to as “the exempt income”) is the sole or main income of the individual to or in respect of whom the exempt income arises.
(3) This section shall have effect as respects the year 1990-91 and subsequent years of assessment.
6 Amendment of provisions relating to relief in respect of premiums on certain insurances, etc.
6.—Section 8 of the Finance Act, 1989, shall have effect, as respects the year 1990-91 and subsequent years of assessment, as if “50 per cent.” were substituted for “80 per cent.”.
7 Tax treatment of certain payments made by the Haemophilia H.I.V. Trust.
7.—(1) In this section “the Trust” means the trust established by deed dated the 22nd day of November, 1989, between the Minister for Health and certain other persons and referred to in the deed as “the Haemophilia H.I.V. Trust” or “the HHT”.
(2) This section applies to income consisting of payments made by the trustees of the Trust to, or in respect of, a beneficiary under the Trust, whether that income has arisen before or arises after the passing of this Act.
(3) Notwithstanding any provision of the Income Tax Acts, income to which this section applies shall be disregarded for all the purposes of those Acts.
8 Amendment of section 13 (surcharge on certain income of trustees) of Finance Act, 1976.
8.—As respects the year 1990-91 and subsequent years of assessment, section 13 of the Finance Act, 1976, is hereby amended by the substitution, in subsection (2), of the following paragraphs for paragraph (a):
“(a) Income to which this section applies shall, in addition to being chargeable to income tax at the standard rate for the year of assessment for which it is so chargeable, be charged to an additional duty of income tax (hereinafter referred to as ‘a surcharge’) at the rate of 20 per cent.
(aa) A surcharge to be made on trustees under this section in respect of income arising in a year of assessment (hereinafter referred to as ‘the first year of assessment’) shall—
(i) be charged on the trustees for the year of assessment in which a period of eighteen months beginning immediately after the end of that first year of assessment ends, and
(ii) be treated as income tax chargeable for the year of assessment for which it is so charged.”.
9 Amendment of section 28 (farming: provision relating to relief in respect of increase in stock values) of Finance Act, 1980.
9.—As respects disposals made on or after the 6th day of April, 1990, section 28 of the Finance Act, 1980, is hereby amended in paragraph (b) of subsection (3)—
(a) by the substitution in subparagraph (ii) of “two years” for “one year”,
(b) by the substitution in subparagraph (ii) of the following clause for clause (II):
“(II) the value of the said trading stock at the beginning of the immediately succeeding accounting period or at the beginning of the accounting period next after that period, where appropriate,”,
and
(c) by the substitution of the following paragraph for paragraph (A) of the proviso:
“(A) this subsection shall not be construed as enabling the value of trading stock at the end of an accounting period or, as the case may be, at the beginning of an immediately succeeding accounting period or of the accounting period next after that period, to exceed the value of the trading stock at the beginning of the first-mentioned accounting period,”,
and the said paragraph (b) (other than subparagraph (i) and the proviso), as so amended, is set out in the Table to this section.
TABLE
(b) Where—
(ii) apart from the provisions of this subsection, the value of the trading stock of the said trade of farming at the beginning of the accounting period exceeds the value of the trading stock at the end of the accounting period, the person may elect, by notice in writing given to the inspector not later than two years after the end of the accounting period, that for the purpose of section 31 of and the Third Schedule to the Finance Act, 1975, and section 12 of the Finance Act, 1976—
(I) the value of the trading stock of the trade of farming at the end of the accounting period, and
(II) the value of the said trading stock at the beginning of the immediately succeeding accounting period or at the beginning of the accounting period next after that period, where appropriate,
shall be computed as if the said stock to which this subsection applies had not been disposed of:
10 Amendment of Chapter III (Income Tax: Relief for Investment in Corporater Trades) of Part I of Finance Act, 1984.
10.—Chapter III of Part I of the Finance Act, 1984, is hereby amended—
(a) in subsection (1) of section 11—
(i) by the insertion of the following definition before the definition of “associate”:
“‘advance factory building’ means a factory building the construction of which is—
(a) promoted by a local community group the objective of which, or one of the main objectives of which, is to promote the development of, and the creation of opportunities for employment in, its locality, and
(b) undertaken without any prior commitment, either direct or indirect, in writing or otherwise, by a person that either he or any other person will enter into a lease for its use;”,
and
(ii) by the insertion of the following definitions after the definition of “director”:
“‘factory building’ has the meaning assigned to it by section 2 (1) of the Industrial Development Act, 1986;
‘industrial development agency’ means the Industrial Development Authority, the Shannon Free Airport Development Company Limited or Údarás na Gaeltachta, as may be appropriate;”,
(b) in section 12—
(i) by the substitution of the following subparagraph for subparagraph (ii) of paragraph (c) of subsection (1):
“(ii) with a view to the creation or maintenance of employment in the company or, in the case of qualifying trading operations to which section 16 (2) (a) (iiib) (inserted by the Finance Act, 1990) relates, in either or both a company contracted to construct the advance factory building concerned and a company which enters into a lease for its use:”,
(ii) by the insertion of the following additional proviso to paragraph (c) of subsection (1):
“Provided also that where the money raised was used, is being used, or is intended to be used, for the purpose of the construction and the leasing of an advance factory building, the aforementioned evidence shall include a certificate by an industrial development agency certifying that it has satisfied itself—
(i) that the building is or will be an advance factory building, and
(ii) that—
(I) the advance factory building is or will be situated in an area which, on the basis of guidelines agreed between it and the Minister for Industry and Commerce or the Minister for the Gaeltacht (as may be appropriate in the circumstances) and with the consent of the Minister for Finance, was or is in particular need of development and of the creation of opportunities for employment, and
(II) its construction contributes or will contribute significantly to meeting those needs.”,
and
(iii) by the insertion of the following proviso to subsection (4):
“Provided that, in the case of qualifying trading operations to which section 16 (2) (a) (iiib) (inserted by the Finance Act, 1990) relates, the trade shall be deemed to have commenced on the date on which the construction of the advance factory building commenced.”,
and
(c) in section 16—
(i) by the substitution, in paragraph (a) of subsection (2)—
(I) of the following proviso for the proviso to subparagraph (i):
“Provided that trading operations or activities included in the definition, or regarded as the manufacture within the State, of goods for the purposes of the said Chapter VI by any enactment enacted after the passing of this Act (other than section 41 of the Finance Act, 1990), shall not, subject to the following provisions of this paragraph, be regarded as qualifying trading operations for the purposes of this Chapter,”,
and
(II) of the following subparagraph for subparagraph (ii):
“(ii) in respect of a subscription for eligible shares issued on or after the passing of the Finance Act, 1990, the rendering of services (other than relevant trading operations within the meaning of section 39B, inserted by the Finance Act, 1987, of the Finance Act, 1980) in the course of a service industry (within the meaning of the Industrial Development Act, 1986) in respect of which—
(I) an employment grant was made by the Industrial Development Authority under section 25 of the Industrial Development Act, 1986, or
(II) a grant under section 3, or financial assistance under section 4, of the Shannon Free Airport Development Company Limited (Amendment) Act, 1970, was made available by the Shannon Free Airport Development Company Limited, or
(III) financial assistance was made available by Údarás na Gaeltachta under section 10 of the Údarás na Gaeltachta Act, 1979,”,
(ii) by the insertion, in paragraph (a) of subsection (2), of the following subparagraph:
“(iiib) in respect of a subscription for eligible shares made on or after the passing of the Finance Act, 1990, the construction and the leasing of an advance factory building,”,
(iii) by the substitution, in subsection (2), of the following paragraph for paragraph (II) of the second proviso (inserted by the Finance Act, 1989):
“(II) the leasing of land or buildings (other than the leasing of an advance factory building), or”,
and
(iv) by the substitution of the following subsection for subsection (4):
“(4) References in this Chapter to a trade shall be construed—
(a) without regard to so much of the definition of ‘trade’ in section 1 (1) of the Income Tax Act, 1967, as relates to adventures or concerns in the nature of trade, and
(b) as including the construction and the leasing of an advance factory building:
Provided that, for all other purposes of the Tax Acts, the question of whether a trade is being carried on shall be determined without regard to this subsection.”.
11 Restriction of relief to individuals on loans applied in acquiring shares in companies.
11.—Notwithstanding the provisions of section 34 of the Finance Act, 1974, and section 8 of the Finance Act, 1978, relief shall not be given under the said section 34 or the said section 8 in respect of any payment of interest on any loan applied in acquiring shares issued on or after the 20th day of April, 1990 (being shares forming part of the ordinary share capital of a company) if a claim for relief under Chapter III of Part I of the Finance Act, 1984, is made in respect of the amount subscribed for those shares.
12 Amendment of Schedule 3 (reliefs in respect of tax charged on payments on retirement, etc.) to Income Tax Act, 1967.
12.—Schedule 3 to the Income Tax Act, 1967, is hereby amended, as on and from the 20th day of April, 1990—
(a) by the substitution of the following subparagraph for subparagraph (c) of paragraph 4:
“(c) there shall be deducted from the product at (b) an amount equal to the relevant capital sum in relation to the office or employment.”,
and
(b) by the substitution of the following paragraph for paragraph 6:
“6. (a) In this Schedule ‘the relevant capital sum in relation to an office or employment’ means the aggregate of—
(i) the amount of any lump sum (not chargeable to tax) received, and
(ii) the amount equal to the value, at the relevant date, of any lump sum (not chargeable to tax) receivable, and
(iii) the amount equal to the value, at the relevant date, of any lump sum (not chargeable to tax) which, upon the exercise of an option or a right to commute, in whole or in part, a pension in favour of a lump sum, may be received in the future,
by the holder in respect of the office or employment in pursuance of any such scheme or fund as is referred to in section 115 (1) (d):
Provided that the relevant capital sum in relation to an office or employment shall include the amount mentioned in clause (iii) irrespective of whether or not the option or right referred to in that clause is exercised:
Provided also that, where, under the conditions or terms of any such scheme or fund as is referred to in section 115 (1) (d), the holder of the office or employment is entitled to surrender irrevocably the option or right referred to in clause (iii) and has done so at the relevant date, the relevant capital sum in relation to an office or employment shall not include the amount mentioned in that clause.
(b) In computing the charge to tax in respect of a payment chargeable to tax under section 114 in the case of a claimant, if the claimant has not previously made a claim under section 115 and the relevant capital sum (if any) in relation to the office or employment in respect of which the payment is made does not exceed £4,000, section 115 (3) and paragraph 3 shall apply to that payment as if each reference to £6,000 were a reference to £6,000 increased by the amount by which £4,000 exceeds that relevant capital sum.”.
13 Exemption of local authorities, etc., from certain tax provisions.
13.—(1) Notwithstanding any provision of the Income Tax Acts, other than the provisions of Chapter IV of Part I of the Finance Act, 1986, income arising to a body to which this section applies shall be exempt from income tax.
(2) This section shall have effect as respects the year 1973-74 and subsequent years of assessment.
(3) This section shall apply to each of the following bodies, that is to say:
(a) a local authority;
(b) a health board;
(c) a vocational education committee established under the Vocational Education Acts, 1930 to 1970;
(d) a committee of agriculture established under the Agriculture Acts, 1931 to 1980.
(4) In this section “local authority” has the meaning assigned to it by section 2 (2) of the Local Government Act, 1941, and includes a body established under the Local Government Services (Corporate Bodies) Act, 1971.
Chapter II Change in Basis of Assessment and Consequential Provisions
14 Basis of assessment: Cases I and II of Schedule D.
14.—(1) As respects the year 1990-91 and subsequent years of assessment, section 58 of the Income Tax Act, 1967, is hereby amended—
(a) by the deletion, in subsection (1), of “the year preceding”, and
(b) by the substitution of the following subsections for subsections (3) and (4):
“(3) Any person chargeable with income tax in respect of the profits or gains of any trade or profession which has been set up and commenced within the year preceding the year of assessment shall be charged on the full amount of the profits or gains for one year from the time of such setting up and commencement.
(4) Any person chargeable with income tax in respect of the profits or gains of any trade or profession which has been set up and commenced within the year next before the year preceding the year of assessment shall be entitled, on giving notice in writing to the inspector with the return required under section 10 of the Finance Act, 1988, for the year of assessment, to have the assessment reduced by the amount (if any) by which the amount of the assessment for the year preceding the year of assessment exceeds the full amount of the profits or gains of that preceding year:
Provided that, where the said excess is greater than the amount of the assessment, the difference between the excess and the amount of the assessment shall be treated, for the purposes of section 309 of the Income Tax Act, 1967, as if it were a loss sustained in a trade in that year of assessment.”,
and the said subsection (1), as so amended, is set out in the Table to this subsection.
TABLE
(1) Subject to the provisions of this section and sections 59 and 60, tax shall be charged under Case I or Case II of Schedule D on the full amount of the profits or gains of the year of assessment.
(2) In relation to a trade or profession which is permanently discontinued on or after the 6th day of April, 1991, section 3 of the Finance Act, 1971, shall cease to have effect.
15 Period of computation of profits.
15.—As respects the year 1990-91 and subsequent years of assessment, the Income Tax Act, 1967, is hereby amended by the substitution of the following section for section 60:
“60.— (1) Where, in the case of any trade or profession, it has been customary to make up accounts—
(a) if only one account was made up to a date within the year of assessment, and that account was for a period of one year, the profits or gains of the year ending on that date shall be taken to be the profits or gains of the year of assessment;
(b) if an account, other than an account to which paragraph (a) applies, was made up to a date in the year of assessment, or if more accounts than one were made up to dates in the year of assessment, the profits or gains of the year ending on that date, or on the last of those dates, as the case may be, shall be taken to be the profits or gains of the year of assessment;
(c) in any other case, the profits or gains of the year of assessment shall be determined in accordance with the provisions of subsection (1) of section 58.
(2) Where the profits or gains of a year of assessment have been computed on the basis of a period in accordance with the provisions of paragraph (b) or (c) of subsection (1) and the profits of the corresponding period relating to the immediately preceding year of assessment exceed the profits or gains charged to income tax for that year, then the profits of that corresponding period shall be taken to be the profits or gains of that preceding year of assessment and the assessment shall be amended accordingly.
(3) In the case of the death of a person who, if he had not died, would, under the provisions of this section, have become chargeable to income tax for any year of assessment, the tax which would have been so chargeable shall be assessed and charged upon his executors or administrators and shall be a debt due from and payable out of his estate.”.
16 Basis of assessment: transitional provisions.
16.—(1) In this section—
“basis period for the year 1990-91” means the period on the profits or gains of which income tax for the year 1990-91 falls to be finally computed for the purposes of Case I and Case II of Schedule D;
“corresponding period” means the period of 12 months immediately preceding the basis period for the year 1990-91.
(2) Subject to subsections (4) and (5), the provisions of subsection (3) shall apply, in determining for the year 1990-91 the full amount of the profits or gains of a trade or profession where the trade or profession was set up and commenced before the 6th day of April, 1989.
(3) Where this subsection applies, the assessment which, by virtue of section 58 of the Income Tax Act, 1967 (as amended by section 14), falls to be made for the year 1990-91, shall be reduced by the excess of the amount of the profits or gains of the basis period for the year 1990-91 over one-half of the aggregate of the profits or gains of that basis period and of the profits or gains, if any, of the corresponding period:
Provided that the assessment for the year 1990-91 shall not be reduced under the provisions of this section to an amount which is less than the amount determined by the formula—
| 125 | ||
|---|---|---|
| A | ___ | |
| 100 |
where A is the amount of the profits or gains of the corresponding period.
(4) Where an individual is charged to income tax for the year 1990-91 on the full amount of the profits or gains from farming determined in accordance with the provisions of subsection (2) of section 20B of the Finance Act, 1974 (as amended by section 20), the provisions of subsection (3) shall have effect as if—
(a) the reference to the amount of the profits or gains of the basis period for the year 1990-91 were a reference to the full amount of the profits or gains from farming of the individual determined without regard to the other provisions of this section but in accordance with the provisions of subsection (2) of the said section 20B (as so amended) for the year 1990-91,
(b) the reference to the amount of the profits or gains of the corresponding period were a reference to the full amount of the profits or gains determined upon a fair and just average of the profits or gains from farming of the individual in each of the 3 years ending on the date 12 months immediately before the end of the basis period for the year 1990-91, and
(c) the reference in subsection (3) to section 58 of the Income Tax Act, 1967, were a reference to subsection (2) of the said section 20B (as so amended).
(5) Where, under the provisions of section 58 (5) (a) (ii) of the Income Tax Act, 1967 (as amended by section 14), profits or gains of the year ending on the 5th day of April, 1991, are to be computed or the assessment for the year 199091 is to be amended, then those profits or gains shall be computed without reference to the provisions of this section and the said assessment shall be amended accordingly.
17 Basis of assessment: Case III of Schedule D.
17.—(1) As respects the year 1990-91 and subsequent years of assessment—
(a) Chapter IV of Part IV of the Income Tax Act, 1967, is hereby amended—
(i) by the substitution of the following section for section 75:
“75.— Income or profits chargeable under Case III of Schedule D shall, for all the purposes of ascertaining liability to income tax, be deemed to issue from a single source, and the provisions of section 77 shall apply accordingly.”,
(ii) in section 76, by the deletion, in subsections (1) and (3), of “the year preceding”, and
(iii) in section 77, by the substitution of the following subsection for subsection (1):
“(1) Tax under Case III of Schedule D shall be computed on the full amount of the profits or income arising within the year of assessment.”,
and
(b) Part III of Schedule 6 to the Income Tax Act, 1967, is hereby amended by the deletion, in subparagraph (2) of paragraph 1, of “the year preceding”,
and the said subsections (1) and (3) of the said section 76 and the said subparagraph (2), as so amended, are set out in the Table to this subsection.
TABLE
(1) Subject to the provisions of this section and section 77, tax chargeable under Case III of Schedule D in respect of income arising from securities and possessions in any place outside the State shall be computed on the full amount thereof arising in the year of assessment whether the income has been or will be received in the State or not, subject, in the case of income not received in the State—
(a) to the same deductions and allowances as if it had been so received; and
(b) to the deduction, where such deduction cannot be made under, and is not forbidden by, any other provision of this Act, of any sum which has been paid in respect of income tax in the place where the income has arisen; and
(c) to a deduction on account of any annual interest or any annuity or other annual payment payable out of the income to a person not resident in the State,
and the provisions of this Act (including those relating to the delivery of statements) shall apply accordingly.
(3) In the cases mentioned in subsection (2), the tax shall, subject to the provisions of section 77, be computed on the full amount of the actual sums received in the State from remittances payable in the State, or from property imported, or from money or value arising from property not imported, or from money or value so received on credit or on account in respect of such remittances, property, money or value brought into the State in the year of assessment without any deduction or abatement.
(2) The following provisions shall have effect for the purposes of Case III of Schedule D, notwithstanding anything to the contrary in section 76 or 77:
The tax in respect of income arising from possessions in Great Britain or Northern Ireland, other than stocks, shares, or rents or the occupation of land, shall be computed either on the full amount thereof arising in the year of assessment or on the full amount thereof on an average of such period as the case may require and as may be directed by the Appeal Commissioners, so that according to the nature of the income the tax may be computed on the same basis as that on which it would have been computed if the income had arisen in the State, and subject in either case to a deduction on account of any annual interest or any annuity or other annual payment payable out of the income to a person not resident in the State and the provisions of this Act (including those relating to the delivery of statements) shall apply accordingly; and the person chargeable and assessable shall be entitled to the same allowances, deductions, and reliefs as if the income had arisen in the State:
In this paragraph “rents” includes any payment in the nature of a royalty and any annual or periodical payment in the nature of a rent derived from any lands, tenements or hereditaments, including lands, tenements and hereditaments to which section 56 would apply or have applied if such lands, tenements and hereditaments were situate in the State.
(2) In respect of a person who, on or after the 6th day of April, 1991, ceases to possess the whole of a single source of income or profit as is referred to in section 75 (as amended by this section) of the Income Tax Act, 1967, subsections (3) and (4) of section 77 of the Income Tax Act, 1967, shall not apply or have effect.
18 Basis of assessment: Case V of Schedule D.
18.—(1) As respects the year 1990-91 and subsequent years of assessment, Chapter VI of Part IV of the Income Tax Act, 1967, is hereby amended—
(a) in subsection (3) of section 81 (inserted by the Finance Act, 1969), by the substitution of the following paragraph for paragraph (a):
“(a) Tax under Case V of Schedule D shall be computed on the full amount of the profits or gains arising within the year of assessment.”,
(b) in subsection (1) of section 89 (as so inserted)—
(i) by the deletion of “may, on a claim being made in that behalf, be deducted from or set off, as far as may be, against the amount of profits or gains on which the person chargeable is assessed under Case V of Schedule D for that year, and any portion of the excess for which relief is not so given”, and
(ii) by the substitution of “the person chargeable” for “he”,
and
(c) in subsection (2) of section 89 (as so inserted), by the deletion of “by way of carrying forward any portion of such excess as is referred to in subsection (1)”,
and the said section 89, as so amended, is set out in the Table to this subsection.
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89.— (1) Where in any year of assessment the aggregate amount of the deficiencies, computed in accordance with section 81 (4), exceeds the aggregate of the surpluses as so computed, the excess shall be carried forward and, so far as may be, deducted from or set off against the amount of profits or gains on which the person chargeable is assessed under Case V of Schedule D for any subsequent year of assessment, and, if tax has been overpaid, the amount overpaid shall be repaid.
(2) Any relief under this section shall be given as far as possible from the first subsequent assessment, and so far as it cannot be so given then from the next assessment and so on.
(2) In respect of a person who, on or after the 6th day of April, 1991, ceases to possess the whole of a single source of profits or gains as is referred to in section 81 (2) of the Income Tax Act, 1967, paragraphs (b) and (c) of subsection (3) of the said section 81 shall not apply or have effect.
19 Basis of assessment: Schedule E.
19.—As respects the year 1990-91 and subsequent years of assessment, Chapter I of Part V of the Income Tax Act, 1967, is hereby amended—
(a) by the substitution of the following section for section 110:
“110.—Tax under Schedule E shall be annually charged on every person having or exercising an office or employment of profit mentioned in that Schedule, or to whom any annuity, pension or stipend, chargeable under that Schedule, is payable, in respect of all salaries, fees, wages, perquisites or profits whatsoever therefrom and shall be computed on the amount of all such salaries, fees, wages, perquisites or profits whatsoever therefrom for the year of assessment.”,
and
(b) by the deletion of section 111:
Provided that the deletion of the said section 111 shall not affect any enactment which contains reference to the said section or any part of it.
20 Basis of assessment: consequential provisions.
20.—(1) As respects the year 1990—91 and subsequent years of assessment, Schedule 18 to the Income Tax Act, 1967, is hereby amended—
(a) by the substitution, in paragraphs II, III and IV of “the year of assessment” for “the preceding year” in each place where it occurs, and
(b) by the deletion, in paragraph VI, of “or of the preceding year, as the case shall require”,
and the said paragraphs II, III, IV and VI, as so amended, are set out in the Table to this subsection.
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The amount of the profits or gains thereof arising within the year of assessment.
The full amount of the profits or gains arising therefrom within the year of assessment.
(1) The full amount arising within the year of assessment, and the amount of every deduction or allowance claimed in respect thereof, together with the particulars of such deduction and the grounds for claiming such allowance; or
(2) In the case of any such person who satisfies the Revenue Commissioners that he is not domiciled in the State, or that being a citizen of Ireland he is not ordinarily resident in the State, or in the case of income arising from such securities and possessions aforesaid which form part of the investments of the foreign life assurance fund of an assurance company the full amount of the actual sums received in the State from remittances payable in the State or from property imported, or from money or value arising from property not imported, or from money or value so received on credit or on account in respect of such remittances, property, money or value brought into the State in the year of assessment without any deduction or abatement.
The amount of the salary, fees, wages, perquisites, and profits of the year of assessment.
(2) As respects the year 1990-91 and subsequent years of assessment, section 20B (inserted by the Finance Act, 1981) of the Finance Act, 1974, is hereby amended—
(a) by the substitution, in subsection (2), of the following paragraph for paragraph (a):
“(a) An individual who is to be charged to tax for a year of assessment in respect of profits or gains from farming in accordance with the provisions of this subsection shall be so charged under Case I of Schedule D on the full amount of those profits or gains determined upon a fair and just average of the profits or gains from farming of the individual in each of the three years ending on that date in the year of assessment to which it has been customary to make up accounts or, where it has not been customary to make up accounts, on the 5th day of April in the year of assessment.”,
and
(b) by the substitution of the following subsection for subsection (4):
“(4) Where, for a year of assessment, an individual is, by virtue of subsection (3), chargeable to tax in respect of profits or gains from farming in accordance with the provisions of subsection (2) and he was so chargeable for each of the three years of assessment immediately preceding the year of assessment, he may, by notice in writing given to the inspector with the return required under section 10 of the Finance Act, 1988, for the said year of assessment, elect to be charged to tax for that year of assessment in accordance with the provisions of section 58 of the Income Tax Act, 1967:
Provided that where, for any year of assessment, in the case of an individual, subsection (3) does not apply by reason of paragraph (a) of the proviso to the said subsection (3), he shall be deemed to be entitled to elect and to have duly elected, as respects that year of assessment, in accordance with this subsection.”.
(3) The provisions specified in the Table to this subsection shall not apply or have effect for the year 1990-91 or any subsequent year of assessment.
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(a) Paragraphs (a) and (c) in Part I of the Table to section 17 of the Finance Act, 1980.
(b) Paragraphs (a) and (b) of section 9 of the Finance Act, 1981.
(4) (a) In this subsection—
“deficiency” means a deficiency computed in accordance with subsection (4) of section 81 of the Income Tax Act, 1967;
“excepted premises” means a premises other than a qualifying premises;
“qualifying expenditure” means expenditure which would, but for the provisions of this Chapter, qualify for relief under any of the specified sections;
“qualifying premises” means a premises or building in respect of which any of the specified sections apply;
“specified sections” means—
(i) sections 23 and 24 of the Finance Act, 1981,
(ii) sections 21 and 22 of the Finance Act, 1985, and
(iii) sections 43 and 44 of the Finance Act, 1986;
“surplus” means a surplus computed in accordance with subsection (4) of section 81 of the Income Tax Act, 1967.
(b) Where a person, who is within the charge to income tax, has incurred qualifying expenditure in the year 1989-90, the provisions of section 89 of the Income Tax Act, 1967, as they apply for the year 1989-90, shall have effect in relation to a deficiency in respect of rent from a qualifying premises as if the other provisions of this Chapter had not been enacted and no surplus from excepted premises arose in the year 1989-90:
Provided that where the person is chargeable under Case V for the year 1989-90 on the basis of the profits or gains arising in that year, the provisions of this paragraph shall not apply or have effect.
21 Capital allowances: transitional provisions.
21.—(1) In this section—
“basis period for the year 1990-91” has the meaning assigned to it by section 16;
“basis period for the year 1989-90” means the period on the profits or gains of which income tax for the year 1989-90 falls to be finally computed for the purposes of Case I or II of Schedule D in accordance with the provisions (as if this Act had not been enacted) of Chapter II of Part IV of the Income Tax Act, 1967;
“intervening period” means the period beginning immediately after the end of the basis period for the year 1989-90 and ending immediately before the commencement of the basis period for the year 1990-91;
“relevant expenditure” means capital expenditure incurred by a person—
(a) on the provision, for the purposes of a trade or profession, of machinery or plant,
(b) for the purposes of a trade of farming farmland occupied by him, on the construction of farm buildings (excluding a building or part of a building used as a dwelling), fences, roadways, holding yards, drains or land reclamation or other works, or
(c) on the construction of a building or structure which is, or is to be, an industrial building or structure for the purposes of Chapter II of Part XV (as amended by section 34 of the Finance Act, 1975) of the Income Tax Act, 1967.
(2) Notwithstanding any other provision of the Tax Acts, where a person has incurred relevant expenditure to which this subsection applies then, as respects that expenditure—
(a) allowances shall not be made under sections 251 (as amended by this Act) and 254 (as amended by this Act) of the Income Tax Act, 1967,
(b) an allowance which falls to be made under section 241 (as amended by this Act) of the Income Tax Act, 1967, shall not be increased under section 11 (as amended by this Act) of the Finance Act, 1967, or section 26 (as amended by this Act) of the Finance Act, 1971,
(c) an allowance which falls to be made under section 22 (as amended by this Act) of the Finance Act, 1974, shall not be increased under the proviso to subsection (2) of that section, and
(d) an allowance which falls to be made under section 264 (as amended by section 50 of the Finance Act, 1988) of the Income Tax Act, 1967, shall not be increased under section 25 (as amended by this Act) of the Finance Act, 1978.
(3) Subsection (2) applies to relevant expenditure incurred by a person in the intervening period.
(4) Subsection (3) shall not have effect in relation to a person where he so elects, by giving notice in writing to the inspector with the return for the year 1990-91 which is required under section 10 of the Finance Act, 1988.
(5) Where a person makes an election under subsection (4), the provisions of subsection (2) shall apply to relevant expenditure incurred by the person in the basis period for the year 1990-91.
22 Capital allowances: consequential provisions.
22.—(1) The Income Tax Act, 1967, is hereby amended—
(a) in section 262—
(i) by the deletion, in paragraph (b) of subsection (2), of “or of the cessation of the single source of profits or gains mentioned in section 81 (2)”, and
(ii) by the deletion, in paragraph (c) of subsection (2), of “or the said single source ceases” and of “or the cessation”, and
(b) in section 297—
(i) by the deletion, in paragraph (b) of subsection (2), of “or of the cessation of the single source of profits or gains mentioned in section 81 (2)”, and
(ii) by the deletion, in paragraph (c) of subsection (2), of “or the said single source ceases” and of “or the cessation”,
and the said paragraphs (b) and (c) of the said subsection (2) of the said section 262 and the said paragraphs (b) and (c) of the said subsection (2) of the said section 297, as so amended, are set out, respectively, in the Table to this subsection.
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(b) where there is an interval between the end of the basis period for one year of assessment and the basis period for the next year of assessment, then, unless the second-mentioned year of assessment is the year of the permanent discontinuance of the trade or profession, the interval shall be deemed to be part of the second basis period; and
(c) where there is an interval between the end of the basis period for the year of assessment preceding that in which the trade or profession is permanently discontinued and the basis period for the year in which the permanent discontinuance occurs, the interval shall be deemed to form part of the first basis period.
(b) where there is an interval between the end of the basis period for one year of assessment and the basis period for the next year of assessment, then, unless the second-mentioned year of assessment is the year of the permanent discontinuance of the trade, the interval shall be deemed to be part of the second basis period, and
(c) where there is an interval between the end of the basis period for the year of assessment preceding that in which the trade is permanently discontinued and the basis period for the year in which the permanent discontinuance occurs, the interval shall be deemed to form part of the first basis period.
(2) Section 22 of the Finance Act, 1974, is hereby amended by the substitution in subsection (2A) (c) of “For the purposes of this section” for “For the purpose of this subsection” and the said subsection (2A) (c), as so amended, is set out in the Table to this subsection.
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(c) For the purposes of this section “basis period” has the meaning assigned to it by section 297 of the Income Tax Act, 1967.
23 Tax returns.
23.—(1) Section 70 of the Income Tax Act, 1967, is hereby amended—
(a) in subsection (1)—
(i) by the deletion, in paragraph (a), of “(in this section referred to as the preceding year) immediately preceding the year of assessment”,
(ii) by the substitution, in paragraph (b), of “the year of assessment” for “the preceding year”, and
(iii) by the deletion, in paragraph (c), of “the preceding year or”,
and
(b) by the substitution of the following subsection for subsection (2):
“(2) The amount of income from any source to be included in a return under this section shall be computed in accordance with the provisions of this Act:
Provided that where, in the case of a trade, an account has been made up to a date within the year of assessment or more accounts than one have been made up to dates within that year, the computation shall be made by reference to the period or to all the periods, where there are more than one, for which accounts have been made up as aforesaid.”.
(2) Section 172 of the Income Tax Act, 1967, is hereby amended—
(a) in subsection (1)—
(i) by the deletion, in paragraph (a), of “(in this section referred to as the preceding year) immediately preceding the year of assessment”,
(ii) by the substitution, in paragraph (b), of “the year of assessment” for “the preceding year”, and
(iii) by the deletion, in paragraph (c), of the words “the preceding year or”,
and
(b) in subsection (2)—
(i) by the deletion of “save that the computation shall be made in all cases by reference to the preceding year”, and
(ii) by the substitution of the following proviso for the proviso thereto:
“Provided that where, under section 60 (as amended by the Finance Act, 1990), the profits or gains of a year ending on a date within the year of assessment are to be taken to be the profits or gains of that year of assessment, the computation shall be made by reference to the said year ending on a date within that year of assessment.”,
and the said subsection (1) of the said section 70 and the said subsections (1) and (2) (other than the proviso) of section 172, as so amended, are set out, respectively, in the Table to this subsection.
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(1) The precedent partner of any partnership, when required to do so by a notice given to him in relation to any year of assessment by an inspector, shall, within the time limited by the notice, prepare and deliver to the inspector a return in the prescribed form of—
(a) all the sources of income of the partnership for the year of assessment in relation to which the notice is given;
(b) the amount of income from each source for the year of assessment computed in accordance with subsection (2);
(c) such further particulars for the purposes of income tax for the year of assessment as may be required by the notice or indicated by the prescribed form.
(1) Every individual, when required to do so by a notice given to him in relation to any year of assessment by an inspector, shall, within the time limited by the notice, prepare and deliver to the inspector a return in the prescribed form of—
(a) all the sources of his income for the year of assessment in relation to which the notice is given;
(b) the amount of income from each source for the year of assessment computed in accordance with subsection (2);
(c) such further particulars for the purposes of income tax for the year of assessment as may be required by the notice or indicated by the prescribed form.
(2) The amount of income from any source to be included in a return under this section shall be computed in accordance with the provisions of this Act:
(3) The Finance Act, 1988, is hereby amended—
(a) by the substitution, in the definition of “specified return date for the chargeable period”, in subsection (1) of section 9, of the following paragraph for paragraph (a):
“(a) where the chargeable period is a year of assessment, the 31st day of January in the year of assessment following that year, and”,
and
(b) by the substitution, in paragraph (a) of subsection (1) of section 10, of “which is” for “immediately preceding”,
and the said paragraph (a), as so amended, is set out in the Table to this subsection.
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(a) in the case of a chargeable person, who is chargeable to income tax for a chargeable period which is a year of assessment, all such matters and particulars as would be required to be contained in a statement delivered pursuant to a notice given to the chargeable person by the appropriate inspector under section 169 of the Income Tax Act, 1967, if the period specified in such notice were the year of assessment which is the relevant chargeable period, and where the chargeable person is an individual who is chargeable to income tax for a relevant chargeable period, in addition to such matters and particulars as aforesaid, all such matters and particulars as would be required to be contained in a return for the period delivered to the appropriate inspector pursuant to a notice given to the chargeable person by the appropriate inspector under section 172 of the said Act, or
(4) (a) Every chargeable person (as defined in section 9 of the Finance Act, 1988), who is within the charge to income tax, shall prepare and deliver to the appropriate inspector (as defined in the said section 9) a return in the prescribed form of all such matters and particulars as would have been included in a return for the year of assessment 1990-91 if the provisions of this Chapter, other than this subsection, had not been enacted.
(b) The return to which this subsection applies shall be identified and referred to as the “1990 Income Tax Return”.
(c) Sections 500 and 503 of the Income Tax Act, 1967, shall apply to a failure to deliver a return in accordance with this subsection as they apply to a failure to deliver a return referred to in the said section 500, and Schedule 15 to that Act is hereby amended by the insertion, in column 1, of “Finance Act, 1990, section 23 (4)”.
(d) Section 48 (as amended by this Act) of the Finance Act, 1986, shall have effect as if the definition of “return of income” in subsection (1) (a) of that section included the return to which this subsection applies and as if that section provided that the specified date in relation to that return was 31 January, 1991.
(5) Subsections (1), (2) and (3) shall apply and have effect as respects the year 1990-91 and subsequent years of assessment.
24 Payment of tax.
24.—As respects the year 1990-91 and subsequent years of assessment and as respects accounting periods ending on or after the 6th day of April, 1990—
(a) section 477 (inserted by the Finance Act, 1980) of the Income Tax Act, 1967, is hereby amended, in subsection (1)—
(i) by the substitution of “1st day of November” for “1st day of October”, in both places where it occurs, and
(ii) by the substitution of “not later than one month from the date” for “on the day next after the day”,
(b) section 550 (2) of the Income Tax Act, 1967, and section 27 (4) of the Finance Act, 1982, shall cease to have effect,
(c) section 6 (as amended by the Finance Act, 1985) of the Corporation Tax Act, 1976, is hereby amended by the substitution, in subsection (4), of “seven months” for “six months”, and of “one month” for “two months”, and
(d) section 18 of the Finance Act, 1988, is hereby amended—
(i) by the substitution, in subsection (1), of “1st day of November” for “1st day of October”, in both places where it occurs, and of “7 months” for “6 months”, in both places where it occurs,
(ii) by the substitution of the following paragraph for paragraph (b) of subsection (2):
“(b) where the assessment is made on or after that date—
(i) if the chargeable period is a year of assessment, on or before the specified return date for the chargeable period or, if later, not later than one month from the date on which the assessment is made, and
(ii) if the chargeable period is an accounting period of a company, not later than one month from the date on which the assessment is made.”,
(iii) by the substitution of the following subsection for subsection (3):
“(3) Where, but for this subsection, tax specified in an assessment made on a chargeable person for a relevant chargeable period would be due and payable in accordance with subsection (2) (b) and—
(a) the chargeable person has defaulted in the payment of preliminary tax for that chargeable period,
(b) the preliminary tax paid by the chargeable person for the chargeable period is less than, or less than the lower of, as the case may be—
(i) 90 per cent. of the tax payable by the chargeable person for the chargeable period, or
(ii) in the case of a chargeable person who is chargeable to income tax for the said chargeable period being a year of assessment, the tax payable for the immediately preceding chargeable period:
Provided that for the purposes of this subparagraph—
(I) where the chargeable person was not a chargeable person for the immediately preceding chargeable period, the tax payable for the immediately preceding chargeable period shall be taken to be nil, and
(II) where, after the due date for the payment of an amount of preliminary tax for a chargeable period which is a year of assessment, an amount of additional tax for the immediately preceding chargeable period becomes payable, that additional tax shall not be taken into account if, but only if, it became due and payable one month following the amendment to the assessment or the determination of the appeal, as the case may be, by virtue of the provisos (as amended by section 24 of the Finance Act, 1990) to subsection (4) or (5),
or
(c) the preliminary tax payable by the chargeable person for the chargeable period was not paid by the date on which it was due and payable,
the tax specified in the assessment shall be deemed to have been due and payable on the due date for the payment of an amount of preliminary tax for the chargeable period.”,
(iv) by the substitution, in the proviso to subsection (4), of “not later than one month from the date of the amendment” for “on the day immediately following the date of the amendment”, and
(v) by the substitution, in the proviso to subsection (5), of “not later than one month from the date of the determination of the appeal” for “on the date of the determination of the appeal”,
and the said subsection (1) of the said section 477, the said subsection (4) of the said section 6, the said subsection (1) and the provisos to subsections (4) and (5) of the said section 18, as so amended, are set out, respectively, in the Table to this section.
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(1) Subject to the provisions of this section, tax contained in an assessment for any year of assessment shall be payable on or before the 1st day of November in that year, except that tax included in an assessment for any year of assessment which is made on or after the 1st day of November in that year shall be deemed to be due and payable not later than one month from the date on which the assessment is made.
(4) Corporation tax assessed for an accounting period shall be paid within seven months from the end of the accounting period or, if it is later, within one month of the making of the assessment.
(1) Preliminary tax appropriate to a relevant chargeable period shall be due and payable—
(a) where the chargeable period is a year of assessment, on or before the 1st day of November in that year of assessment, or
(b) where the chargeable period is an accounting period of a company, within the period of 7 months from the end of the accounting period,
and references in this Chapter to the due date for the payment of an amount of preliminary tax shall be construed as references to the 1st day of November in the relevant year of assessment or the last day of that period of 7 months, as the case may be.
Provided that if—
(a) the assessment was made after the chargeable person had delivered a return containing a full and true disclosure of all material facts necessary for the making of the assessment, or
(b) the assessment had previously been amended following the delivery of the return containing such disclosure,
the additional tax so due shall be deemed to have been due and payable not later than one month from the date of the amendment.
Provided that—
(a) where the tax which the chargeable person had so paid is not less than 90 per cent. of the tax so found to be payable on the determination of the appeal, and
(b) where the tax charged by the assessment was due and payable in accordance with the provisions of subsection (2),
the said excess shall be deemed to be due and payable not later than one month from the date of the determination of the appeal.
25 Surcharge for late submission of returns.
25.—(1) Section 48 of the Finance Act, 1986, is hereby amended—
(a) in paragraph (a) of subsection (1)—
(i) by the insertion of the following definition:
“‘chargeable person’ means, in relation to a year of assessment or an accounting period—
(i) a person who is a chargeable person for the purposes of Chapter II of Part I of the Finance Act, 1988, or
(ii) a person who is chargeable to capital gains tax;”,
and
(ii) by the substitution, in the definition of “specified date”, of the following subparagraphs for subparagraph (II) of paragraph (i):
“(II) as respects any of the years 1987-88, 1988-89 or 1989-90, the 31st day of December in that year of assessment,
(IIa) as respects the year 1990-91 or any subsequent year of assessment, the 31st day of January in the year following the year of assessment,”,
and
(b) in paragraph (b) of subsection (1), by the substitution of the following subparagraphs for subparagraphs (iii), (iv) and (v):
“(iii) where a person delivers a return of income on or before the specified date in relation to the return of income but the inspector, by reason of being dissatisfied with any statement of profits or gains arising to the person from any trade or profession which is contained in the return of income, requires the person, by notice in writing served on him under section 174 of the Income Tax Act, 1967, to do any thing, the person shall be deemed not to have delivered the return of income on or before the specified date unless he does that thing within the time specified in the notice, and
(iv) references to such of the specified sections as are applied, subject to any necessary modifications, in relation to capital gains tax by paragraph 3 of Schedule 4 to the Capital Gains Tax Act, 1975, shall be construed as including references to those sections as so applied.”,
and
(c) by the substitution of the following subsection for subsection (2) (other than the proviso thereto):
“(2) Where, in relation to a year of assessment or accounting period, a chargeable person fails to deliver a return of income on or before the specified date in relation to the return of income, any amount of tax for that year of assessment or accounting period which, apart from this section, is or would be contained in an assessment to tax made or to be made on the chargeable person shall be increased by an amount (hereafter in this subsection referred to as the ‘surcharge’) equal to 10 per cent. of that amount of tax and, if the tax contained in the assessment to tax is not the amount of tax as so increased, then all the provisions of the Tax Acts and the Capital Gains Tax Acts (apart from this section) including, in particular, those relating to the collection and recovery of tax and the payment of interest on unpaid tax shall apply as if the tax contained in the assessment to tax were the amount of tax as so increased:”.
(2) Subsection (1) shall apply and have effect as respects the year 1991-92 and any subsequent year of assessment and as respects any accounting period ending on or after the 6th day of April, 1990.
(3) In relation to the year 1990-91 only, subsection (2) (as amended by this section) of section 48 of the Finance Act, 1986, shall have effect as if the reference to the chargeable person who fails to deliver a return of income before the specified date in relation to the return of income were a reference to a chargeable person who fails to deliver either—
(a) the 1990 Income Tax Return referred to in subsection (4) of section 23 before the specified date in relation to that return, or
(b) the return of income for the year 1990-91 before the specified date in relation to that return.
26 Payments in respect of professional services.
26.—(1) As respects the year 1990-91 and subsequent years of assessment and as respects accounting periods ending on or after the 6th day of April, 1990, Chapter III of Part I of the Finance Act, 1987, is hereby amended—
(a) in section 13, by the substitution of the following paragraph for paragraph (b) of subsection (2)—
“(b) in relation to a specified person, appropriate tax referable to—
(i) an accounting period,
(ii) a basis period for a year of assessment, or
(iii) a credit period within the meaning of section 18 (as amended by the Finance Act, 1990) for a year of assessment,
means the appropriate tax deducted from a relevant payment which is taken into account in computing the specified person's profits or gains for the said period and where there is more than one such relevant payment in the said period the aggregate of the appropriate tax deducted from such payments.”,
and
(b) in section 18—
(i) by the substitution, in subsections (2) and (4), of “credit” for “basis” where it occurs in those subsections, and
(ii) by the addition of the following subsection after subsection (4)—
“(5) In this section—
‘credit period for a year of assessment’ means, in relation to a specified person—
(a) as respects the year of assessment 1990-91, the basis period which would otherwise have been the basis period for that year of assessment but for the provisions of sections 14 and 15 of the Finance Act, 1990,
(b) as respects any subsequent year of assessment, the basis period for the year of assessment immediately preceding the year of assessment, or
(c) notwithstanding paragraph (a) or (b), as respects a year of assessment which is a discontinuance period, the year of assessment:
Provided that where there is an interval between the end of the credit period for one year of assessment and the credit period for the next year of assessment, then, the interval shall be deemed to be part of the second credit period;
‘discontinuance period’ means the year of assessment in which a source of income, profits or gains is permanently discontinued (or is to be treated as permanently discontinued by virtue of section 59 or 71 of the Income Tax Act, 1967) and in relation to which a relevant payment is to be taken into account in a computation of the income, profits or gains of that source for that year of assessment.”,
and the said subsections (2) and (4), as so amended, are set out in the Table to this subsection.
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(2) Where, in relation to a year of assessment, a specified person is within the charge to income tax and has borne appropriate tax referable to the credit period for that year of assessment he may, subject to the provisions of section 21, claim to have the amount of appropriate tax specified in subsection (4) set against the income tax chargeable for that year of assessment and, where such appropriate tax exceeds such income tax, to have the excess refunded to him.
(4) The amount of the appropriate tax to be set against corporation tax for an accounting period or income tax for a year of assessment in accordance with subsection (1) or (2) shall be the total of the appropriate tax referable to the accounting period or to the credit period for the year of assessment, as the case may be, which is included in the forms furnished in accordance with subsection (3) and not repaid under any of the provisions of this Chapter.
(2) Where a specified person is within the charge to income tax for the year of assessment 1990-91, section 19 of the Finance Act, 1987, shall apply as respects the first-mentioned period (being the first-mentioned period within the meaning assigned to it by subsection (1) of that section) which is the basis period for the year of assessment 1990-91 as if, in subsection (2) of that section 19, the reference to the basis period for the year of assessment immediately preceding the first-mentioned period were a reference to the basis period for the year of assessment 1989-90.
(3) (a) This section shall not apply in relation to a specified person where the year 1990-91 is a discontinuance period (within the meaning assigned to it by section 18 (5), inserted by this Act, of the Finance Act, 1987) as respects that person.
(b) This subsection shall be construed together with Chapter III of Part I of the Finance Act, 1987 (as amended by this Act).
27 Miscellaneous (Chapter II).
27.—(1) As respects the year 1990-91 and subsequent years of assessment, section 236 of the Income Tax Act, 1967, is hereby amended by the substitution of the following subsection for subsection (11) (inserted by the Finance Act, 1974), other than the proviso thereto:
“(11) Where, in relation to a year of assessment, a qualifying premium is paid after the end of the year of assessment but on or before the 31st day of January in the year following the year of assessment, the premium may, if the individual so elects on or before the said 31st day of January, be treated for the purposes of this section as paid in the earlier year (and not in the year in which it is paid):”.
(2) The following provisions shall not apply or have effect for the year 1990-91 or any subsequent year of assessment, that is to say—
(a) subsection (1AA) (inserted by the Finance Act, 1979) of section 307, and section 546, of the Income Tax Act, 1967;
(b) section 20 of the Finance Act, 1988.
Chapter III Income Tax, Corporation Tax and Capital Gains Tax
28 Amendment of section 421 (procedure on appeals) of Income Tax Act, 1967.
28.—Section 421 of the Income Tax Act, 1967, is hereby amended by the substitution of the following subsection for subsection (2):
“(2) Upon any appeal the Appeal 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, or any person who has been admitted a member of the body incorporated under the Companies Act, 1963, on the 31st day of December, 1975, as ‘The Institute of Taxation in Ireland’:
Provided that the Commissioners may permit any other person representing the appellant to plead before them where they are satisfied that such permission should be given.”.
29 Tax treatment of profits, losses and capital gains arising from activities of a grouping (EEIG).
29.—(1) In this section “grouping” means a European Economic Interest Grouping formed upon the terms, in the manner and with the effects laid down in—
(a) Council Regulation (EEC) No. 2137/85 of 25 July 1985[^] on the European Economic Interest Groupings (EEIG), and
(b) the European Communities (European Economic Interest Groupings) Regulations, 1989 (S.I. No. 191 of 1989),
and references to members of a grouping shall be construed accordingly.
(2) Notwithstanding anything in the Tax Acts or in the Capital Gains Tax Acts, a grouping shall be neither—
(a) charged to income tax, corporation tax or capital gains tax, as the case may be, in respect of profits or gains or chargeable gains arising to it, nor
(b) entitled to relief for a loss sustained by it,
and any assessment required to be made on such profits or gains or chargeable gains, and any relief for a loss, shall, as appropriate, be made on and allowed to the members of a grouping in accordance with the provisions of this section.
(3) Section 2 (1) of the Capital Gains Tax Act, 1975, is hereby amended by the substitution of the following definition for the definition of “company”—
“‘company’ means any body corporate but does not include a grouping within the meaning of section 29 of the Finance Act, 1990;”.
(4) Section 1 (5) of the Corporation Tax Act, 1976, is hereby amended by the insertion in the definition of “company” of the following subparagraph after subparagraph (i)—
“(iA) a grouping within the meaning of section 29 of the Finance Act, 1990,”.
(5) The provisions of—
(a) Chapter III of Part IV of the Income Tax Act, 1967, other than section 72 (8) of that Act, and
(b) section 4 (5) of, and paragraph 3 (5) of Schedule 4 to, the Capital Gains Tax Act, 1975,
shall apply, with any necessary modifications, to the activities of a grouping in the same manner as they apply to a trade or profession which is carried on by two or more persons in partnership.
(6) In particular, but without prejudice to the generality of subsection (5), the provisions mentioned therein shall, in their application for the purposes of this section, have effect as if—
(a) references to a partnership agreement were references to the contract forming or providing for the formation of a grouping,
(b) references to a partner were references to a member of a grouping, and
(c) anything done or required to be done by the precedent acting partner was done or required to be done by the grouping.
(7) This section shall be deemed to have come into effect on the 1st day of July, 1989.
30 Designated areas for urban renewal relief: extension of certain time limits.
30.—(1) For the purposes of the definition of “qualifying period” in each of the provisions of the Finance Act, 1986, specified in the Table to this subsection, the reference to the 31st day of May, 1991 (as provided for by section 26 of the Finance Act, 1988) shall have effect as if it were a reference to the 31st day of May, 1993.
TABLE
Subsection (1) of section 42 (allowance in relation to construction of certain commercial premises).
Subsection (1) (a) of section 44 (allowance to owner-occupiers in respect of certain premises).
Subsection (1) (a) of section 45 (double rent allowance as a deduction in computing trading income).
(2) For the purposes of the definition of “qualifying period” in section 4 of the Finance Act, 1989, the reference to the 31st day of May, 1991, shall have effect as if it were a reference to the 31st day of May, 1993.
31 Amendment of section 27 (designated areas for urban renewal relief) of Finance Act, 1987.
31.—Section 27 of the Finance Act, 1987, is hereby amended by the substitution in subsection (1) (a) (ii) of “31st day of May, 1993,” for “31st day of May, 1991,”.
32 Amendment of section 45 (double rent allowance as a deduction in computing trading income) of Finance Act, 1986.
32.—Section 45 (as amended by section 30) of the Finance Act, 1986, is hereby amended by the addition of the following proviso to subsection (2):
“Provided that—
(a) the aggregate of the amount by which the tax liability of an individual is reduced by reason of an allowance under this section and the amount by which his tax liability is reduced by reason of the deduction of the rent giving rise to the allowance shall not exceed the amount of the rent and there shall be made such adjustments in the amount of the relief as is necessary to give effect to this proviso, and
(b) where a person, being a person who holds an interest in a qualifying premises out of which interest a qualifying lease is created (directly or indirectly) in respect of that qualifying premises and in respect of the qualifying lease a claim for a further deduction under this section is made—
(i) takes under a qualifying lease a qualifying premises (hereafter in this proviso referred to as ‘the second-mentioned premises’) which is occupied by him for the purposes of his trade or profession, and
(ii) is, apart from this section, entitled, in the computation of the amount of the profits or gains of that trade or profession, to a deduction on account of rent, in respect of the second-mentioned premises,
then, unless the person shows that the taking on lease of the second-mentioned premises was not undertaken for the sole or main benefit of obtaining for him a further deduction on account of rent under the provisions of this section, he shall not be entitled in the computation of the amount of the profits or gains of his trade or profession to any further deduction on account of rent in respect of the second-mentioned premises.”.
33 Finance leases.
33.—(1) A finance lease, that is to say—
(a) a lease in respect of a qualifying premises where at the inception of the lease the aggregate of the current value of the minimum lease payments, including any initial payment but excluding any payment or part thereof for which the lessor will be accountable to the lessee, payable by the lessee in relation to the lease amounts to an amount equal to 90 per cent. or more of the fair value of the qualifying premises, or
(b) a lease which, in all the circumstances, is considered to provide in substance for the lessee the risks and benefits associated with ownership of the qualifying premises other than legal title to that premises,
shall not be a qualifying lease for the purposes of section 45 of the Finance Act, 1986.
(2) (a) In this section—
“current value”, in relation to minimum lease payments, means the value of those payments discounted to their present value at a rate which, when applied at the inception of the lease to—
(i) those payments, including any initial payment but excluding any payment or part thereof for which the lessor will be accountable to the lessee, and
(ii) any unguaranteed residual value of the qualifying premises, excluding any part of such value for which the lessor will be accountable to the lessee,
produces discounted present values the aggregate amount of which equals the amount of the fair value of the qualifying premises;
“fair value”, in relation to a qualifying premises, means an amount equal to such consideration as might be expected to be paid for the premises on a sale negotiated on an arm's length basis less any grants receivable towards the purchase of the qualifying premises;
“inception of the lease” means the earlier of the time the qualifying premises is brought into use or the date from which rentals under the lease first accrue;
“minimum lease payments” means the minimum payments over the remaining part of the term of the lease to be paid to the lessor and includes any residual amount which is to be paid to the lessor at the end of the term of the lease and which is guaranteed by the lessee or by a person who is connected with the lessee;
“qualifying premises” has the meaning assigned to it by section 45 of the Finance Act, 1986;
“unguaranteed residual value”, in relation to a qualifying premises, means that part of the residual value of that premises at the end of a term of a lease, as estimated at the inception of the lease, the realisation of which by the lessor is not assured or is guaranteed solely by a person who is connected with the lessor.
(b) For the purposes of this section a person shall be regarded as connected with another person if he would be so regarded for the purposes of section 16 of the Finance (Miscellaneous Provisions) Act, 1968.
34 Restriction of certain reliefs.
34.—(1) (a) In this section—
“the Act of 1976” means the Corporation Tax Act, 1976;
“distribution” has the same meaning as it has for the purposes of the Act of 1976.
(b) For the purposes of this section—
(i) any question whether a person is connected with another shall be determined in accordance with section 157 of the Act of 1976, and
(ii) an amount specified or implied shall include an amount specified or implied in a foreign currency.
(2) (a) This section shall apply to shares in a company where any agreement, arrangement or understanding exists which could reasonably be considered to eliminate the risk that the person beneficially owning those shares—
(i) might, at or after a time specified in or implied by that agreement, arrangement or understanding, be unable to realize directly or indirectly, in money or money's worth, an amount so specified or implied, other than a distribution, in respect of those shares, or
(ii) might not receive an amount so specified or implied of distributions in respect of those shares.
(b) The reference in this subsection to the person beneficially owning shares shall be deemed to be a reference to both that person and any person connected with that person.
(3) Where any person receives a distribution on or after the 21st day of July, 1989, in respect of shares to which this section applies and, apart from the application of the provisions of this subsection to the distribution, section 64, 76 (2) (a), 93 (3) (a) or 170 (3) (a) of the Act of 1976 would apply to the distribution, then, notwithstanding any provision of the Tax Acts, other than subsection (5), and for all the purposes of those Acts—
(a) none of the said sections of the Act of 1976 shall apply to the distribution,
(b) that person shall not be entitled to a tax credit in respect of the distribution, and
(c) the distribution shall be treated as income chargeable to income tax or corporation tax, as the case may be, under Case IV of Schedule D.
(4) Notwithstanding any provision of Chapter III of Part I of the Finance Act, 1984, relief from income tax shall not be allowed under that Chapter in respect of the amount subscribed for any shares to which this section applies issued on or after the 20th day of April, 1990.
(5) The provisions of subsection (3) shall not apply to a distribution received—
(a) by a company—
(i) none of the shares of which is beneficially owned by a person resident in the State, and
(ii) which, if this subsection had not been enacted, would not be chargeable to corporation tax in respect of any profits other than distributions which would be so chargeable by virtue of this section, or
(b) by a person who is not resident in the State.
(6) Notwithstanding subsection (5), the liability to income tax or corporation tax, as the case may be, of any person resident in the State, other than a company to which paragraph (a) of that subsection relates, shall be determined as if that subsection had not been enacted.
35 Certain unit trusts not to be collective investment undertakings.
35.—(1) This section shall apply to any unit trust scheme, within the meaning assigned to it by section 1 (1) of the Unit Trusts Act, 1972, where there is, or was at any time, in respect of any or all units issued after the 14th day of June, 1973, a requirement for participation in that unit trust scheme that a policy of assurance upon human life be effected (but without those units becoming the property of the owner of the policy either as benefits or otherwise).
(2) Notwithstanding section 18 of the Finance Act, 1989, a unit trust scheme to which this section applies, shall be deemed not to be a collective investment undertaking for the purposes of that section and the First Schedule to the said Act.
(3) This section shall have effect as on and from the 6th day of April, 1990.
36 Tax credits in respect of distributions.
36.—(1) The provisions of the Corporation Tax Act, 1976, specified in paragraph 1 of the First Schedule shall have effect in relation to distributions made on or after the 6th day of April, 1991, as if the standard rate for the year 1991-92 and subsequent years of assessment were 25 per cent.
(2) The First Schedule shall have effect for the purpose of supplementing subsection (1).
Chapter IV Corporation Tax
37 Rate of corporation tax.
37.—(1) As respects any accounting period ending on or after the 1st day of April, 1991, section 1 (as amended by the Finance Act, 1988) of the Corporation Tax Act, 1976, is hereby amended by the substitution of the following subsection for subsection (1):
“(1) For the financial year 1974 and each subsequent financial year there shall be charged on profits of companies a tax, to be called corporation tax, at the rate of—
(a) 43 per cent. for—
(i) each financial year until and including the year 1990, and
(ii) that part of the financial year 1991 beginning on the 1st day of January, 1991, and ending on the 31st day of March, 1991,
and
(b) 40 per cent. for—
(i) that part of the financial year 1991 beginning on the 1st day of April, 1991, and ending on the 31st day of December, 1991, and
(ii) each subsequent financial year.”.
(2) The Second Schedule shall have effect for the purpose of supplementing this section.
38 Amendment of section 25 (attribution of distributions to accounting periods) of Finance Act, 1989.
38.—Section 25 of the Finance Act, 1989, is hereby amended by the substitution in subsection (3) (a) of “6th day of April, 1991,” for “6th day of April, 1990,”.
39 Exploration expenditure.
39.—As respects expenditure incurred on or after the 1st day of April, 1990, the Finance (Taxation of Profits of Certain Mines) Act, 1974, is hereby amended—
(a) by the deletion of the proviso to subsection (1) of section 2,
(b) by the deletion, in subsection (2) of section 3, of “but was incurred within a period of ten years prior to the date on which he commences to carry on the said trade”,
(c) by the insertion in subsection (1) of section 4 of “or section 2 as applied by section 7A,” after “section 2 or 3,”, and
(d) by the insertion after section 7 of the following section:
“7A.— (1) For the purposes of this section—
‘exploration company’ means a company, the business of which for the time being consists primarily of exploring for scheduled minerals;
‘exploring for scheduled minerals’ means searching in the State for deposits of scheduled minerals or testing such deposits or winning access thereto, and includes the systematic searching for areas containing scheduled minerals and searching by drilling or other means for scheduled minerals within those areas but does not include operations which are operations in the course of developing or working a qualifying mine.
(2) Subject to subsections (3) to (5), for as long as a company—
(a) is an exploration company,
(b) does not carry on a trade of working a qualifying mine, and
(c) incurs capital expenditure (including such expenditure incurred on the provision of plant and machinery) for the purposes of exploring for scheduled minerals,
it shall be deemed for the purposes of sections 2, 3 (4), 6 and 7 and the other provisions of the Tax Acts, except the other provisions of this Act—
(i) to be carrying on a trade of working a qualifying mine,
(ii) to come within the charge to corporation tax in respect of that trade when it first incurs the said capital expenditure, and
(iii) to incur for the purposes of that trade the said expenditure incurred on the provision of plant and machinery,
so that all allowances or charges which fall to be made for an accounting period by virtue of this subsection and section 2, 6 or 7 shall be given effect by treating the amount of any allowance as a trading expense of that trade in the period and by treating the amount on which any such charge is to be made as a trading receipt of that trade in the period.
(3) Where, by virtue of subsection (2), a company is to be treated as incurring a loss in a trade in an accounting period, the company—
(a) shall be entitled to relief in respect of the loss under subsections (1) to (3) of section 16, subsections (1) and (2) of section 18 and section 25 of the Corporation Tax Act, 1976, as if for the term ‘trading income from the trade’ or ‘trading income’, wherever occurring in sections 16 and 18, there were substituted ‘profits (of whatever description)’, and
(b) subject to subsection (4) (b) (ii), shall not otherwise be entitled to relief in respect of the loss or to surrender relief under subsection (1) of section 116 of the Corporation Tax Act, 1976, in respect of the loss.
(4) (a) Any asset representing exploration expenditure, in respect of which an allowance or deduction has been made, by virtue of subsection (2) and section 2, to a company shall, for the purposes of section 245 (11) of the Income Tax Act, 1967, be treated as an asset representing capital expenditure incurred in connection with the mine which the company is deemed to be working by virtue of subsection (2), and the company shall not cease to be deemed to be carrying on the trade of working that mine, so as to be within the charge to corporation tax in respect of that trade, before any sale of such an asset in the event of such a sale.
(b) Where a company begins at any time (in this paragraph referred to as the relevant time) to carry on a trade of working a qualifying mine and, accordingly, ceases to be deemed to carry on such a trade, it shall be treated as carrying on the same trade before and after that time for the purposes of—
(i) any allowance, charge or trade receipt treated as arising by reference to any capital expenditure incurred before the relevant time, and
(ii) relief, other than by virtue of subsection (3), under section 16 (1) of the Corporation Tax Act, 1976, for any losses arising before the relevant time, in so far as relief has not already been given for those losses by virtue of this section:
Provided that the provisions of this paragraph shall not apply where there is a change in the ownership of the company within a period of—
(I) twelve months ending at the relevant time, or
(II) twenty-four months beginning at the relevant time.
(c) The provisions of the Fifth Schedule to the Finance Act, 1973, other than paragraphs 8 and 10 of Part I thereof, shall have effect for the purposes of supplementing this subsection as if the references therein to section 39 of that Act were references to this subsection.
(5) (a) Notwithstanding any other provision of the Tax Acts, if an allowance or deduction has been given by virtue of this section in respect of any expenditure, then no other allowance or deduction shall be given by virtue of any provision of the Tax Acts, including this section, in respect of that expenditure.
(b) Paragraph (b) of subsection (1) of section 35 of the Finance Act, 1986, shall apply to a company for as long as it is deemed by virtue of subsection (2) to be carrying on a trade of working a qualifying mine, as if ‘who is not a company within the charge to corporation tax in respect of the payment’ were deleted from that paragraph.”,
and the said subsection (2) of section 3 and subsection (1) of section 4 (other than the proviso), as so amended, are set out in the Table to this section.
TABLE
(2) Where a person who commences to carry on a trade of working a qualifying mine after the 6th day of April, 1974, incurred exploration expenditure on or after the 6th day of April, 1967, and that expenditure was not incurred in connection with the said qualifying mine, then in taxing the said trade for the chargeable period in which he commenced to carry on the said trade, there shall be made an allowance of an amount equal to the amount of that expenditure.
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