Legalize / Ireland / Act

Finance Act 2011

Type Act

Publication 2011-02-06

State In force

Source Irish Statute Book

articles 84

Reform history JSON API

Chapter 1 Interpretation

1. Interpretation (Part 1).

1.— In this Part “Principal Act” means the Taxes Consolidation Act 1997.

2. Cessation of charge to income levy.

2.— The Principal Act is amended in Part 18A by inserting the following after section 531N:

“Cessation of charge to income levy.

531NA.— Subject to section 531AY, income levy shall cease to be charged, in accordance with this Part, for the year of assessment 2011 and subsequent years of assessment.”.

3.— (1) The Principal Act is amended—

(a) by inserting the following Part after Part 18C:

“PART 18D

Definitions (Part 18D).

531AL.— In this Part—

‘aggregate income for the tax year’, in relation to an individual and a tax year, means the aggregate of the individual’s—

(a) relevant emoluments in the tax year, including relevant emoluments that are paid in whole or in part for a tax year other than the tax year during which the payment is made, and

(b) relevant income for the tax year;

‘Collector-General’ means the Collector-General appointed under section 851;

‘employee’ and ‘employer’ have the same meanings as in section 983;

‘excluded emoluments’ means emoluments which have been gifted to the Minister for Finance under section 483;

‘income levy’ has the meaning assigned to it by section 531B;

‘income tax month’ means a calendar month;

‘inspector’ means an inspector of taxes or other officer of the Revenue Commissioners;

‘PAYE Regulations’ means the Income Tax (Employments) (Consolidated) Regulations 2001 (S.I. No. 559 of 2001);

‘relevant emoluments’ and ‘relevant income’ shall be construed in accordance with paragraphs (a) and (b), respectively, of the Table to section 531AM(1);

‘similar type payments’ means payments which are of a similar character to social welfare payments but which are made by—

(a) the Health Service Executive,

(b) the Department of Community, Equality and Gaeltacht Affairs,

(d) the Department of Education and Skills,

(e) the Department of Agriculture, Fisheries and Food,

(f) An Foras Áiseanna Saothair, in respect of schemes mentioned in clauses (I), (II) and (III) of section 472A(1)(b)(i), or

(g) any other state or territory;

‘social welfare payments’ means payments made under the Social Welfare Acts;

‘tax year’ means a year of assessment within the meaning of the Tax Acts;

‘universal social charge’ has the meaning assigned to it by section 531AM.

Charge to universal social charge.

531AM.— (1) With effect from 1 January 2011, there shall be charged, levied and paid, in accordance with the provisions of this Part, a tax to be known as ‘universal social charge’ in respect of the income specified in paragraphs (a) and (b) of the Table to this subsection.

TABLE

(a) The income described in this paragraph (in this Part referred to as ‘relevant emoluments’) is emoluments to which Chapter 4 of Part 42 applies or is applied, including—

(i) any allowable contributions referred to in Regulations 41 and 42 of the PAYE Regulations,

(ii) the initial market value (within the meaning of section 510(2)) of any shares, excluded from the charge to income tax by virtue of section 510(4), appropriated in accordance with Chapter 1 of Part 17,

(iii) the market value (determined in accordance with section 548) of the right referred to in section 519A(1) or 519D(1), and

(iv) any gain exempted from income tax by virtue of section 519A(3) or 519D(3),

but not including—

(I) social welfare payments and similar type payments,

(II) excluded emoluments,

(III) emoluments disregarded by an employer on the direction of an inspector in accordance with Regulation 10(3) of the PAYE Regulations,

(IV) any amount in respect of which relief is due under section 201(5)(a) and paragraphs 6 and 8 of Schedule 3, and

(V) emoluments of an individual who is resident in a territory with which arrangements have been made under subsection (1)(a)(i) or (1B)(a)(ii) of section 826 in relation to affording relief from double taxation, where those emoluments are the subject of a notification issued under section 984(1).

(b) The income described in this paragraph (in this Part referred to as ‘relevant income’) is income, without regard to any amount deductible from or deductible in computing total income, from all sources as estimated in accordance with the Tax Acts, other than—

(i) relevant emoluments,

(ii) any emoluments, payments, expenses or other amounts referred to in clauses (I) to (V) of paragraph (a)(iv) of this Table,

(iii) any gains, income or payments to which any of the following provisions apply—

(I) Chapter 4 of Part 8;

(II) Chapter 5 of Part 8;

(III) Chapter 7 of Part 8;

(IV) Chapter 5 of Part 26;

(V) Chapter 6 of Part 26;

(VI) Chapter 1A of Part 27;

(VII) Chapter 4 of Part 27,

(iv) where section 825A applies in respect of an individual for a tax year, an amount equal to the difference between—

(I) the individual’s total income for the tax year had that section not applied for that year, and

(II) the amount of total income which if charged to income tax for the year would have given an amount of income tax payable equal to that which would be payable by virtue of the operation of that section,

(v) where section 1025 applies in respect of an individual, the amount of any deduction for any payment to which that section applies, made by an individual pursuant to a maintenance arrangement (within the meaning of that section) relating to the marriage for the benefit of the other party to the marriage unless section 1026 applies in respect of such payment,

(vi) where section 382 applies in respect of an individual carrying on a trade or profession, an amount equal to the amount referred to in section 531AU(1), and

(vii) where section 272, 284, 658 or 659 applies in respect of an individual carrying on a trade or profession, an amount equal to the amount referred to in section 531AU(2),

and—

(I) as if sections 140, 141, 142, 143, 195, 232, 234 and 664 were never enacted, and

(II) without regard to any deduction—

(A) in respect of double rent allowance under section 324(2), 333(2), 345(3) or 354(3),

(B) under section 372AP, in computing the amount of a surplus or deficiency in respect of rent from any premises,

(D) under section 847A, in respect of a relevant donation (within the meaning of that section), or

(E) under section 848A, in respect of a relevant donation (within the meaning of that section).

(2) Universal social charge shall not be payable for a tax year by an individual who proves to the satisfaction of the Revenue Commissioners that his or her aggregate income for the tax year does not exceed €4,004.

Rate of charge.

531AN.— (1) For the tax year 2011 and for each subsequent tax year an individual shall be charged to universal social charge on his or her aggregate income for the tax year—

(a) at the rate specified in column (2) of the Table to this section corresponding to the part of aggregate income specified in column (1) of that Table where the individual is aged under 70 years, and

(b) at the rate specified in column (3) of the Table to this section corresponding to the part of aggregate income specified in column (1) of that Table where the individual is aged 70 years or over at any time during the tax year.

(2) Notwithstanding subsection (1) and the Table to this section and subject to subsection (3), for the tax year 2011 and for each subsequent tax year where an individual has relevant income that exceeds €100,000, the individual shall, instead of being charged to universal social charge on the amount of the excess at the rates provided for in that Table, be charged on the amount of that excess—

(a) at the rate of 10 per cent where the individual is aged under 70 years, or

(b) at the rate of 7 per cent where the individual is aged 70 years or over at any time during the tax year.

(3) Notwithstanding subsection (1) and the Table to this section, for the tax year 2011 and for each subsequent tax year where an individual is aged under 70 years and has full eligibility for services under Part IV of the Health Act 1970, by virtue of sections 45 and 45A of that Act or Council Regulation (EEC) No. 1408/71 of 14 June 1971, the individual shall, instead of being charged to universal social charge on the part of aggregate income for the tax year concerned that exceeds €16,016 at the rate provided for in column (2) of that Table, be charged on the amount of the excess at the rate of 4 per cent.

(4) Subsections (2) and (3) shall cease to have effect for the tax year 2015 and subsequent tax years.

TABLE

Part of aggregate income	Rate of universal social charge (Individual aged under 70 years)	Rate of universal social charge (Individual aged 70 years or over)
(1)	(2)	(3)
The first €10,036	2%	2%
The next €5,980	4%	4%
The remainder	7%	4%

Deduction and payment of universal social charge on relevant emoluments.

531AO.— (1) An employer shall be liable in the first instance to pay universal social charge due in respect of any payment of relevant emoluments.

(2) As respects any payment of relevant emoluments made to or on behalf of an employee on or after 1 January 2011, universal social charge shall be deducted from such emoluments by the employer at any or all of the following rates:

(a) zero per cent where the amount of the relevant emoluments does not exceed €77, in the case where the period in respect of which the payment is being made is a week, or a corresponding amount where the period is greater or less than a week;

(b) 2 per cent on the full amount of the relevant emoluments where that amount exceeds €77 but does not exceed €193, in the case where the period in respect of which the payment is being made is a week, or a corresponding amount where the period is greater or less than a week;

(i) where the amount of the relevant emoluments exceeds €193, but does not exceed €308,

(ii) where, in the case of an employee who is aged 70 years or over at any time during the tax year, the amount of the relevant emoluments exceeds €193, or

(iii) where, in the case of an employee who is aged under 70 years and has full eligibility for services under Part IV of the Health Act 1970, by virtue of sections 45 and 45A of that Act or Council Regulation (EEC) No. 1408/71 of 14 June 1971 [^1], the amount of the relevant emoluments exceeds €193,

in the case where the period in respect of which the payment is being made is a week, or a corresponding amount where the period is greater or less than a week;

(d) 7 per cent on the amount of the excess—

(i) where, in the case of an employee who is not aged 70 years or over at any time during the tax year, the amount of the relevant emoluments exceeds €308, or

(ii) where, in the case of an employee who does not have full eligibility for services under Part IV of the Health Act 1970, by virtue of sections 45 and 45A of that Act or Council Regulation (EEC) No. 1408/71 of 14 June 1971, the amount of the relevant emoluments exceeds €308,

in the case where the period in respect of which payment is being made is a week, or a corresponding amount where the period is greater or less than a week,

and notwithstanding that the relevant emoluments are in whole or in part for some tax year other than that during which the payment is made.

(3) The provisions of Part 4 of the PAYE Regulations, with any necessary modifications, shall apply to universal social charge in respect of relevant emoluments and universal social charge payable by an employee shall only be recoverable from him or her by his or her employer by deduction in accordance with those provisions.

(4) Within 14 days of the end of every income tax month the employer shall remit to the Collector-General the total of all amounts of universal social charge that the employer was liable to deduct from relevant emoluments paid by the employer during that income tax month.

(5) The Collector-General may, in writing, and unless the employer objects, authorise the employer to remit to the Collector-General, within 14 days from the end of such longer period (if any) than the period specified in subsection (4) but not exceeding one year, as may be so authorised, the total of all amounts of universal social charge which the employer was liable to deduct from relevant emoluments paid by the employer during that longer period.

(6) Where a remittance referred to in subsection (4) is made by such electronic means (within the meaning of section 917EA) as are approved by the Revenue Commissioners, that subsection shall apply and have effect as if ‘within 23 days of the end of every income tax month’ were substituted for ‘within 14 days of the end of every income tax month’ but, where that remittance is not made within that period of 23 days, subsection (4) shall apply and have effect without regard to the provisions of this subsection.

(7) On payment of universal social charge, the Collector-General may send, make available or cause to be made available to the employer concerned a receipt in respect of the payment which shall consist of whichever of the following the Collector-General considers appropriate, namely—

(a) a separate receipt in respect of each such payment, or

(b) a receipt for all such payments made within the period specified in the receipt.

(8) Within 46 days from the end of a tax year, or from the date the employer ceases permanently to be an employer to whom Regulation 7(1) of the PAYE Regulations applies, whichever is the earlier, the employer shall send to the Collector-General—

(a) a return, in a form provided or approved by the Revenue Commissioners, in respect of each individual to whom payment of relevant emoluments was made during the tax year showing—

(i) the total amount of universal social charge payable as respects the individual in the tax year,

(ii) the dates of commencement and cessation within the tax year of the employment of the individual, where applicable,

(iii) the rate of universal social charge payable as respects the individual, and

(iv) the total relevant emoluments paid to the individual in the tax year,

and

(b) a statement, declaration and certificate in such form as may be provided or approved by the Revenue Commissioners, showing the total amount of universal social charge which the employer was liable to remit in respect of every individual to whom payment of relevant emoluments was made in the tax year.

(9) Where the employer is a body corporate, the declaration and certificate referred to in subsection (8)(b) shall be signed either by the secretary or a director of the body corporate.

(10) (a) Within 46 days from the end of a tax year, the employer shall give to every employee who is in the employer’s employment on the last day of the tax year and from whose relevant emoluments any universal social charge has been deducted during that tax year, a certificate showing—

(i) the total amount of universal social charge deducted from the relevant emoluments of the employee during that tax year,

(ii) the date of commencement within that tax year of the employment of the employee, where applicable,

(iii) the rate of universal social charge payable as respects the employee, and

(iv) the total relevant emoluments paid to the employee in that tax year.

(b) The certificate specified in paragraph (a) shall be in such form as may be provided or approved by the Revenue Commissioners.

(11) (a) An employer shall, in the case of an employee to whom he or she makes a payment of relevant emoluments, give to the employee, on the cessation of the period of employment to which the payment of universal social charge in respect of the employee relates, a certificate showing—

(i) the total universal social charge as respects the employee which the employer was liable to remit for the tax year in which the cessation occurs up to and including the date of cessation,

(ii) the dates of commencement (where applicable) and cessation within that tax year of the employment of the individual,

(iii) the rate of universal social charge payable as respects the employee, and

(iv) the total relevant emoluments paid to the employee in that tax year up to and including the date of cessation.

(b) The certificate specified in paragraph (a) shall be in such form as may be provided or approved by the Revenue Commissioners.

(12) This section shall cease to have effect upon the coming into operation of the regulations made under section 531AAB.

Record keeping.

531AP.— (1) An employer shall record the following particulars in respect of each employee to whom payment of relevant emoluments has been made in a tax year—

(a) the amount of each payment of relevant emoluments,

(b) the amount of universal social charge deducted from each such payment,

(c) the total amount of universal social charge which the employer is liable to remit in respect of each such payment, and

(d) the dates of commencement and cessation within the tax year of the employment of the individual, where applicable.

(2) The records specified in subsection (1) shall be in a form approved by the Revenue Commissioners and shall be retained by employers for not less than 6 years after the end of the tax year to which they relate.

(3) This section shall cease to have effect upon the coming into operation of the regulations made under section 531AAB.

Power of inspection.

531AQ.— (1) Regulation 32 of the PAYE Regulations, as it relates to inspection of records, shall apply, with any necessary modifications, to the particulars recorded pursuant to section 531AP as it applies to the records specified in the said Regulation 32.

(2) This section shall cease to have effect upon the coming into operation of the regulations made under section 531AAB.

Estimation of universal social charge due.

531AR.— Sections 989, 990 and 990A shall apply to universal social charge as they apply to income tax.

Universal social charge payable by chargeable persons (within the meaning of Part 41).

531AS.— (1) Universal social charge payable for a tax year in respect of an individual’s aggregate income for a tax year, being an individual who is a chargeable person (within the meaning of Part 41), shall be due and payable in all respects as if it were an amount of income tax due and payable by the chargeable person under the Income Tax Acts, but without regard to section 1017.

(2) An individual who, by virtue of section 140, 141, 142, 143, 195, 232, 234, or 664, would not be treated as a chargeable person (within the meaning of Part 41) in respect of the individual’s aggregate income for a tax year, shall be treated as such a chargeable person for the purposes of this Part.

(3) Universal social charge may be stated in one sum (in this section referred to as the ‘aggregated sum’) with the amount of income tax contained in any computation of, or any assessment or assessments to, income tax made by or on such an individual as is referred to in subsection (1).

(4) For the purposes of subsection (2) universal social charge may be so stated as referred to in subsection (3) notwithstanding that there is no amount of income tax contained in the computation, assessment or assessments, and all the provisions of the Tax Acts, other than any such provisions in so far as they relate to the granting of any allowance, deduction or relief, shall apply as if the aggregated sum were a single sum of income tax.

(5) Where universal social charge is payable for the tax year 2011 in respect of an individual’s aggregate income for a tax year, being an individual who is a chargeable person (within the meaning of Part 41), section 958 shall apply and have effect as if, in accordance with this Part, universal social charge had been payable for the tax year 2010 and as if income levy had not been payable for that tax year.

Universal social charge payable by persons other than chargeable persons (within the meaning of Part 41).

531AT.— (1) Universal social charge payable for a tax year in respect of an individual’s aggregate income for a tax year, being an individual who is not a chargeable person (within the meaning of Part 41), shall be assessed, charged and paid in all respects as if it were an amount of income tax due and payable under the Income Tax Acts, but without regard to section 1017.

(2) Subsections (2) and (3) of section 531AS, as they relate to the aggregation of universal social charge and income tax, shall apply, with any necessary modifications, as they apply to universal social charge due and payable by a chargeable person.

Capital allowances and losses.

531AU.— (1) Where an individual who has sustained a loss in a trade or profession for which relief from income tax has not been wholly given in an earlier tax year carries forward any unrelieved portion of that loss to a later tax year in accordance with section 382, the amount referred to in section 531AM(1)(b)(vi) is an amount equal to the amount of the carried forward loss that is deducted from or set off against the amount of profits or gains on which the individual is assessed to income tax under Schedule D in respect of that trade or profession for that later tax year.

(2) The amount referred to in section 531AM(1)(b)(vii) is—

(a) in the case of an individual who is entitled to an allowance for a tax year under section 284(1),

(b) in the case of an individual who is entitled to an allowance for a tax year under subsection (3) of section 272 of an amount determined in accordance with paragraph (a), (b), (c)(iii), (da), (db), (e) or (g) of that subsection,

(c) in the case of an individual who is entitled to an allowance for a tax year under subsection (2) of section 658 of an amount determined in accordance with paragraph (b) of that subsection, or

(d) in the case of an individual who is entitled to an allowance for a tax year under section 659(2)(a) determined in accordance with subsection (3A), (3AA), (3B) or (3BA) of that section,

an amount equal to the aggregate of—

(i) the amount of the allowance made in the tax year to which effect is given in taxing the individual’s trade or profession for that tax year, other than where effect is given by making a claim under section 381 by virtue of section 392, and

(ii) any unrelieved allowance, or part of an allowance, carried forward from a previous tax year in accordance with section 304(4) to which effect is given in the tax year,

other than where such an allowance is made on a lessor or where such an allowance is made on an individual who is not an active partner (within the meaning of section 409A).

Married couples.

531AV.— Where an election has been made or is deemed to have been made under section 1018 and has effect for a tax year, universal social charge payable by one spouse shall be charged, collected and recovered as if it were universal social charge payable by the spouse assessable under section 1017.

Repayments.

531AW.— (1) In any case of underpayment or overpayment of universal social charge to the Collector-General, payment of the amount not paid or repayment of the amount overpaid, as the case may be, shall be made to or by the Collector-General, as appropriate.

(2) In the case of an individual to whom section 531AM(2) applies, any universal social charge deducted from his or her income shall be repaid to the individual by the Revenue Commissioners on receipt of a valid claim made in such manner as may be approved by the Revenue Commissioners, and for the purposes of such repayment universal social charge shall be deemed to be income tax.

Restriction on deduction.

531AX.— (1) Universal social charge paid in respect of a tax year is in addition to, and does not reduce, any liability which an individual may have in respect of income tax or other taxes under the Tax Acts.

(2) Excess tax credits or reliefs which are available to an individual may not be set against any charge to universal social charge which is due and payable for a tax year.

Recovery of unpaid universal social charge.

531AY.— (1) Where any universal social charge in relation to an employee, remains unpaid for a tax year and is not otherwise recovered (in this section referred to as the ‘underpayment’), the employer shall be treated, on receipt of a notice from an inspector to the effect that this section applies, as making a payment of relevant emoluments to the employee in the subsequent tax year of an amount equal to the amount determined by subsection (2) (in this section referred to as ‘notional emoluments’).

(2) The amount of the notional emoluments shall be an amount that would produce an amount of universal social charge equal to the amount of the underpayment and which amount shall be set out in the notice issued under subsection (1).

(3) Where an employer is treated as making a payment of notional emoluments in accordance with subsections (1) and (2), the amount of the notional emoluments for the subsequent tax year shall be apportioned over that tax year to each week, in a case where relevant emoluments are paid weekly, or such corresponding period where relevant emoluments are paid for a period either greater or less than a week, and the employer shall deduct universal social charge by reference to the part of the notional emoluments for the tax year apportioned to each such week or a corresponding amount where the period is greater or less than a week.

(4) Where any universal social charge remains unpaid after the end of a tax year, the amount of tax credits (within the meaning of the PAYE Regulations) and the standard rate cut-off point (within that meaning) appropriate to an employee for any subsequent tax year may be adjusted as necessary by an inspector to collect unpaid universal social charge which is not otherwise recovered.

(5) Where, but for this subsection, no assessment to universal social charge would be made on an individual for a tax year, then an inspector may make an assessment to universal social charge on the individual to the best of the inspector’s judgement of the amounts chargeable to universal social charge, and the provisions of the Tax Acts, including in particular those provisions relating to the assessment, collection and recovery of tax and the payment of interest on unpaid tax, shall apply as respects any assessment to universal social charge made on the individual by virtue of this subsection, other than any such provisions in so far as they relate to the granting of any allowance, deduction or relief.

Repayments of, and recovery of unpaid, income levy.

531AZ.— (1) Where any income levy in relation to an employee, remains unpaid for the tax year 2009 or 2010 and is not otherwise recovered, the provisions of section 531AY in relation to—

(a) the making of notional emoluments and the apportionment of those emoluments, and

(b) the adjustment of tax credits and the standard rate cut-off point,

shall apply to the recovery of any underpayment of income levy as they apply to the recovery of any underpayment of universal social charge.

(2) Repayments of income levy paid for the tax years 2009 and 2010 shall, to the extent that insufficient income levy has been paid in 2011 or a later year, be made out of universal social charge.

Application of provisions relating to income tax.

531AAA.— The provisions of—

(a) Chapter 1 and 4 of Part 38, in relation to the making of returns of income,

(b) Chapter 1 and 2 of Part 39, in relation to the making of assessments of income tax,

(d) Chapter 1 of Part 42, in relation to the collection and recovery of unpaid income tax, and

(e) Part 47, in relation to penalties, offences, interest and other sanctions,

shall apply, with any necessary modifications, to universal social charge as those provisions apply to income tax.

Regulations.

531AAB.— (1) The Revenue Commissioners may make regulations for the purposes of the proper implementation and administration of this Part, and those regulations may, in particular and without prejudice to the generality of the foregoing, include provision—

(a) for requiring any employer who pays relevant emoluments exceeding the limit specified in section 531AM(2) to notify the Revenue Commissioners within the period specified in the regulations that that employer is such an employer;

(b) for requiring any employer making any payment of relevant emoluments, when that employer makes the payment, to make a deduction or repayment of universal social charge calculated by reference to such rate or rates of charge for the tax year as may be specified;

(c) for the deduction of universal social charge at whatever rate or rates are specified for a tax year in such cases or classes of cases as may be provided for by the regulations;

(d) for specifying the manner in which deductions or repayments of universal social charge are to be made from any payment of relevant emoluments made by an employer;

(e) for rendering persons who are required to make any deduction or repayment of universal social charge accountable, in the case of a deduction (whether or not made), for the amount of universal social charge deductible and liable to pay that amount to the Revenue Commissioners and entitled, in the case of a repayment, (if a repayment has been made) to be paid it, or given credit for it, by the Revenue Commissioners;

(f) for treating persons who are not employers as employers in such cases or classes of cases as may be provided for by the regulations;

(g) for the manner in which employers are to remit payments of universal social charge to the Revenue Commissioners, including remittance by electronic means, and the manner in which the Revenue Commissioners are to acknowledge such payments;

(h) for the period within which payment of universal social charge is to be remitted to the Revenue Commissioners;

(i) for requiring any employer making any payment of relevant emoluments to provide the Revenue Commissioners, within a period specified in the regulations, and in such form as the Revenue Commissioners may approve or provide, with information in relation to payments of relevant emoluments and universal social charge deducted from such relevant emoluments, and such other information as the Revenue Commissioners consider appropriate, and in whatever form they consider appropriate;

(j) for requiring any employer making any payment of relevant emoluments to provide his or her employees, within a period specified in the regulations or on the occurrence of a particular event such as the cessation of an employee’s employment, and in such form as the Revenue Commissioners may approve or provide, with information in relation to payments of relevant emoluments and universal social charge deducted from such relevant emoluments;

(k) for requiring every employer who pays relevant emoluments exceeding the limits specified in section 531AM(2) to keep and maintain a register of that employer’s employees in such manner as may be specified in the regulations and, on being required to do so on receipt of a notice from the Revenue Commissioners, to deliver the register to the Revenue Commissioners within the period specified in the notice;

(l) for the production to, and inspection by, persons authorised by the Revenue Commissioners of payroll records and other documents and records for the purpose of satisfying themselves that universal social charge in respect of relevant emoluments has been and is being duly deducted, repaid and accounted for;

(m) for the collection and recovery, whether by deduction from relevant emoluments paid in any tax year or otherwise, of universal social charge in respect of relevant emoluments which has not been deducted or otherwise recovered during the tax year;

(n) for the collection and recovery, to the extent that the Revenue Commissioners consider appropriate, and the employee does not object, of universal social charge in respect of income other than relevant emoluments, which has not otherwise been recovered during the tax year;

(o) for the collection and recovery, from the employee rather than from the employer, of any amount of universal social charge that the Revenue Commissioners consider should have been deducted by the employer from the relevant emoluments of the employee;

(p) for the collection and recovery from an employee of any amount of interest and penalties due from the employee that has not otherwise been recovered;

(q) for the repayment to an employer of a payment or remittance (including part of such a payment or remittance) that is in excess of the amount of liability due and payable under this Part against which it is credited provided that a claim for such repayment is made by the employer within 4 years after the end of the tax year to which the claim applies, and

(r) for appeals with respect to matters arising under the regulations that would not otherwise be the subject of an appeal.

(2) Any reference in regulations under this section to a payment of relevant emoluments shall include a reference to an amount referred to in section 531AY as ‘notional emoluments’.

(3) Regulations under this section shall apply notwithstanding anything in this Part, but shall not affect any right of appeal that a person would have apart from the regulations.

(4) Notwithstanding any other provision of this section, where the Revenue Commissioners are satisfied that it is unnecessary or is not appropriate for an employer to comply with any of the regulations made under subsection (1) they may notify the employer accordingly.

(5) Every regulation made under this section shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the regulation is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.

Care and management.

531AAC.— Universal social charge is under the care and management of the Revenue Commissioners and Part 37 shall apply to universal social charge as it applies to income tax.

Excess bank remuneration charge.

531AAD.— (1) In this section—

‘excess bank remuneration charge’ shall be construed in accordance with subsection (7);

‘relevant employee’, in relation to a specified institution, means an employee of the specified institution—

(a) who is resident in the State (within the meaning of Part 34) in a tax year for the purposes of the Acts, or

(b) the duties of whose employment in that specified institution are at any time in the tax year concerned performed wholly or partly in the State;

‘relevant remuneration’, in relation to a relevant employee, means, subject to subsection (2), relevant emoluments that are not regular salary or wages or a regular benefit or perquisite;

‘regular’, in relation to any salary, wages, fees, benefit or perquisite of a relevant employee, means so much of the amount of such salary, wages, fees, benefit or perquisite that does not vary according to—

(a) the performance of, or any part of—

(i) any business of the specified institution, or

(ii) any business of a person connected with the specified institution,

(b) the contribution made by the relevant employee to the performance of, or of any part of, any business referred to in subparagraph (i) or (ii) of paragraph (a), or

or any similar consideration;

‘specified institution’ means an institution, specified by order of the Minister for Finance made under section 6(1) of the Credit Institutions (Financial Support) Act 2008, that has received financial support under either or both that Act and the National Pensions Reserve Fund Act 2000.

(2) This section does not apply in respect of a relevant employee to whom or in respect of whom relevant remuneration of not more than €20,000 is awarded during a tax year.

(3) For the purposes of this section, relevant remuneration is awarded during a tax year if—

(a) a contractual obligation to pay or provide it arises during the tax year, or

(b) the relevant remuneration is paid or provided during the tax year without any such obligation having arisen during the tax year.

(4) The amount of any relevant remuneration is—

(a) if it is money, its amount when awarded, or

(b) if it is money’s worth, the amount of the money’s worth when awarded.

(5) Where the market value (within the meaning of section 548) of any relevant remuneration at the time it is awarded exceeds, or would exceed, what would otherwise be its amount, its amount is that market value.

(6) (a) Where anything constituting relevant remuneration is or would be when awarded subject to any restriction the restriction is to be ignored in arriving at its amount.

(b) For the purpose of paragraph (a) ‘restriction’ means any condition, restriction or other similar provision that causes the market value of the relevant remuneration to be less than it would otherwise be.

(7) A relevant employee, instead of being charged to universal social charge at the rates provided for in section 531AN on that part of his or her aggregate income for a tax year that constitutes relevant remuneration awarded during the tax year to or in respect of the relevant employee by reason of his or her employment as an employee of the specified institution, shall be charged to universal social charge (to be known, for the purposes of this section, as ‘excess bank remuneration charge’) on the amount of that relevant remuneration at the rate of 45 per cent for that tax year.

(8) Notwithstanding section 531AO(2), as respects any award of relevant remuneration made to or in respect of a relevant employee in the period beginning on the date of the passing of the Finance Act 2011 and ending on 31 December 2011 and in each subsequent tax year, excess bank remuneration charge shall be deducted from relevant remuneration by the employer at the rate of 45 per cent.

(9) An employer shall for each award of relevant remuneration from which excess bank remuneration charge has not been deducted in the period beginning on 1 January 2011 and ending on the date of the passing of the Finance Act 2011 make and deliver to the Revenue Commissioners on or before 30 June 2011 a return, in such form as may be provided or approved by the Revenue Commissioners, including the following information in respect of each such payment—

(a) the name, address and Personal Public Service Number (within the meaning of section 262 of the Social Welfare Consolidation Act 2005) of the relevant employee to whom the relevant remuneration was awarded,

(b) the amount of the relevant remuneration awarded,

(c) the amount, if any, of universal social charge deducted and remitted to the Collector-General in respect of that relevant remuneration, and

(d) such other details or information as may be specified by the Revenue Commissioners in the return.

(10) Within 46 days from the end of a tax year an employer shall for each award of relevant remuneration made to or in respect of a relevant employee in the period beginning on the date of the passing of the Finance Act 2011 and ending on 31 December 2011 and in each subsequent tax year make and deliver to the Revenue Commissioners a return, in such form as may be provided or approved by the Revenue Commissioners, including the following information in respect of each such payment—

(b) the amount of the relevant remuneration awarded,

(c) the amount, if any, of excess bank remuneration charge deducted and remitted to the Collector-General in respect of that relevant remuneration, and

(d) such other details or information as may be specified by the Revenue Commissioners in the return.”.

(b) in section 960A in the definition of “Acts” by substituting the following for paragraph (g):

“(g) Parts 18A, 18B, 18C and 18D,”,

(d) in section 1002(1) in the definition of “the Acts” by substituting the following for paragraph (iiia):

“(iiia) Parts 18A, 18B, 18C and 18D,”,

(e) in section 1006(1) in the definition of “the Acts” by deleting paragraph (f),

(f) in section 1006(1) in the definition of “the Acts” by substituting the following for paragraph (aa):

“(aa) Parts 18A, 18B, 18C and 18D,”,

(g) in section 1077A in the definition of “the Acts” by substituting the following for paragraph (c):

“(c) Parts 18A, 18B, 18C and 18D,”,

(h) in section 1078(1) in the definition of “the Acts” by deleting paragraph (i),

(i) in section 1078(1) in the definition of “the Acts” by substituting the following for paragraph (ca):

“(ca) Parts 18A, 18B, 18C and 18D,”,

(j) in section 1079(1) in the definition of “the Acts” by substituting the following for paragraph (ca):

“(ca) Parts 18A, 18B, 18C and 18D,”,

(k) in section 1086(1) in the definition of “the Acts” by inserting the following after paragraph (a):

“(aa) Parts 18A, 18B, 18C and 18D,”,

(l) in section 1094(1) in the definition of “the Acts” by inserting the following after paragraph (c):

“(ca) Parts 18A, 18B, 18C and 18D,”,

(m) in section 1095(1) in the definition of “the Acts” by inserting the following after paragraph (c):

“(ca) Parts 18A, 18B, 18C and 18D,”,

and

(n) in paragraph 1(1) of Part 1 of Schedule 24 by substituting the following for the definition of “the Irish taxes”:

“ ‘the Irish taxes’ means income tax, income levy, universal social charge and corporation tax;”.

(2) This section applies for the year of assessment 2011 and each subsequent year of assessment.

Chapter 3 Income Tax

4. Amendment of section 15 (rate of charge) of Principal Act.

4.— As respects the year of assessment 2011 and subsequent years of assessment, section 15 of the Principal Act is amended—

(a) in subsection (3)(i) by substituting “€23,800” for “€27,400”, and

(b) by substituting the following Table for the Table to that section:

“TABLE

PART 1

Part of taxable income	Rate of tax	Description of rate
(1)	(2)	(3)
The first €32,800	20 per cent	the standard rate
The remainder	41 per cent	the higher rate

PART 2

Part of taxable income	Rate of tax	Description of rate
(1)	(2)	(3)
The first €36,800	20 per cent	the standard rate
The remainder	41 per cent	the higher rate

PART 3

Part of taxable income	Rate of tax	Description of rate
(1)	(2)	(3)
The first €41,800	20 per cent	the standard rate
The remainder	41 per cent	the higher rate

”.

5. Age exemption.

5.— As respects the year of assessment 2011 and subsequent years of assessment, section 188 of the Principal Act is amended—

(a) in subsection (2)(a) by substituting “€36,000” for “€40,000” (inserted by the Finance Act 2008), and

(b) in subsection (2)(b) by substituting “€18,000” for “€20,000” (inserted by the Finance Act 2008).

6. Personal tax credits.

6.— (1) Where an individual is entitled under a provision of the Principal Act mentioned in column (1) of the Table to this subsection to have the income tax to be charged on the individual, other than in accordance with the provisions of section 16(2) of the Principal Act, reduced for the year of assessment 2011 and any subsequent year of assessment and the amount of the reduction would, but for this section, be an amount which is the lesser of—

(a) the amount specified in column (2) of that Table, and

(b) the amount which reduces that liability to nil,

the amount of the reduction in accordance with paragraph (a) shall be the amount of the tax credit specified in column (3) of the Table.

TABLE

Statutory Provision	Existing tax credit	Tax credit for the year 2011 and subsequent years
(1)	(2)	(3)
Section 461
(basic personal tax credit)
(married person)	€3,660	€3,300
(widowed person bereaved in year of assessment)	€3,660	€3,300
(single person)	€1,830	€1,650

Section 461A
(additional tax credit for certain widowed persons)	€600	€540

Section 462
(one-parent family tax credit)	€1,830	€1,650

Section 463
(widowed parent tax credit)
(1st year)	€4,000	€3,600
(2nd year)	€3,500	€3,150
(3rd year)	€3,000	€2,700
(4th year)	€2,500	€2,250
(5th year)	€2,000	€1,800

Section 464
(age tax credit)
(married person)	€650	€490
(single person)	€325	€245

Section 465
(incapacitated child tax credit)	€3,660	€3,300

Section 466
(dependant relative tax credit)	€80	€70
Section 466A
(home carer tax credit)	€900	€810

Section 468
(blind person’s tax credit)
(blind person)	€1,830	€1,650
(both spouses blind)	€3,660	€3,300

Section 472
(employee tax credit)	€1,830	€1,650

(2) Section 3 (as amended by the Finance Act 2008) of the Finance Act 2002 shall have effect subject to the provisions of this section.

(3) Schedule 1 shall apply for the purposes of supplementing subsection (1).

7. Benefit-in-kind taxation.

7.— (1) The Principal Act is amended—

(a) in section 118(5E) by inserting the following after paragraph (b):

“(c) This subsection shall not apply as respects the year of assessment 2011 and each subsequent year of assessment.”,

(b) in section 120A by inserting the following after subsection (3):

“(4) This section shall not apply as respects the year of assessment 2011 and each subsequent year of assessment.”,

and

(2) Subsection (1)(c) shall have effect as on and from 26 January 2011.

8. Taxation of lump sums.

8.— (1) The Principal Act is amended in section 201 by inserting the following after subsection (7):

“(8) (a) Notwithstanding the provisions of this section and Schedule 3, income tax shall be charged by virtue of section 123 on the amount of the lump sum which exceeds the lesser of—

(i) that part of the lump sum which, apart from this subsection, would be exempt from income tax by virtue of this section and Schedule 3, including any deduction in computing the charge to income tax under paragraph 6 of that Schedule, and

(ii) €200,000.

(b) The amount of €200,000 referred to in subparagraph (a)(ii) shall be reduced by an amount equal to the aggregate amounts exempted from income tax in respect of all payments to which section 123 applied which were paid before or at the same time as the payment of the lump sum, and shall include any deduction in computing the charge to income tax under paragraph 6 of Schedule 3.

(c) The amount determined in accordance with paragraphs (a)and(b) shall be determined without regard to subsections (1A) and (2).

(d) Where 2 or more payments in respect of which tax is chargeable by virtue of section 123 are made to or in respect of the same person in respect of the same office or employment, or in respect of different offices or employments, for the purposes of this subsection this paragraph shall apply as if those payments were a single payment of an amount equal to that aggregate amount, and the provisions of paragraph (a) shall apply to that amount accordingly.”.

(2) This section shall apply as respects any payment made on or after 1 January 2011.

9.— Section 470B of the Principal Act is amended by substituting the following for subsection (4):

“(4) Subject to subsections (5) and (6), where, for a relevant year of assessment, an individual or, if the individual is a married person assessed to tax in accordance with section 1017, the individual’s spouse makes a payment to an authorised insurer under a relevant contract and—

(a) the payment is in respect of a premium due under the relevant contract and the relevant contract was renewed or entered into on or after 1 January 2009 but before 1 January 2012, and

(b) the payment or part of the payment, as the case may be, is attributable to an insured person, and only to an insured person, who is aged 50 years or over on the date the relevant contract is renewed or entered into, as the case may be,

then the individual shall, for the relevant year of assessment, in respect of so much of the relievable amount of the payment or part of the payment, as the case may be, as is attributable to an insured person referred to in paragraph (b), be entitled to a credit (referred to in this section as ‘age-related tax credit’) equal to the lower of—

(i) as respects a relevant contract renewed or entered into on or after 1 January 2009 but before 1 January 2010, the amount specified in column (2) of the Table to this subsection corresponding to the class of insured person mentioned in column (1) of that Table or, where the payment made to the authorised insurer is a monthly or other instalment towards the payment of the total annual premium due under the relevant contract, an amount equal to the amount so specified divided by the total number of instalments to be made to pay such total annual premium,

(ii) as respects a relevant contract renewed or entered into on or after 1 January 2010, the amount specified in column (3) of the Table to this subsection corresponding to the class of insured person mentioned in column (1) of that Table or, where the payment made to the authorised insurer is a monthly or other instalment towards the payment of the total annual premium due under the relevant contract, an amount equal to the amount so specified divided by the total number of instalments to be made to pay such total annual premium,

(iii) as respects a relevant contract renewed or entered into on or after 1 January 2011, the amount specified in column (4) of the Table to this subsection corresponding to the class of insured person mentioned in column (1) of that Table or, where the payment made to the authorised insurer is a monthly or other instalment towards the payment of the total annual premium due under the relevant contract, an amount equal to the amount so specified divided by the total number of instalments to be made to pay such total annual premium, and

(iv) an amount which reduces the income tax to be charged on the individual for the relevant year of assessment, other than in accordance with section 16(2), to nil.

TABLE

Class of Insured Person	Amount of age-related tax credit	Amount of age-related tax credit	Amount of age-related tax credit
(1)	(2)	(3)	(4)
Aged 50 years and over but less than 60 years on the date the relevant contract is renewed or entered into, as the case may be.	€200.00	€200.00	Nil
Aged 60 years and over but less than 70 years on the date the relevant contract is renewed or entered into, as the case may be.	€500.00	€525.00	€625.00
Aged 70 years and over but less than 80 years on the date the relevant contract is renewed or entered into, as the case may be.	€950.00	€975.00	€1,275.00
Aged 80 years and over on the date the relevant contract is renewed or entered into, as the case may be.	€1,175.00	€1,250.00	€1,725.00

”.

10.— The Principal Act is amended—

(a) in section 479 by inserting the following after subsection (8):

“(9) The deduction authorised by subsection (2) shall not be made in respect of eligible shares where those shares are subscribed for on or after 8 December 2010.”,

(b) in section 519D by inserting the following after subsection (7):

“(8) The exemption from income tax authorised by subsection (2) in respect of the receipt of the right referred to in subsection (1) shall not apply where the right is received on or after 24 November 2010.

(9) The exemption from income tax authorised by subsection (3) in respect of any gain realised by the exercise of the right referred to in subsection (1) shall not apply where the gain from the exercise of the right is realised on or after 24 November 2010.”,

(d) in section 985A by inserting the following after subsection (1A):

“(1B) Subsection (1A) shall not apply to shares or stock referred to in that subsection received on or after 1 January 2011.”.

11. Termination of relief to individuals on loans applied in acquiring interest in companies.

11.— Section 248 of the Principal Act is amended by inserting the following after subsection (5):

“(6) Notwithstanding subsection (5), the deduction authorised by that subsection shall not exceed—

(a) as respects the year of assessment 2011, 75 per cent of the deduction that would but for this subsection be authorised by that subsection,

(b) as respects the year of assessment 2012, 50 per cent of the deduction that would but for this subsection be authorised by that subsection,

(c) as respects the year of assessment 2013, 25 per cent of the deduction that would but for this subsection be authorised by that subsection, and

(d) as respects the year of assessment 2014 and each subsequent year of assessment, zero per cent of the deduction that would but for this subsection be authorised by that subsection.

(7) This section shall not apply to a loan made after 7 December 2010.”.

12. Abolition of relief for trade union subscriptions.

12.— Section 472C of the Principal Act is amended by inserting the following after subsection (8):

“(9) This section ceases to have effect for the year of assessment 2011 and each subsequent year of assessment.”.

13. Relief for energy efficient works.

13.— The Principal Act is amended by inserting the following after section 477:

“477A.— (1) In this section—

‘appropriate percentage’, in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year;

‘approved contractor’ means a person who is a registered person and at the time of carrying out the qualifying work has—

(a) a tax clearance certificate issued under section 1095, or

(b) a certificate of authorisation issued under section 531;

‘Authority’ means the Sustainable Energy Authority of Ireland;

‘certificate of payment’, in relation to an individual, means a certificate issued by the Authority certifying that the individual has incurred qualifying expenditure and stating the amount of the qualifying expenditure so incurred;

‘qualifying expenditure’ means expenditure not exceeding the relevant limit incurred on qualifying work carried out by an approved contractor on a qualifying residence;

‘qualifying residence’ means a residential premises situated in the State in respect of which no rent is received or receivable by the individual making a claim under this section other than any rent that forms part of any relevant sums (within the meaning of section 216A) received by the individual in respect of that residential premises;

‘qualifying work’ shall be read in accordance with subsection (2);

‘registered person’ means a person who is registered with, and approved by, the Authority to carry out qualifying work;

‘relevant limit’, in relation to a year of assessment, means—

(a) €10,000 in the case of an individual assessed to tax in accordance with section 1016, or

(b) €15,000 in the case of individuals assessed to tax in accordance with section 1017,

subject in any case to a maximum amount of €15,000 in respect of which relief may be claimed under this section in respect of any one qualifying residence in the year of assessment concerned;

‘rent’ has the same meaning as in Chapter 8 of Part 4;

‘residential premises’ means a building or part of a building used solely or mainly as a dwelling;

‘tax reference number’ has the same meaning as in section 885.

(2) (a) In this subsection ‘energy-efficient works’ means works the purpose of which is to reduce the costs incurred in respect of heating a residential premises.

(b) The Authority shall keep and maintain and make available to the public a list of such energy-efficient works as are, from time to time, determined by the Minister for Finance, in consultation with the Minister for Communications, Energy and Natural Resources, to be energy-efficient works to which relief under this section applies (in this section referred to as ‘qualifying work’).

(3) (a) Where an individual, for the year of assessment 2011 or any subsequent year of assessment, on the making of a claim supported by a certificate of payment, proves that he or she made a payment to an approved contractor in respect of qualifying expenditure, the income tax to be charged on the claimant for that year of assessment, other than in accordance with section 16(2), shall be reduced by an amount which is the lesser of—

(i) the amount equal to the appropriate percentage of the qualifying expenditure,

(ii) the amount equal to the appropriate percentage of the relevant limit, and

(iii) the amount which reduces that income tax to nil.

(b) For the purpose of this section, in the case of an individual assessed to tax for a year of assessment in accordance with section 1017, any payment of qualifying expenditure to an approved contractor made by the individual’s spouse, in respect of which the individual’s spouse would have been entitled to relief under this section if that spouse were assessed to tax for the year of assessment in accordance with section 1016 (apart from subsection (2) of that section), shall be deemed to have been made by the individual.

(c) In all cases relief from income tax consequent on the allowance of qualifying expenditure under this section shall be given by means of repayment.

(4) The Authority shall not issue a certificate of payment in any case where the aggregate of all qualifying expenditure included on certificates of payment previously issued for the year of assessment concerned exceeds €150,000,000.

(5) Notwithstanding subsection (3), a payment to an approved contractor in respect of qualifying expenditure shall not be regarded as having been made in so far as any sum in respect of, or by reference to, the qualifying work to which it relates has been or is to be received directly or indirectly by the individual from the State, from any public or local authority, from any other person or under any contract of insurance or by way of compensation or otherwise.

(6) Notwithstanding subsection (3), where, on the basis of the information furnished to them under section 894A(2) or any other information in their possession, the Revenue Commissioners are satisfied as to the entitlement of an individual to relief under this section then, notwithstanding any other provision of the Income Tax Acts to the contrary, if the Revenue Commissioners consider it appropriate in the circumstances, the relief due may be given to the individual without the making and proving of a claim.

(7) Where relief is given under this section, no relief, deduction or credit under any other provision of the Income Tax Acts shall be given or allowed in respect of the qualifying expenditure.

(8) The following records shall be maintained by the Authority in respect of each individual to whom a certificate of payment is issued:

(a) his or her name and address;

(b) his or her Personal Public Service Number within the meaning of section 262 of the Social Welfare Consolidation Act 2005;

(d) the amount of qualifying expenditure incurred;

(e) the year in which qualifying expenditure is incurred;

(f) the name and tax reference number of the approved contractor who carried out the qualifying work;

(g) proof that a payment or payments have been made to a qualifying contractor in respect of qualifying work.

(9) This section comes into operation on such day as the Minister for Finance may appoint by order.”.

14. Amendment of section 473 (allowance for rent paid by certain tenants) of Principal Act.

14.— Section 473 of the Principal Act is amended—

(a) in subsection (1) by substituting the following for the definition of “specified limit”:

“ ‘specified limit’, in relation to an individual for a year of assessment specified in column (1) of the Table to this definition, means—

(a) in the case of—

(i) a married person assessed to tax in accordance with section 1017, or

(ii) a widowed person,

the corresponding amount specified in column (2) of the Table to this definition; but, if at any time during the year of assessment the individual was of the age of 55 years or over, ‘specified limit’ means the corresponding amount specified in column (3) of the Table to this definition, and

(b) in any other case, the corresponding amount specified in column (4) of the Table to this definition; but, if at any time during the year of assessment the individual was of the age of 55 years or over, ‘specified limit’ means the corresponding amount specified in column (5) of the Table to this definition;

TABLE

(1)	(2)	(3)	(4)	(5)
	€	€	€	€
2011	3,200	6,400	1,600	3,200
2012	2,400	4,800	1,200	2,400
2013	2,000	3,600	1,000	2,000
2014	1,600	3,200	800	1,600
2015	1,200	2,400	600	1,200
2016	800	1,600	400	800
2017	400	800	200	400
2018	0	0	0	0

”,

and

(b) by inserting the following after subsection (1):

“(1A) (a) This section shall not apply as respects rent paid on or after 8 December 2010.

(b) Notwithstanding paragraph (a), this section shall continue to apply for the year of assessment 2010 and each subsequent year of assessment up to and including the year of assessment 2017 in respect of rent paid by a tenant who on 7 December 2010 is paying rent under a tenancy.”.

15. Amendment of section 473A (relief for fees paid for third level education, etc.) of Principal Act.

15.— Section 473A of the Principal Act is amended for the year of assessment 2011 and each subsequent year of assessment by inserting the following after subsection (4):

“(4A) In any claim or claims for relief under this section made by an individual in respect of qualifying fees, there shall be disregarded for each year of assessment—

(a) the first €2,000 of those fees or the full amount of those fees, whichever is the lesser, where the qualifying fees, or part of the qualifying fees, the subject of the claim or claims concerned relate to a full-time course or full-time courses, or

(b) the first €1,000 of those fees or the full amount of those fees, whichever is the lesser, where all the qualifying fees the subject of the claim or claims concerned relate only to a part-time course or part-time courses.”.

16. Tax treatment of flight crew in international traffic.

16.— The Principal Act is amended in Chapter 5 of Part 5 by inserting the following section after section 127A:

“127B.— (1) Income arising to any individual, whether resident in the State or not, from any employment exercised aboard an aircraft—

(a) that is operated in international traffic, and

(b) where the aircraft is so operated by an enterprise that has its place of effective management in the State,

shall be chargeable to tax under Schedule E.

(2) For the purposes of an arrangement to which this section and section 826 applies, ‘international traffic’, in relation to an aircraft, does not include an aircraft operated solely between places in another state.”.

17. Exemption of certain earnings of writers, composers and artists.

17.— Section 195 of the Principal Act is amended in subsection (3)—

(a) in paragraph (a) by substituting “subject to paragraphs (aa) and (b)” for “subject to paragraph (b)”, and

(b) by inserting the following after paragraph (a):

“(aa) The amount of the profits or gains for a year of assessment which an individual shall be entitled to have disregarded for the purposes of the Income Tax Acts by virtue of paragraph (a) shall not exceed €40,000 for the year of assessment 2011 and each subsequent year of assessment.”.

18. Amendment of Schedule 13 (accountable persons for purposes of Chapter 1 of Part 18) to Principal Act.

18.— (1) Schedule 13 to the Principal Act is amended—

(a) by deleting paragraphs 132 and 146,

(b) by deleting “174. Inland Fisheries Ireland.” (inserted by section 8 of, and Part 13 of Schedule 2 to, the Inland Fisheries Act 2010),

“181. Inland Fisheries Ireland.”,

and

(d) by inserting the following after paragraph 181 (inserted by paragraph (c)):

“182. National Consumer Agency.

183.

The body known as the Credit Review Office established pursuant to guidelines issued under section 210 of the National Asset Management Agency Act 2009.

184.

Health and Safety Authority.

185.

Irish Takeover Panel.

186.

The Pharmaceutical Society of Ireland.

187.

Ombudsman for Children.”.

(2) (a) Paragraphs (b) and (c) of subsection (1) apply as and from 1 July 2010.

(b) Paragraph (d) of subsection (1) applies as and from 1 May 2011.

19. Retirement benefits.

19.— (1) Chapter 1 of Part 30 of the Principal Act is amended—

(a) in section 772(3A) by substituting the following for paragraph (a):

“(a) Subject to paragraph (aa), the Revenue Commissioners shall not approve a retirement benefits scheme for the purposes of this Chapter unless it appears to them that the scheme provides for any individual entitled to a pension under the scheme or, as the case may be, where the pension or part of the pension is payable in accordance with a pension adjustment order, the spouse or former spouse of such an individual to whom the pension or part of the pension is so payable (in this subsection referred to as the ‘relevant individual’), to opt, on or before the date on which that pension would otherwise become payable, for the transfer, on or after that date, to—

(i) the relevant individual, or

(ii) an approved retirement fund,

of an amount equivalent to the amount determined by the formula—

A — B

where—

A is the amount equal to the value of the relevant individual’s accrued rights under the scheme (including accrued rights which relate to additional voluntary contributions under the scheme) exclusive of any lump sum paid in accordance with subsection (3)(f), and

B is the amount or value of assets which the trustees, administrators or other person charged with the management of the scheme (in this section referred to as ‘the trustees’) would, if the assumptions in paragraph (b) were made, be required, in accordance with section 784C, to transfer to an approved minimum retirement fund held in the name of the relevant individual or to apply in purchasing an annuity payable to the relevant individual with effect from the date of the exercise of the option.”,

(b) in section 772(3A) by inserting the following after paragraph (a):

“(aa) In the case of a retirement benefits scheme that is a defined benefit arrangement within the meaning of section 787O(1), paragraph (a) shall, with any necessary modifications, apply in relation to an individual entitled to a pension under the scheme (other than a proprietary director of a company to which the scheme relates) as if—

(i) the reference in that paragraph to any relevant individual entitled to a pension under the scheme were a reference to any individual entitled to a pension under the scheme who is an individual entitled to rights arising from additional voluntary contributions to the scheme, and

(ii) A in the formula in that paragraph was the amount equal to the value of the individual’s accrued rights under the scheme which relate to additional voluntary contributions paid by that individual exclusive of any part of that amount paid by way of a lump sum in accordance with subsection (3)(f) in conjunction with the scheme rules.

(ab) (i) In this paragraph ‘deferred annuity option’ means the option provided to an individual who is a member of a retirement benefits scheme to defer, in accordance with Revenue e-Brief No. 65/08 entitled ‘Deferral of Annuity Purchase’ issued by the Revenue Commissioners on 22 December 2008, the purchase of an annuity from a company carrying on the business of granting annuities on human life.

(ii) An individual entitled to a pension under a retirement benefits scheme approved by the Revenue Commissioners before the date of passing of the Finance Act 2011who, before that date, has exercised a deferred annuity option may opt in accordance with paragraph (a) within the period of one month from that date, where on or after that date the rules of the scheme are altered to enable such an option.

(iii) For the purposes of this paragraph, where an individual has exercised a deferred annuity option, the purchase of the annuity may be further deferred for a period of one month from the date of passing of the Finance Act 2011.”,

(d) in section 772(3B)(a) by inserting the following after subparagraph (ii):

“(iia) in the case of an individual referred to in subsection (3A)(ab)(ii) (in this paragraph referred to as the ‘first-mentioned individual’)—

(I) the reference in subsection (2)(ii) of section 784C to an amount equivalent to the amount determined by the formula in that subsection were a reference to an amount equal to €63,500,

(II) the reference in subsection (4)(a) of section 784C to specified income per annum of an amount equal to the amount determined by the formula in that subsection were a reference to specified income per annum of €12,700, and

(III) the reference in subsection (6A) of section 784C to the individual were a reference to the first-mentioned individual and the reference in that subsection to the transfer, before the date of passing of the Finance Act 2011, of the amount referred to as B in the formula in section 784(2A) to an approved minimum retirement fund in respect of the individual, were a reference to the transfer, within the period of time referred to in subsection (3A)(ab)(ii), of the amount referred to as B in the formula in subsection (3A)(a) to an approved minimum retirement fund in respect of the first-mentioned individual.”,

and

(e) in section 772(3B)(b) by substituting “other than in the case of an individual referred to in subsection (3A)(aa)” for “in the case of a proprietary director”.

(2) Chapter 2 of Part 30 of the Principal Act is amended—

(a) in section 784A(1BA) by substituting “5” for “3” in the formula in paragraph (c),

(b) in section 784C(2) by substituting the following for paragraph (b):

“(b) apply in the purchase of an annuity payable to the individual,

shall be the lesser of—

(i) the amount referred to as A in that formula, and

(ii) an amount equivalent to the amount determined by the formula—

SPC 52 10

where SPC is the weekly rate of State Pension (Contributory), as set out in column (2) of Part 1 of Schedule 2 to the Social Welfare Consolidation Act 2005, payable in the State at the date of the exercise of the option, and where the amount so determined is not a multiple of €100 the amount shall, as the case may be, be rounded up or down to the nearest €100.”,

(d) in section 784C(3) by substituting the following for paragraph (b):

“(b) an amount equivalent to the amount determined by the formula in subsection (2)(ii) if SPC in that formula was the weekly rate of State Pension (Contributory), as set out in column (2) of Part 1 of Schedule 2 to the Social Welfare Consolidation Act 2005, payable in the State at the date of the exercise of the most recent of the options referred to in this subsection.”,

(e) in section 784C(4) by substituting the following for paragraph (a):

“(a) Where, at the date of exercise of an option under section 784(2A), the individual by whom the option is exercised is in receipt of specified income per annum of an amount equivalent to the amount determined by the formula—

SPC 52 1.5

where SPC is the weekly rate of State Pension (Contributory), as set out in column (2) of Part 1 of Schedule 2 to the Social Welfare Consolidation Act 2005, payable in the State at the date of the exercise of the option (and where the amount so determined is not a multiple of €100 the amount shall, as the case may be, be rounded up or down to the nearest €100), the amount referred to as B in the formula in section 784(2A) shall be nil.”,

(f) in section 784C by substituting the following for subsection (6):

“(6) Where the individual referred to in subsection (2)—

(a) attains the age of 75 years,

(b) is in receipt of specified income referred to in subsection (4) at any date (in this paragraph referred to as the ‘first-mentioned date’) after the date of the exercise of an option under section 784(2A) of an amount which would, if the option had been exercised on the first-mentioned date, have resulted in B in the formula in section 784(2A) being nil, or

the approved minimum retirement fund shall, thereupon, become an approved retirement fund and section 784A, subsections (1) and (5) of section 784B and section 784E shall apply accordingly.”,

and

(g) in section 784C by inserting the following after subsection (6):

“(6A) Where before the date of passing of the Finance Act 2011, the individual referred to in subsection (2) has exercised an option in accordance with section 784(2A) and the person with whom the annuity contract is made has, before that date, transferred the amount referred to as B in the formula in that section to an approved minimum retirement fund in respect of that individual, subsection (6) shall apply for the period of 3 years from the date of passing of the Finance Act 2011 as if the following paragraph were substituted for paragraph (b) of that subsection:

‘(b) is in receipt of specified income of €12,700 at any time in the period of 3 years from the date of passing of the Finance Act 2011, or’.”.

(3) Chapter 2C of Part 30 of the Principal Act is amended—

(a) in section 787O(1) in the definition of “maximum tax-relieved pension fund” by substituting “7 December 2005” for “the specified date”,

(b) in section 787O(1) in the definition of “personal fund threshold” by substituting the following for paragraph (a):

“(a) (i) where the individual is an individual to whom the Revenue Commissioners have, before the specified date, issued a certificate in accordance with section 787P(5), the amount stated in that certificate as being the individual’s personal fund threshold, and

(ii) in any other case, for the year of assessment 2010, as on and from the specified date, and for the year of assessment 2011, the lesser of—

(I) €5,418,085, and

(II) (A) where no benefit crystallisation event in relation to the individual has occurred on or after 7 December 2005 and the individual has uncrystallised pension rights on the specified date, the amount of the uncrystallised pension rights on the specified date in relation to the individual, where the amount of those rights on that date exceed the standard fund threshold, or

(B) where one or more than one benefit crystallisation event in relation to the individual has occurred on or after 7 December 2005 and the individual has uncrystallised pension rights on the specified date, the aggregate of the amounts crystallised by those benefit crystallisation events and the amount of the uncrystallised pension rights on the specified date in relation to the individual, where the aggregate amount of those crystallised and uncrystallised rights exceed the standard fund threshold, and”,

(c) in section 787O(1) in paragraph (b) of the definition of “personal fund threshold” by substituting “year of assessment 2011” for “year of assessment 2006”,

(d) in section 787O(1) by substituting the following for the definition of “specified date”:

“‘specified date’ means 7 December 2010;”,

(e) in section 787O(1) in the definition of “standard fund threshold” by substituting the following for paragraph (a):

“(a) for the year of assessment 2010, as on and from the specified date, and for the year of assessment 2011, €2,300,000, and”,

(f) in section 787O(1) in paragraph (b) of the definition of “standard fund threshold” by substituting “year of assessment 2011” for “year of assessment 2006”,

(g) in section 787O(2) by substituting the following for paragraph (b):

“(b) Where the administrator of a relevant pension arrangement has, before the specified date, used a valuation factor (in this subsection referred to as the ‘first-mentioned factor’) other than the relevant valuation factor referred to in paragraph (a) then, in such a case, the first-mentioned factor is the relevant valuation factor for the purposes of this Chapter and Schedule 23B.”,

(h) in section 787O(2) by deleting paragraphs (c) and (d),

(i) in section 787O(5)(b) by substituting “7 December 2005” for “specified date” in each place,

(j) in section 787P by substituting the following for subsection (1):

“(1) An individual’s maximum tax-relieved pension fund shall not exceed—

(a) the standard fund threshold, or

(b) the personal fund threshold, where—

(i) the condition set out in subsection (2) is met and the Revenue Commissioners have issued a certificate in accordance with subsection (5) or a revised certificate in accordance with subsection (6), or

(ii) the Revenue Commissioners have, before the specified date, issued a certificate in accordance with subsection (5).”,

(k) in section 787P(5) by substituting “Subject to subsection (6), the Revenue Commissioners” for “The Revenue Commissioners”,

(l) in section 787P(5) by substituting the following for all of the words from “shall, on being satisfied” to the end of the provision:

“shall, within 30 days of receipt of the notification or, as the case may be, the late notification, or such longer time as they may require for the purposes of this subsection, issue a certificate to the individual stating the amount of the personal fund threshold.”,

(m) in section 787P by inserting the following after subsection (5):

“(6) Notwithstanding subsection (5), the Revenue Commissioners may at any time withdraw a certificate issued in accordance with that subsection (in this subsection referred to as the ‘first-mentioned certificate’) and issue a revised certificate if, following the issue of the first-mentioned certificate, the Commissioners are not satisfied that the calculation of the personal fund threshold contained in the notification referred to in subsection (2) or, as the case may be, the late notification referred to in subsection (4) was correct.”,

(n) in section 787Q(1) by substituting “7 December 2005” for “the specified date”,

(o) in section 787R by substituting the following for subsection (2):

“(2) The persons liable for income tax charged under subsection (1) shall be the administrator of the relevant pension arrangement under which the benefit crystallisation event arises and the individual in relation to whom the benefit crystallisation event occurs and their liability shall be joint and several.”,

(p) in section 787R(4)—

(i) by deleting “on or after the date of passing of the Finance Act 2006”,

(ii) in paragraph (b) by substituting “7 December 2005” for “the specified date”, and

(iii) in paragraph (d) by inserting “whether issued before or after the specified date, or, as the case may be, a copy of the revised certificate issued by the Commissioners under section 787P(6),” after “under section 787P(5),”,

(q) in section 787S by substituting the following for subsection (1):

“(1) The administrator of a relevant pension arrangement shall, within 3 months of the end of the month in which the benefit crystallisation event giving rise to the chargeable excess occurs, make a return to the Collector-General which shall contain—

(a) the name and address of the administrator,

(b) the name, address and PPS Number of the individual in relation to whom the benefit crystallisation event has occurred,

(c) details of the relevant pension arrangement under which the benefit crystallisation event giving rise to the chargeable excess has occurred,

(d) the amount of, and the basis of calculation of, the chargeable excess arising in respect of the benefit crystallisation event, and

(e) details of the tax which the administrator is required to account for in relation to the chargeable excess.”,

(r) in section 787S by deleting subsection (2), and

(s) in section 787S(7)(b) by substituting “0.0219 per cent” for “0.0273 per cent”.

(4) Chapter 4 of Part 30 of the Principal Act is amended—

(a) in section 790A by inserting the following after subsection (3):

“(4) Notwithstanding subsection (2), for the purposes of subsection (1) the earnings limit for the year of assessment 2011 shall be €115,000.

(5) Notwithstanding subsection (2), for the purposes of subsection (1) the earnings limit for the year of assessment 2010 shall be deemed to be €115,000 for the purpose of determining how much of a contribution or qualifying premium, as the case may be, paid by an employee or an individual in the year of assessment 2011, is to be treated by virtue of section 774(8), 776(3), 787(7) or 787C(3), as the case may be, as paid in the year of assessment 2010.”,

and

(b) by substituting the following for section 790AA:

“Taxation of lump sums in excess of the tax free amount.

790AA.— (1) (a) In this section—

‘administrator’, in relation to a relevant pension arrangement, means the person or persons having the management of the arrangement and, in particular, but without prejudice to the generality of the foregoing, references to the administrator of a relevant pension arrangement include—

(i) an administrator within the meaning of section 770(1),

(ii) a person mentioned in section 784, lawfully carrying on the business of granting annuities on human life, including the appointed person mentioned in section 784(4A)(ii), and

(iii) a PRSA administrator within the meaning of section 787A(1);

‘excess lump sum’ shall be construed in accordance with paragraph (e);

‘relevant pension arrangement’ means any one or more of the following—

(i) a retirement benefits scheme, within the meaning of section 771, approved by the Revenue Commissioners for the purposes of Chapter 1,

(ii) an annuity contract or a trust scheme or part of a trust scheme approved by the Revenue Commissioners under section 784,

(iii) a PRSA contract, within the meaning of section 787A, in respect of a PRSA product, within the meaning of that section,

(iv) a qualifying overseas pension plan within the meaning of Chapter 2B,

(v) a public service pension scheme within the meaning of section 1 of the Public Service Superannuation (Miscellaneous Provisions) Act 2004,

(vi) a statutory scheme, within the meaning of section 770(1), other than a public service pension scheme referred to in paragraph (v);

‘specified date’ means 1 January 2011;

‘standard chargeable amount’ means the amount equivalent to the amount determined by the formula—

(SFT)— TFA

where—

SFT is the standard fund threshold, within the meaning of section 787O(1), for the year of assessment in which the lump sum is paid, and

TFA is the tax free amount;

‘standard rate’ means the standard rate of income tax in force at the time the lump sum is paid;

‘tax free amount’ means €200,000;

‘tax year’ means a year of assessment within the meaning of the Tax Acts.

(b) (i) For the purposes of this section, a reference to a lump sum is a reference to a lump sum that is paid to an individual under the rules of a relevant pension arrangement by means of commutation of part of a pension or of part of an annuity or otherwise.

(ii) Without prejudice to the generality of subparagraph (i), the reference in that subparagraph to the commutation of part of a pension or of part of an annuity shall, in a case where an individual opts in accordance with section 772(3A) or, as the case may be, section 784(2A), be construed as a reference to the commutation of part of the pension or, as the case may be, part of the annuity which would, but for the exercise of that option, be payable to the individual.

(c) For the purposes of this section references to a lump sum that is paid to an individual include references to a lump sum that is obtained by, given to, or made available to, an individual and references to a lump sum which was, or has, or had been paid to an individual shall be construed accordingly.

(d) For the purposes of this section—

(i) a lump sum (in this subsection referred to as the ‘first-mentioned lump sum’) shall be treated as paid before another lump sum (in this subsection referred to as the ‘second-mentioned lump sum’) if the first-mentioned lump sum is paid before the second-mentioned lump sum on the same day, and

(ii) a lump sum shall not be treated as paid at the same time as one or more than one other lump sum and, where but for this subsection they would be so treated, the individual to whom the lump sums are paid shall decide on the order in which they are to be deemed to be paid.

(e) For the purposes of this section the excess lump sum, if any, in respect of a lump sum that is paid to an individual on or after the specified date (in this paragraph referred to as the ‘current lump sum’) shall be—

(i) where no other lump sum has been paid to the individual on or after 7 December 2005, the amount by which the current lump sum exceeds the tax free amount, and

(ii) where, before the current lump sum was paid, one or more than one lump sum had been paid to the individual on or after 7 December 2005 (in this section referred to as the ‘earlier lump sums’), then—

(I) where the amount of the earlier lump sums is less than the tax free amount, the amount by which the aggregate of the amounts of the earlier lump sums and the current lump sum exceeds the tax free amount, and

(II) where the amount of the earlier lump sums is equal to or greater than the tax free amount, the amount of the current lump sum.

(2) Where a lump sum is paid to an individual on or after the specified date, the excess lump sum shall be regarded as income of the individual for the tax year in which the lump sum is paid and shall be chargeable to income tax in accordance with subsection (3).

(3) Subject to subsection (7)(b)—

(a) where the excess lump sum arises in accordance with subsection (1)(e)(i), (1)(e)(ii)(I) or (1)(e)(ii)(II) (in so far as the amount of the earlier lump sums referred to in subsection (1)(e)(ii)(II) is equal to the tax free amount), then—

(i) so much of the excess lump sum as does not exceed the standard chargeable amount shall be charged to income tax under Case IV of Schedule D at the standard rate, and

(ii) so much of the excess lump sum, if any, as exceeds the standard chargeable amount shall be regarded as—

(I) profits or gains accruing from an office or employment (and accordingly tax under Schedule E shall be charged on those payments, and tax so chargeable shall be computed under section 112(1)), and

(II) emoluments to which Chapter 4 of Part 42 applies, (in this section referred to as ‘relevant emoluments’).

(b) Where the excess lump sum arises in accordance with subsection (1)(e)(ii)(II) (in so far as the amount of the earlier lump sums referred to in that subsection is greater than the tax free amount), then—

(i) where the amount by which the earlier lump sums is greater than the tax free amount (in this paragraph referred to as the ‘first-mentioned amount’) is less than the standard chargeable amount—

(I) so much of the excess lump sum as does not exceed an amount equivalent to the difference between the standard chargeable amount and the first-mentioned amount shall be charged to income tax under Case IV of Schedule D at the standard rate, and

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Finance Act 2011

PART 1 Income Levy, Universal Social Charge, Income Tax, Corporation Tax and Capital Gains Tax

Chapter 1 Interpretation

1. Interpretation (Part 1).

Chapter 2 Income Levy and Universal Social Charge

2. Cessation of charge to income levy.

3. Universal social charge.

Chapter 3 Income Tax

4. Amendment of section 15 (rate of charge) of Principal Act.

PART 1

PART 2

PART 3

5. Age exemption.

6. Personal tax credits.

7. Benefit-in-kind taxation.

8. Taxation of lump sums.

9. Amendment of section 470B (age-related relief for health insurance premiums) of Principal Act.

10. Employee share schemes.

11. Termination of relief to individuals on loans applied in acquiring interest in companies.

12. Abolition of relief for trade union subscriptions.

13. Relief for energy efficient works.

14. Amendment of section 473 (allowance for rent paid by certain tenants) of Principal Act.

15. Amendment of section 473A (relief for fees paid for third level education, etc.) of Principal Act.

16. Tax treatment of flight crew in international traffic.

17. Exemption of certain earnings of writers, composers and artists.

18. Amendment of Schedule 13 (accountable persons for purposes of Chapter 1 of Part 18) to Principal Act.

19. Retirement benefits.