Finance Act 2005

“864A.—(1) (a) In this section—

‘approved electronic communications’ means such form of electronic communications as the Revenue Commissioners approve of for the purposes of this section;

‘electronic communications’ means communication by electrical, digital, magnetic, optical, electromagnetic, biometric or photonic technology, and related technology, by means of which data is transmitted, including telephone apparatus, and ‘electronic means’ shall be construed accordingly;

‘telephone apparatus’ means telegraphy apparatus designed or adapted for the purposes of transmitting and receiving, by way of a public telecommunications service, spoken messages or information or both of them.

• (b) In paragraph (a)—

‘information’ has the meaning assigned to it by the Electronic Commerce Act 2000;

‘public telecommunications service’ has the meaning assigned to it by the European Communities (Telecommunications Infrastructure) Regulations 1997 (S.I. No. 338 of 1997).

• (c) Except where the Revenue Commissioners otherwise direct, this section applies to a claim for an allowance, deduction or relief which falls to be taken into account—

  • (i) in the making of deductions or repayments of tax under Chapter 4 of Part 42 and the regulations made under that Chapter, or

  • (ii) except in the case of a chargeable person (within the meaning of section 950), in relation to a repayment of tax deducted under that Chapter and those regulations.

• (d) References in this section to ‘a claim for an allowance, deduction or relief’ include references to—

  • (i) the making of an election,

  • (ii) the giving of a notification or notice,

  • (iii) the amendment of a claim, election, notification or notice, and

  • (iv) the withdrawal of any claim, election, notification or notice,

  in relation to an allowance, deduction or relief, and also include references to an election, notice or application for the purposes of Chapter 1 of Part 44 or a claim under Regulation 26(5) of the Income Tax (Employments) (Consolidated) Regulations 2001 (S.I. No. 559 of 2001).

• (e) Notwithstanding any other enactment, references in this section to a claim in writing do not include a reference to a claim made by representing or reproducing words in visible form using electronic means.

• (2) Notwithstanding any other provision of the Income Tax Acts or instruments made thereunder requiring claims to which this section applies to be made in writing or by notice or in such form as may be prescribed by the Revenue Commissioners, such claims as may be specified by the Revenue Commissioners may be made by an individual by means of approved electronic communications, but subject to such terms and conditions as the Revenue Commissioners may from time to time consider appropriate and specify for the purposes of this section.

• (3) The Revenue Commissioners shall make known, in such manner as they think fit, any terms and conditions for the time being specified by them for the purposes of this section.

• (4) Where terms and conditions specified by the Revenue Commissioners under this section are for the time being in force with respect to the making of claims to which this section applies, such claims that are made by electronic communications are required to be made in accordance with those terms and conditions.

• (5)

  • (a) Terms and conditions specified by the Revenue Commissioners for the purposes of this section shall not be capable of modifying any requirement by or under any enactment as to the period within which any claim is to be made, or as to the contents of any claim.

  • (b) Such terms and conditions may include provision as to how any requirement as to the contents of a claim is to be fulfilled when the claim is not produced in writing.

• (6) Where a claim is made by a person in accordance with this section, the claim shall—

  • (a) unless and until the contrary is proved, be deemed to have been made by the person purporting to have made the claim, and

  • (b) be treated as having been made when it is acknowledged, howsoever, by the Revenue Commissioners as having been received by them.

• (7) The making of a claim by a person in accordance with this section shall not prevent an officer of the Revenue Commissioners from enquiring into the claim in accordance with section 886A (inserted by the Finance Act 2005).

• (8) Where a claim made in accordance with this section results in the issue to the claimant of a notice, or an amended notice, of determination of tax credits and standard rate cut-off point, the inspector shall, as may be appropriate, be deemed to have determined the amount of the tax credits and standard rate cut-off point appropriate to the claimant in accordance with Regulation 10, or amended the amount in accordance with Regulation 13, of the Income Tax (Employments)(Consolidated) Regulations 2001.

• (9) Section 917M (as amended by the Finance Act 2001) shall apply in respect of proceedings in relation to this section, in the same manner as it applies in respect of proceedings in relation to Chapter 6 of Part 38, subject to any necessary modifications including substituting in section 917M a reference to section 864A for a reference to section 917F(1) in each place where it occurs.

• (10) Any act to be performed or function to be discharged by the Revenue Commissioners which is authorised by this section may be performed or discharged by any of their officers acting under their authority.”.

24 Amendment of provisions relating to claims by individuals.

24.—(1) The Principal Act is amended—

• (a) in section 458—

• (i) by inserting in subsection (1) “, subject to subsection (1B),” after “a claim in that behalf and”, and

• (ii) by inserting the following after subsection (1A) (inserted by the Finance Act 2001):

• “(1B) The requirement in subsection (1) to make a return in the prescribed form of the individual's total income shall not apply, except where the Revenue Commissioners otherwise direct, where the claim falls to be taken into account—

  • (a) in the making of deductions or repayments of tax under Chapter 4 of Part 42 and the regulations made under that Chapter, or

  • (b) except in the case of a chargeable person (within the meaning of section 950), in relation to a repayment of tax deducted under that Chapter and those regulations.”,

• (b) in section 459 by inserting the following after subsection (4):

• “(5) Subsections (3) and (4) shall not apply, except where the Revenue Commissioners otherwise direct, in relation to a claim which falls to be taken into account—

  • (a) in the making of deductions or repayments of tax under Chapter 4 of Part 42 and the regulations made under that Chapter, or

  • (b) except in the case of a chargeable person (within the meaning of section 950), in relation to a repayment of tax deducted under that Chapter and those regulations.”,

and

• (c) in section 865—

• (i) in subsection (1) by substituting the following for paragraph (b)(i):

• “(i) where a person furnishes a statement or return which is required to be delivered by the person in accordance with any provision of the Acts for a chargeable period, such a statement or return shall be treated as a valid claim in relation to a repayment of tax where—

  • (I) all the information which the Revenue Commissioners may reasonably require to enable them determine if and to what extent a repayment of tax is due to the person for that chargeable period is contained in the statement or return, and

  • (II) the repayment treated as claimed, if due—

  • (A) would arise out of the assessment to tax, made by the inspector within the meaning of section 950 (in this clause referred to as the ‘inspector’) at the time the statement or return was furnished, on foot of the statement or return, or

  • (B) would have arisen out of the assessment to tax, that would have been made by the inspector at the time the statement or return was furnished, on foot of the statement or return if an assessment to tax had been made by the inspector at that time,”

and

• (ii) by inserting the following after subsection (3):

“(3A)(a) Subject to paragraph (b), subsection (3) shall not prevent the Revenue Commissioners from making, to a person other than a chargeable person (within the meaning of section 950), a repayment in respect of tax deducted, in accordance with Chapter 4 of Part 42 and the regulations made thereunder, from that person's emoluments for a year of assessment where, on the basis of the information available to them, they are satisfied that the tax so deducted, and in respect of which the person is entitled to a credit, exceeds the person's liability for that year.

• (b) A repayment referred to in paragraph (a) shall not be made at a time at which a claim to the repayment would not be allowed under subsection (4).”.

• (2)
• (a) Paragraph (c)(i) of subsection (1) applies to statements or returns made on or after 3 February 2005.

• (b) Subsection (1) (other than paragraph (c)(i)) applies with effect from the passing of this Act.

25 Retention and inspection of records in relation to claims by individuals.

25.—With effect from the passing of this Act the Principal Act is amended in Chapter 3 of Part 38 by inserting the following after section 886:

“886A.—(1) An individual who, in relation to a year of assessment, may wish to make a claim for an allowance, deduction or relief in relation to income tax shall keep and preserve all such records as may be requisite for the purpose of enabling the individual to make a correct and complete claim.

• (2) The records which an individual is required to keep and preserve in accordance with subsection (1) shall be retained by the individual for the longer of the following periods—

  • (a) where enquiries into the claim or any amendment of the claim are made by an officer of the Revenue Commissioners, the period ending on the day on which those enquiries are treated as completed by the officer, and

  • (b) a period of 6 years beginning at the end of the year of assessment to which the claim relates.

• (3) Subject to subsection (4), an individual who fails to comply with subsection (1) in relation to any claim which is made for a year of assessment, shall be liable to a penalty of €1,520 and, for the purposes of recovery of a penalty under this subsection, section 1061 shall apply in the same manner as it applies for the purposes of the recovery of a penalty under any of the sections referred to in that section.

• (4) Subsection (3) shall not apply where an officer of the Revenue Commissioners is satisfied that any facts which the officer reasonably requires to be proved, and which would have been proved by the records, are proved by other documentary evidence furnished to the officer.

• (5) Subject to the provisions of section 956, an officer of the Revenue Commissioners may enquire into—

  • (a) a claim made by an individual, or

  • (b) any amendment made by an individual of a claim made by the individual,

  if, within 4 years from the end of the year of assessment in which the claim, or (as the case may be) any amendment of the claim, is made, the officer gives notice of his or her intention to do so to that individual.

• (6) Where an officer of the Revenue Commissioners gives notice under subsection (5) to any individual (in this subsection referred to as the ‘claimant’) of his or her intention to enquire into—

  • (a) a claim made by the claimant, or

  • (b) any amendment made by the claimant of such a claim,

  then the officer may at the same or any subsequent time by notice in writing require the claimant, within such time (which shall not be less than 30 days) as may be specified in the notice—

  - (i) to produce to the officer such documents as are in the claimant's possession or power and as the officer may reasonably require for the purpose of determining whether and, if so, the extent to which the claim or amendment is correct, and
  
  - (ii) to furnish the officer with such accounts or particulars as the officer may reasonably require for that purpose.
  

• (7) In complying with a notice under subsection (6) an individual may furnish to the officer copies of documents instead of originals, but—

  • (a) the copies must be photographic or other facsimiles, and

  • (b) the officer may by notice require the original to be produced for inspection.

• (8) The officer may take copies of, or make extracts from, any document produced to him or her under this section.”.

26 Amendment of section 997 (supplementary provisions (Chapter 4)) of Principal Act.

26.—With effect from the passing of this Act section 997 of the Principal Act is amended by inserting the following after subsection (2):

• “(3) Where the inspector, in accordance with the provisions of Regulation 37 of the Income Tax (Employments) (Consolidated) Regulations 2001 (S.I. No. 559 of 2001) sends a statement of liability to an employee, that statement shall, if the inspector so directs and gives notice accordingly in or with the statement sent to the employee, be treated in all respects as if it were an assessment raised on the employee, and all the provisions of the Income Tax Acts relating to appeals against assessments and the collection and recovery of tax charged in an assessment shall accordingly apply to the statement.”.

Chapter 4 Income Tax, Corporation Tax and Capital Gains Tax

27 Amendment of section 18 (amendment of Part 16 (income tax relief for investment in corporate trades — business expansion scheme and seed capital scheme) of Principal Act) of Finance Act 2004.

27.—Section 18 of the Finance Act 2004 is amended—

• (a) in subsection (2)—

• (i) by substituting the following for paragraph (b):

• “(b) in section 491—

  • (i) in subsections (2)(a) and (3)(a), by substituting ‘€1,000,000’ for ‘€750,000’,

  and

  • (ii) by inserting the following after subsection (3):

  ‘(3A) Notwithstanding anything in subsections (2) and (3), relief shall not be given in respect of a relevant issue to the extent that—

• (a) the amount raised by the relevant issue, or

• (b) the aggregate of—

  • (i) the amount to be raised through the relevant issue, and

  • (ii) the amount or amounts, if any, raised through the issue of eligible shares other than the relevant issue, within the period of 6 months ending with the date of that relevant issue, by the company or by all of the companies (including the company making the relevant issue) which are associated within the meaning of this section, as the case may be,

  exceeds €750,000.’ ”,

• (ii) by inserting the following after paragraph (c):

• “(cc) in section 495—

• (i) by substituting the following for subsections (1) and (2):

‘(1) In this section—

“EEA Agreement” means the Agreement on the European Economic Area signed at Oporto on 2 May 1992, as adjusted by the Protocol signed at Brussels on 17 March 1993;

“EEA State” means a state which is a contracting party to the EEA Agreement;

“qualifying subsidiary”, in relation to a company, means a subsidiary of that company of a kind which a company may have by virtue of section 507.

• (2) A company shall be a qualifying company if it is incorporated in the State or in an EEA State other than the State and complies with this section.’,

  • (ii) in subsection (3)(a), by substituting ‘which is resident in the State, or is resident in an EEA State other than the State and carries on business in the State through a branch or agency,’ for ‘which is resident in the State and not resident elsewhere.’,

  • (iii) by inserting the following after subsection (3):

  ‘(3A) The company shall—

  • (a) as respects the period 5 February 2004 to 31 December 2004 be a small or medium-sized enterprise within the meaning of Annex 1 to Commission Regulation (EC) No. 70/2001 of 12 January 2001¹, and

  • (b) as respects the period commencing on 1 January 2005 be a micro, small or medium-sized enterprise within the meaning of Annex 1 to Commission Regulation (EC) No. 364/2004 of 25 February 2004².’,

  and

  - (iv) by inserting the following after subsection (15):
  
    ‘(16) Notwithstanding the foregoing provisions of this section, a company shall not be a qualifying company while the company is regarded as a firm in difficulty for the purposes of the Community Guidelines on State Aid for rescuing and restructuring firms in difficulty<sup>3</sup>.’ ”,
  

and

• (iii) by substituting the following for paragraph (d):

• “(d) in section 496—

• (i) in subsection (2)(a)—

  • (I) in subparagraph (i)—

  • (A) in clause (I), by substituting ‘this Part,’ for ‘this Part, and’,

  • (B) in clause (II), by substituting ‘this Part, and’ for ‘this Part,’, and

    • (C) by inserting the following after clause (II):

    ‘(III) as respects a subscription for eligible shares issued on or after 5 February 2004, trading operations consisting of software development services referred to in subparagraph (ii) of paragraph (a) of section 443(10) and which would be qualifying trading operations if the employment grants referred to in subparagraph (I) of that paragraph were made, shall, notwithstanding anything in subparagraph (ii), be regarded as qualifying trading operations if approval for the making of such grant is obtained,’,

    and

    • (II) in subparagraphs (iv) and (xv), by substituting ‘on or after 1 January 2003 and on or before 31 December 2004’ for ‘on or after 1 January 2003’,

    and

• (ii) by inserting the following after subsection (4):

‘(4A) Notwithstanding the provisions of this section, trading operations carried on in the coal industry or in the steel and shipbuilding sectors shall not be regarded as qualifying trading operations for the purposes of this Part.’ ”,

and

• (b) in subsection (3)(b)—

• (i) in subparagraph (i), by substituting “5 February 2004” for “4 February 2004”,

• (ii) by substituting the following for subparagraph (ii):

• “(ii) as respects paragraph (b)(i), in relation to eligible shares issued on or after 1 January 2004 and as respects paragraph (b)(ii), in relation to eligible shares issued on or after 5 February 2004”,

• (iii) in subparagraph (iii), by substituting “5 February 2004,” for “4 February 2004, and”,

• (iv) by inserting the following after subparagraph (iii):

“(iiia) as respects paragraph (cc), as on and from 5 February 2004, and”,

and

• (v) in subparagraph (iv), by substituting “5 February 2004” for “4 February 2004.”.

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

28.—Section 482 of the Principal Act is amended—

• (a) in subsection (5)(b)—

• (i) in subparagraph (ii)(II), by substituting “4 hours,” for “4 hours, and”,

• (ii) in subparagraph (iii), by substituting “access to the building, and” for “access to the building.”, and

• (iii) by inserting the following after subparagraph (iii):

• “(iv) the Revenue Commissioners are satisfied that—

  • (I) details relating to that access are publicised or drawn to the attention of the public by way of advertisement, leaflet, press notice or similar means annually,

  • (II) a notice containing the details of the dates and times at which access is afforded to the public—

  • (A) is displayed on the days on which such access is so afforded and in a conspicuous location at or near the place where the public can gain entrance to the building concerned, and

  • (B) is so displayed so as to be easily visible and legible by the public,

  and

  - (III) conditions, if any, in regard to that access are such that they would not act as a disincentive to the public from seeking such access.”,
  

and

• (b) in subsection (7), by substituting the following for paragraph (a):

• “(a) Where a person makes a claim under subsection (2), an authorised person may at any reasonable time enter the building in respect of which the qualifying expenditure has been incurred for the purpose of—

  • (i) inspecting, as the case may be, the building or an object or of examining any work in respect of which the expenditure to which the claim relates was incurred, or

  • (ii) ensuring that the requirements in relation to reasonable access set out in subsection (5) are being complied with.”.

29 Amendment of Chapter 1 (interpretation and general) of Part 23 (farming and market gardening) of Principal Act.

29.—Chapter 1 of Part 23 of the Principal Act is amended by inserting the following after section 657:

“Taxation of certain farm payments.

657A.—(1) In this section— ‘relevant individual’ means an individual who is in receipt of— (a) a relevant payment or relevant payments, and (b) a payment under the EU Single Payment Scheme operated by the Department of Agriculture and Food under Council Regulation No. 1782/2003 of 29 September 20031, in respect of both of which the individual would be, apart from this section, chargeable to income tax on the profits or gains from farming for the year of assessment 2005, but does not include an individual who in the year of assessment 2005 is chargeable to income tax in respect of profits or gains from farming in accordance with subsection (5) of section 657; ‘relevant payment’ means a payment made at any time in the calendar year 2005 to an individual under any of the EU schemes specified in the Table to this section. (2) A relevant individual may elect to have the aggregate of all relevant payments made to the individual treated in accordance with subsections (3) to (6), and each such election shall be made in such form and contain such information as the Revenue Commissioners may require. (3) Notwithstanding any other provision of the Income Tax Acts apart from subsection (4), where an individual elects in accordance with subsection (2), the relevant payment or relevant payments shall be disregarded as respects the year of assessment 2005 and shall instead be treated for the purposes of the Income Tax Acts as arising in equal instalments in the year of assessment 2005 and in the 2 immediately succeeding years of assessment. (4) Where a trade of farming is permanently discontinued, tax shall be charged under Case IV of Schedule D for the year of assessment in which such discontinuation takes place in respect of the amount of any relevant payment which would, but for such discontinuance, be treated by virtue of subsection (3) as arising in a year of assessment or years of assessment ending after such discontinuance. (5) An election under subsection (2) by a person to whom this section applies, shall be made by notice in writing on or before 31 October 2006 and shall be included in the annual statement required to be delivered on or before that date under the Income Tax Acts of the profits or gains from farming for the year of assessment 2005. (6) Subject to subsection (4) an election made under subsection (2) cannot be altered or varied during the period to which it refers. TABLE 1. Special Beef Premium Schemes. 2. Suckler Cow Premium Scheme. 3. Ewe Premium Schemes. 4. Extensification Payments Scheme. 5. Slaughter Premium Scheme. 6. Arable Aid Schemes. 7. National Envelope Top-Ups.”.

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

30.—Section 659 of the Principal Act is amended—

• (a) in subsection (1)(c), by substituting “1 January 2009” for “1 January 2007” (inserted by the Finance Act 2004),

• (b) in subsection (2)(b)—

• (i) by substituting “6 April 2000,” for “6 April 2000, or” in subparagraph (i),

• (ii) by substituting “6 April 2000 but before 1 January 2005, or” for “6 April 2000,” in subparagraph (ii), and

• (iii) by inserting the following after subparagraph (ii):

• “(iii) 3 years beginning with the chargeable period related to the capital expenditure, where that expenditure is incurred on or after 1 January 2005.”,

• (c) in subsection (3A) by substituting “on or after 6 April 2000 but before 1 January 2005 shall,” for “on or after 6 April 2000 shall,”,

• (d) by inserting the following after subsection (3A):

• “(3AA) The farm pollution control allowances to be made in accordance with subsection (2) during the writing-down period referred to in subsection (2)(b)(iii) in respect of capital expenditure incurred in a chargeable period, shall where that expenditure is incurred on or after 1 January 2005, and subject to subsection (3BA), be an amount equal to 33⅓ per cent of that expenditure incurred for each of the 3 years of the writing-down period.”,

• (e) in subsection (3B)(a)—

• (i) by substituting “In this subsection and subsection (3BA)” for “In this subsection”,

• (ii) by substituting “residual amount.” for “residual amount;” in the definition of “specified amount”, and

• (iii) by deleting “ ‘specified return date for the chargeable period’ has the same meaning as in section 950.”,

• (f) by inserting the following after subsection (3B):

• “(3BA)

  • (a) Notwithstanding subsection (3AA), where farm pollution control allowances are to be made to a person in accordance with that subsection during the writing-down period referred to in subsection (2)(b)(iii), such person may elect to have those allowances made in accordance with this subsection and, where such person so elects, the allowances shall be made in accordance with this subsection only.

  • (b) Where paragraph (a) applies to a person, the farm pollution control allowance to be made to such person during the writing-down period referred to in subsection (2)(b)(iii) shall be an amount equal to—

    • (i) 33⅓ per cent of the specified amount for each of the 3 years of the writing-down period, and

    • (ii) subject to paragraph (c), the whole or any part of the residual amount, as is specified by the person to whom the allowances are to be made, in any year of the writing-down period.

  • (c) The allowances to be made in accordance with paragraph (b) for any year of the writing-down period, shall not in the aggregate exceed the residual amount.”,

• (g) by substituting the following for subsection (3C)(a):

• “(3C)
  • (a) An election by a person to whom this section applies in relation to the farm pollution control allowances claimed in subsection (3B) or (3BA), as the case may be, shall be made in writing on or before the specified return date for the chargeable period (within the meaning of section 950) in which the expenditure is incurred and shall be included in the annual statement required to be delivered under the Income Tax Acts of the profits or gains from farming as set out in subsection (5).”,

and

• (h) in subsection (11) by substituting “Chapter 1 or Chapter 2” for “Chapter 1”.

31 Amendment of section 666 (deduction for increase in stock values) of Principal Act.

31.—(1) Section 666 of the Principal Act is amended by substituting the following for subsection (4) (inserted by the Finance Act 2003):

• “(4)

  • (a) A deduction shall not be allowed under this section in computing a company's trading income for any accounting period which ends after 31 December 2006.

  • (b) Any deduction allowed by virtue of this section in computing the profits or gains of the trade of farming for an accounting period of a person other than a company shall not apply for any purpose of the Income Tax Acts for any year of assessment later than the year 2006.”.

• (2) This section comes into operation on 3 February 2005.

32 Amendment of section 667A (further provisions for qualifying farmers) of Principal Act.

32.—(1) Section 667A (inserted by the Finance Act 2004) of the Principal Act is amended in paragraph (b) of subsection (6) by substituting “31 December 2006” for “31 December 2004”.

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

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

33.—Section 843 of the Principal Act is amended by substituting the following for subsection (7):

• “(7) The Minister for Finance may not give a certificate under subsection (4) unless an application for certification was made before 1 January 2005.”.

34 Capital allowances for registered tourist accommodation.

34.—Chapter 1 of Part 9 of the Principal Act is amended—

• (a) in section 268—

• (i) by inserting the following after subsection (2B):

• “(2C) For the purposes of this Part, a building or structure (other than a building or structure which is in use for the purposes of the trade of hotel-keeping) which is in use as—

  • (a) a guest house and is registered in the register of guest houses kept under the Tourist Traffic Acts 1939 to 2003, or

  • (b) a holiday hostel and is registered in the register of holiday hostels kept under the Tourist Traffic Acts 1939 to 2003,

  shall, as respects capital expenditure incurred on or after 3 February 2005 on its construction (within the meaning of section 270), be deemed to be a building or structure in use for the purposes of the trade of hotel-keeping.”,

• (ii) in subsection (3), by substituting “a holiday camp registered in the register of holiday camps kept under the Tourist Traffic Acts 1939 to 2003” for “a holiday camp”,

• (iii) in subsection (12)—

• (I) by substituting the following for paragraph (a):

• “(a) that it has received a declaration from that person as to whether or not that person is—

  • (i) a small or medium-sized enterprise within the meaning of Annex I to Commission Regulation (EC) No. 70/2001 of 12 January 2001 on the application of Articles 87 and 88 of the European Communities Treaty to State aid to small and medium-sized enterprises¹, or

  • (ii) a micro, small or medium-sized enterprise within the meaning of the Annex to Commission Recommendation of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises²,”,

• (II) in paragraph (d)(i), by substituting “the Regulation or Recommendation” for “the Regulation”, and

• (III) in paragraph (d)(ii), by inserting the following after “European Communities”:

“or, as the case may be, ‘Community guidelines on State aid for rescuing and restructuring firms in difficulty’³ prepared by that Commission”,

and

• (iv) by inserting the following after subsection (13):

• “(14) Subject to subsection (15), a building or structure in use for the purposes of the trade of hotel-keeping (but not including a building or structure deemed to be such a building or structure) shall not, as respects capital expenditure incurred on or after 3 February 2005 on its construction (within the meaning of section 270), be treated as an industrial building or structure unless the building or structure is registered in the register of hotels kept under the Tourist Traffic Acts 1939 to 2003.

• (15) Subsection (14) shall not apply as respects capital expenditure incurred on or before 31 July 2006 on the construction or refurbishment of a building or structure in use for the purposes of the trade of hotel-keeping if—

  • (a) (i) a planning application (not being an application for outline permission within the meaning of section 36 of the Planning and Development Act 2000), in so far as planning permission was required, in respect of the construction or refurbishment work on the building or structure represented by that expenditure, was made in accordance with the Planning and Development Regulations 2001 to 2004,

    • (ii) an acknowledgement of the application, which confirms that the application was received on or before 31 December 2004, was issued by the planning authority in accordance with article 26(2) of the Planning and Development Regulations 2001 (S.I. No. 600 of 2001), and

    • (iii) the application was not an invalid application in respect of which a notice was issued by the planning authority in accordance with article 26(5) of those regulations,

  • (b) (i) a planning application, in so far as planning permission was required, in respect of the construction or refurbishment work on the building or structure represented by that expenditure, was made in accordance with the Local Government (Planning and Development) Regulations 1994 (S.I. No. 86 of 1994), not being an application for outline permission within the meaning of article 3 of those regulations,

    • (ii) an acknowledgement of the application, which confirms that the application was received on or before 10 March 2002, was issued by the planning authority in accordance with article 29(2)(a) of the regulations referred to in subparagraph (i), and

    • (iii) the application was not an invalid application in respect of which a notice was issued by the planning authority in accordance with article 29(2)(b)(i) of those regulations,

  • (c) where the construction or refurbishment work on the building or structure represented by that expenditure is exempted development for the purposes of the Planning and Development Act 2000 by virtue of section 4 of that Act or by virtue of Part 2 of the Planning and Development Regulations 2001 (S.I. No. 600 of 2001) and—

    • (i) a detailed plan in relation to the development work was prepared,

    • (ii) a binding contract in writing, under which the expenditure on the development is incurred, was in existence, and

    • (iii) work to the value of 5 per cent of the development costs was carried out,

    not later than 31 December 2004, or

  • (d) (i) the construction or refurbishment of the building or structure is a development in respect of which an application for a certificate under section 25(7)(a)(ii) of the Dublin Docklands Development Authority Act 1997 was made to the Authority (within the meaning of that Act),

    • (ii) an acknowledgement of the application, which confirms that the application was received on or before 31 December 2004, was issued by that Authority, and

    • (iii) the application was not an invalid application.”,

• (b) in section 272—

• (i) in subsection (3)—

• (I) in paragraph (c), by substituting “paragraph (d) or (da)” for “paragraph (d)”, and

• (II) by inserting the following after paragraph (d):

• “(da) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of section 268(1)(d) by reason of its use as a guest house or a holiday hostel to which section 268(2C) applies, 4 per cent of the capital expenditure on the construction (within the meaning of section 270) of the building or structure which is incurred on or after 3 February 2005,”,

and

• (ii) in subsection (4)—

• (I) in paragraph (c), by substituting “paragraph (d) or (da)” for “paragraph (d)”, and

• (II) by inserting the following after paragraph (d):

• “(da) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of section 268(1)(d) by reason of its use as a guest house or a holiday hostel to which section 268(2C) applies, 25 years beginning with the time when the building or structure was first used, in the case where the capital expenditure on the construction (within the meaning of section 270) of the building or structure is incurred on or after 3 February 2005,”,

and

• (c) in section 274(1)—

• (i) in paragraph (b)(iii), by substituting “subparagraph (iv) or (iva)” for “subparagraph (iv)”, and

• (ii) by inserting the following after subparagraph (iv):

“(iva) in relation to a building or structure which is to be regarded as an industrial building or structure within the meaning of section 268(1)(d) by reason of its use as a guest house or a holiday hostel to which section 268(2C) applies, 25 years after the building or structure was first used, in the case where the capital expenditure on the construction (within the meaning of section 270) of the building or structure is incurred on or after 3 February 2005,”.

35 Amendment of section 372AJ (nonapplication of relief in certain cases and provision against double relief) of Principal Act.

35.—Section 372AJ(1) of the Principal Act is amended in paragraph (ab) by inserting the following after the existing text in that paragraph:

“or, as the case may be, by a micro, small or medium-sized enterprise within the meaning of the Annex to Commission Recommendation of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises¹”.

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

36.—Section 481 of the Principal Act is amended—

• (a) in subsection (2)(b), by deleting subparagraph (1),

• (b) in subsection (2A)(g)—

• (i) by deleting subparagraph (i),

• (ii) in subparagraph (iii) by substituting “the amount per cent (in subsection (2)(c) referred to as ‘the specified percentage’) specified in the certificate” for “the specified percentage, as referred to in that subsection”,

• (iii) by substituting the following for subparagraph (iv):

• “(iv) in relation to the minimum amount of money to be expended on the production of the qualifying film—

  • (I) directly by the qualifying company on the employment, by the company, of eligible individuals, in so far as those individuals exercise their employment in the State in the production of the qualifying film, and

  • (II) directly or indirectly by the qualifying company, on the provision of certain goods, services and facilities, as set out in regulations made under subsection (2E),”,

and

• (iv) by inserting the following after subparagraph (iv):

• “(v) where financial arrangements have been approved by the Revenue Commissioners in accordance with subsection (2C)(ba), in relation to any matter pertaining to those arrangements.”,

• (c) in subsection (2C)—

• (i) in paragraph (b), by inserting “subject to paragraph (ba),” before “if”, and

• (ii) by inserting the following after paragraph (b):

• “(ba) (i) Paragraph (b) shall not apply to financial arrangements in relation to a transaction or series of transactions, where such arrangements have been approved by the Revenue Commissioners.

  • (ii) The Revenue Commissioners shall not approve financial arrangements, to which paragraph (b) would, but for this paragraph, apply unless:

    • (I) the arrangements relate to either or both—

    • (A) an investment made in a qualifying film, and

    • (B) the filming of part of a film in a territory other than a territory referred to in clause (I) or (II) of paragraph (b)(i),

      • (II) a request for approval is made by the qualifying company to the Revenue Commissioners before such arrangements are effected,

      • (III) the qualifying company demonstrates to the satisfaction of the Revenue Commissioners that it can provide, if requested, sufficient records to enable the Revenue Commissioners to verify—

    • (A) in the case of an investment, the amount of the investment made in the qualifying company and the person who made the investment, and

    • (B) in the case of filming in a territory, the amount of each item of expenditure on the production of the qualifying film expended in the territory, whether expended by the qualifying company or by any other person,

    and

    - (IV) they are satisfied that it is appropriate to grant such approval.
    

  • (iii) In considering whether to grant an approval under this paragraph in relation to financial arrangements, the Revenue Commissioners may seek any information they consider appropriate in relation to the arrangements or in relation to any person who is, directly or indirectly, a party to the arrangements.

  • (iv) Where the Revenue Commissioners have approved financial arrangements in accordance with this paragraph, no amount of money expended, either directly or indirectly, as part of the arrangements may be regarded, for the purposes of subsection (2A)(g)(iv), as an amount of money expended on either the employment of eligible individuals or on the provision of goods, services and facilities as referred to in that subsection.”,

• (d) in subsection (2E)—

• (i) in paragraph (k), by deleting “and”, and

• (ii) by inserting the following after paragraph (l):

• “(m) governing the approval of financial arrangements in accordance with subsection (2C)(ba), and

• (n) governing the employment of eligible individuals, as referred to in subsection (2A)(g)(iv), and the circumstances in which expenditure by a qualifying company would be regarded as expenditure on the employment of those individuals in the production of a qualifying film.”,

and

• (e) in subsection (22), by substituting “1 January 2005” for “the day appointed by order made by the Minister for Finance for the coming into operation of this subsection” and “the day so appointed” respectively.

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

37.—Section 1013 of the Principal Act is amended—

• (a) in subsection (1) in the definition of “limited partner”—

• (i) in paragraph (c) by substituting “trade,” for “trade, or”,

• (ii) in paragraph (d) by substituting “partner,” for “partner;”, and

• (iii) by inserting the following after paragraph (d):

• “(e) a person who carries on the trade as a partner in a partnership registered under the law of any territory outside the State, otherwise than as an active partner, or

• (f) a person who carries on the trade jointly with others under any agreement, arrangement, scheme or understanding which is governed by the law of any territory outside the State, otherwise than as a person who works for the greater part of his or her time on the day-to-day management or conduct of that trade;”,

and

• (b) in subsection (2)(a)—

• (i) in subparagraph (II) by substituting “trade,” for “trade, or”,

• (ii) in subparagraph (III) by substituting “trade, or” for “trade,”, and

• (iii) by inserting the following after subparagraph (III):

• “(IV) where the individual is a limited partner in relation to a trade by virtue of paragraph (e) or (f) of the definition of ‘limited partner’ and the relevant year of assessment is the year of assessment 2005 or any subsequent year of assessment, only against income consisting of profits or gains arising from the trade,”.

38 Amendment of Schedule 26A (donations to approved bodies, etc.) to Principal Act.

38.—Schedule 26A to the Principal Act is amended in Part 3 by substituting “2 years,” for “3 years,” in subparagraph (c) of paragraph 3.

39 Amendment of section 817 (schemes to avoid liability to tax under Schedule F) of Principal Act.

39.—(1) Section 817 of the Principal Act is amended in subsection (1) by inserting the following after paragraph (c)—

• “(ca) For the purposes of this section, following a disposal of shares in a close company by a shareholder or the carrying out of a scheme or arrangement of which the disposal is a part, the interest of the shareholder in any trade or business which was carried on by the close company shall be deemed—

  • (i) to include the interest, or interests as the case may be, in that trade or business of one or more persons connected with the shareholder, if increasing that interest of the shareholder by such interest, or interests as the case may be, would result in the interest of the shareholder in the trade or business not having been significantly reduced,

  • (ii) notwithstanding paragraph (c), not to have been significantly reduced where—

    • (I) the business carried on by the close company, taking account of any trade carried on by that company, consisted wholly or mainly of the holding of shares in another company carrying on a trade or business or in more than one such other company, and

    • (II) the interest of the shareholder in any such trade or business last-mentioned in clause (I), whether or not that trade or business continues to be carried on by such other company after the disposal, is not significantly reduced,

  • (iii) notwithstanding paragraph (c), not to have been significantly reduced where the gain realised by the shareholder on that disposal is wholly or mainly attributable to payments or other transfers of value from another company or companies, which is or are controlled by that shareholder or by that shareholder and persons connected with him or her, to the close company, and

  • (iv) not to have been significantly reduced where—

    • (I) it would not have been so reduced if the shareholder were to be treated as beneficially entitled to any shares to which he or she could, at any time, become so entitled by the exercise of a discretion by trustees,

    • (II) the acquisition of those shares by the trustees was directly or indirectly related to a disposal, including a prior or subsequent disposal, of such shares by the shareholder, and

    • (III) the shares were acquired by the trustees with the direct or indirect financial assistance of a company or companies, which is or are controlled by the shareholder or by the shareholder and persons connected with the shareholder.”.

• (2) This section applies and has effect as respects any disposal of shares (within the meaning of section 817 of the Principal Act) on or after 1 March 2005.

40 Court funds.

40.—The Principal Act is amended—

• (a) in section 739B(1)—

• (i) in the definition of “chargeable event” by inserting the following after paragraph (II):

“(IIa) any transaction in relation to, or in respect of, relevant units (within the meaning of subsection (2A)(a)) in an investment undertaking which transaction arises only by virtue of a change of court funds manager for that undertaking,”,

and

• (ii) “collective investor”:

“ ‘court funds manager’ means a person appointed by the Service to set up and administer an investment undertaking with money under the control or subject to the order of any Court;”,

and

• (b) in section 739D(1)—

• (i) by deleting “and” after “unit,” in paragraph (b), and

• (ii) by inserting the following after paragraph (b):

• “(bb) references to an amount invested by a unit holder in an investment undertaking for the acquisition of a unit (in this paragraph referred to as the ‘original unit’), where the original unit has been exchanged for a unit or units in a transaction of the type referred to in paragraph (IIa) of the definition of ‘chargeable event’ in section 739B(1), are references to the amount invested by the unit holder for the acquisition of the original unit, and”.

41 Assets of overseas life assurance companies.

41.—(1) Section 29(3) of the Principal Act is amended—

• (a) in paragraph (c) by substituting “agency,” for “agency.”, and

• (b) by inserting the following after paragraph (c):

• “(d) assets situated outside the State of an overseas life assurance company (within the meaning of section 706(1)), being assets which were held in connection with the life business (within the meaning of section 706(1)) carried on by the company, which at or before the time the chargeable gains accrued were used or held by or for the purposes of that company's branch or agency in the State.”.

• (2) This section applies as respects accounting periods ending on or after 1 March 2005.

42 Amendment of Chapter 5 (policyholders— new basis) of Part 26 of Principal Act.

42.—(1) Chapter 5 of Part 26 of the Principal Act is amended—

• (a) in section 730C(1)(a) by inserting the following after subparagraph (iii):

• “(iv) the ending of a relevant period, where such ending is not otherwise a chargeable event within the meaning of this section, and for the purposes of this subparagraph ‘relevant period’ in relation to a life policy means a period of 7 years beginning with the inception of the policy and each subsequent period of 7 years beginning immediately after the preceding relevant period,”,

• (b) in section 730D—

• (i) in subsection (1)—

• (I) by deleting “and” in paragraph (d), and

• (II) by inserting the following after paragraph (d):

• “(da) if the chargeable event is the ending of a relevant period in accordance with section 730C(1)(a)(iv), a gain in the amount determined under subsection (3)(da), and”,

• (ii) in subsection (3)—

• (I) by deleting “and” in paragraph (d), and

• (II) by inserting the following after paragraph (d):

• “(da) in subsection (1)(da) is the amount determined by the formula—

V — P

and”,

• (iii) in subsection (4) by inserting the following after paragraph (b):

• “(ba) Where a chargeable event in relation to a life policy is the ending of a relevant period in accordance with section 730C(1)(a)(iv) then, for the purposes of determining a gain arising on the happening of a subsequent chargeable event, the allowable premiums immediately after the time of such ending shall be deemed to be the greater of—

  • (i) an amount equal to the value of the policy immediately after the time of such ending, and

  • (ii) the allowable premiums immediately before such ending.”,

and

• (iv) by inserting the following after subsection (4)—

• “(5)

  • (a) Where at any time—

    • (i) a chargeable event, being a chargeable event (in this subsection referred to as a ‘relevant event’) within the meaning of section 730C(1)(a)(iv), occurs in relation to a life policy which commenced before 1 May 2005,

    • (ii) immediately before that time the assurance company that commenced the life policy does not have in its possession a declaration in relation to the policy of the kind referred to in subsection (2), and

    • (iii) the permanent address of the policyholder, as stated in the policy, is not in the State and the assurance company does not have reasonable grounds to believe that the policyholder is resident in the State,

    then the assurance company may elect to be treated in relation to that chargeable event for the purposes of subsection (2) as if, immediately before that time, the assurance company was in possession of a declaration in relation to the policy of the kind referred to in that subsection.

  • (b) Where at any time—

    • (i) a relevant event occurred in relation to a life policy and a chargeable event, not being a relevant event, subsequently occurs in relation to the policy,

    • (ii) this subsection applied to the relevant event in accordance with paragraph (a), and

    • (iii) immediately before that time the assurance company that commenced the life policy does not have in its possession a declaration in relation to the policy of the kind referred to in subsection (2),

    then paragraph (a) shall be deemed not to have applied to the relevant event and any appropriate tax payable by virtue of a gain arising under this section shall be due and payable as if paragraph (a) had not been enacted.”,

• (c) in section 730E(2)(a) by adding “at or about the time of the inception of the life policy” after “policyholder”, and

• (d) in section 730F(3)(a)(ii) by inserting the following after clause (I):

“(Ia) is the ending of a relevant period in accordance with section 730C(1)(a)(iv), or”.

• (2) This section comes into operation on such day or days as the Minister for Finance may by order appoint either generally or with reference to any particular provision of this section or class of policy and different days may be so appointed for different provisions of this section or for different classes of policies.

43 Amendment of section 747E (disposal of an interest in offshore funds) of Principal Act.

43.—(1) Section 747E (inserted by the Finance Act 2001) of the Principal Act is amended in subsection (3) by substituting “for the purposes of the Tax Acts and the Capital Gains Tax Acts” for “accordingly for the purposes of this Chapter”.

• (2) This section applies as respects the disposal of an interest in an offshore fund (within the meaning of section 747E of the Principal Act) on or after 3 February 2005.

44 Common contractual funds.

44.—The Principal Act is amended—

• (a) in the definition of “collective investment undertaking” in section 172A(1)(a)—

• (i) by deleting “or” in subparagraph (ii),

• (ii) by inserting “or” after “Finance Act, 2000),” in subparagraph (iii), and

• (iii) by inserting the following after subparagraph (iii):

• “(iv) a common contractual fund within the meaning of section 739I (inserted by the Finance Act 2005),”,

• (b) in the definition of “investment undertaking” in section 246(1)—

• (i) by deleting “or” in paragraph (b),

• (ii) by substituting “section 739B, or” for “section 739B;” in paragraph (c), and

• (iii) by inserting the following after paragraph (c):

• “(d) a common contractual fund within the meaning given to it in section 739I (inserted by the Finance Act 2005);”,

• (c) in section 739C—

• (i) in subsection (1) by deleting “, subject to subsection (1A),”, and

• (ii) by deleting subsection (1A),

and

• (d) by inserting the following after section 739H—

“Common contractual funds.

739I.—(1) (a) In this section ‘common contractual fund’ means— (i) a collective investment undertaking being an unincorporated body established by a management company under which the participants by contractual arrangement participate and share in the property of the collective investment undertaking as co-owners, where it is expressly stated under its deed of constitution to be established pursuant to an Act of the Oireachtas and which holds an authorisation issued in accordance with such Act and which is not established pursuant to Council Directive No. 85/611/EEC of 20 December 19851, as amended by Council Directive No. 88/220/EEC of 22 March 19882 and Directive No. 95/26/EC of the Council and of the European Parliament of 29 June 19953, or (ii) an investment undertaking within the meaning of paragraph (b) of the definition of ‘investment undertaking’ which is constituted otherwise than under trust law or statute law. (b) For the purposes of this section the definitions of ‘relevant gains’, ‘relevant income’, ‘relevant payment’, ‘relevant profits’, ‘unit’ and ‘unit holder’ shall apply, with any necessary modifications, to a collective investment undertaking within the meaning of paragraph (i) of the definition of ‘common contractual fund’ as they apply to an investment undertaking within the meaning of paragraph (b) of the definition of ‘investment undertaking’. (2) (a) Notwithstanding anything in the Tax Acts and subject to subsections (3) and (4), a common contractual fund shall not be chargeable to tax in respect of relevant profits. (b) For the purposes of the Tax Acts, relevant income and relevant gains in relation to a common contractual fund shall be treated as arising, or as the case may be, accruing, to each unit holder of the common contractual fund in proportion to the value of the units beneficially owned by the unit holder, as if the relevant income and relevant gains had arisen or, as the case may be, accrued, to the unit holders in the common contractual fund without passing through the hands of the common contractual fund. (3) Subsection (2) shall only apply where each of the units of the common contractual fund— (a) is an asset of a pension fund or beneficially owned by a person other than an individual, or (b) is held by a custodian or trustee for the benefit of a person other than an individual. (4) Every common contractual fund shall in respect of each year of assessment, on or before 28 February in the year following the year of assessment, make a statement (including where it is the case, a statement with a nil amount) to the Revenue Commissioners in electronic format approved by them, which in respect of each year of assessment— (a) specifies the total amount of relevant profits arising to the common contractual fund in respect of units in that fund, and (b) specifies in respect of each person who is a unit holder— (i) the name and address of the person, (ii) the amount of the relevant profits to which the person is entitled, and (iii) such other information as the Revenue Commissioners may require. (5) Notwithstanding Chapter 4 of Part 8, that Chapter shall apply to a deposit (within the meaning of that Chapter) to which a common contractual fund is for the time being entitled as if such deposit were not a relevant deposit within the meaning of that Chapter.”.

45 Treatment of leasing.

45.—(1) The Principal Act is amended—

• (a) in section 396A(1) by substituting the following for the definition of “relevant trading loss”:

“ ‘relevant trading loss’, in relation to an accounting period of a company, means a loss incurred in the accounting period in a trade carried on by the company, other than—

• (a) so much of the loss as is a loss incurred in an excepted trade within the meaning of section 21A, and

• (b) any amount which is or would, if subsection (8) of section 403 had not been enacted, be the relevant amount of the loss for the purposes of subsection (4) of that section.”,

• (b) in section 396B(1), in the definition of “relevant trading loss”, by deleting the words after “section 396A”,

• (c) in section 403(4)(a)(ii) by substituting “group relief except to the extent that it could be set off under section 420A against income of a trade of leasing carried on by the claimant company if paragraph (b) of the definition of relevant trading loss in section 420A were deleted” for “group relief”,

• (d) in section 420A(1) by substituting the following for the definition of “relevant trading loss”:

“ ‘relevant trading loss’, in relation to an accounting period of a company, means a loss incurred in the accounting period in a trade carried on by the company, other than—

• (a) so much of the loss as is a loss incurred in an excepted trade within the meaning of section 21A, and

• (b) any amount which is or would, if subsection (8) of section 403 had not been enacted, be the relevant amount of the loss for the purposes of subsection (4) of that section.”,

and

• (e) in section 420B, in the definition of “relevant trading loss”, by deleting the words after “section 396A”.

• (2)
• (a) Paragraphs (a), (b) and (d) of subsection (1) apply as respects any claim made by a company on or after 3 February 2005 for relief for a loss.

• (b) Paragraph (c) of subsection (1) applies as respects an accounting period ending on or after 3 February 2005.

46 Treatment of certain dividends.

46.—(1) The Principal Act is amended—

• (a) in section 17 by inserting the following after subsection (2):

• “(3) Subsection (1) shall not apply to a banker by virtue only of the clearing of a cheque, or the arranging for the clearing of a cheque, by the banker.”,

and

• (b) in section 62—

• (i) by renumbering the existing provision as subsection (1) of that section, and

• (ii) by inserting the following after subsection (1):

• “(2) This section does not apply to a banker by virtue only of the clearing of a cheque, or the arranging for the clearing of a cheque, by the banker.”.

• (2) This section applies as respects any payment on or after the date of the passing of this Act.

47 Dividend withholding tax.

47.—(1) Chapter 8A (inserted by the Finance Act 1999) of Part 6 of the Principal Act is amended—

• (a) in section 172A(1)(a) by inserting the following definitions after the definition of “pension scheme”:

“ ‘PRSA administrator’ has the same meaning as in section 787A;

‘PRSA assets’ has the same meaning as in section 787A;”,

and

• (b) in section 172C—

• (i) in subsection (2)—

• (I) by inserting the following paragraph after paragraph (ba):

• “(bb) a PRSA administrator who is receiving the relevant distribution as income arising in respect of PRSA assets, and has made a declaration to the relevant person in relation to the relevant distribution in accordance with paragraph 10 of Schedule 2A,”,

and

• (II) by inserting the following paragraph after paragraph (da):

• “(db) a unit trust to which section 731(5)(a) applies and which has made a declaration to the relevant person in relation to the relevant distribution in accordance with paragraph 11 of Schedule 2A,”,

and

• (ii) in subsection (3) by inserting the following paragraphs after paragraph (c):

• “(ca) a PRSA administrator who receives a relevant distribution as income arising in respect of PRSA assets,

• (cb) a unit trust to which section 731(5)(a) applies which receives a relevant distribution in relation to units in that unit trust,”.

• (2) Schedule 2A (inserted by the Finance Act 1999) of the Principal Act is amended by inserting the following paragraphs after paragraph 9:

“Declaration to be made by a PRSA administrator

1. The declaration referred to in section 172C(2)(bb) shall be a declaration in writing to the relevant person which—

2. (a) is made by the person (in this paragraph referred to as the ‘declarer’) beneficially entitled to the relevant distribution in respect of which the declaration is made,

3. (b) is signed by the declarer,

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

5. (d) declares that, at the time when the declaration is made, the person beneficially entitled to the relevant distribution is a person referred to in section 172C(2)(bb),

6. (e) contains the name and tax reference number of the person,

7. (f) contains a statement that, at the time when the declaration is made, the relevant distribution in respect of which the declaration is made will be applied as income of a PRSA,

8. (g) contains an undertaking by the declarer that, if the person mentioned in subparagraph (d) ceases to be an excluded person, the declarer will, by notice in writing, advise the relevant person in relation to the relevant distribution accordingly, and

9. (h) contains such other information as the Revenue Commissioners may reasonably require for the purposes of Chapter 8A of Part 6.

Declaration to be made by exempt unit trust

1. The declaration referred to in section 172C(2)(db) shall be a declaration in writing to the relevant person which—

2. (a) is made by the person (in this paragraph referred to as the ‘declarer’) beneficially entitled to the relevant distributions in respect of which the declaration is made,

3. (b) is signed by the declarer,

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

5. (d) declares that, at the time when the declaration is made, the person beneficially entitled to the relevant distribution is a person referred to in section 172C(2)(db),

6. (e) contains the name and tax reference number of the person,

7. (f) contains a statement that, at the time when the declaration is made, the relevant distribution in respect of which the declaration is made will be applied as income of an exempt unit trust to which section 731(5)(a) applies,

8. (g) contains an undertaking by the declarer that, if the person mentioned in subparagraph (d) ceases to be an excluded person, the declarer will, by notice in writing, advise the relevant person in relation to the relevant distribution accordingly, and

9. (h) contains such other information as the Revenue Commissioners may reasonably require for the purposes of Chapter 8A of Part 6.”.

• (3) This section shall apply as on and from 3 February 2005.

Chapter 5 Corporation Tax

48 Generally accepted accounting standards.

48.—(1) The Principal Act is amended—

• (a) in section 4—

• (i) in subsection (1)—

• (I) by inserting the following after the definition of “franked investment income”:

“ ‘generally accepted accounting practice’ means—

• (a) in relation to the affairs of a company or other entity that prepares accounts (in this section referred to as ‘IAS accounts’) in accordance with international accounting standards, generally accepted accounting practice with respect to such accounts;

• (b) in any other case, Irish generally accepted accounting practice;”,

and

• (II) by inserting the following after the definition of “interest”:

“ ‘international accounting standards’ means the international accounting standards, within the meaning of Regulation (EC) No. 1606/2002 of the European Parliament and the Council of 19 July 2002 on the application of international accounting standards (in this section referred to as ‘the Regulation’);

‘Irish generally accepted accounting practice’ means generally accepted accounting practice with respect to accounts (other than IAS accounts) of companies incorporated or formed under the laws of the State, being accounts that are intended to give a true and fair view;”,

and

• (ii) by inserting the following after subsection (6):

• “(7) For the purposes of this section, where the European Commission in accordance with the Regulation adopts an international accounting standard with modifications, then as regards matters covered by that standard—

  • (a) generally accepted accounting practice with respect to IAS accounts shall be regarded as permitting the use of the standard either with or without the modifications, and

  • (b) accounts prepared on either basis shall be regarded as prepared in accordance with international accounting standards.”,

• (b) in Chapter 5 of Part 4, by inserting the following after section 76: