FINANCE ACT, 1998

• (b) in section 403, by the insertion of the following subsection after subsection (5):

• “(5A)

  • (a) In this subsection ‘appointed day’ has the same meaning as in section 284(3A).

  • (b) In relation to capital allowances in respect of machinery or plant to which section 284(3A) applies—

    • (i) notwithstanding subsections (3) and (5)—

      • (I) subsection (3) shall not apply, and

      • (II) section 305(1)(b) shall apply,

      where the capital expenditure on that machinery or plant is incurred in the period of 2 years commencing on the appointed day, and

    • (ii) notwithstanding subsections (4) and (5)—

      • (I) subsection (4) shall not apply, and

      • (II) sections 308(4) and 420(2) shall apply,

      where the capital expenditure on that machinery or plant is incurred in the period of 3 years commencing on the appointed day.

  • (c) This subsection shall come into operation on the appointed day.”.

24 Amendment of Chapter 3 (designated areas, designated streets, enterprise areas and multi-storey car parks in certain urban areas) of Part 10 of Principal Act.

24.—(1) Chapter 3 of Part 10 of the Principal Act is hereby amended—

• (a) (i) in section 339(1), by the substitution in paragraph (b) of the definition of “qualifying period” of “31st day of December, 1999” for “30th day of June, 2000”, and

• (ii) in section 339(2)—

• (I) in paragraph (a), by the substitution of the following for the words from “the reference in paragraph (a)” to the end of the paragraph:

“the reference in paragraph (a) of the definition of ‘qualifying period’ in subsection (1) to the period ending on the 31st day of July, 1997, shall be construed as a reference to the period ending on the 31st day of July, 1998.”,

and

• (II) by the insertion of the following paragraph after paragraph (b):

• “(c) Where in relation to the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of a building or structure to which paragraph (a) relates—

• (i) the relevant local authority has given to the person constructing, converting or refurbishing, as the case may be, that building or structure, a certificate in writing to which that paragraph refers certifying that not less than 15 per cent of the total cost of the building or structure had been incurred before the 31st day of July, 1997, and

• (ii) an application for planning permission for the work represented by the expenditure incurred or to be incurred on the building or structure had (in so far as such permission is required) been received by a planning authority not later than the 1st day of March, 1998, and

• (iii) where the expenditure to be incurred on a building or structure has not been fully incurred by the 31st day of July, 1998, the relevant local authority gives a certificate in writing to the person referred to in subparagraph (i) stating that in its opinion—

  • (I) that person had, on the 31st day of July, 1997, a reasonable expectation that the expenditure to be incurred on the building or structure would have been incurred in full on or before the 31st day of July, 1998, and

  • (II) the failure to incur that expenditure in full on or before the 31st day of July, 1998, was, on the basis of reasons of a bona fide character stated to it, due, to a significant extent, to a delay outside the direct control of that person, including an unanticipated delay in obtaining the grant of planning permission or a fire certificate, an unanticipated delay due to legal proceedings or unanticipated difficulties in completing the acquisition of a site or involving the failure of a building contractor to fulfil his or her obligations or the need to respect any archaeological site or remains,

  then, the reference in paragraph (a) of the definition of ‘qualifying period’ to the period ending on the 31st day of July, 1997, shall be construed as a reference to the period ending on the 31st day of December, 1998.”,

• (b) in section 340(2), by the substitution in paragraph (ii) of “31st day of December, 1999” for “30th day of June, 2000”,

• (c) in section 343—

• (i) in subsection (1), in the definition of “qualifying company”, by the substitution of the following paragraph for paragraph (a):

• “(a) which has been approved for financial assistance under a scheme administered by Forfás, Forbairt, the Industrial Development Agency (Ireland) or Údarás na Gaeltachta, and”,

• (ii) in subsection (1), in the definition of “qualifying trading operations” by the substitution of the following for paragraphs (a) and (b):

• “(a) the manufacture of goods within the meaning of Part 14,

• (b) the rendering of services in the course of a service industry (within the meaning of the Industrial Development Act, 1986), or

• (c) the rendering of services in the course or furtherance of a business of freight forwarding or the provision of logistical services in relation to such business where the rendering or provision of those services is carried on in an area or areas immediately adjacent to any of the airports to which section 340(2) refers.”,

and

• (iii) in subsection (2), by the substitution of the following paragraph for paragraph (a):

• “(a) on the recommendation of Forfás (in conjunction with Forbairt, the Industrial Development Agency (Ireland) or Údarás na Gaeltachta, as may be appropriate), in accordance with guidelines laid down by the Minister, and”,

• (d) in section 345, by the substitution, in subsection (1), of the following for the definition of “qualifying lease”:

“‘qualifying lease’ means, subject to subsection (8), a lease in respect of a qualifying premises granted in the qualifying period, or within the period of one year from the day next after the end of the qualifying period, on bona fide commercial terms by a lessor to a lessee not connected with the lessor, or with any other person entitled to a rent in respect of the qualifying premises, whether under that lease or any other lease;”,

and

• (e) by the insertion of the following section after section 350:

“Provision against double relief.

350A.—Where relief is given by virtue of any provision of this Chapter in relation to capital expenditure or other expenditure incurred on, or rent payable in respect of, any building or structure, premises or multi-storey car park, relief shall not be given in respect of that expenditure or that rent under any other provision of the Tax Acts.”.

• (2) Paragraph (c)(ii) of subsection (1) shall come into operation on such day as the Minister for Finance may, by order, appoint.

25 Amendment of Chapter 1 (Custom House Docks Area) of Part 10 of Principal Act.

25.—(1) Chapter 1 of Part 10 of the Principal Act is hereby amended—

• (a) in section 322—

• (i) in subsection (1), by the substitution in the definition of “the specified period” of “31st day of December, 1999” for “24th day of January, 1999”, and

• (ii) in subsection (2)(b), by the substitution of “31st day of December, 1999” for “24th day of January, 1999”,

and

• (b) in section 323, by the deletion of subsection (3)(b).

• (2) This section shall come into operation on such day as the Minister for Finance may, by order, appoint.

26 Amendment of section 344 (capital allowances in relation to construction or refurbishment of certain multi-storey car parks) of Principal Act.

26.—Section 344 of the Principal Act is hereby amended in subsection (1) by the substitution of the following for the definition of “qualifying period”:

“‘qualifying period’ means the period commencing on the 1st day of July, 1995, and ending on—

• (a) the 30th day of June, 1998, or

• (b) the 30th day of June, 1999, where, in relation to the construction or refurbishment of the qualifying multi-storey car park concerned, the relevant local authority gives a certificate in writing on or before the 30th day of September, 1998, to the person constructing or refurbishing the qualifying multi-storey car park stating that it is satisfied that not less than 15 per cent of the total cost of the qualifying multi-storey car park and the site thereof had been incurred prior to the 1st day of July, 1998, and, in considering whether to give such a certificate, the relevant local authority shall have regard only to guidelines in relation to the giving of such certificates issued by the Department of the Environment and local Government for the purposes of this definition;”.

27 Amendment of section 351 (interpretation (Chapter 4)) of Principal Act.

27.—Section 351 of the Principal Act is hereby amended—

• (a) by the substitution of the following for the definition of “qualifying period”:

“‘qualifying period’ means the period commencing on the 1st day of July, 1995, and ending on—

• (a) the 30th day of June, 1998, or

• (b) the 30th day of June, 1999, where, in relation to the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of the building or structure concerned, being—

  • (i) a building or structure to which section 352 applies, or

  • (ii) a qualifying premises within the meaning of section 353, 354, 356, 357 or 358,

  the relevant local authority gives a certificate in writing, on or before the 30th day of September, 1998, to the person constructing, converting or refurbishing, as the case may be, the building or structure stating that it is satisfied that not less than 15 per cent of the total cost of the building or structure and the site thereof had been incurred prior to the 1st day of July, 1998, and, in considering whether to give such a certificate, the relevant local authority shall have regard only to guidelines in relation to the giving of such certificates issued by the Department of the Environment and Local Government for the purposes of this definition;”,

and

• (b) by the insertion of the following definition after the definition of “refurbishment”:

“‘the relevant local authority’, in relation to the construction of, conversion into, refurbishment of, or, as the case may be, construction or refurbishment of a building or structure of the kind referred to in paragraph (b) of the definition of ‘qualifying period’, means the council of a county or the corporation of a county or other borough or, where appropriate, the urban district council, in whose functional area the building or structure is situated.”.

28 Amendment of Chapter 6 (Dublin Docklands Area) of Part 10 of Principal Act.

28.—(1) Chapter 6 of Part 10 of the Principal Act is hereby amended—

• (a) in section 368 by the insertion of the following after subsection (4):

• “(4A) Notwithstanding section 274(1), no balancing charge shall be made in relation to a building or structure to which this section applies by reason of any of the events specified in that section which occurs—

  • (a) more than 13 years after the building or structure was first used, or

  • (b) in a case where section 276 applies, more than 13 years after the capital expenditure on refurbishment of the building or structure was incurred.”,

and

• (b) in section 371 by the substitution of the following for subsection (2):

• “(2)

  • (a) Subject to subsection (3), where an individual, having made a claim in that behalf, proves to have incurred qualifying expenditure in a year of assessment, the individual shall be entitled, for that year of assessment and for any of the 9 subsequent years of assessment in which the qualifying premises in respect of which the individual incurred the qualifying expenditure is the only or main residence of the individual, to have a deduction made from his or her total income of an amount equal to—

    • (i) in the case where the qualifying expenditure has been incurred on the construction of the qualifying premises, 5 per cent of the amount of that expenditure, or

    • (ii) in the case where the qualifying expenditure has been incurred on the refurbishment of the qualifying premises, 10 per cent of the amount of that expenditure.

  • (b) A deduction shall be given under this section in respect of qualifying expenditure only in so far as that expenditure is to be treated under section 372(5) as having been incurred in the qualifying period.”.

• (2) This section shall apply as on and from the 6th day of April, 1997.

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

29.—Part 11 of the Principal Act is hereby amended—

• (a) in subsection (2) of section 373—

• (i) in paragraph (i), by the substitution of “mechanically propelled vehicle;” for “mechanically propelled vehicle.”, and

• (ii) by the insertion of the following after paragraph (i):

• “(j) £15,500, where the expenditure was incurred on or after the 3rd day of December, 1997, on the provision or hiring of a vehicle which, on or after that date was not a used or secondhand vehicle and was first registered in the State under section 131 of the Finance Act, 1992, without having been previously registered in any other state which duly provides for the registration of a mechanically propelled vehicle.”,

and

• (b) in subsection (1) of section 376, by the substitution of the following for the definition of “relevant amount”:

“‘relevant amount’ means—

• (a) in relation to qualifying expenditure incurred before the 23rd day of January, 1997, £14,000,

• (b) in relation to qualifying expenditure incurred on or after the 23rd day of January, 1997, and before the 3rd day of December, 1997, £15,000, and

• (c) in relation to qualifying expenditure incurred on or after the 3rd day of December, 1997, £15,500;”.

30 Treatment of certain losses and capital allowances.

30.—The Principal Act is hereby amended by the insertion of the following sections after section 409:

“Income tax: restriction on use of capital allowances on certain industrial buildings and other premises.

409A.—(1) In this section—

‘active partner’, in relation to a partnership trade, means a partner who works for the greater part of his or her time on the day-to-day management or conduct of the partnership trade;

‘industrial development agency’ means the Industrial Development Agency (Ireland);

‘partnership trade’ and ‘several trade’ have the same meanings, respectively, as in Part 43;

‘specified building’ means—

• (a) a building or structure which is or is to be an industrial building or structure by reason of its use or its deemed use for a purpose specified in section 268(1), and

• (b) any other building or structure in respect of which an allowance is to be made, or will by virtue of section 279 be made, for the purposes of income tax under Chapter 1 of Part 9 by virtue of Part 10 or section 843,

but does not include a building or structure—

- (i) which is or is deemed to be an industrial building or structure by reason of its use for the purposes specified in section 268(1)(*d*), or

- (ii) to which section 355(1)(*b*) applies.

• (2) Subject to subsection (5), in relation to any allowance to be made to an individual under Chapter 1 of Part 9 for any year of assessment in respect of capital expenditure incurred on or after the 3rd day of December, 1997, on a specified building, section 305 shall apply as if the following were substituted for subsection (1)(b) of that section:

‘(b) Notwithstanding paragraph (a), where an allowance referred to in that paragraph is available primarily against income of the specified class and the amount of the allowance is greater than the amount of the person's income of that class for the first-mentioned year of assessment, the person may, by notice in writing given to the inspector not later than 2 years after the end of the year of assessment, elect that the excess or £25,000, whichever is the lower, shall be deducted from or set off against the person's other income for that year of assessment, and it shall be deducted from or set off against that income and tax shall be discharged or repaid accordingly and only the balance, if any, of the allowance shall be deducted from or set off against the person's income of the specified class for succeeding years.’.

• (3) Subject to subsection (5), where—

  • (a) any allowance or allowances under Chapter 1 of Part 9 is or are to be made for a year of assessment to an individual, being an individual who is a partner in a partnership trade, in respect of capital expenditure incurred on or after the 3rd day of December, 1997, on a specified building, and

  • (b) that allowance or those allowances is or are to be made in taxing the individual's several trade,

  then, unless in the basis period for the year of assessment in respect of which that allowance or those allowances is or are to be made the individual is an active partner in relation to the partnership trade, the amount of any such allowance or allowances which is to be taken into account for the purposes of section 392(1) shall not exceed an amount determined by the formula—

  A + £25,000

  where A is the amount of the profits or gains of the individual's several trade in the year of loss before section 392(1) is applied.

• (4) Where an individual is a partner in 2 or more partnership trades, then, for the purposes of subsection (3), those partnership trades in relation to which the individual is not an active partner shall, in relation to that individual, be deemed to be a single partnership trade and the individual's several trades in relation to those partnership trades shall be deemed to be a single several trade.

• (5) This section shall not apply to an allowance to be made to an individual under Chapter 1 of Part 9 in respect of capital expenditure incurred on or after the 3rd day of December, 1997, on a specified building where before that date—

  • (a) (i) in the case of construction, the foundation for the specified building was laid in its entirety,

    • (ii) in the case of a refurbishment project, work to the value of 5 per cent of the total cost of that refurbishment project was carried out, or

    • (iii) a project for which the specified building is to be provided had been approved for grant assistance by an industrial development agency but only where that approval was given within a period of 2 years preceding that date,

    or

  • (b) (i) an application for planning permission for the work represented by that expenditure on the specified building had (in so far as such permission is required) been received by a planning authority before the 3rd day of December, 1997, or

    • (ii) the individual can prove, to the satisfaction of the Revenue Commissioners, that a detailed plan had been prepared for the work represented by that expenditure and that detailed discussions had taken place with a planning authority in relation to the specified building before the 3rd day of December, 1997, and that this can be supported by means of an affidavit or statutory declaration duly made on behalf of the planning authority concerned,

    and that expenditure is incurred under an obligation entered into by the individual in relation to the specified building before—

    • (i) the 3rd day of December, 1997, or

    • (ii) the 1st day of May, 1998, pursuant to negotiations which were in progress before the 3rd day of December, 1997.

• (6) For the purposes of subsection (5)—

  • (a) an obligation shall be treated as having been entered into before a particular date only if, before that date, there was in existence a binding contract in writing under which that obligation arose, and

  • (b) negotiations pursuant to which an obligation was entered into shall not be regarded as having been in progress before a particular date unless preliminary commitments or agreements in writing in relation to that obligation had been entered into before that date.

• (7) Where an individual has entered into an obligation to which subsection (5) relates to incur capital expenditure on a specified building on or after the 3rd day of December, 1997, and that individual dies before any part of that expenditure has been incurred, another individual who—

  • (a) undertakes in writing to honour the obligation entered into by the deceased individual, and

  • (b) incurs that part of the capital expenditure on the specified building which would otherwise have been incurred by the deceased individual,

  shall be deemed to have complied with the requirements of subsection (5) in relation to that expenditure.

• (8) This section shall, with any necessary modifications, apply in relation to a profession as it applies in relation to a trade.

Income tax: restriction on use of capital allowances on certain hotels, etc.

409B.—(1) In this section—

‘active partner’, in relation to a partnership trade, has the same meaning as in section 409A;

‘partnership trade’ and ‘several trade’ have the same meanings, respectively, as in Part 43;

‘specified building’ means a building or structure which is or is deemed to be an industrial building or structure by reason of its use for a purpose specified in section 268(1)(d) but does not include—

- (*a*) any such building or structure (not being a building or structure in use as a holiday camp referred to in section 268(3))—

    - (i) the site of which is wholly within any of the administrative counties of Cavan, Donegal, Leitrim, Mayo, Monaghan, Roscommon and Sligo but not within a qualifying resort area within the meaning of Chapter 4 of Part 10, and

    - (ii) in which the accommodation and other facilities provided meet a standard specified in guidelines issued by the Minister for Tourism, Sport and Recreation with the consent of the Minister for Finance,

      and

- (*b*) a building or structure which is deemed to be such a building or structure by reason of its use as a holiday cottage of the type referred to in section 268(3).

• (2) Subject to subsection (4), section 305(1)(b) shall not apply in relation to any allowance to be made to an individual for a year of assessment under Chapter 1 of Part 9 in respect of capital expenditure incurred on or after the 3rd day of December, 1997, on a specified building.

• (3) Subject to subsection (4), where—

  • (a) any allowance or allowances under Chapter 1 of Part 9 is or are to be made for a year of assessment to an individual, being an individual who is a partner in a partnership trade, in respect of capital expenditure incurred on or after the 3rd day of December, 1997, on a specified building, and

  • (b) that allowance or those allowances is or are to be made in taxing the individual's several trade,

  then, unless in the basis period for the year of assessment in respect of which that allowance or those allowances is or are to be made the individual is an active partner in relation to the partnership trade, the amount of any such allowance or allowances which is to be taken into account for the purposes of section 392(1) shall not exceed the amount of the profits or gains of the individual's several trade in the year of loss before that section is applied.

• (4) This section shall not apply to an allowance to be made to an individual under Chapter 1 of Part 9 in respect of capital expenditure incurred on or after the 3rd day of December, 1997, on a specified building where before that date—

  • (a) (i) in the case of construction, the foundation for the specified building was laid in its entirety, or

    • (ii) in the case of a refurbishment project, work to the value of 5 per cent of the total cost of that refurbishment project was carried out,

    or

  • (b) (i) an application for planning permission for the work represented by that expenditure on the specified building had (in so far as such permission is required) been received by a planning authority before the 3rd day of December, 1997, or

    • (ii) the individual can prove, to the satisfaction of the Revenue Commissioners, that a detailed plan had been prepared for the work represented by that expenditure and that detailed discussions had taken place with a planning authority in relation to the specified building before the 3rd day of December, 1997, and that this can be supported by means of an affidavit or statutory declaration duly made on behalf of the planning authority concerned,

    and that expenditure is incurred under an obligation entered into by the individual in relation to the specified building before—

    • (i) the 3rd day of December, 1997, or

    • (ii) the 1st day of May, 1998, pursuant to negotiations which were in progress before the 3rd day of December, 1997.

• (5) For the purposes of subsection (4)—

  • (a) an obligation shall be treated as having been entered into before a particular date only if, before that date, there was in existence a binding contract in writing under which that obligation arose, and

  • (b) negotiations pursuant to which an obligation was entered into shall not be regarded as having been in progress before a particular date unless preliminary commitments or agreements in writing in relation to that obligation had been entered into before that date.

• (6) Where an individual has entered into an obligation to which subsection (4) relates to incur capital expenditure on a specified building on or after the 3rd day of December, 1997, and that individual dies before any part of that expenditure has been incurred, another individual who—

  • (a) undertakes in writing to honour the obligation entered into by the deceased individual, and

  • (b) incurs that part of the capital expenditure on the specified building which would otherwise have been incurred by the deceased individual,

  shall be deemed to have complied with the requirements of subsection (4) in relation to that expenditure.

• (7) This section shall, with any necessary modifications, apply in relation to a profession as it applies in relation to a trade.”.

31 Amendment of section 403 (restriction on use of capital allowances for certain leased assets) of Principal Act.

31.—Section 403 of the Principal Act is hereby amended in subsection (9) by the substitution of the following paragraph for paragraph (b):

• “(b) The reference in the definition of ‘the specified capital allowancess’ to machinery or plant to which this subsection applies is a reference to machinery or plant (not being a film of the kind mentioned in subsection (7)(a)) provided on or after the 13th day of May, 1986, for leasing by a lessor to a lessee (who is not a person connected with the lessor) under a lease the terms of which include an undertaking given by the lessee that, during a period (in this section referred to as ‘the relevant period’) which is not less than 3 years and which commences on the day on which the machinery or plant is first brought into use by the lessee, the machinery or plant so provided will—

  • (i) where it is so provided before the 4th day of March, 1998, be used by the lessee for the purposes only of a specified trade carried on in the State by the lessee, and

  • (ii) where it is so provided on or after that day, be used by the lessee for the purposes only of a specified trade carried on in the State by the lessee and that it will not be used for the purposes of any other trade, or business or activity other than the lessor's trade.”.

32 Amendment of section 481 (relief for investment in films) of Principal Act.

32.—(1) Section 481 of the Principal Act is hereby amended in subsection (1) in the definition of “film”—

• (a) in paragraph (a), by the substitution of “subsection (2), and” for “subsection (2), or”,

• (b) in paragraph (b), by the substitution of “as respects every film” for “as respects any other film”.

• (2) This section shall apply as on and from the 6th day of April, 1997.

33 Amendment of section 482 (relief for expenditure on significant buildings and gardens) of Principal Act.

33.—As respects qualifying expenditure incurred on or after the 12th day of February, 1998, section 482 of the Principal Act is hereby amended by the addition to subsection (2) of the following paragraph after paragraph (c)—

• “(d) For the purpose only of determining, in relation to a claim referred to in paragraph (a), whether and to what extent qualifying expenditure incurred in relation to an approved building is incurred or not incurred in a chargeable period, only such an amount of that qualifying expenditure as is properly attributable to work which was actually carried out during the chargeable period shall (notwithstanding any other provision of the Tax Acts as to the time when any expenditure is or is to be treated as incurred) be treated as having been incurred in that period.”.

34 Restriction of relief as respects eligible shares issued on or after 3rd December, 1997.

34.—The Principal Act is hereby amended in Part 16—

• (a) subject to section 35, as respects eligible shares issued on or after the 3rd day of December, 1997—

• (i) in section 491—

• (I) by the substitution of the following for subsections (2) and (3):

• “(2)

  • (a) Subject to this section, where a company raises any amount through the issue of eligible shares on or after the 3rd day of December, 1997, (in this section referred to as ‘the relevant issue’), relief shall not be given in respect of the excess of the amount so raised over the amount determined by the formula—

  A− B

  where—

  A is—

  - (i) in the case of a company which, or whose qualifying subsidiary, raises the amount by virtue of section 496(2)(*a*)(iv)(II), £100,000,
  
  - (ii) in the case of a relevant investment, £500,000,
  
  - (iii) in the case where the money raised was used, is being used or is intended to be used solely for qualifying trading operations referred to in section 496(2)(*a*)(ix) carried on or to be carried on by the company or its qualifying subsidiary, £1,000,000, or
  
  - (iv) in any other case, £250,000, and
  
    B is the lesser of—
  
  - (i) the appropriate amount represented by A in the formula, and
  
  - (ii) an amount equal to the aggregate of all amounts raised by the company through the issue of eligible shares at any time before the relevant issue other than—
  
      - (I) where A in the formula is £100,000, the first £400,000, and
  
      - (II) where A in the formula is £250,000, the first £250,000,
  
        of any amounts raised by way of relevant investments.
  

  • (b) (i) Where a company raises any amount through a relevant issue which amount consists of a relevant investment and any other amount, the relevant issue shall be deemed for the purposes of this subsection (but for no other purpose of this Part) to consist of 2 separate issues of eligible shares one of which shall be in respect of the relevant investment (in this paragraph referred to as ‘the first issue’) and the other in respect of the other amount raised (in this paragraph referred to as ‘the second issue’).

    • (ii) Where subparagraph (i) applies, the first issue shall be deemed for the purposes of this subsection (but for no other purpose of this Part) to have been made on the day before the date of the relevant issue and the second issue shall be deemed for the purposes of this subsection (but for no other purpose of this Part) to have been made on the date of the relevant issue and paragraph (a) shall apply accordingly.

• (3)

  • (a) Where a company raises any amount through a relevant issue and that company is associated (within the meaning of this section) with one or more other companies, then, as respects that company, relief shall not be given in respect of the excess of the amount so raised over the amount determined by the formula—

  A − B

  where—

  A is—

  - (i) in the case of a company which, or whose qualifying subsidiary, raises the amount by virtue of section 496(2)(*a*)(iv)(II), £100,000,
  
  - (ii) in the case of a relevant investment, £500,000,
  
  - (iii) in the case where the money raised was used, is being used or is intended to be used solely for qualifying trading operations referred to in section 496(2)(*a*)(ix) carried on or to be carried on by the company or its qualifying subsidiary, £1,000,000, or
  
  - (iv) in any other case, £250,000, and
  
    B is the lesser of—
  
  - (i) the appropriate amount represented by A in the formula, and
  
  - (ii) the aggregate of all amounts raised through the issue of eligible shares at any time before or on the date of the relevant issue by all of the companies (including that company) which are associated within the meaning of this section other than—
  
      - (I) the amount raised through the relevant issue, and
  
      - (II) (A) where A in the formula is £100,000, the first £400,000, and
  
      - (B) where A in the formula is £250,000, the first £250,000, of any amounts raised by way of relevant investments.
  

  • (b) (i) Where a company raises any amount through a relevant issue which amount consists of a relevant investment and any other amount, the relevant issue shall be deemed for the purposes of this subsection (but for no other purpose of this Part) to consist of 2 separate issues of eligible shares one of which shall be in respect of the relevant investment (in this paragraph referred to as ‘the first issue’) and the other in respect of the other amount raised (in this paragraph referred to as ‘the second issue’).

    • (ii) Where subparagraph (i) applies, the first issue shall be deemed for the purposes of this subsection (but for no other purpose of this Part) to have been made on the day before the date of the relevant issue and the second issue shall be deemed for the purposes of this subsection (but for no other purpose of this Part) to have been made on the date of the relevant issue and paragraph (a) shall apply accordingly.”,

and

• (II) by the substitution of the following subsection for subsection (5):

• “(5) In determining for the purposes of the formula in subsection (2)(a) or, as the case may be, the formula in subsection (3)(a) the amount to which paragraph (ii) of the definition of ‘B’ in those formulas relates, account shall not be taken of any amount—

  • (a) which is subscribed by a person other than an individual who qualifies for relief, or

  • (b) in respect of which relief is precluded by virtue of section 490.”,

and

• (ii) by the deletion of section 492,

• (b) in section 498, as on and from the 12th day of February, 1998, by the substitution of the following subsection for subsection (4)—

• “(4) Where an individual holds ordinary shares of any class in a company and the relief has been given in respect of some shares of that class but not others, any disposal by the individual of ordinary shares of that class in the company, not being a disposal to which section 479(3) or 512(2) applies, shall be treated for the purposes of this section as relating to those in respect of which relief has been given under this Part rather than to others.”,

and

• (c) in section 504, by the substitution in paragraph (a) of subsection (7) of “500” for “498”.

35 Transitional arrangements in relation to section 34.

35.—(1) In this section—

“auditor” means—

• (a) in relation to a company or its qualifying subsidiary, the person or persons appointed as auditor of the company or its qualifying subsidiary, as appropriate, for all the purposes of the Companies Acts, 1963 to 1990, and

• (b) in relation to a specified designated fund, the person or persons appointed as auditor of that fund;

“authority” has the meaning assigned to it by section 492 of the Principal Act;

“certifying agency” has the meaning assigned to it by section 488 of the Principal Act;

“certifying Minister” has the meaning assigned to it by section 488 of the Principal Act;

“combined certificate” has the meaning assigned to it by section 492 of the Principal Act;

“County Enterprise Board” means a board referred to in the Schedule to the Industrial Development Act, 1995;

“eligible shares” has the meaning assigned to it by section 488 of the Principal Act;

“industrial development agency” has the meaning assigned to it by section 488 of the Principal Act;

“the principal provisions” mean Chapter III of Part I of the Finance Act, 1984, or Part 16 of the Principal Act;

“prospectus”, in relation to a company, means any prospectus, notice, circular or advertisement, offering to the public for subscription or purchase any eligible shares of the company, and in this definition “the public” includes any section of the public, whether selected as members of the company or as clients of the person issuing the prospectus or in any other manner;

“qualifying subsidiary”, in relation to a company, has the same meaning as it has for the purposes of section 495 of the Principal Act;

“qualifying trading operations” has the meaning assigned to it by section 496 of the Principal Act;

“relevant certificate” has the meaning assigned to it by section 492 of the Principal Act;

“specified designated fund” means an investment fund designated under section 27 of the Finance Act, 1984, which closed on or before the 5th day of April, 1997;

“the specified period” means the period beginning on the 1st day of December, 1996, and ending on the 2nd day of December, 1997.

• (2) Paragraph (a) of section 34 shall not apply as respects eligible shares issued on or after the 3rd day of December, 1997, by a company to which this section applies and in respect of which the conditions in either subsection (5), (6) or (7) are met.

• (3) The provisions of Part 16 of the Principal Act which were in force immediately before the 3rd day of December, 1997, shall, as those provisions stand amended by paragraphs (b) and (c) of section 34, apply as respects eligible shares issued on or after that day by a company to which this section applies and in respect of which the conditions in either subsection (5), (6) or (7) are met.

• (4) This section applies to a company which, or whose qualifying subsidiary, either carries on or intends to carry on one or more of the qualifying trading operations.

• (5) The conditions of this subsection referred to in subsection (2) are—

• (a) the eligible shares are issued by the company on or before the 5th day of April, 1998, and

• (b) the eligible shares are issued following a subscription on behalf of an individual by a person or persons having the management of a specified designated fund, and

• (c) the company proves to the satisfaction of the Revenue Commissioners that before the 3rd day of December, 1997, it had the intention of raising money, on or before the 5th day of April, 1998, under the principal provisions through the specified designated fund referred to in paragraph (b) of this subsection,

and in determining whether they are satisfied that the company has complied with the requirements specified in paragraph (c) of this subsection the Revenue Commissioners shall have regard to the following—

• (i) (I) signed heads of agreement between the company and the fund, or

• (II) exchange of correspondence between the company and the fund showing a clear intention that the fund intended, on or before the 5th day of April, 1998, to subscribe for eligible shares in the company,

• (ii) a certificate by the auditor of the fund confirming that it is a specified designated fund, and

• (iii) any other information the Revenue Commisisoners deem necessary for the purpose.

• (6) The conditions of this subsection referred to in subsection (2) are—

• (a) the eligible shares are issued by the company on or before the 30th day of September, 1998, and

• (b) a relevant certificate or a combined certificate has been issued to the company by an authority before the 3rd day of December, 1997.

• (7) The conditions of this subsection referred to in subsection (2) are—

• (a) the eligible shares are issued by the company on or before the 30th day of September, 1998, and

• (b) the company proves to the satisfaction of the Revenue Commissioners that before the 3rd day of December, 1997, it had an intention to raise money under the principal provisions, and in determining whether they are so satisfied the Revenue Commissioners shall have regard to one or more of the following—

• (i) an application in writing made by the company to the Revenue Commissioners in the specified period for the opinion of the Revenue Commissioners as to whether the company would be a qualifying company for the purposes of the principal provisions,

• (ii) an application in writing made by the company to an authority in the specified period for a relevant certificate or a combined certificate,

• (iii) an application in writing made by the company to an industrial development agency in the specified period for a certificate referred to in section 489(2)(e) of the Principal Act,

• (iv) an application in writing made to a certifying agency, certifying Minister or County Enterprise Board in the specified period for a certificate under section 497 of the Principal Act, and

• (v) the publication in the specified period of a prospectus by, or on behalf of, the company,

and

• (c) (i) in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (i), (ii), (iii), (v), (viii), (ix), (xi) or (xiii) of paragraph (a) of section 496(2) of the Principal Act, that in the specified period the company or its qualifying subsidiary, as the case may be, had entered into a binding contract in writing—

• (I) to purchase or lease land or a building,

• (II) to purchase or lease plant or machinery, or

• (III) for the construction or refurbishment of a building,

to be used in the carrying on of its qualifying trading operation,

• (ii) in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (vii) of paragraph (a) of section 496(2) of the Principal Act, that in the specified period the company or its qualifying subsidiary, as the case may be, had entered into a binding contract in writing—

• (I) to purchase or lease greenhouses,

• (II) to purchase or lease plant or machinery, or

• (III) for the construction or refurbishment of greenhouses,

to be used in the carrying on of its qualifying trading operation,

• (iii) in the case of a company which, or whose qualifying subsidiary, either carries on or intends to carry on a qualifying trading operation as is mentioned in subparagraph (xii) of paragraph (a) of section 496(2) of the Principal Act, that in the specified period the company or its qualifying subsidiary, as the case may be, had entered into a binding contract in writing for the production, publication, marketing or promotion of the qualifying recording or qualifying recordings which the company or its qualifying subsidiary, as the case may be, intends to produce,

and the company proves to the satisfaction of the Revenue Commisisoners that the contract which it or its qualifying subsidiary, as the case may be, had entered into was integral to, or consistent with, the purpose for which it had intended to raise money under the principal provisions and that the consideration of the contract is equal to 25 per cent or more of the money which it is intended to so raise.

• (8) For the purposes of subsection (7)—

• (a) the date on which a contract was entered into by a company or, as the case may be, its qualifying subsidiary, and

• (b) the date on which a prospectus was published by, or on behalf of, a company,

shall be confirmed in a certificate by the auditor of the company, or its qualifying subsidiary, as appropriate.

36 Employee share schemes.

36.—(1) The Principal Act is hereby amended—

• (a) in Chapter 1 of Part 17, by the insertion of the following section after section 511:

“Shares acquired from an employee share ownership trust.

511A.—(1) Where, on or after the date of the passing of the Finance Act, 1998, the trustees of an approved scheme make an appropriation of shares to which section 510(3) applies to a participant and the conditions mentioned in subsection (2) are satisfied, then, for the purposes of this Chapter as it applies to those shares—

• (a) the period of retention shall end on, and

• (b) the release date shall be,

the day following the day on which the shares were appropriated to the participant.

• (2) The conditions referred to in subsection (1) are that—

  • (a) the shares concerned were transferred to the trustees of the approved scheme concerned by the trustees of an employee share ownership trust to which section 519 applies,

  • (b) immediately prior to the transfer referred to in paragraph (a), the shares had been held in that employee share ownership trust for a period of not less than 3 years, and

  • (c) the participant concerned was a beneficiary (within the meaning of paragraph 11 of Schedule 12) under that employee share ownership trust at all times during the period of 3 years ending on the date on which the shares were appropriated to him or her.”,

• (b) in Chapter 2 of Part 17, by the substitution in section 519 of the following subsection for subsection (7):

• “(7) The trustees of a trust to which this section applies shall not be chargeable to income tax in respect of income consisting of dividends in respect of securities held by the trust if, and to the extent that, the income is expended within the expenditure period (within the meaning of paragraph 13 of Schedule 12) by the trustees for one or more of the qualifying purposes referred to in that paragraph, but the trustees shall not be entitled to the setoff or payment of a tax credit under section 136 in respect of those dividends.”,

• (c) in Schedule 11, by the insertion in paragraph 4 of the following subparagraph after subparagraph (1):

• “(1A)

  • (a) As respects a profit sharing scheme approved on or after the date of the passing of the Finance Act, 1998, the Revenue Commissioners must be satisfied—

    • (i) that there are no features of the scheme (other than any which are included to satisfy the requirements of Chapter 1 of Part 17 and this Schedule) which have or would have the effect of discouraging any description of employees or former employees who fulfil the conditions in subparagraph (1) from participating in the scheme, and

    • (ii) where the company concerned is a member of a group of companies, that the scheme does not and would not have the effect of conferring benefits wholly or mainly on directors of companies in the group or on those employees of companies in the group who are in receipt of higher or the highest levels of remuneration.

  • (b) In this subparagraph ‘a group of companies’ means a company and any other companies of which it has control.”,

and

• (d) in Schedule 12—

• (i) in paragraph 1—

• (I) by the substitution of the following subparagraph for subparagraph (3):

• “(3) For the purposes of this Schedule, a company falls within the founding company's group at a particular time if—

  • (a) it is the founding company, or

  • (b) at that time, it is controlled by the founding company and the trust concerned referred to in paragraph 2(1) is expressed to extend to it.”,

and

• (II) in subparagraph (4)(a), by the substitution of the following definition for the definition of “associate”:

“‘associate’ has the meaning assigned to it by subsection (3) of section 433, subject to the reference to the employees in both places where it occurs in subparagraph (ii) of paragraph (c) of that subsection being construed as including a reference to former employees;”,

• (ii) by the substitution of the following paragraph for paragraph 2:

“2. (1) On the application of a body corporate (in this Schedule referred to as ‘the founding company’) which has established an employee share ownership trust, the Revenue Commissioners shall approve of the trust as a qualifying employee share ownership trust if they are satisfied that the conditions in paragraphs 6 to 18 are complied with in relation to the trust.

• (2)

  • (a) Where the founding company is a member of a group of companies, the Revenue Commissioners shall not approve of a trust under subparagraph (1) unless they are satisfied that the trust does not and would not have the effect of conferring benefits wholly or mainly on directors of companies in the group or on those employees of companies in the group who are in receipt of higher or the highest levels of remuneration.

  • (b) In this subparagraph ‘a group of companies’ means a company and any other companies of which it has control.”,

• (iii) in paragraph 11—

• (I) by the substitution of the following subparagraphs for subparagraph (2):

• “(2) The trust deed shall provide that a person is a beneficiary at a particular time (in this subparagraph referred to as ‘the relevant time’) if—

  • (a) the person is at the relevant time an employee or director of a company within the founding company's group,

  • (b) at each given time in a qualifying period the person was such an employee or director of a company falling within the founding company's group at that given time,

  • (c) in the case of a director, at that given time the person worked as a director of the company concerned at the rate of at least 20 hours a week (disregarding such matters as holidays and sickness), and

  • (d) the person is chargeable to income tax in respect of his or her office or employment under Schedule E.

• (2A) The trust deed may provide that a person is a beneficiary at a particular time if, but for subparagraph (2)(d), he or she would be a beneficiary within the rule which is included in the deed and conforms with subparagraph (2).”,

• (II) in subparagraph (4)(a), by the substitution for “subparagraph (3)” of “subparagraphs (2A) and (3)”,

• (III) in subparagraph (5), by the substitution for “subparagraph (2)” of “subparagraphs (2) and (2A)”,

• (IV) in subparagraph (7), by the substitution for “subparagraph (3) or (4)” of “subparagraph (2A), (3) or (4)”, and

• (V) in subparagraph (8), by the substitution for “subparagraph (2), (3) or (4)” of “subparagraph (2), (2A), (3) or (4)”.

• (2)
• (a) Paragraph (b) of subsection (1) shall apply as on and from the date of the passing of this Act.

• (b) Paragraph (d) of subsection (1) shall apply as respects employee share ownership trusts approved of under paragraph 2 of Schedule 12 of the Principal Act on or after the date of the passing of this Act.

37 Payments to subcontractors in certain industries.

37.—(1) Part 18 of the Principal Act is hereby amended in Chapter 2—

• (a) in subsection (1) of section 530, by the substitution of the following definition for the definition of “meat processing operations”:

“‘meat processing operations’ means operations of any of the following descriptions—

• (a) the slaughter of cattle, sheep, pigs, domestic fowl, turkeys, guinea-fowl, ducks or geese,

• (b) the catching of domestic fowl, turkeys, guinea-fowl, ducks or geese,

• (c) the division (including cutting or boning), sorting, packaging (including vacuum packaging), rewrapping or branding of, or the application of any other similar process to, the carcasses or any part of the carcasses (including meat) of slaughtered cattle, sheep, pigs, domestic fowl, turkeys, guinea-fowl, ducks or geese,

• (d) the application of methods of preservation (including cold storage) to the carcasses or any part of the carcasses (including meat) of slaughtered cattle, sheep, pigs, domestic fowl, turkeys, guinea-fowl, ducks or geese,

• (e) the loading or unloading of the carcasses or part of the carcasses (including meat) of slaughtered cattle, sheep, pigs, domestic fowl, turkeys, guinea-fowl, ducks or geese at any establishment where any of the operations referred to in paragraphs (a), (c) and (d) are carried on,

• (f) the haulage of the carcasses or any part of the carcasses (including meat) of slaughtered cattle, sheep, pigs, domestic fowl, turkeys, guinea-fowl, ducks or geese from any establishment where any of the operations referred to in paragraphs (a), (c) and (d) are carried on,

• (g) the cleaning down of any establishment where any of the operations referred to in paragraphs (a), (c) and (d) are carried on,

• (h) the grading, sexing and transport of day-old chicks of domestic fowl, turkeys, guinea-fowl, ducks or geese,

• (i) the haulage for hire of cattle, sheep, pigs, domestic fowl, turkeys, guinea-fowl, ducks or geese or of any of the materials, machinery or plant for use, whether used or not, in any of the operations referred to in paragraphs (a) to (h).”,

and

• (b) in paragraph (b) of section 531(1), by the substitution of the following for subparagraph (ii):

• “(ii) carrying on a business of meat processing operations in an establishment approved and inspected in accordance with the European Communities (Fresh Meat) Regulations, 1997 (S.I. No. 434 of 1997) or, as the case may be, the European Communities (Fresh Poultry-meat) Regulations, 1996 (S.I. No. 3 of 1996), or”.

• (2) This section shall apply as on and from the 6th day of October, 1998.

38 Amendment of section 659 (farming: allowances for capital expenditure on the construction of farm buildings, etc. for control of pollution) of Principal Act.

38.—Section 659 of the Principal Act is hereby amended in subsection (3) by the substitution of the following paragraph for paragraph (a):

• “(a) as respects the first year of the writing-down period referred to in subsection (2), where the capital expenditure was incurred—

  • (i) before the 6th day of April, 1998, an amount equal to 50 per cent of that expenditure or £10,000, whichever is the lesser, or

  • (ii) on or after the 6th day of April, 1998, an amount equal to 50 per cent of that expenditure or £15,000, whichever is the lesser,”.

39 Amendment of section 667 (special provisions for qualifying farmers) of Principal Act.

39.—Section 667 of the Principal Act is hereby amended in paragraph (b) of subsection (2)—

• (a) in subparagraph (i), by the substitution of “years of assessment, or” for “years of assessment,”, and

• (b) by the substitution of the following for subparagraphs (ii) and (iii):

• “(ii) on or after the 6th day of April, 1995, and before the 6th day of April, 1999, for the year of assessment in which the individual becomes a qualifying farmer and for each of the 3 immediately succeeding years of assessment.”.

40 Amendment of section 680 (annual allowance for mineral depletion) of Principal Act.

40.—Section 680(2) of the Principal Act is hereby amended—

• (a) by the insertion after “qualifying mine” of “at any time”, and

• (b) by the substitution for “date” of “time”.

41 Amendment of section 681 (allowance for mine rehabilitation expenditure) of Principal Act.

41.—Subsection (1)(a) of section 681 of the Principal Act is hereby amended by the insertion in the definition of “qualifying mine” after “limestone,” of “fireclay, coal,”.

42 Amendment of section 734 (taxation of collective investment undertakings) of Principal Act.

42.—Section 734 of the Principal Act, is hereby amended in paragraph (a) of subsection (1) by the substitution for paragraph (ii) of the definition of “specified company” of the following paragraph:

• “(ii) (I) not more than 25 per cent of the share capital of which is owned directly or indirectly by persons resident in the State, or

  • (II) all of the share capital of which is owned directly by another company resident in the State and not more than 25 per cent of the share capital of that other company is owned directly or indirectly by persons resident in the State,”.

43 Taxation of shares issued in place of cash dividends.

43.—(1) The Principal Act is hereby amended—

• (a) in section 816 by the substitution for subsections (1) to (3) of the following subsections—

• “(1) In this section—

‘company’ means any body corporate;

‘quoted company’ means a company whose shares, or any class of whose shares—

- (*a*) are listed in the official list of the Irish Stock Exchange or on any other stock exchange, or

- (*b*) are quoted on the market known as the Developing Companies Market, or the market known as the Exploration Securities Market, of the Irish Stock Exchange or on any similar or corresponding market of any other stock exchange;

  ‘share’ means share in the share capital of a company and includes stock and any other interest in the company.

• (2) Where any person as a consequence of the exercise (whether before, on or after the declaration of a distribution of profits by a company) of an option to receive in respect of shares in the company either a sum in cash or additional share capital of the company, receives such additional share capital, then, an amount equal to the amount which that person would have received if that person had received the distribution in cash instead of such share capital shall for the purposes of the Tax Acts—

  • (a) where the company is resident outside the State, be deemed to be income received by the person from the company, and such income shall be treated as income from securities and possessions outside the State and be assessed and charged to tax under Case III of Schedule D,

  • (b) where the company is resident in the State and is a quoted company—

    • (i) be treated as a distribution made by the company, and

    • (ii) be deemed to be a distribution received by the person,

    and

  • (c) where the company is resident in the State and is not a quoted company, be deemed to be profits or gains of the person, being profits or gains not within any other Case of Schedule D and not charged by virtue of any other Schedule, and be assessed and charged to tax under Case IV of Schedule D.

• (3) Where a company is treated under subsection (2)(b)(i) as making a distribution to a person, section 152 shall apply with any necessary modifications as if the distribution were a dividend to which subsection (1) of that section applies.”,

• (b) in section 4 (as amended by section 51) in the definition of “distribution” in subsection (1) by the substitution for “sections 436 and 437” of “sections 436 and 437, and subsection (2)(b) of section 816”,

• (c) in section 20(1), paragraph 1 of Schedule F by the substitution for “sections 436 and 437” of “sections 436 and 437, and subsection (2)(b) of section 816”, and

• (d) in section 130(1) by the substitution for “sections 436 and 437” of “sections 436 and 437, and subsection (2)(b) of section 816”.

• (2) This section shall apply as respects shares issued by a company on or after the 3rd day of December, 1997.

44 Amendment of section 843 (capital allowances for buildings used for third level educational purposes) of Principal Act.

44.—Section 843 of the Principal Act is hereby amended in subsection (1)—

• (a) by the substitution of the following definition for the definition of “approved institution”:

“‘approved institution’ means—

• (a) an institution of higher education within the meaning of section 1 of the Higher Education Authority Act, 1971, or

• (b) an institution in the State in receipt of public funding which provides courses to which a scheme approved by the Minister for Education and Science under the Local Authorities (Higher Education Grants) Acts, 1968 to 1992, applies;”,

and

• (b) by the substitution, in the definition of “qualifying premises”, of the following subparagraph for subparagraph (ii) of paragraph (b):

• “(ii) is let to an approved institution,”.

45 Amendment of Part 41 (self assessment) of Principal Act.

45.—(1) Part 41 of the Principal Act is hereby amended—

• (a) in section 950(1), by the substitution, in the definition of “specified return date for the chargeable period”, 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; but as respects—

  • (i) such year of assessment (not being earlier than the year 1998–99) as the Minister for Finance shall by order appoint, and

  • (ii) each year of assessment following the year to which subparagraph (i) relates,

  the 30th day of November following the year of assessment,”,

and

• (b) in section 958—

• (i) in subsection (2)—

• (I) by the substitution of the following paragraphs for paragraphs (a) and (b):

• “(a) where the chargeable period is a year of assessment for income tax and subject to subsection (10), on or before the 1st day of November in the year of assessment; but as respects—

  • (i) such year of assessment (not being earlier than the year 1999-2000) as the Minister for Finance shall by order appoint, and

  • (ii) each year of assessment following the year to which subparagraph (i) relates,

  the 30th day of November in the year of assessment,

• (b) where the chargeable period is a year of assessment for capital gains tax, on or before the 1st day of November following the year of assessment; but as respects—

  • (i) such year of assessment (not being earlier than the year 1998-1999) as the Minister for Finance shall by order appoint, and

  • (ii) each year of assessment following the year to which subparagraph (i) relates,

  the 30th day of November following the year of assessment, or”,

and

• (II) by the substitution of “the 1st day of November in the year of assessment, the 30th day of November in the year of assessment, the 1st day of November following the year of assessment, the 30th day of November following the year of assessment” for “the 1st day of November in the year of assessment, the 1st day of November following the year of assessment”,

• (ii) in subsection (3) (b), the substitution of the following subparagraph for subparagraph (ii):

• “(ii) if the chargeable period is a year of assessment for capital gains tax, 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; but as respects—

  • (I) such year of assessment (not being earlier than the year 1998–1999) as the Minister for Finance shall by order appoint, and

  • (II) each year of assessment following the year to which clause (I) relates,

  on or before the specified return date for the chargeable period, and”,

• (iii) in subsection (4)(b), by the substitution of the following subparagraph for subparagraph (i):

• “(i) (I) 90 per cent of the tax payable by the chargeable person for the chargeable period, or

  • (II) in the case of an assessment to capital gains tax made on a chargeable person for the chargeable period, being the year 1998-99 or any subsequent year of assessment, the tax payable by the chargeable person for the chargeable period,”,

and

• (iv) in subsection (10)—

• (I) in paragraph (a), by the substitution of the following for the words from “on or before the 9th day of December” to the end of the paragraph:

“on or before—

• (i) in the case of the years 1997-98 and 1998-99, the 9th day of December, and

• (ii) in the case of the year 1999-2000 and any subsequent year of assessment, the 9th day of March,

in the year of assessment to which the preliminary tax relates by virtue of subsection (2)(a).”,

• (II) in paragraph (b), by the substitution of the following for the words from “throughout the calendar year” to the end of the paragraph:

“throughout—

• (i) in the case of the years 1997-98 and 1998-99, the calendar year or a part of that year in which the due date for the payment of that preliminary tax in accordance with subsection (2)(a) falls, and

• (ii) in the case of the year 1999-2000 or any subsequent year of assessment, that year,

and the Collector-General shall debit the bank account of that person with such instalments on the 9th day of each month in that calendar year or a part of that calendar year or, as the case may be, in that year.”,

and

• (III) by the substitution of the following paragraph for paragraph (c):

• “(c) (i) In the case of the years 1997-98 and 1998-99, the Collector-General may at any time, notwithstanding paragraph (b), agree to alter the amount of preliminary tax to be debited to the bank account of the chargeable person in accordance with this subsection.

• (ii) In the case of the year 1999-2000 or any subsequent year of assessment, the Collector-General may, in any particular case, in order to facilitate the payment of preliminary tax in accordance with this subsection, agree to vary the number of equal monthly instalments to be collected in a year or, after one or more monthly instalments have been paid in that year, agree to an increase or decrease in the amount to be collected in subsequent instalments in that year; but, a chargeable person shall not be treated as having paid an amount of preliminary tax in accordance with this subsection unless—

  • (I) the number of monthly instalments paid by that person in the year of assessment is not less than 10, and

  • (II) not less than 70 per cent of the amount of the preliminary tax payable by that person for that year is paid by instalments on or before the 31st day of December, in that year.”.

• (2) Every order made by the Minister for Finance under this section shall be laid before Dáil Éireann as soon as may be after it is made.

46 Amendment of section 787 (nature and amount of relief for qualifying premiums) of Principal Act.

46.—Section 787 of the Principal Act is hereby amended, in subsection (7), by the substitution of “on or before the specified return date for the chargeable period (within the meaning of Part 41)” for “on or before the 31st day of January in the year following the year of assessment”.

47 Amendments of Principal Act in consequence of a change in the currency of certain states.

47.—(1) The provisions of the Principal Act referred to in Schedule 2 shall apply subject to the amendments specified in that Schedule (being amendments the purposes of which are, amongst other things, to make provision in consequence of a change in the currency of certain states).

• (2) This section shall come into operation on such day or days as the Minister for Finance may appoint by order or orders either generally or with reference to any particular provision of Schedule 2 and different days may be so appointed for different such provisions.

48 Amendment of Principal Act in consequence of convention with United States of America relating to double taxation, etc.

48.—(1) Subject to subsection (2), the provisions of the Principal Act referred to in Schedule 3 shall apply subject to the amendments specified in that Schedule.

• (2)
• (a) Subject to paragraph (b), this section shall apply as on and from the times at which the Convention set out in the Schedule to the Double Taxation Relief (Taxes on Income and Capital Gains) (United States of America) Order, 1997 (S.I. No. 477 of 1997), has effect in accordance with paragraph 2 of Article 29 of that Convention.

• (b) Where, in relation to a person, paragraph 3 of Article 29 of the said Convention applies in respect of the period specified in that paragraph, the Principal Act shall apply in relation to the person in respect of that period as if subsection (1) had not been enacted.

49 Amendment of Part 26 (life assurance companies) of Principal Act.

49.—(1) Part 26 of the Principal Act is hereby amended by the substitution in both section 723(6) and section 738 (2)(c) of “the rate per cent of corporation tax specified in section 21(1)” for “the rate per cent of corporation tax specified in section 21(1)(b)”.

• (2) This section shall apply as on and from the 6th day of April, 1997.

50 Amendment of section 1013 (limited partnerships) of Principal Act.

50.—(1) Section 1013 of the Principal Act is hereby amended—

• (a) in subsection (1)—

• (i) by the insertion before the definition of “the aggregate amount” of the following definition—

“‘active partner’, in relation to a partnership trade, means a partner who works for the greater part of his or her time on the day-to-day management or conduct of the partnership trade;”,

and

• (ii) in the definition of “limited partner”—