Legalize / Ireland / Act

FINANCE ACT 2017

Type Act

Publication 2017-12-25

Last updated 2019-12-22

State In force superseded text

Text As published

Source Irish Statute Book

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articles 88

This is the act as published. Later amendments are not folded into the text below: each one is a separate act in this repository and an entry in this law's history.

2 amending acts · 2019-12-22, Finance Act 2019

Act to provide for the imposition, repeal, remission, alteration and regulation of taxation, of stamp duties and of duties relating to excise and otherwise to make further provision in connection with finance including the regulation of customs

Reform history JSON API

“(3)

(a) In this subsection—

(i)‘accounting policy’, ‘a change in accounting policy’, ‘accounting standard’, ‘retrospective’ and ‘opening reserves’ shall be construed in accordance with generally accepted accounting practice;

(ii)‘relevant period’ means the accounting period beginning on the first day of the period of account in which the change in accounting policy, referred to in paragraph (b), is adopted for the first time.

(b) This subsection shall apply to a change in accounting policy other than on the adoption of—

(i) an accounting standard for the first time, or

(ii) an amendment of an accounting standard for the first time.

(c) Subject to the Tax Acts, an amount representing the retrospective effect of a change in accounting policy which is recognised in opening reserves (howsoever designated) for a period of account in accordance with generally accepted accounting practice shall be taxable or deductible, as the case may be, in computing the profits or gains of a company for the relevant period for the purposes of Case I or II of Schedule D.

(d) An amount shall not be regarded by virtue of paragraph (c) as deductible in computing the profits or gains of a company for the relevant period for the purposes of Case I or II of Schedule D to the extent that—

(i) a deduction has been made in respect of that amount in computing such profits or gains for a previous accounting period, or

(ii) the company has benefited from a tax relief under any provision in respect of that amount for a previous accounting period.

(e) An amount shall not be regarded by virtue of paragraph (c) as taxable in computing the profits or gains of a company for the relevant period for the purposes of Case I or II of Schedule D to the extent that the amount was treated as taxable in computing such profits or gains for a previous accounting period.

(f) References to profits or gains in paragraphs (c), (d) and (e) include references to losses.

(4)

(a) In this subsection—

(i)‘accounting standard’, ‘retrospective’ and ‘opening reserves’ shall be construed in accordance with generally accepted accounting practice;

(ii)‘relevant period’ means the accounting period beginning on the first day of the period of account in which the accounting standard, referred to in paragraph (b), is adopted for the first time;

(iii)‘relevant amount’ means the amount representing the retrospective effect of adopting an accounting standard as computed in accordance with generally accepted accounting practice as adjusted to satisfy the requirements of paragraphs (d) and (e).

(b) This subsection shall apply where—

(i) an accounting standard is adopted for the first time and subsection (2) does not apply, or

(ii) an amendment of an accounting standard is adopted for the first time,

and references in this subsection to adopting an accounting standard for the first time shall be construed as including references to adopting an amendment of an accounting standard for the first time.

(c) Subject to the Tax Acts, an amount representing the retrospective effect of adopting an accounting standard which is recognised in opening reserves (howsoever designated) for a period of account in accordance with generally accepted accounting practice shall be taxable or deductible, as the case may be, in computing the profits or gains of a company for the purposes of Case I or II of Schedule D.

(d) An amount shall not be regarded by virtue of paragraph (c) as deductible in computing the profits or gains of a company for an accounting period for the purposes of Case I or II of Schedule D to the extent that—

(i) a deduction has been made in respect of that amount in computing such profits or gains for a previous accounting period, or

(ii) the company has benefited from a tax relief under any provision in respect of that amount for a previous accounting period.

(e) An amount shall not be regarded by virtue of paragraph (c) as taxable in computing the profits or gains of a company for an accounting period for the purposes of Case I or II of Schedule D to the extent that the amount was treated as taxable in computing such profits or gains for a previous accounting period.

(f) References to profits or gains in paragraphs (c), (d) and (e) include references to losses.

(g) Subject to the Tax Acts, the relevant amount shall neither be taxable nor deductible, as the case may be, for the relevant period but instead—

(i) a part of the relevant amount shall be taxable or deductible, as the case may be, for each accounting period falling wholly or partly within the period of 5 years beginning at the commencement of the relevant period,

(ii) the part of the relevant amount which shall be taxable or deductible for any such accounting period shall be such amount as bears to the relevant amount the same proportion as the length of the accounting period, or the part of the accounting period falling within the period of 5 years, bears to 5 years, and

(iii) where any accounting period referred to in subparagraph (ii) is the last accounting period in which the company carried on a trade or profession, then such part of the relevant amount as is required to ensure that the whole of the relevant amount is accounted for shall be taxable or deductible, as the case may be, for that accounting period.

(5)

(a) In this subsection—

(i) ‘material error’, ‘fundamental error’, ‘retrospective’ and ‘opening reserves’ shall be construed in accordance with generally accepted accounting practice;

(ii) ‘relevant amount’ means the amount representing the correction of an error which is taxable or deductible, as the case may be, by virtue of paragraphs (c) or (d) as adjusted to satisfy the requirements of paragraphs (e) and (f);

(iii) ‘relevant period’ means the accounting period beginning on the first day of the period of account in which the error, referred to in paragraph (b), is corrected for the first time.

(b) This subsection shall apply where a company’s accounts include the correction of an error.

(c) Subject to the Tax Acts, an amount representing the retrospective effect of correcting either a material error or a fundamental error which is recognised in opening reserves (howsoever designated) for a period of account in accordance with generally accepted accounting practice shall be taxable or deductible, as the case may be, in computing the profits or gains of a company for the purposes of Case I or II of Schedule D.

(d) Subject to the Tax Acts, an amount representing the effect of correcting an error which is neither a material error nor a fundamental error and which is included in the profits of a company for a period of account as computed in accordance with generally accepted accounting practice shall be taxable or deductible, as the case may be, in computing the profits or gains of that company for the purposes of Case I or II of Schedule D.

(e) An amount shall not be regarded by virtue of paragraphs (c) and (d) as deductible in computing the profits or gains of a company for an accounting period for the purposes of Case I or II of Schedule D to the extent that—

(i) a deduction has been made in respect of that amount in computing such profits or gains for a previous accounting period, or

(ii) the company has benefited from a tax relief under any provision in respect of that amount for a previous accounting period.

(f) An amount shall not be regarded by virtue of paragraphs (c) and (d) as taxable in computing the profits or gains of a company for an accounting period for the purposes of Case I or II of Schedule D to the extent that the amount was treated as taxable in computing such profits or gains for a previous accounting period.

(g) References to profits or gains in paragraphs (c), (d), (e) and (f) include references to losses.

(h) Subject to the Tax Acts, the relevant amount shall neither be taxable nor deductible, as the case may be, for the relevant period but instead—

(i) where any part of the relevant amount relates to the relevant period, then that part of the relevant amount shall be taxable or deductible, as the case may be, for the relevant period,

(ii) where any part of the relevant amount relates to an accounting period which commenced on or after 1 January 2013, then the return and self assessment for that accounting period shall be amended in accordance with section 959V to correct that part of the relevant amount, and

(iii) where any part of the relevant amount relates to an accounting period which commenced before 1 January 2013, then the return for that accounting period shall be amended to correct that part of the relevant amount and for this purpose section 959V shall apply to such an amendment as if—

(I) subsections (2) and (4) of that section shall not apply,

(II) references in that section to ‘return and self assessment’, ‘return and a self assessment’, ‘return and the self assessment’ and ‘return or self assessment’ were references to ‘return’, and

(III) the reference in that section to section 959Z was a reference to section 956.”.

(2)
(a) This section applies as respects accounting periods beginning on or after the date of the passing of this Act.

(b) Where a company so notifies the Revenue Commissioners in writing on or before the specified return date for the accounting period (within the meaning of section 959A), that company may elect that the provisions of this section shall apply.

23. Amendment of section 135 of Principal Act (distributions: supplemental)

23. (1) Section 135 of the Principal Act is amended—

(a) by inserting the following subsection after subsection (2)—

“(2A) No consideration derived from any share capital or security of a company (being a close company within the meaning of section 430 and in this subsection referred to as the ‘first-mentioned company’) issued to another company (being a close company within the meaning of section 430 and in this subsection referred to as the ‘second-mentioned company’) in exchange for the issue of shares or securities by the second-mentioned company shall be regarded for the purposes of this Chapter as new consideration received by the second-mentioned company in so far as it exceeds any new consideration received by the first-mentioned company for the issue of the said share capital or security.”,

and

(b) by inserting the following subsection after subsection (3)—

“(3A) Where a member of a company (being a close company within the meaning of section 430 and in this subsection referred to as the ‘first-mentioned company’), or a person connected with that member, enters into arrangements directly or indirectly with another company (being a close company within the meaning of section 430 and in this subsection referred to as the ‘second-mentioned company’), whereby a member (in this subsection referred to as the ‘disposing member’), of the first-mentioned company disposes of an interest in shares or securities of the first-mentioned company and the consideration for the acquisition of those shares or securities is paid or to be paid directly or indirectly out of the assets of the first-mentioned company, any amount received directly or indirectly by the disposing member from the second-mentioned company in respect of the disposal shall be treated for the purposes of this Chapter as a distribution made by the first-mentioned company to that member at the time of the payment by the second-mentioned company, and this subsection shall apply however many companies participate in the arrangements.”.

(2) This section shall come into operation on 2 November 2017.

24. Charges on income for corporation tax purposes

24. (1) Part 8 of the Principal Act is amended—

(a) in section 243(8), by substituting “subsections (2A), (2B)” for “subsections (2A)”,

(b) in section 247(1)(a) by inserting the following definition after the definition of “control”:

“ ‘intermediate holding company’ means a company whose business consists wholly or mainly of the holding of stocks, shares or securities and is, in relation to an investee company referred to in subsection (2)(a)(iv), a company through which the investee company holds stocks, shares or securities in a company referred to in subsection (2)(a)(i);”,

(i) by substituting the following for paragraph (a):

“(a) in acquiring any part of the ordinary share capital of—

(i) a company which exists wholly or mainly for the purpose of carrying on a trade or trades,

(ii) a company whose income consists wholly or mainly of profits or gains chargeable under Case V of Schedule D,

(iii) a company whose business consists wholly or mainly of the holding of stocks, shares or securities directly in a company referred to in subparagraph (i),

(iv) a company whose business consists wholly or mainly of the holding of stocks, shares or securities of a company referred to in subparagraph (i) indirectly through an intermediate holding company or companies, or

(v) a company whose business consists wholly or mainly of the holding of stocks, shares or securities directly in a company referred to in subparagraph (ii),”,

(ii) in paragraph (b)—

(I) in subparagraph (ii), by substituting “relate,” for “relate, or”,

(II) in subparagraph (iii), by substituting “directly in a company” for “of a company”, and

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

“(iv) where the company is a company whose business consists wholly or mainly of the holding of stocks, shares or securities of a company referred to in paragraph (a)(i) indirectly through an intermediate holding company or companies, for the purposes of acquiring and holding such stocks, shares or securities, or

(v) where the company is a company whose business consists wholly or mainly of the holding of stocks, shares or securities directly in a company referred to in paragraph (a)(ii), for the purposes of holding such stocks, shares or securities,”,

(iii) in paragraph (ba)—

(I) by substituting “in paragraph (a) (other than a company referred to in paragraph (a)(iv))” for “in paragraph (a)”,

(II) in subparagraph (ii), by substituting “relate,” for “relate, or”,

(III) in subparagraph (iii), by substituting “directly in a company” for “of a company”, and

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

“(iv) where the connected company is a company whose business consists wholly or mainly of the holding of stocks, shares or securities directly in a company referred to in paragraph (a)(ii), for the purposes of holding such stocks, shares or securities,”,

and

(iv) by inserting the following after paragraph (ba):

“(bb) in lending to a company referred to in paragraph (a)(iv) money which is on-lent by that company to a connected company and is used wholly and exclusively by that connected company—

(i) where the connected company is a company referred to in paragraph (a)(iii), for the purposes of acquiring and holding any part of the ordinary share capital of a company referred to in paragraph (a)(i), or

(ii) where the connected company is a company referred to in paragraph (a)(iv), for the purposes of acquiring and holding any part of the ordinary share capital of a company referred to in paragraph (a)(iii), or”,

(d) in section 247(2A)—

(i) in subparagraph (c), by substituting “directly or indirectly in a company” for “of a company” and by substituting “securities, or” for “securities.”,

(ii) by inserting the following after subparagraph (c):

“(d) where the company which uses the capital is a company whose business consists wholly or mainly of the holding of stocks, shares or securities directly in a company referred to in paragraph (a)(ii) of subsection (2), for the purposes of holding such stocks, shares or securities.”,

(e) in section 247, by inserting the following after subsection (2A):

“(2B) Subsection (2)(a)(iv), (b)(iv) and (bb) shall apply only to a company, being a company whose business consists wholly or mainly of the holding of stocks, shares or securities of a company referred to in subsection (2)(a)(i) indirectly through an intermediate holding company or companies, where the company and each intermediate holding company exists for bona fide commercial reasons and not as part of a scheme or arrangement the purpose of which or one of the purposes of which is the avoidance of tax.”,

(f) in section 247(3)(a), by inserting “or (2)(bb)” after “subsection (2)(ba)”,

(g) in section 249(1)(a)(iii)(II), by inserting “or (2)(ac)” after “subsection (2)(aa)”,

(h) in section 249(2)(aa)(i), by substituting “referred to in section 247(2)(a)(iii), (iv) or (v)” for “to which section 247(2)(a)(ii) applies”, and

(i) in section 249(2), by inserting the following paragraph after paragraph (ab):

“(ac) (i) Where the company concerned is a company referred to in section 247(2)(a)(iv), the investing company shall be deemed, subject to subparagraph (iii), to have recovered from the company concerned an amount equal to so much of any capital recovered by an intermediate holding company from another company where—

(I) the company concerned owns directly or indirectly more than 50 per cent of the ordinary share capital of the intermediate holding company or both companies are under the control of the same person or persons, and

(II) the intermediate holding company owns directly more than 50 per cent of the ordinary share capital of the other company or both companies are under the control of the same person or persons.

(ii) Subparagraph (aa)(ii) shall apply with any necessary modifications for the purposes of determining whether an intermediate holding company has recovered capital from another company, as if in that provision ‘intermediate holding company’ were substituted for the ‘company concerned’.

(iii) An investing company shall not be deemed by subparagraph (i) to have recovered capital where—

(I) and to the extent that, any capital recovered by the intermediate holding company from another company is applied by the intermediate holding company in repaying any loan or advance made to it by the company concerned,

(II) the amount of capital recovered by the intermediate holding company is applied in accordance with paragraph (a) or (b) of section 247(2),

(III) the amount of capital recovered by the intermediate holding company is applied in the repayment of a loan to which section 247 applies, or

(IV) an intermediate holding company (that is not a company to which subparagraph (i) or (ii) of section 247(2)(bb) applies) transfers all of its assets and liabilities to another intermediate holding company and—

(A) the transfer is made in the course of the intermediate holding company being dissolved with or without going into liquidation,

(B) the company concerned, being a company referred to in section 247(2)(a)(iv), continues to hold the same beneficial percentage of stocks, shares or securities of a company referred to in section 247(2)(a)(i) indirectly through one or more intermediate holding companies, and

(C) the transfer is for bona fide commercial reasons and is not part of any scheme or arrangement the purpose of which, or one of the purposes of which, is the avoidance of tax.

(iv) Paragraph (ab) shall apply with any necessary modifications to this paragraph as if references in that paragraph to the ‘company concerned’ were to ‘intermediate holding company’ and references to paragraph (aa) were to paragraph (ac).

(v) (I) This clause and clauses (II) and (III) shall apply where an investing company is deemed to have recovered an amount of capital under this paragraph or under paragraph (aa) and included within that capital is an amount or value which was, within a reasonable period of time previously and by reference to related transactions or events, an amount of capital deemed to have been recovered by the investing company under this paragraph (in clause (II) referred to as ‘capital previously recovered’).

(II) An investing company may, upon giving notice in writing to the Revenue Commissioners, exclude capital previously recovered from an amount of capital it is deemed to have recovered under this paragraph or paragraph (aa).

(III) An investing company is required to maintain and have available such records as may reasonably be required for the purposes of determining whether it meets the requirements of clause (I).

(vi) Subparagraph (aa)(iii) shall apply with any necessary modifications for the purposes of subparagraph (i) as it applies in relation to subparagraph (aa)(i) as if the reference in that subparagraph to subparagraph (i) were a reference to subparagraph (i) of this paragraph.”.

(2) This section applies in respect of a loan made on or after 19 October 2017.

25. Amendment of section 291A of Principal Act (intangible assets)

25. (1) Section 291A of the Principal Act is amended—

(a) in subsection (5), by inserting the following paragraph after paragraph (b):

“(c) Where the trade of a company consists wholly of the carrying on of relevant activities (within the meaning of paragraph (a)), then the trade shall, for the purposes of subsection (6), be treated as a relevant trade.”,

and

(b) in subsection (6)(a), by substituting “exceed 80 per cent of” for “exceed”.

(2)
(a) Subsection (1)(a) is deemed to have applied in respect of capital expenditure incurred by a company on or after 8 May 2009.

(b) Subsection (1)(b) applies to capital expenditure incurred by a company on or after 11 October 2017.

Chapter 6 Capital Gains Tax

26. Amendment of section 29 of Principal Act (persons chargeable)

26. (1) Section 29 of the Principal Act is amended in subsection (1A)(c)(i) by inserting “or other assets (apart from relevant assets)” after “money”.

(2) This section applies to disposals made on or after 19 October 2017.

27. Amendment of section 626B of Principal Act (exemption from tax in the case of gains on certain disposals of shares)

27. (1) Section 626B of the Principal Act is amended by inserting the following after subsection (3A):

“(3B)

(a) In this subsection—

‘arrangement’ includes any agreement, understanding, scheme, transaction or series of transactions;

‘relevant assets’ means the assets specified in subsection (3)(d).

(b) In calculating the portion of the value of shares attributable directly or indirectly to relevant assets, account shall not be taken of any arrangement that—

(i) involves a transfer of money or other assets (apart from relevant assets) from a person connected with the company in which those shares are held,

(ii) is made before a disposal of relevant assets, and

(iii) the main purpose or one of the main purposes of which is the avoidance of tax.”.

(2) This section applies to disposals made on or after 19 October 2017.

28. Amendment of section 980 of Principal Act (deduction from consideration on disposal of certain assets)

28. (1) Section 980 of the Principal Act is amended by inserting the following after subsection (2):

“(2A)

(a) In this subsection—

‘arrangement’ includes any agreement, understanding, scheme, transaction or series of transactions;

‘relevant assets’ means assets specified in subsection (2)(a), (b) or (c).

(b) In calculating the portion of the value of shares attributable directly or indirectly to relevant assets for the purposes of subsection (2)(d), account shall not be taken of any arrangement that—

(i) involves a transfer of money or other assets (apart from relevant assets) from a person connected with the company in which those shares are held,

(ii) is made before a disposal of relevant assets, and

(iii) the main purpose or one of the main purposes of which is the avoidance of tax.”.

(2) This section applies to disposals made on or after 19 October 2017.

29. Amendment of section 604B of Principal Act (relief for farm restructuring)

29. (1) Section 604B of the Principal Act is amended by inserting the following after subsection (3):

“(3A) Where an individual is entitled to relief in respect of the whole or part of a gain under subsection (2) or (3), as the case may be, the individual shall furnish to the Revenue Commissioners, on a form provided for that purpose, the following information to enable the Revenue Commissioners to calculate the amount of the gain that would have arisen if the relief had not applied:

(a) his or her name and address;

(b) the consideration paid for the qualifying land, sold or exchanged by him or her, when that land was acquired by him or her;

(c) the consideration received by him or her for the qualifying land on the sale of that land and the consideration paid by him or her for the other qualifying land purchased by him or her;

(d) in the case of an exchange of qualifying land, the market value of the qualifying land conveyed or transferred by him or her for the purposes of the exchange and the market value of the other qualifying land received by him or her in exchange for that land; and

(e) the incidental costs (within the meaning of section 552(2)) relating to the acquisition, sale or exchange of the qualifying land referred to in paragraphs (b), (c) and (d).

(3B) For the purposes of subsection (3A)(b), the provisions of section 547(1) shall apply where the land was acquired otherwise than by means of a bargain made at arm’s length.”.

(2) Subsection (1) applies to disposals made on or after 1 July 2016.

30. Amendment of Chapter 6 of Part 19 of Principal Act (transfers of business assets)

30. (1) Section 597AA of the Principal Act is amended—

(a) in subsection (2)(b)—

(i) in subparagraph (ii), by substituting “land,” for “land, or”,

(ii) in subparagraph (iii), by substituting “chargeable gains,” for “chargeable gains.”, and

(iii) by inserting the following subparagraphs after subparagraph (iii)—

“(iv) subject to subsection (8), goodwill which is disposed of directly or indirectly to a company, where, immediately following the disposal, the individual is connected with the company, or

(v) subject to subsection (8), shares or securities in a company which are disposed of directly or indirectly to another company, where, immediately following the disposal, the individual is connected with the first-mentioned company.”,

and

(b) by inserting the following subsections after subsection (5):

“(6) Subject to section 600 and subsection (8), this section shall not apply to such portion of the chargeable gain or gains accruing in respect of a disposal or disposals by a relevant individual of chargeable business assets which form part of a transfer to which section 600 applies as bears the same proportion to the total of such gains as the value of the consideration received by the relevant individual out of the assets of the company in respect of the transfer bears to the value of the consideration received by the relevant individual other than by way of shares or securities in respect of such transfer.

(7) Where a relevant individual enters into arrangements, the main purpose, or one of the main purposes, of which is to secure that the relevant individual is not connected with a company for the purpose of either or both of subparagraphs (iv) or (v) of subsection (2)(b), this section shall not apply.

(8) Subsections (2)(b)(iv), (2)(b)(v) and (6) shall not apply in relation to a disposal of assets where it would be reasonable to consider that the disposal is made for bona fide commercial reasons and does not form part of any arrangement or scheme the main purpose or one of the main purposes of which is the avoidance of liability to tax.”.

(2) Section 598 of the Principal Act is amended—

(a) in subsection (1), in the definition of “chargeable business asset”, by substituting the following for “other than an asset on the disposal of which no gain accruing would be a chargeable gain;”:

“other than—

(I) an asset on the disposal of which no gain accruing would be a chargeable gain,

(II) subject to subsection (1)(f), goodwill which is disposed of directly or indirectly to a company, where, immediately following the disposal the individual is connected with the company, or

(III) subject to subsection (1)(f), shares or securities in a company which are disposed of directly or indirectly to another company where, immediately following the disposal, the individual is connected with the first-mentioned company;”,

(b) in subsection (1), by inserting the following paragraph after paragraph (e)—

“(f) Goodwill, shares or securities referred to in clauses (II) and (III) of the definition of ‘chargeable business asset’ shall be treated as chargeable business assets where it would be reasonable to consider that a disposal of such assets is made for bona fide commercial reasons and does not form part of any arrangement or scheme the main purpose or one of the main purposes of which is the avoidance of liability to tax.”,

and

“(7B) Where an individual enters into arrangements, the main purpose, or one of the main purposes, of which is to secure that the individual is not connected with a company for the purpose of either or both of clauses (II) or (III) in the definition of ‘chargeable business asset’, the individual will be deemed to be connected with that company for the purpose of either or both of clauses (II) or (III) as the case may be.

(7C) Subject to section 600 and subsection (7D), this section shall not apply to such portion of the chargeable gain or gains accruing in respect of a disposal or disposals by an individual of qualifying assets which form part of a transfer to which section 600 applies as bears the same proportion to the total of such gains as the value of the consideration received by the individual out of the assets of the company in respect of the transfer bears to the value of the consideration received by the individual other than by way of shares or securities in respect of such transfer.

(7D) Subsection (7C) shall not apply in relation to a disposal of assets where it would be reasonable to consider that the disposal is made for bona fide commercial reasons and does not form part of any arrangement or scheme the main purpose or one of the main purposes of which is the avoidance of liability to tax.”.

(3) Section 599 of the Principal Act is amended—

(a) in subsection (5) by substituting “Subject to subsection (7), the consideration” for “The consideration”, and

(b) by inserting the following subsection after subsection (6):

“(7) Where there is—

(a) a disposal of shares or securities of a family company by an individual referred to in subparagraph (iia) or (iii) of subsection (1)(b) to his or her child, and

(b) a disposal of shares or securities of the family company by the individual to a company controlled by that child,

the consideration for the disposals referred to in paragraphs (a) and (b) shall be aggregated for the purpose of section 598(3).”.

(4) This section shall come into operation on 2 November 2017.

31. Amendment of Part 20 of Principal Act (companies’ chargeable gains)

31. Part 20 of the Principal Act is amended—

(a) in section 616(1)(a) by substituting “sections 617(5), 621(1) and 623(7)” for “section 621(1)”,

(b) in section 617 by inserting the following after subsection (4):

“(5) For the purposes of this section, a ‘group of companies’ shall include only companies which, by virtue of the law of a relevant Member State or other territory with the government of which arrangements having the force of law by virtue of section 826(1) have been made, are resident for the purposes of tax in such Member State or territory, as the case may be, and for this purpose ‘tax’, in relation to a relevant Member State or such territory, other than the State, means any tax imposed in the Member State or territory which corresponds to corporation tax in the State.”,

and

“(7) For the purposes of this section, a ‘group of companies’ shall include only companies which, by virtue of the law of a relevant Member State or other territory with the government of which arrangements having the force of law by virtue of section 826(1) have been made, are resident for the purposes of tax in such Member State or territory, as the case may be, and for this purpose ‘tax’, in relation to a relevant Member State or such territory, other than the State, means any tax imposed in the Member State or territory which corresponds to corporation tax in the State.”.

32. Amendment of section 613 of Principal Act (miscellaneous exemptions for certain kinds of property)

32. (1) Section 613 of the Principal Act is amended—

(a) in subsection (1) by inserting the following after paragraph (c):

“(ca) any sum obtained by means of compensation under the 2017 Voluntary Homeowners Relocation Scheme administered by the Commissioners of Public Works in Ireland under section 2 of the Commissioners of Public Works (Functions and Powers) Act 1996;”,

and

(b) in subsection (7) by inserting the following after paragraph (a):

“(aa) No chargeable gain shall arise on a disposal of land (including a right of turbary) to the Minister referred to in paragraph (a) where that land has been acquired by that Minister for the purposes of granting a right of turbary to an individual who—

(i) is entitled to compensation under the scheme referred to in paragraph (a), and

(ii) enters into an agreement with that Minister in respect of that land (or any estate, right or interest in or over that land).”.

(2) This section applies with effect from 19 October 2017.

33. Amendment of section 604A of Principal Act (relief for certain disposals of land or buildings)

33. (1) Section 604A of the Principal Act is amended—

(a) in subsection (2)(b) by substituting “4 years” for “7 years”,

(b) by inserting the following after subsection (2):

“(2A) Where a person disposes of land or buildings to which this section applies during the period beginning 4 years after the date they were acquired and ending 7 years after that date, any gain on the disposal of such land or buildings shall not be a chargeable gain.”,

(d) in subsection (4)—

(i) by substituting “subsection (2A) or (3)” for “subsection (3)”,

(ii) in paragraph (a) by substituting “in the period from” for “in the period of 7 years from”, and

(iii) in paragraph (b) by substituting “subsection (2A) or (3), as the case may be” for “subsection (3)”.

(2) Subsection (1) applies to disposals made on or after 1 January 2018.

34. Amendment of section 598 of Principal Act (disposals of business or farm on “retirement”)

34. (1) Section 598 of the Principal Act is amended by inserting the following after subsection (2):

“(2A)

(a) In this subsection ‘solar panel’ means ground-mounted equipment used to capture solar energy and convert it into electrical energy, together with ancillary equipment used to harness, store and transfer the electrical energy.

(b) Notwithstanding that solar panels are installed on land which is suitable for farming purposes, the land shall be treated as a qualifying asset for the purposes of subsection (2) where the area of the land on which the solar panels are installed does not exceed half the total area of the land concerned.”.

(2) Subsection (1) applies to disposals made on or after 1 January 2018.

PART 2 Excise

Chapter 1 Sugar Sweetened Drinks Tax

35. **Interpretation (Chapter 1)**

35. In this Chapter and in Schedule 4—

“accounting period” means a period of 2 calendar months or such other period as the Commissioners may prescribe for the purposes of payment and returns under section 39;

“added sugar” means—

(a) sugar, or

(b) substances containing sugar, except for juices,

that is or are combined with other ingredients in the production or manufacture of prepacked ready to consume sugar sweetened drinks or prepacked concentrated sugar sweetened drinks;

“CN Code” means a Community subdivision to the combined nomenclature of the European Communities referred to in Article 1 of Council Regulation (EEC) No. 2658/87 of 23 July 1987¹⁵ as amended by Commission Implementing Regulation (EU) No. 1821/2016 of 6 October 2016 ¹⁶;

“Commissioners” means the Revenue Commissioners;

“concentrated” means a prepacked liquid or solid that requires preparation before consumption as a beverage;

“exporter” means a person who supplies sugar sweetened drinks on a commercial basis outside the State where the sugar sweetened drinks have been acquired in the State by that person;

“food information” has the meaning assigned to it by Article 2 of Regulation (EU) No. 1169/2011 ¹⁷ on the provision of food information to consumers;

“food supplement” has the meaning assigned to it by the European Communities (Food Supplements) Regulations 2007 (S.I. No. 506 of 2007);

“first supplied”, where express provision is not made in this behalf, means the first time a supply is made within the State by a supplier;

“juice” means any fruit or vegetable juice falling within CN Code heading 2009 that does not contain added sugar;

“label” has the meaning assigned to it by Article 2 of Regulation (EU) No. 1169/2011 on the provision of food information to consumers;

“officer” means an officer of the Commissioners;

“prepacked” has the meaning assigned to it by Article 2 of Regulation (EU) No. 1169/2011 on the provision of food information to consumers;

“preparation” means the addition of water, ice or carbon dioxide, or any combination of these substances, in a manner detailed on the label, packaging or accompanying documentation of the sugar sweetened drink, to give rise to a beverage that is ready to consume;

“prescribed” means prescribed by regulations made by the Commissioners under section 45;

“ready to consume” means intended for direct consumption by a consumer;

“related company” has the meaning assigned to it by the Companies Act 2014;

“sugar” has the meaning assigned to it by Annex 1 of Regulation (EU) No. 1169/2011 on the provision of food information to consumers;

“sugar content” means the number of grams of sugar per 100 millilitres of sugar sweetened drink in ready to consume form;

“sugar sweetened drink” means—

(a) a prepacked, ready to consume beverage, containing added sugar and which falls within CN Code headings 2009 and 2202 except for beverages falling within CN Code subheadings 2202 91 00, 2202 99 11, 2202 99 15, 2202 99 91, 2202 99 95, 2202 99 99 and alcohol free wines falling within CN Code subheading 2202 99 19, other than—

(i) food supplements, or

(ii) products exempted by the European Union (Provision of Food Information to Consumers) (Amendment) (No. 2) Regulations 2016 (S.I. No. 559 of 2016) from requirements to provide specific food information on labels, packaging or accompanying documentation,

(b) a prepacked, concentrated substance in liquid or solid form, containing added sugar, which requires preparation before consumption by the final consumer and which, after such preparation, has the same characteristics as beverages referred to in paragraph (a), other than—

(i) food supplements, or

(ii) products exempted by the European Union (Provision of Food Information to Consumers) (Amendment) (No. 2) Regulations 2016 (S.I. No. 559 of 2016) from requirements to provide specific food information on labels, packaging or accompanying documentation,

“supplier” means—

(a) except where paragraph (b) applies, a taxable person within the meaning of section 2 of the Value-Added Tax Consolidation Act 2010, or

(b) an accountable person for the purposes of Part 2 of the Value-Added Tax Consolidation Act 2010,

who supplies sugar sweetened drinks;

“supply” means the supply of a quantity of sugar sweetened drink to another person, other than—

(a) the supply or self-supply of a beverage prepared from a prepacked concentrated sugar sweetened drink for private domestic use,

(b) the supply of sugar sweetened drinks between related companies, or

(c) the supply of a beverage prepared from a prepacked concentrated sugar sweetened drink which has already been supplied in the State;

“tax” means sugar sweetened drinks tax within the meaning of section 36.

36. Charging and rates of sugar sweetened drinks tax

36. (1) Subject to the provisions of this Chapter and any regulations made under it, a duty of excise, to be known as sugar sweetened drinks tax, shall be charged, levied and paid at the rates specified in Schedule 4 on each sugar sweetened drink, with a sugar content of 5 grams or more per 100 millilitres, supplied in the State by a supplier.

(2) For the purposes of the charge to sugar sweetened drinks tax, the sugar content of a sugar sweetened drink shall be that which is stated in, or can be ascertained from, the food information set out on the label or packaging of, or the accompanying documentation for, the drink concerned.

(3) Notwithstanding subsection (2), where a sugar sweetened drink is first supplied in a concentrated form or in a ready to drink form prepared from a concentrated form, then the sugar content shall be ascertained on the basis of the sugar content of the ready to consume beverage resulting from preparation in accordance with manufacturer’s or producer’s instructions provided on the label, packaging or accompanying documentation for the concentrated sugar sweetened drink concerned.

37. Liability to pay sugar sweetened drinks tax

37. Tax shall be charged at the time the sugar sweetened drink is first supplied in the State by a supplier and that supplier shall be accountable for and liable to pay the tax charged.

38. Registration of sugar sweetened drinks suppliers and exporters

38. (1) Before making a supply of a sugar sweetened drink, being the first supply of the sugar sweetened drink by the supplier, a supplier shall (if not already so registered) register with the Commissioners in accordance with such procedures as the Commissioners may prescribe or otherwise require.

(2) An exporter who intends to claim relief under section 40 shall, prior to the first export of sugar sweetened drinks, register with the Commissioners in accordance with such procedures as the Commissioners may prescribe or otherwise require; a reference in this Chapter to a registered exporter is a reference to an exporter who is registered with the Commissioners in accordance with those procedures.

39. Returns and payment by sugar sweetened drinks suppliers

39. (1) For the purposes of section 37, a supplier shall within one month after the end of an accounting period, in respect of the sugar sweetened drinks supplied in that accounting period, furnish to an officer a return in such form as the Commissioners may require showing—

(a) the quantity of ready to consume sugar sweetened drinks supplied by the supplier in that period, and

(b) the quantity of ready to consume beverages that would result from the preparation of the quantity of concentrated sugar sweetened drinks supplied by the supplier in that period.

(2) The supplier shall, in accordance with the return under subsection (1) and by the time that return is due, pay the amount of tax due in respect of the accounting period concerned.

40. Relief from sugar sweetened drinks tax for supplies made outside the State

40. Subject to such conditions as the Commissioners may prescribe or otherwise impose, a full relief from the tax shall be granted to a registered exporter in respect of any sugar sweetened drinks that are shown to the satisfaction of the Commissioners to have been supplied outside the State by that registered exporter.

41. Returned sugar sweetened drinks

41. Subject to such conditions as the Commissioners may prescribe or otherwise impose, a repayment of tax may be granted in respect of any sugar sweetened drinks, for which tax has been paid, that are shown to the satisfaction of the Commissioners to have been returned to the liable supplier.

42. Repayments of sugar sweetened drinks tax

42. (1) Where a supply qualifies under sections 40 and 41 a repayment of that tax shall be made to the relevant person.

(2)
(a) Claims for repayment under subsection (1) shall be in such form as the Commissioners may direct and shall be submitted to the Commissioners within a period of not less than 1 month and not more than 6 calendar months after the end of the accounting period in which the supplies were made.

(b) Except where the Commissioners may in any particular case otherwise allow, a repayment may not be made unless the claim is made within 6 calendar months following the end of the period in respect of which the claim for repayment is made.

43. Records

43. Every supplier and exporter of sugar sweetened drinks shall maintain such records for such periods as the Commissioners may prescribe and shall produce those records for inspection to a Revenue officer where the officer so requests.

44. **Offence and penalty (Chapter 1)**

44. (1) It is an offence under this subsection for any person to contravene or fail to comply with any provision of this Chapter, or any regulation made under section 45, or any condition imposed under this Chapter, or under such regulation in relation to such provision.

(2) Without prejudice to any other penalty to which a person may be liable, a person guilty of an offence under subsection (1) shall be liable on summary conviction, to a class A fine.

(3) Where an offence under subsection (1) is committed by a body corporate and the offence is proved to have been committed with the consent or connivance of any person who, when the offence was committed, was a director, manager, secretary or other officer of the body corporate, or who purported to act in any such capacity, that person as well as the body corporate shall be guilty of an offence and shall be liable to be proceeded against and punished as if he or she were guilty of the first-mentioned offence.

(4) Where the affairs of a body corporate are managed by its members, subsection (3) shall apply in relation to the acts and defaults of a member in connection with his or her functions of management as if he or she were a director or manager.

45. **Regulations (Chapter 1)**

45. The Commissioners may, for the purposes of managing, securing and collecting the tax, or for the protection of the revenue derived from it, make regulations.

46. **Care and management (Chapter 1)**

46. The tax imposed by this Chapter is placed under the care and management of the Commissioners.

47. **Commencement (Chapter 1)**

47. This Chapter comes into operation on such day as the Minister for Finance may appoint by order.

Chapter 2 Miscellaneous

48. Amendment of Chapter 4 of Part 2 of Finance Act 2001 (powers of officers)

48. Chapter 4 of Part 2 of the Finance Act 2001 is amended in section 138 by substituting the following for subsection (2):

“(2) For the purposes of paragraphs (c) and (d) of subsection (1), a receptacle includes, but is not limited to, a bag, parcel, carton, item of luggage, container or other thing that may be used in the storage or transport of a good but does not include any article of clothing worn by the person concerned.”.

49. Rates of tobacco products tax

49. The Finance Act 2005 is amended with effect as on and from 11 October 2017 by substituting the following for Schedule 2 (as amended by section 36 of the Finance Act 2016 (No. 18 of 2016)) to that Act:

“SCHEDULE 2

Rates of Tobacco Products Tax

(With effect as on and from 11 October 2017)

Description of Product Rate of Tax

Cigarettes .... .... .... .... Rate of tax at—

(a) except where paragraph (b) applies, €309. 04 per thousand together with an amount equal to 9. 04 per cent of the price at which the cigarettes are sold by retail, or

(b) €344. 07 per thousand in respect of cigarettes sold by retail where the rate of tax would be less than that rate had the rate been calculated in accordance with paragraph (a).

Cigars .... .... .... .... Rate of tax at €355. 238 per kilogram.

Fine-cut tobacco for the rolling of cigarettes .... .... .... .... Rate of tax at €335.342 per kilogram.

Other smoking tobacco.... .... Rate of tax at €246.449 per kilogram.

”.


Description of Product	Rate of Tax
Cigarettes .... .... .... ....	Rate of tax at—
	(a) except where paragraph (b) applies, €309. 04 per thousand together with an amount equal to 9. 04 per cent of the price at which the cigarettes are sold by retail, or
	(b) €344. 07 per thousand in respect of cigarettes sold by retail where the rate of tax would be less than that rate had the rate been calculated in accordance with paragraph (a).
Cigars .... .... .... ....	Rate of tax at €355. 238 per kilogram.
Fine-cut tobacco for the rolling of cigarettes .... .... .... ....	Rate of tax at €335.342 per kilogram.
Other smoking tobacco.... ....	Rate of tax at €246.449 per kilogram.

50. Amendment of Chapter 1 of Part 2 of Finance Act 2002 (consolidation and modernisation of betting duties law)

50. Chapter 1 of Part 2 of the Finance Act 2002 is amended—

(a) in section 64, by inserting the following after the definition of “remote bookmaker’s licence”:

“ ‘remote means’ has the same meaning as it has in section 1 of the Betting Act 1931;”,

and

(b) in section 68(1)(b), by substituting “remote means” for “any means of telecommunications”.

51. Amendment of section 137A of Finance Act 2001 (substitute fuels)

51. Section 137A of the Finance Act 2001 is amended in subsection (4)(b) by inserting “or an additive” after “fuel”.

52. Amendment of section 99A of Finance Act 1999 (relief for qualifying road transport operators)

52. Section 99A(5) of the Finance Act 1999 is amended—

(a) in paragraph (b) by substituting “obligations,” for “obligations, or,”,

(b) in paragraph (c) by substituting “obligations, or” for “obligations.”, and

“(d) the qualifying road transport operator is regarded as an undertaking in difficulty for the purposes of the Commission Guidelines on State aid for rescuing and restructuring non-financial undertakings in difficulty ¹⁸.”.

53. Amendment of section 130 of Finance Act 1992 (interpretation)

53. (1) Section 130 of the Finance Act 1992 is amended—

(a) by substituting the following for the definition of “category A vehicle”:

“ ‘category A vehicle’ means—

(a) a category M1 vehicle, or

(b) a category N1 vehicle, that has 4 or more seats and to which a BE bodywork code has not been assigned;”,

(b) by substituting the following for the definition of “category B vehicle”:

“ ‘category B vehicle’ means—

(a) a category N1 vehicle that has 3 seats or less,

(b) a category N1 vehicle to which a BE bodywork code has been assigned, or

(c) a motor caravan;”,

and

“ ‘BE bodywork code’ means a bodywork code assigned to a vehicle at type approval stage where—

(a) the vehicle has a maximum mass not exceeding 3,500 kilograms, and

(b) the seating positions and the cargo area of the vehicle are not located in a single compartment;”.

(2) Subsection (1) shall come into operation on 31 July 2018.

54. Amendment of section 135D of Finance Act 1992 (repayment of amounts of vehicle registration tax on export of certain vehicles)

54. Section 135D of the Finance Act 1992 is amended in subsection (2) by—

(a) deleting “and” in paragraph (a),

(b) substituting “section 141, and” for “section 141.” in paragraph (b), and

“(c) notwithstanding paragraph (a), not exceed the amount of vehicle registration tax paid on the registration of the vehicle under section 131.”.

PART 3 Value-Added Tax

55. **Interpretation (Part 3)**

55. In this Part “Principal Act” means the Value-Added Tax Consolidation Act 2010.

56. Amendment of Schedule 3 to Principal Act (goods and services chargeable at the reduced rate)

56. Schedule 3 to the Principal Act is amended in paragraph 21, with effect from 1 January 2018, by substituting the following for subparagraph (1):

“(1) Services consisting of the care of the human body, including services supplied in the course of a health studio business or similar business, but excluding the following:

(a) exempted activities referred to in Part 1 of Schedule 1;

(b) hairdressing services referred to in paragraph 13(3);

(c) sunbed services.”.

57. Exempted education activities

57. The Principal Act is amended—

(a) in section 120, by inserting the following after subsection (13):

“(13A) As regards paragraph 4(3) of Schedule 1, regulations may—

(a) provide for the conditions under which training or retraining services may or may not be treated as vocational training or retraining services,

(b) specify the bodies which provide Exchequer funding to providers for the purposes of providing education or vocational training or retraining,

(c) provide for the conditions under which education provided to children or young people which, if provided by a recognised school within the meaning of section 10 of the Education Act 1998, would be the curriculum determined by the Minister for Education and Skills in accordance with that Act.”,

and

(b) in paragraph 4 of Schedule 1, by substituting the following subparagraph for subparagraph (3):

“(3)
(a) The provision of—

(i) children’s or young people’s education, school or university education, or

(ii) vocational training or retraining (subject to any conditions as may be specified in regulations),

including the supply of goods and services incidental to that provision, other than the supply of research services, but excluding instruction in the driving of mechanically propelled road vehicles other than the instruction of a kind to which clause (c) relates, by—
- (I) a public body,

- (II) a provider in receipt of Exchequer funds for the purposes of that provision from a body specified in regulations,

- (III) a recognised school within the meaning of the Education Act 1998,

- (IV) a college within the meaning of section 2 of the Regional Technical Colleges Act 1992, or

- (V) a university mentioned in section 3 of the Universities Act 1997.
(b) The provision by a body of any of the following:

(i) a programme of education and training within the meaning of the Qualifications and Quality Assurance (Education and Training) Act 2012 which is validated under section 45 of that Act;

(ii) a course which is considered by the Minister for Justice and Equality as an acceptable basis for the granting of an immigration permission, where such body is included on a list published by that Minister;

(iii) a course accredited by an approved college, within the meaning assigned by section 473A of the Taxes Consolidation Act 1997;

(iv) education to children or young people which, if provided by a recognised school within the meaning of section 10 of the Education Act 1998, would be the curriculum determined by the Minister for Education and Skills in accordance with that Act (subject to any conditions as may be specified in regulations);

(v) vocational training or retraining (subject to any conditions as may be specified in regulations),

including the supply of goods and services incidental to that provision, other than the supply of research services, but excluding instruction in the driving of mechanically propelled road vehicles other than the instruction of a kind to which clause (c) relates.

(c) Instruction in the driving of the following mechanically propelled road vehicles:

(i) vehicles designed or constructed for the carriage of 1. 5 tonnes of goods or more;

(ii) vehicles designed or constructed for the carriage of more than 9 persons (including the driver).”.

58. Miscellaneous amendments to Principal Act

58. The Principal Act is amended—

(a) in section 2, by inserting the following before the definition of “customs-free airport”:

“ ‘Customs Acts’ has the meaning given to it by section 2(3) of the Customs Act 2015;”,

(b) in section 11(2)(b), by substituting “Chapters 2A and 2B of Part 2 of Finance Act 2001” for “Chapter II of Part II of the Finance Act 1992”,

(c) in section 53(3), by substituting “Customs Acts” for “Customs Consolidation Act 1876, and other law in force in the State relating to customs,”,

(d) in section 66(4C)(b), by substituting “section 71” for “section 71(1)”,

(e) in section 101(6), by deleting paragraph (ba),

(f) in section 116(22), by substituting “officer of Customs” for “officer of Customs and Excise”,

(g) in section 120(18), by deleting paragraph (a),

(h) in paragraph 4(4) of Schedule 1, by substituting “Tuition” for “tuition”,

(i) in paragraph 17 of Schedule 3, by substituting the following for subparagraph (3)(a):

“(a) ‘vehicle gas’ within the meaning of section 94(1) of the Finance Act 1999,

(aa) ‘liquefied petroleum gas’ within the meaning of section 94(1) of the Finance Act 1999 when used or intended for use as a ‘propellant’ within the meaning of that section,”,

and

(j) in paragraph 21(5) of Schedule 3, by substituting “paragraph 4(3)(c) of Schedule 1” for “paragraph 4(3) of Schedule 1”.

PART 4 Stamp Duties

59. **Interpretation (Part 4)**

59. In this Part “Principal Act” means the Stamp Duties Consolidation Act 1999.

60. Amendment of Schedule 1 to Principal Act (stamp duties on instruments)

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

(a) in the heading “CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance.”—

(i) in paragraph (4), by substituting “6 per cent” for “2 per cent”, and

(ii) in paragraph (5)(a)(ii)—

(I) by substituting “1 January 2021” for “1 January 2018”,

(II) by deleting “and the individual by whom the farm is being conveyed or transferred has not, at the date of conveyance or transfer attained the age of 67 years”, and

(III) by substituting “1 per cent of the consideration which is attributable to property which is not residential property” for “a duty of an amount equal to one-half of the ad valorem stamp duty which, but for the provisions of this paragraph, would be chargeable under this heading”,

and

(b) in the heading “LEASE.”—

(i) in paragraph (1), by substituting “€40,000” for “€30,000”, and

(ii) in paragraph (3)(b), by substituting “6 per cent” for “2 per cent”.

(2) Subsection (1)(a)(i) and (a)(ii)(III) and (b)(ii)—

(a) shall have effect as respects instruments executed on or after 11 October 2017, and

(b) shall not have effect as respects any instrument executed before 1 January 2018, where—

(i) the effect of the application of subsection (1) would be to increase the duty otherwise chargeable on the instrument, and

(ii) the instrument contains a statement, in such form as the Revenue Commissioners may specify, certifying that the instrument was executed solely in pursuance of a binding contract entered into before 11 October 2017.

(3) Subsection (1)(a)(ii)(I) and (II) and (b)(i) come into operation on the passing of this Act.

(4) The furnishing of an incorrect certificate for the purposes of subsection (2) shall be deemed to constitute the delivery of an incorrect statement for the purposes of section 1078 of the Taxes Consolidation Act 1997.

61. Repayment of stamp duty where land used for residential development

61. The Principal Act is amended by inserting the following section after section 83C:

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