Legalize / Ireland / Act

Finance Act 2018

Type Act

Publication 2018-12-19

State In force

Source Irish Statute Book

articles 65

Reform history JSON API

Chapter 1 Interpretation

1. **Interpretation (Part 1)**

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

2. Amendment of section 531AN of Principal Act (rate of charge)

2. (1) Section 531AN of the Principal Act is amended—

(a) in subsection (3), by substituting “€19,874” for “€19,372”, and

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

“TABLE

PART 1

Part of aggregate income	Rate of universal social charge
(1)	(2)
The first €12,012	0.5 per cent
The next €7,862	2 per cent
The next €50,170	4.5 per cent
The remainder	8 per cent

PART 2

Part of aggregate income	Rate of universal social charge
(1)	(2)
The first €12,012	0.5 per cent
The remainder	2 per cent

”.

(2) Subsection (1) applies for the year of assessment 2019 and each subsequent year of assessment.

Chapter 3 Income Tax

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

3. As respects the year of assessment 2019 and subsequent years of assessment section 15 of the Principal Act is amended—

(a) in subsection (3)(i), by substituting “€26,300” for “€25,550”, and

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

“TABLE

PART 1

Part of taxable income (1)	Rate of tax (2)	Description of rate (3)
The first €35,300	20 per cent	the standard rate
The remainder	40 per cent	the higher rate

PART 2

Part of taxable income (1)	Rate of tax (2)	Description of rate (3)
The first €39,300	20 per cent	the standard rate
The remainder	40 per cent	the higher rate

PART 3

Part of taxable income (1)	Rate of tax (2)	Description of rate (3)
The first €44,300	20 per cent	the standard rate
The remainder	40 per cent	the higher rate

”.

4. Amendment of section 472AB of Principal Act (earned income tax credit)

4. (1) Section 472AB of the Principal Act is amended in subsection (2)—

(a) in paragraph (a), by substituting “€1,350” for “€1,150”, and

(b) in paragraph (b), by substituting “€1,350” for “€1,150”.

(2) Subsection (1) applies for the year of assessment 2019 and each subsequent year of assessment.

5. Amendment of section 466A of Principal Act (home carer tax credit)

5. (1) Section 466A of the Principal Act is amended in subsection (2) by substituting “€1,500” for “€1,200”.

(2) Subsection (1) applies for the year of assessment 2019 and each subsequent year of assessment.

6. Amendment of section 191 of Principal Act (taxation treatment of Hepatitis C compensation payments)

6. (1) Section 191 of the Principal Act is amended—

(a) in subsection (1), by inserting the following definitions:

“ ‘comparable overseas scheme’ means a scheme, located in a Member State of the European Economic Area (other than the State), whose purpose is to compensate individuals who have been diagnosed positive for Hepatitis C or HIV resulting from the use of blood products;

‘eligible person’ means—

(a) a person referred to in subsection (1) of section 4 of the Act, in respect of matters referred to in that section,

(b) a person referred to in any Regulations made under section 9 of the Act, in respect of matters referred to in those Regulations, or

(b) by substituting the following for subsection (2):

“(2) This section shall apply to any payment in respect of compensation—

(a) by the Tribunal in accordance with the Act,

(b) following the institution by or on behalf of a person of a civil action for damages in respect of personal injury, or

to an eligible person.”,

and

(2) Subsection (1) shall come into operation on 1 January 2019.

7. Exemption of certain childcare support payments

7. Chapter 1 of Part 7 of the Principal Act is amended by inserting the following section after section 194A:

“Exemption of certain childcare support payments

194AA. (1) In this section—

‘cohabitant’ has the same meaning as it has in Part 44B;

‘eligible child’ means a child in respect of whom a qualifying payment or a relevant payment is made;

‘Minister’ means the Minister for Children and Youth Affairs;

‘qualifying payment’ means a payment made under section 15 of the Childcare Support Act 2018;

‘relevant payment’ means a payment made by or on behalf of the Minister under any of the following childcare support programmes or schemes:

(a) Community Childcare Subvention;

(b) Community Childcare Subvention Plus;

(d) Community Childcare Subvention Resettlement (Transitional);

(e) Community Childcare Subvention Universal;

(f) Training and Employment Childcare.

(2) A qualifying payment shall be exempt from income tax and shall not be reckoned in computing income of the parent or guardian, or the cohabitant of the parent or guardian, of an eligible child for the purposes of the Income Tax Acts.

(3) A relevant payment made on or after 1 January 2019 shall be exempt from income tax and shall not be reckoned in computing income of the parent or guardian, or the cohabitant of the parent or guardian, of the eligible child for the purposes of the Income Tax Acts.

(4) A relevant payment made before 1 January 2019 shall be treated as if it was exempt from income tax in the year of assessment to which it relates and shall not be reckoned in computing income of the parent or guardian, or the cohabitant of the parent or guardian, of the eligible child for the purposes of the Income Tax Acts.”.

8. Certain benefits in kind: members of the Permanent Defence Force

8. (1) Chapter 3 of Part 5 of the Principal Act is amended by inserting the following section after section 120A:

“Certain benefits in kind: members of Permanent Defence Force

120B. (1) Notwithstanding section 118, section 112 shall not apply in relation to any expense incurred by or on behalf of the Minister for Defence—

(a) in or in connection with the provision of living accommodation to a member of the Permanent Defence Force on land occupied by, used by, or under the control (whether temporarily or otherwise) of the Permanent Defence Force, or

(b) in or in connection with the provision of health care to a member of the Permanent Defence Force.

(2) In this section—

‘health care’ means prevention, diagnosis, alleviation or treatment of an ailment, injury, infirmity, defect or disability, and includes care received by a woman in respect of a pregnancy, but does not include—

(a) routine ophthalmic treatment, or

(b) cosmetic surgery or similar procedures, unless the surgery or procedure is necessary to ameliorate a physical deformity arising from, or directly related to, a congenital abnormality, a personal injury or a disfiguring disease;

‘routine ophthalmic treatment’ means the provision and repairing of spectacles or contact lenses.”.

(2) Subsection (1) shall apply for the year of assessment 2018 and each subsequent year of assessment.

9. Benefit in kind: relief relating to electric vehicles

9. Part 5 of the Principal Act is amended—

(a) in section 121(2)(b)—

(i) in subparagraph (ii), by substituting “running the car,” for “running the car, and”,

(ii) in subparagraph (iii)(II), by substituting “31 December 2018,” for “31 December 2018.”, and

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

“(iv) notwithstanding subparagraph (ii), where a car made available during the period 1 January 2019 to 31 December 2021 is an electric vehicle and the original market value of the car does not exceed €50,000, no amount shall be treated as emoluments of the employment,

(v) notwithstanding subparagraph (ii), where—

(I) a car made available to an employee during the period 1 January 2019 to 31 December 2020 is an electric vehicle,

(II) the original market value of the car exceeds €50,000, and

(III) the car was first made available to the employee during the period 10 October 2017 to 9 October 2018,

no amount shall be treated as emoluments of the employment, and

(vi) where a car made available during the period 1 January 2019 to 31 December 2021 is an electric vehicle and the original market value of the car exceeds €50,000, the cash equivalent of the benefit of the car ascertained under subsection (3)(a) or (4)(a), as the case may be, shall be computed on the original market value of the car reduced by €50,000.”.

and

(b) in section 121A(2)(b)—

(i) in subparagraph (ii), by substituting “running the van,” for “running the van, and”,

(ii) in subparagraph (iii)(II), by substituting “31 December 2018,” for “31 December 2018.”, and

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

“(iv) notwithstanding subparagraph (ii), where a van made available during the period 1 January 2019 to 31 December 2021 is an electric vehicle and the original market value of the van does not exceed €50,000, no amount shall be treated as emoluments of the employment,

(v) notwithstanding subparagraph (ii), where—

(I) a van made available to an employee during the period 1 January 2019 to 31 December 2020 is an electric vehicle,

(II) the original market value of the van exceeds €50,000, and

(III) the van was first made available to the employee during the period 10 October 2017 to 9 October 2018,

no amount shall be treated as emoluments of the employment, and

(vi) where a van made available during the period 1 January 2019 to 31 December 2021 is an electric vehicle and the original market value of the van exceeds €50,000, the cash equivalent of the benefit of the van ascertained under subsection (3) shall be computed on the original market value of the van reduced by €50,000.”.

10. Amendment of section 985A of Principal Act (application of section 985 to certain perquisites, etc.)

10. Section 985A of the Principal Act is amended in subsection (1)(a)(iii) by substituting “section 112A or 112AA” for “section 112A”.

11. Amendment of section 128F of Principal Act (key employee engagement programme)

11. (1) Section 128F of the Principal Act is amended—

(a) in subsection (1), in the definition of “qualifying share option”, by substituting the following paragraph for paragraph (d):

“(d) the total market value of all shares, in respect of which qualifying share options have been granted by the qualifying company to an employee or director, does not exceed—

(i) €100,000 in any one year of assessment,

(ii) €300,000 in all years of assessment, or

(iii) the amount of annual emoluments of the qualifying individual in the year of assessment in which the qualifying share option is granted,”,

and

(b) in subsection (8), by substituting “The Revenue Commissioners may publish the following information in relation to all qualifying companies:” for all of the words from and including “A qualifying company” down to and including “all qualifying companies:”.

(2) Subsection (1)(a) shall come into operation on such day as the Minister for Finance may appoint by order.

12. Retirement benefits

12. (1) The Principal Act is amended by inserting the following section after section 790C:

“Relief for additional superannuation contribution under Public Service Pay and Pensions Act 2017

790CA. Any additional superannuation contribution payable under the Public Service Pay and Pensions Act 2017 by a public servant (within the meaning of that Act) shall, in assessing income tax under Schedule E, be allowed to be deducted as an expense incurred in the year in which the contribution is paid.”.

(2) Subsection (1) applies for the year of assessment 2019 and each subsequent year of assessment.

13. Section 126 of the Principal Act is amended—

(a) by substituting the following for subsection (1):

“(1) In this section—

‘the Acts’ means the Social Welfare Acts;

‘the Act of 2005’ means the Social Welfare Consolidation Act 2005.”,

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

“(6A) A payment which is—

(a) described in column (1) of the Table to this section,

(b) paid on the basis specified in column (2) of that Table, and

shall be exempt from income tax and shall not be reckoned in computing income for the purposes of the Income Tax Acts.

(6B) A payment which—

(a) is described in column (1) of the Table to this section,

(b) is paid on the basis specified in column (2) of that Table, and

shall be treated as if it was exempt from income tax in the year of assessment to which it relates and shall not be reckoned in computing income for the purposes of the Income Tax Acts.”,

(d) by inserting the following Table to the section:

“TABLE

Description of payment (1)	Basis on which payment is made (2)
Basic supplementary welfare allowance	Section 189 of the Act of 2005
Back to education allowance	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Back to education allowance’
Back to work enterprise allowance	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Back to work enterprise allowance’
Back to school clothing and footwear allowance	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Back to school clothing and footwear allowance’
Carer’s support grant	Section 225 of the Act of 2005
Constant attendance allowance	Section 78 of the Act of 2005
Death benefit - funeral expenses	Section 84 of the Act of 2005
Death benefit - orphans	Section 83 of the Act of 2005
Direct provision allowance	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Direct provision allowance’
Disability allowance	Section 210 of the Act of 2005
Disablement gratuity	Section 75(8) of the Act of 2005
Domiciliary care allowance	Section 186F of the Act of 2005
Exceptional needs payment	Section 201 of the Act of 2005
Farm assist	Section 214 of the Act of 2005
Fuel allowance	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Fuel allowance’
Guardian’s payment (contributory)	Section 130 of the Act of 2005
Guardian’s payment (non-contributory)	Section 168 of the Act of 2005
Household benefit package	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Household benefit package’
Humanitarian assistance payment	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Humanitarian assistance payment’
Jobseeker’s allowance	Section 141 of the Act of 2005
Jobseeker’s transitional payment	Section 148A of the Act of 2005
Medical care	Section 86 of the Act of 2005
Part-time job incentive scheme	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Part-time job incentive scheme’
Rent allowance	Section 23 of the Housing (Private Rented Dwellings) Act 1982
Supplementary welfare allowance	Section 198 of the Act of 2005
Telephone support allowance	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Telephone support allowance’
Training support grant	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Training support grant’
Urgent needs payment	Section 202 of the Act of 2005
Widowed or surviving civil partner grant	Section 137 of the Act of 2005
Working family payment	Section 228 of the Act of 2005
Youth employment support scheme	A payment made under a scheme administered by the Minister for Employment Affairs and Social Protection and known as ‘Youth employment support scheme’

”.

14. Relief arising in special circumstances

14. (1) The Principal Act is amended by inserting the following after section 480A:

“Relief arising in special circumstances

480B. (1) Subject to subsection (12), this section applies where emoluments—

(a) which are chargeable to income tax under subsection (3) of section 112, and

(b) from which income tax has been deducted in accordance with the provisions of Chapter 4 of Part 42 and any regulations made thereunder,

are paid on 31 December in a tax year or, if that year is a leap year, on 30 or 31 December in that year (referred to in this section as the ‘relevant date’) to an individual who is paid weekly or fortnightly.

(2) Subject to subsections (4) and (5), a reduction, deduction or tax credit provided for under a provision specified in subsection (3) which is applicable to the individual concerned shall be increased by—

(a) one fifty-second of the amount of the reduction, deduction or tax credit, as the case may be, where the individual is paid weekly and is so paid on the relevant date, or

(b) one twenty-sixth of the amount of the reduction, deduction or tax credit, as the case may be, where the individual is paid fortnightly and is so paid on the relevant date.

(3) The provisions referred to in subsection (2) are sections 461, 461A, 462B, 463, 464, 465, 466, 466A, 468, 470(2), 472, 472AB, 472B and 472BA.

(4) Where the emoluments paid to the individual concerned on the relevant date are less than the amount calculated as follows—

A + B

where—

A is the amount by which the reductions and deductions applicable to the individual concerned are increased in accordance with paragraph (a) or (b) of subsection (2), as the case may be, and

B is the amount by which the tax credits applicable to the individual concerned are increased in accordance with paragraph (a) or (b) of subsection (2), as the case may be, divided by the standard rate of tax for the tax year,

the amount of the increase effected by subsection (2) shall be an amount equal to the amount of the emoluments paid to the individual concerned on the relevant date.

(5) Where the individual concerned is paid weekly and fortnightly on a relevant date in a tax year, the amount of the increase effected by subsection (2) shall be the greater of the increase resulting from—

(a) the application of subsections (2) and (4) to the weekly payment only, and

(b) the application of subsections (2) and (4) to the fortnightly payment only.

(6) Subject to subsections (8) and (9), the part of taxable income specified in the first row of column (1) of Parts 1, 2 and 3 of the Table to section 15 shall be increased by—

(a) one fifty-second of the amount specified, where the individual concerned is paid weekly and is so paid on the relevant date, or

(b) one twenty-sixth of the amount specified, where the individual concerned is paid fortnightly and is so paid on the relevant date.

(7) Subject to subsections (8) and (9), where—

(a) subsection (3) of section 15 applies, and

(b) this section applies both in respect of—

(i) emoluments paid to the individual concerned which are charged to tax for a year of assessment in accordance with section 1017 or 1031C, and

(ii) emoluments paid to the spouse or civil partner of the individual referred to in subparagraph (i),

the amount specified in subparagraph (i) of section 15(3) shall be increased by—

(I) one fifty-second of the amount specified, where the spouse or civil partner of the individual referred to in subparagraph (i) is paid weekly and is so paid on the relevant date, or

(II) one twenty-sixth of the amount specified, where the spouse or civil partner of the individual referred to in subparagraph (i) is paid fortnightly and is so paid on the relevant date.

(8) Where the emoluments paid to the individual concerned on the relevant date are less than the amount calculated as follows—

A + B

where—

A is the amount by which the part of taxable income specified in the first row of column (1) of Part 1, 2 or 3, as the case may be, of the Table to section 15 is increased in accordance with subsection (6), and

B is the amount, if any, by which the amount specified in subparagraph (i) of section 15(3) is increased in accordance with subsection (7),

the aggregate amount of the increase to the part of taxable income specified in the first row of column (1) of Part 1, 2 or 3, as the case may be, of the Table to section 15 effected by the application of subsection (6) and, to the extent that it is applicable, subsection (7), shall be an amount equal to the amount of the emoluments paid to the individual concerned on the relevant date.

(9) Where the individual concerned or their spouse or civil partner is, or both the individual and their spouse or civil partner are, paid weekly and fortnightly on a relevant date in a tax year, the amount of the increase effected by the application of subsections (6), (7) and (8) shall be the greatest of the amounts which result from the application of those subsections to each of the possible permutations of only one of the two payments to the individual or their spouse or civil partner, as the case may be, being taken into account for the purpose of calculating the increase effected by the application of those subsections.

(10) Subject to subsection (11), where section 188 applies, the specified amount (within the meaning of that section) shall be increased by—

(a) one fifty-second of the specified amount, where the individual concerned is paid weekly and is so paid on the relevant date, or

(b) one twenty-sixth of the specified amount, where the individual concerned is paid fortnightly and is so paid on the relevant date,

but the amount of any such increase shall not exceed the amount of the emoluments paid to the individual on the relevant date.

(11) Where the individual concerned is paid weekly and fortnightly on a relevant date in a tax year, the amount of the increase effected by subsection (10) shall be the greater of the increase resulting from—

(a) the application of that subsection to the weekly payment only, and

(b) the application of that subsection to the fortnightly payment only.

(12) This section shall not apply where—

(a) the normal day on which emoluments are paid to the individual concerned during a tax year changes either during that year or the preceding year, or

(b) a payment of emoluments occurs on a relevant date and that date is not the normal day on which emoluments are paid to the individual concerned.

(13) A reference in subsection (12) to the normal day is a reference to the day during the weekly or fortnightly cycle, as the case may be, on which emoluments are paid to the individual concerned.”.

(2) Subsection (1) applies for the year of assessment 2018 and each subsequent year of assessment.

15. Amendment of section 825C of Principal Act (special assignee relief programme)

15. Section 825C of the Principal Act is amended—

(a) in subsection (2A)(e), by substituting “within 90 days” for “within 30 days”, and

(b) in subsection (2B)(b)(i), by substituting for “but in respect of the tax years 2012, 2013 and 2014 where this amount exceeds €500,000, “A” shall be €500,000, and” the following:

“but—

(A) in respect of the tax years 2012, 2013 and 2014 where this amount exceeds €500,000, ‘A’ shall be €500,000,

(B) in respect of the tax years 2019 and 2020, in the case of a relevant employee who first arrives in the State on or after 1 January 2019 for the purposes set out in subsection (2A)(b), where this amount exceeds €1,000,000, ‘A’ shall be €1,000,000, and

(C) in respect of the tax year 2020, in the case of a relevant employee who first arrives in the State on or before 31 December 2018 for the purposes set out in subsection (2A)(b), where this amount exceeds €1,000,000, ‘A’ shall be €1,000,000,

and”.

Chapter 4 Income Tax, Corporation Tax and Capital Gains Tax

16. Taxation of payments under Magdalen Restorative Justice Ex-Gratia Scheme

16. (1) Section 205A of the Principal Act is amended—

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

“ ‘relevant payment’ means—

(a) a payment or payments made, directly or indirectly, to a relevant individual by or on behalf of the Minister for Justice and Equality pursuant to the Magdalen Restorative Justice Ex-Gratia Scheme (that is to say the Scheme administered, under that title, by the Minister for Justice and Equality in furtherance of decisions of the Government of 5 November 2013 and 28 May 2018, respectively),

(b) an amount equal to the State Pension (Contributory) as set out in column 2 of Part 1 of Schedule 2 to the Social Welfare Consolidation Act 2005 paid to a relevant individual,

(c) an amount equal to the State Pension (Non-Contributory) as set out in Part 3 of the Social Welfare Consolidation Act 2005 paid to a relevant individual, and

(d) any payment, other than a payment referred to in paragraphs (a) to (c), made, directly or indirectly, by or on behalf of the Minister for Employment Affairs and Social Protection to a relevant individual, by virtue of that individual being a relevant individual.” ,

and

(b) by substituting the following for subsections (2) and (3):

“(2) Income that—

(a) consists of a relevant payment, or

(b) arises to a person to or in respect of whom a relevant payment is made, from the investment in whole or in part of such a payment or of the income derived from such a payment, being income consisting of dividends or other income which but for this section would be chargeable to tax under Schedule C or under Case III, IV (by virtue of section 59, 745 or 747E) or V of Schedule D or under Schedule F,

shall be exempt from income tax and shall not be reckoned in computing total income for the purposes of the Income Tax Acts.

(3) Gains that accrue to a person, to or in respect of whom a relevant payment is made, from the disposal of—

(a) assets acquired with such a payment,

(b) assets acquired with income exempted from income tax under subsection (2), or

(c) assets acquired directly or indirectly with the proceeds from the disposal of assets referred to in paragraph (a) or (b),

shall not be chargeable gains for the purposes of the Capital Gains Tax Acts.

(4) For the purposes of computing whether by virtue of this section a gain is, in whole or in part, a chargeable gain, or whether income is, in whole or in part, exempt from income tax, all such apportionments shall be made as are, in the circumstances, just and reasonable.”.

(2) Part 8 of the Principal Act is amended—

(a) in section 256(1) by inserting the following after the definition of “PRSA provider”—

(i)“ ‘relevant amount’ means any amount of income referred to in section 205A(2) and any amount of gains referred to in section 205A(3);”, and

(ii) by inserting the following after subsection (1B) of section 256—

“(1C) A deposit shall be a deposit to which this subsection refers as respects any year of assessment if—

(a) the deposit is solely in respect of a relevant amount,

(b) a declaration of the kind mentioned in section 263D has been made to the Revenue Commissioners, and

(c) a notification of the kind mentioned in section 263E has been issued by the Revenue Commissioners to the relevant deposit taker that the deposit is not a relevant deposit.”,

(b) in section 261B by substituting “subsection (1A), (1B), or (1C) of section 256” for “subsection (1A) or (1B) of section 256” in each place where it occurs,

“Declarations to the Revenue Commissioners in relation to relevant amounts

263D. The declaration referred to in section 256(1C) is a declaration in writing to the Revenue Commissioners which—

(a) is made by the person (in this section referred to as the ‘declarer’) to whom any interest on the deposit in respect of which the declaration is made is payable by the relevant deposit taker and is signed by the declarer,

(b) is made in such form as may be prescribed, authorised or approved by the Revenue Commissioners,

(d) contains as respects the person—

(i) the name and address of the person,

(ii) the person’s PPS Number (within the meaning of section 891B),

(iii) the name and address of the deposit taker (including the name and address of the branch of the deposit taker, if any) who holds the deposit in respect of which the declaration is made, and

(iv) the account number or membership number, as the case may be, of the deposit in respect of which the declaration is made,

and

(e) contains such other information as the Revenue Commissioners may reasonably require for the purposes of this Chapter.

Notification by the Revenue Commissioners relating to deposits of relevant amounts

263E. (1) The notification referred to in section 256(1C) is a notification—

(a) in writing by the Revenue Commissioners to a relevant deposit taker confirming that the account identified in the notification is to be treated as not being a relevant deposit unless and until the notification is cancelled in accordance with subsection (2),

(b) which contains as respects the person beneficially entitled to the interest in relation to the deposit mentioned in paragraph (a)—

(i) the name and address of the person,

(ii) the person’s PPS Number (within the meaning of section 891B), and

(iii) the account number of the deposit,

and

(2) The Revenue Commissioners may at any time cancel the notification and give notice in writing to that effect to the relevant deposit taker and the person mentioned in subsection (1)(b). Where at any time the Revenue Commissioners have so notified the deposit taker, the deposit shall not be a deposit to which this section applies from that time.”,

and

(d) in section 267(3) by substituting “section 189(2), section 189A(4), section 192(2) or section 205A(2)” for “section 189(2), section 189A(4) or section 192(2)”.

(3) Chapter 5 of Part 26 of the Principal Act is amended in section 730GA by substituting “section 189, 189A, 192 or 205A” for “section 189, 189A or 192”.

(4) Chapter 1A of Part 27 of the Principal Act is amended in section 739G(2)(j) by substituting “section 189, 189A, 192 or 205A” for “section 189, 189A or 192”.

(5) (a) Subsection (1) shall be deemed to have come into operation on 1 August 2013.

(b) As respects income or gains to which subsection (1)(b) applies for the years of assessment 2013 and 2014, section 865(4) of the Principal Act shall apply as if the reference in that subsection to the making of a claim within 4 years after the end of the chargeable period to which the claim relates were a reference to the making of a claim within 4 years after the end of the chargeable period ending on 31 December 2015.

17. Amendment of section 285A of, and Schedule 4A to, Principal Act (acceleration of wear and tear allowances for certain energy-efficient equipment)

17. (1) Section 285A of the Principal Act is amended—

(a) by substituting the following for subsection (1):

“(1) In this section—

‘energy-efficiency criteria’ has the meaning given to it by subsection (4);

‘energy-efficient equipment’ means equipment complying with the energy-efficiency criteria and named on the specified list;

‘relevant period’ means the period commencing on the date of the making of the Taxes Consolidation Act 1997 (Accelerated Capital Allowances for Energy Efficient Equipment) Order 2008 (S.I. No. 399 of 2008) and ending on 31 December 2020;

‘SEAI’ means Sustainable Energy Ireland - The Sustainable Energy Authority of Ireland;

‘specified list’ has the meaning given to it by subsection (2A);

‘Table’ means the Table in Schedule 4A.”,

(b) in subsection (2), by inserting “which at the time it is so provided is unused and not second-hand” after “that person”,

“(2A) (a) Subject to subsection (3), SEAI shall establish and maintain a list of energy-efficient equipment (in this section referred to as the ‘specified list’).

(b) SEAI shall publish the specified list on the website of SEAI and by such other means as SEAI considers appropriate.

(c) SEAI shall amend the specified list, as necessary, to keep it current by adding thereto or deleting therefrom, as the case may be, and when any such amendment is made to the specified list, SEAI shall publish the amended specified list in accordance with paragraph (b).”,

(d) by substituting the following for subsection (4):

“(4) For the purposes of this section, the Minister for Communications, Climate Action and Environment, after consultation with and with the approval of the Minister for Finance, shall make an order stating the criteria (in this section referred to as the ‘energy-efficiency criteria’) relating to—

(a) the minimum levels of efficiency, performance, speed, storage or efficacy to be met, and

(b) the specific certifications and standards to be complied with or tested, or both, as the case may be,

for each class of technology specified in column (1) of the Table.”,

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

“(b) Where—

(i) expenditure on equipment is incurred on or after 31 January 2008 but before the date of the making of the Taxes Consolidation Act 1997 (Accelerated Capital Allowances for Energy Efficient Equipment) Order 2008 (S.I. No. 399 of 2008), and

(ii) that equipment would have qualified as energy-efficient equipment under this section had the order referred to in subparagraph (i) been made at the time the expenditure was incurred,

then this section shall apply as if the order referred to in subparagraph (i) had been made at that time.”,

and

(f) in subsection (9), by substituting “Minister for Communications, Climate Action and Environment” for “Minister for Communications, Energy and Natural Resources”.

(2) Schedule 4A to the Principal Act is amended in column (2) of the Table in that Schedule by deleting “and that meet specified efficiency criteria” in each place.

18. Acceleration of wear and tear allowances for gas vehicles and refuelling equipment

18. Chapter 2 of Part 9 of the Principal Act is amended by inserting the following after section 285B:

“Acceleration of wear and tear allowances for gas vehicles and refuelling equipment

285C. (1) In this section—

‘biogas’ means gas produced from biomass;

‘biomass’ means the biodegradable fraction of—

(a) products, waste and residues from agriculture, forestry and related industries including, in respect of agriculture, vegetal and animal substances, and

(b) industrial and municipal waste;

‘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 1987[^1] as amended by Commission Regulation (EC) No. 2031/2001 of 6 August 2001[^2];

‘compressed natural gas’ means petroleum gases and other gaseous hydrocarbons in gaseous state falling within CN code 2711 21 00;

‘gas refuelling station’ means a premises, or part of a premises, at which gaseous fuel is supplied to a gas vehicle;

‘gas vehicle’ means a mechanically propelled road vehicle in the engine of which gaseous fuel is used for combustion;

‘gaseous fuel’ means compressed natural gas, liquefied natural gas or biogas;

‘liquefied natural gas’ means petroleum gases and other gaseous hydrocarbons in liquefied state falling within CN code 2711 11 00;

‘qualifying expenditure’ means capital expenditure incurred during the relevant period on the provision of—

(a) qualifying refuelling equipment, or

(b) qualifying vehicles;

‘qualifying refuelling equipment’ means refuelling equipment, which is unused and not second-hand, installed at a gas refuelling station;

‘qualifying vehicle’ means a gas vehicle, which is—

(a) constructed or adapted for—

(i) the conveyance of goods or burden of any description,

(ii) the haulage by road of other vehicles, or

(iii) the carriage of passengers,

(b) unused and not second-hand, and

(i) not commonly used as a private vehicle and unsuitable to be so used, or

(ii) provided or hired, wholly or mainly, for the purpose of hire to or the carriage of members of the public in the ordinary course of trade;

‘refuelling equipment’ means—

(a) a storage tank for gaseous fuel,

(b) a compressor, pump, control or meter used for the purposes of refuelling gas vehicles, or

‘relevant period’ means the period commencing on 1 January 2019 and ending on 31 December 2021.

(2) Where a person has incurred qualifying expenditure for the purposes of a trade carried on by that person, and for any chargeable period a wear and tear allowance is to be made under section 284 in respect of qualifying refuelling equipment or a qualifying vehicle to which that qualifying expenditure relates, subsection (2) of that section shall apply as if the reference in paragraph (ad) of that subsection to 12. 5 per cent were a reference to 100 per cent.

(3) Subsection (2) shall not apply where an allowance on account of the wear and tear of the qualifying refuelling equipment or qualifying vehicle concerned is made in accordance with—

(a) section 284(2)(a)(ii), as applied by section 286(2), or

(b) section 284(2)(ad), as applied by section 285A(2).”.

19. Amendment of Parts 9 and 36 of, and Schedule 25B to, Principal Act (capital allowances for equipment and buildings used for the purposes of providing childcare services or a fitness centre to employees)

19. (1) Chapter 2 of Part 9 of the Principal Act is amended by inserting the following after section 285A—

“Acceleration of wear and tear allowances for childcare and fitness centre equipment

285B. (1) In this section—

‘qualifying expenditure’ means capital expenditure incurred on qualifying machinery or plant by a person carrying on a trade;

‘qualifying machinery or plant’ means machinery or plant in use in a qualifying premises;

‘qualifying premises’ has the same meaning as it has in section 843B.

(2) Where a person has incurred qualifying expenditure, and for any chargeable period a wear and tear allowance is to be made under section 284, subsection (2) of that section shall apply as if the reference in paragraph (ad) of that subsection to 12. 5 per cent were a reference to 100 per cent.”.

(2) (a) Part 36 of the Principal Act is amended by inserting the following after section 843A—

“Capital allowances for buildings used for the purposes of providing childcare services or a fitness centre to employees

843B. (1) In this section—

‘childcare services’ means any form of childminding services or supervised activities to care for children, whether or not provided on a regular basis, in respect of which it can be shown that the applicable requirements of the Child Care Act 1991 (Early Years Services) Regulations 2016 (S.I. No. 221 of 2016) have been complied with;

‘construction’ has the same meaning as it has in section 270;

‘fitness centre’ means a gymnasium used exclusively in providing a range of facilities designed to improve and maintain the physical fitness and health of participants;

‘qualifying expenditure’ means expenditure incurred by an employer, carrying on a trade or a profession, on the construction of a qualifying premises;

‘qualifying premises’ means a building or structure which is in use for the purposes of providing childcare services or the facilities of a fitness centre to employees of the employer, referred to in the immediately preceding definition, which is not accessible nor available for use by the general public and, where that employer is a company, where the employees are employees of that company or of a company connected with that company.

(2) The provisions of the Tax Acts relating to the making of allowances or charges in respect of capital expenditure incurred on the construction of an industrial building or structure shall, notwithstanding anything to the contrary in those provisions, apply in relation to qualifying expenditure on a qualifying premises—

(a) as if the qualifying premises were, at all times at which it is a qualifying premises, a building or structure in respect of which an allowance is to be made for the purposes of income tax or corporation tax, as the case may be, under Chapter 1 of Part 9 by reason of its use for the purpose specified in section 268(1)(a), and

(b) where any activity carried on in the qualifying premises is not a trade, as if (for the purposes only of the making of allowances and charges by virtue of paragraph (a)), it were a trade.

(3) In relation to qualifying expenditure incurred on a qualifying premises, section 272 shall apply as if—

(a) in subsection (3)(a)(ii) of that section the reference to 4 per cent were a reference to 15 per cent, and

(b) in subsection (4)(a) of that section the following were substituted for subparagraph (ii):

‘(ii) where capital expenditure on the construction of the building or structure is incurred, 7 years beginning with the time when the building or structure was first used subsequent to the incurring of that expenditure.’.

(4) Notwithstanding section 274(1), no balancing allowance or balancing charge shall be made in relation to a qualifying premises by reason of any event, referred to in that section, which occurs more than 7 years after the qualifying premises was first used subsequent to the incurring of the qualifying expenditure on the construction of the qualifying premises.

(5) Where relief is given by virtue of this section in relation to qualifying expenditure incurred on the construction of a building or structure, relief shall not be given in respect of that expenditure under any other provision of the Tax Acts.

(6) A person shall not be entitled to allowances under this section while that person 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[^3].”.

(b) Schedule 25B to the Principal Act is amended by inserting the following after the matter set out opposite reference number 50:

“

50A.	Section 843B (capital allowances for buildings used for the purposes of providing childcare services or a fitness centre to employees)	An amount equal to— (a) the aggregate amount of allowances (including balancing allowances) made to the individual under Chapter 1 of Part 9 as that Chapter is applied by section 843B, including any such allowances or part of any allowances made to the individual for a previous tax year and carried forward from that previous tax year in accordance with Part 9, or
		(b) where full effect has not been given in respect of that aggregate for that tax year, the part of that aggregate to which full effect has been given for that tax year in accordance with section 278 and section 304 or 305, as the case may be, or any of those sections as applied or modified by any other provision of the Tax Acts.

”.

(3) Section 12 of the Finance Act 2017 is repealed.

20. Amendment of section 438A of Principal Act (extension of section 438 to loans by companies controlled by close companies)

20. (1) Section 438A of the Principal Act is amended by—

(a) substituting the following for subsection (1):

“(1) In this section—

‘loan’ includes advance;

‘relevant arrangement’ means any arrangement, the main purpose, or one of the main purposes, of which is to avoid or reduce a charge to tax under section 438.”,

and

(b) inserting the following after subsection (3):

“(3A) Where a participator, or an associate of a participator, in a close company is party to any relevant arrangement, as a result of which a loan is made to a participator, or an associate of a participator, which, apart from this section, does not give rise to a charge under subsection (1) of section 438, that section shall apply as if the loan had been made by the close company to such participator, or such associate of a participator, as the case may be.”.

(2) Subsection (1) shall apply to a relevant arrangement that is entered into on or after 18 October 2018.

21. Amendment of Part 23 of Principal Act (farming and market gardening)

21. Part 23 of the Principal Act is amended—

(a) in section 657—

(i) in subsection (1), by deleting the definitions of “an individual to whom subsection (1) applies”, “company” and “director”,

(ii) by deleting subsections (2) and (3),

(iii) in subsection (4)(a), by deleting “other than an individual to whom subsection (1) applies,”, and

(iv) in subsection (6), by substituting the following paragraph for paragraph (b):

“(b) This subsection shall not apply for any year of assessment in which the individual is not chargeable to tax on profits or gains from farming.”,

(b) in section 666(4)—

(i) in paragraph (a), by substituting “31 December 2021” for “31 December 2018”, and

(ii) in paragraph (b), by substituting “year 2021” for “year 2018”,

(i) in subsection (5)(b), by substituting “31 December 2021” for “31 December 2018”,

(ii) in subsection (5A)(b), by substituting “Subject to subsection (5B), where” for “Where”,

(iii) by inserting the following subsection after subsection (5A):

“(5B) The aggregate amount of relief, within the meaning of subsection (5A), granted to a qualifying farmer under this section, section 667D and section 81AA of the Stamp Duties Consolidation Act 1999 shall not exceed the limit of €70,000 as provided for by Article 18 of Commission Regulation (EU) No. 702/2014 of 25 June 2014[^4] or that Regulation as may be revised from time to time.”,

and

(iv) in subsection (7), by substituting “microenterprise or small enterprise in Article 2 of Annex I to Commission Regulation (EU) No. 702/2014 of 25 June 2014 or that Regulation as may be revised from time to time” for “ ‘small and medium-sized enterprises’ in Article 2 of Commission Regulation (EC) No. 1857/2006 of 15 December 2006”,

(d) in section 667C—

(i) in subsection (2)(b), by substituting “2021” for “2018” in each place,

(ii) in subsection (4), by substituting “31 December 2021” for “31 December 2018”, and

(iii) in subsection (4A)(a)(vi), by substituting “subsection (1A)(b)(v)(II)(A)” for “subsection (1A)(c)”,

and

(e) in section 667D—

(i) in subsection (2)(e), by substituting “agreement under subsection (2)(d)” for “partnership agreement”, and

(ii) by inserting the following subsection after subsection (7):

“(8) (a) In this subsection—

‘relevant tax’ means any income tax or universal social charge;

‘relief’ means an amount equivalent to an amount determined by the formula—

A - B

where—

A is the amount of relevant tax that would be payable by a partner in a succession farm partnership for a year of assessment in which a succession tax credit is claimed by the partner, computed as if this section did not apply, and

B is the amount of relevant tax payable by the partner for that year of assessment.

(b) The aggregate amount of relief granted to a person under this section, section 667B and section 81AA of the Stamp Duties Consolidation Act 1999 shall not exceed the limit of €70,000 as provided for by Article 18 of Commission Regulation (EU) No. 702/2014 of 25 June 2014 or that Regulation as may be revised from time to time.”.

22. Amendment of section 486C of Principal Act (relief from tax for certain start-up companies)

22. Section 486C of the Principal Act is amended in subsection (2)(a) by substituting “31 December 2021” for “31 December 2018”.

23. Amendment of section 97 of Principal Act (computational rules and allowable deductions)

23. (1) Section 97 of the Principal Act is amended by substituting the following for subsection (2J):

“(2J) (a) Notwithstanding subsection (2), but subject to the other provisions of this section (including paragraphs (b) and (c) of this subsection), the deduction authorised by subsection (2)(e) shall not exceed—

(i) 75 per cent of the deduction that would, but for this subsection, be authorised by subsection (2)(e) in respect of interest accrued on or after 7 April 2009 up to and including 31 December 2016,

(ii) 80 per cent of the deduction that would, but for this subsection, be authorised by subsection (2)(e) in respect of interest accrued on or after 1 January 2017 up to and including 31 December 2017, and

(iii) 85 per cent of the deduction that would, but for this subsection, be authorised by subsection (2)(e) in respect of interest accrued on or after 1 January 2018 up to and including 31 December 2018,

on borrowed money employed in the purchase, improvement or repair of a premises which, at the time the interest accrues, is a residential premises.

(b) For the purposes of paragraph (a)—

(i) borrowed money employed on the construction of a residential premises on land in which the person chargeable has an estate or interest shall, together with any borrowed money which that person employed in the acquisition of such land, be deemed to be borrowed money employed in the purchase of a residential premises,

(ii) where a premises consists in part of residential premises and in part of premises which are not residential premises, paragraph (a) shall apply to the interest accrued on the part of the borrowed money employed in the purchase, improvement or repair of the premises that is attributable, on a just and reasonable basis, to residential premises, and

(iii) the interest on borrowed money referred to in paragraph (a) shall be treated as accruing from day to day.

(2) Subsection (1) shall come into operation on 1 January 2019.

24. Amendment of section 216A of Principal Act (rent-a-room relief)

24. (1) Section 216A of the Principal Act is amended by inserting the following subsection after subsection (3B):

“(3C) (a) In this subsection, ‘relevant person’ means a person who is resident or ordinarily resident in the State and is incapacitated by reason of mental or physical infirmity.

(b) Subject to paragraph (c), subsection (2) shall not apply for a year of assessment to that part of the relevant sums arising to an individual in respect of the use by a person for the purposes of residential accommodation of a room or rooms in a qualifying residence where the person uses the room or rooms for a period which does not exceed 28 consecutive days.

(i) is a relevant person,

(ii) uses the room or rooms for a minimum of 4 consecutive days per week for not less than 4 consecutive weeks, or

(iii) is receiving full-time or part-time instruction at a university, college, school or other educational establishment in the State.

(d) Where—

(i) the period for which a room or rooms in a qualifying residence is or are used by a person for the purposes of residential accommodation does not exceed 28 consecutive days, and

(ii) the individual to whom relevant sums have arisen in respect of that use claims that subparagraph (i), (ii) or (iii) of paragraph (c) applies,

the Revenue Commissioners may require the individual to provide proof supporting such claim.”.

(2) Subsection (1) applies for the year of assessment 2019 and each subsequent year of assessment.

25. Relief for investment in corporate trades

25. (1) The Principal Act is amended by substituting the following for Part 16:

“PART 16

Relief for Investment in Corporate Trades

Chapter 1

Interpretation (Part 16)

Interpretation

488. (1) In this Part—

‘associate’ has the same meaning in relation to a person as it has by virtue of subsection (3) of section 433 in relation to a participator;

‘company’ means a body corporate;

‘compliance period’ means the pre-investment period and the relevant period;

‘control’ shall be construed in accordance with subsections (2) to (6) of section 432;

‘director’ shall be construed in accordance with section 433(4);

‘emoluments’ has the same meaning as in section 983;

‘General Block Exemption Regulation’ means Commission Regulation (EU) No. 651/2014 of 17 June 2014[^5];

‘innovation’ means process innovation or organisational innovation;

‘market value’ shall be construed in accordance with section 548;

‘organisational innovation’ means the implementation of a new organisational method in an undertaking’s business practices, workplace organisation or external relations, other than—

(a) changes that are based on organisational methods already in use in the undertaking,

(b) changes in management strategy, mergers and acquisitions, or

(i) ceasing to use a process,

(ii) simple capital replacement or extension,

(iii) changes resulting purely from changes in factor prices, customisation, localisation, regular, seasonal and other cyclical changes, or

(iv) trading of new or significantly improved products;

‘PPS Number’ has the meaning assigned to it in section 891B(1);

‘pre-investment period’, in relation to relief in respect of any eligible shares issued by a company, means the period beginning 2 years before the shares were issued, or if later, beginning on the date the first company in the RICT group was incorporated and ending immediately before the subscription for eligible shares;

‘process innovation’ means the implementation of a new or significantly improved production or delivery method (including significant changes in techniques, equipment or software), other than—

(a) minor changes or improvements,

(b) increases in production or service capabilities through the addition of manufacturing or logistical systems which are very similar to those already in use, or

(i) ceasing to use a process,

(ii) simple capital replacement or extension,

(iii) changes resulting purely from changes in factor prices, customisation, localisation, regular, seasonal and other cyclical changes, or

(iv) trading of new or significantly improved products;

‘qualifying new venture’ means a venture consisting of relevant trading activities which are set up and commenced by a new company other than—

(a) activities which were previously carried on by another person and to which the company has succeeded, or

(b) a venture, the activities of which were previously carried on as part of another person’s trade or profession;

‘relevant period’, in relation to relief in respect of any eligible shares issued by a company, means the period beginning on the date on which the shares were issued and ending 4 years after that date;

‘relief’ means a deduction from total income granted under this Part, and includes relief granted on a share issue at any time after 6 April 1984 (and the foregoing reference to this Part includes this Part as it stood enacted at any time before the commencement of section 23 of the Finance Act 2018 or, as the case may be, the commencement of section 33(1)(a) of the Finance Act 2011) and subsection (2) supplements this definition;

‘R&D+I’ means research and development activities (within the meaning of section 766) and innovation.

(2) In this Part a reference to relief under this Part is a reference to, as the case may be—

(a) relief as provided under this Part as it operates by virtue of section 502 or, where the context admits, as it operates by virtue of section 503 or, as appropriate, section 507, or

(b) relief as provided under all of those sections.

(3) References in this Part to a disposal of shares include references to a disposal of an interest or right in or over the shares, and an individual shall be treated for the purposes of this Part as disposing of any shares which the individual is treated by virtue of section 587 as exchanging for other shares.

(4) References in this Part to the reduction of any amount include references to its reduction to nil.

(5) A word or expression that is used in this Part and is also used in the General Block Exemption Regulation shall have the meaning in this Part that it has in that Regulation.

Chapter 2

Qualifying companies

Interpretation (Chapter 2)

489. In this Part—

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

‘EEA State’ means a state which is a contracting party to the EEA Agreement;

‘financial activities’ means the provision of, and all matters relating to the provision of, financing or refinancing facilities by any means which involves, or has an effect equivalent to, the extension of credit;

‘financial assets’ includes shares, gilts, bonds, foreign currencies and all kinds of futures, options and currency and interest rate swaps, and similar instruments, including commodity futures and commodity options, invoices and all types of receivables, obligations evidencing debt (including loans and deposits), leases and loan and lease portfolios, bills of exchange, acceptance credits and all other documents of title relating to the movement of goods, commercial paper, promissory notes and all other kinds of negotiable or transferable instruments;

‘financing or refinancing facilities’ includes—

(a) loans, mortgages, leasing, lease rental and hire-purchase, and all similar arrangements,

(b) equity or other investment,

(d) the underwriting of debt instruments and all other kinds of financial securities;

‘linked businesses’ means two or more businesses that are regarded as linked enterprises, within the meaning of Annex 1 of the General Block Exemption Regulation;

‘partner businesses’ means two or more businesses that are regarded as partner enterprises, within the meaning of Annex 1 of the General Block Exemption Regulation;

‘qualifying subsidiary’, in relation to a company, means a subsidiary of that company of a kind which a company may have by virtue of section 492;

‘relevant trading activities’ means activities carried on in the course of a trade the profits or gains of which are charged to tax under Case I of Schedule D, excluding activities related to—

(a) adventures or concerns in the nature of trade,

(b) dealing in commodities or futures or in shares, securities or other financial assets,

(d) the provision of professional services (within the meaning of section 128F(1)),

(e) dealing in or developing land,

(f) the occupation of woodlands within the meaning of section 232,

(g) operating or managing hotels, guest houses, self catering accommodation or comparable establishments or managing property used as an hotel, guest house, self catering accommodation or comparable establishment, except where such activity is a tourist traffic undertaking (within the meaning of section 491),

(h) operations carried on in the coal industry or in the steel and shipbuilding sectors, and

(i) the production of a film (within the meaning of section 481);

‘RICT group’ means the company concerned (that is to say the company referred to in the provision concerned of this Part), its partner businesses and linked businesses, and references to a RICT group shall be taken to refer to any RICT group of which the company is part, and—

(a) for the purposes of section 496(5), includes any company that was, at any time, part of a RICT group with the qualifying company or its qualifying subsidiaries but has since been disposed of,

(b) for the purposes of sections 500, 508P and 508R, includes any company which is at any point during the compliance period a subsidiary of the qualifying company, whether it becomes a subsidiary before, during or after—

(i) the year of assessment in respect of which the individual concerned claims relief and whether or not it is such a subsidiary while he or she is a partner, director or employee, or has an interest in the capital of the company, mentioned in section 500(2)(b), or

(ii) the individual concerned receives any value from it;

‘SME’ means a RICT group that would fall within the SME category of Annex 1 of the General Block Exemption Regulation;

‘unlisted’, in respect of a company, means a company none of whose shares, stock or debentures (within the meaning of section 2 of the Companies Act 2014) are listed in the official list of a stock exchange, or quoted on an unlisted securities market of a stock exchange other than—

(a) on the market known as the Enterprise Securities Market of the Irish Stock Exchange, or

(b) on any similar or corresponding market of the stock exchange—

(i) in a Member State, or

(ii) in an EEA state other than the State.

Qualifying companies

490. (1) In this Part, a company shall be a qualifying company if it is incorporated in the State or in another EEA State and, in either case, complies with this section and section 491.

(2) At the time the eligible shares are issued—

(a) the RICT group shall—

(i) be an SME, and

(ii) not be an undertaking in difficulty,

(b) each company in the RICT group shall—

(i) be unlisted, and no arrangements shall be in existence at that time in relation to the company becoming a listed company, and

(ii) not be subject to an outstanding recovery order following a previous decision of the Commission that declared an aid illegal and incompatible with the internal market,

and

(3) Throughout the relevant period—

(a) the company shall—

(i) be resident in the State, or resident in an EEA State other than the State and carry on, or intend to carry on, relevant trading activities from a fixed place of business in the State, and

(ii) not at any time—

(I) control (or together with any person connected with it control) another company other than a qualifying subsidiary, or

(II) be under the control of another company (or of another company and any person connected with that other company), unless such control is exercised by the National Asset Management Agency, or by a company referred to in section 616(1)(g),

and no arrangements shall be in existence at any time in that period by virtue of which the company could fall within clause (I) or (II),

(b) no company in the RICT group shall have any part of its issued shares not fully paid up.

(4) (a) The company shall be—

(i) a company which exists wholly for the purpose of carrying on relevant trading activities, or

(ii) a company whose business consists wholly of—

(I) the holding of shares or securities of, or the making of loans to, one or more qualifying subsidiaries of the company, or

(II) both the holding of such shares or securities or the making of such loans and the carrying on of relevant trading activities where relevant trading activities are carried on from a fixed place of business in the State.

(b) Where a company raises any amount through the issue of eligible shares for the purposes of raising money for relevant trading activities which are being carried on by a qualifying subsidiary or which such a qualifying subsidiary intends to carry on, the amount so raised shall be used for the purpose of acquiring eligible shares in the qualifying subsidiary and for no other purpose.

(5) Subject to subsection (6), a company shall be regarded as having ceased to comply with this section if, before the end of the relevant period, a resolution is passed, or an order is made, for the winding up of the company (or, in the case of a winding up otherwise than under the Companies Act 2014, any other act is done for the like purpose) or the company is dissolved without winding up.

(6) A company shall not be regarded as ceasing to comply with this section by reason only of the fact that it is wound up or dissolved without winding up if—

(a) it is shown that the winding up or dissolution is for bona fide commercial reasons and not part of a scheme or arrangement the main purpose or one of the main purposes of which is the avoidance of tax, and

(b) the company’s net assets, if any, are distributed to its members before the end of the relevant period or, in the case of a winding up, the end (if later) of 3 years from the commencement of the winding up.

Qualifying companies (supplemental)

491. (1) (a) In this subsection ‘internationally traded financial services’ means the services specified in the Schedule to the Industrial Development (Service Industries) Order 2010 (S.I. No. 81 of 2010) other than those falling within the meaning of paragraph (b) or (c) of the definition of ‘relevant trading activities’.

(b) A company whose relevant trading activities includes internationally traded financial services shall not be a qualifying company unless a certificate has been provided to it by Enterprise Ireland to the effect that, in the opinion of Enterprise Ireland, the company’s activities are of a kind specified in the Schedule to the Industrial Development (Service Industries) Order 2010 (S.I. No. 81 of 2010).

(2) (a) In this subsection ‘tourist traffic undertaking’ means—

(i) the operation of tourist accommodation facilities for which the National Tourism Development Authority maintains a register in accordance with the Tourist Traffic Acts 1939 to 2003,

(ii) the operation of such other classes of facilities as may be approved of for the purpose of the relief by the Minister for Finance, in consultation with the Minister for Transport, Tourism and Sport, on the recommendation of the National Tourism Development Authority in accordance with specific codes of standards laid down by it, or

(iii) the promotion outside the State of—

(I) one or more tourist accommodation facilities for which the National Tourism Development Authority maintains a register in accordance with the Tourist Traffic Acts 1939 to 2003, or

(II) any of the facilities mentioned in subparagraph (ii).

(b) A company whose relevant trading activities includes one or more tourist traffic undertakings shall not be a qualifying company unless it has submitted to, and has had approved of by, the National Tourism Development Authority a 3 year development and marketing plan in respect of that undertaking or those undertakings, as the case may be, being a plan primarily designed and formulated to increase tourist traffic and revenue from outside the State.

(c) In considering whether to approve of such a plan, the National Tourism Development Authority shall have regard only to such guidelines in relation to such approval as may from time to time be agreed, with the consent of the Minister for Finance, between it and the Minister for Transport, Tourism and Sport, and those guidelines may, without prejudice to the generality of the foregoing, set out—

(i) the extent to which the company’s interests in land and buildings may form part of its total assets,

(ii) specific requirements which have to be met in order to comply with the objective mentioned in paragraph (b), and

(iii) the extent to which the money raised through the issue of eligible shares should be used in promoting outside the State the undertaking or undertakings, as the case may be.

(3) (a) In this subsection—

‘energy from renewable sources’ means energy from renewable non-fossil sources, that is to say wind, solar, aerothermal, geothermal, hydrothermal and ocean energy, hydropower, biomass, landfill gas, sewage treatment plant gas and biogases and includes the development of any facilities for the storage of energy from renewable sources;

‘green energy activities’ means activities undertaken with a view to producing energy from renewable sources;

‘grid connection agreement’ means an agreement with the transmission system operator or distribution system operator (both within the meaning of the Electricity Regulation Act 1999), or an offer from the transmission system operator or distribution system operator to enter into an agreement for connection to, or use of, the transmission or distribution system.

(b) For the purposes of this Part, a company carrying on green energy activities shall be deemed to have commenced relevant trading activities when it has made an application for a grid connection agreement.

Qualifying subsidiaries

492. (1) In this Part, a qualifying subsidiary is one that—

(a) satisfies the conditions set out in subsection (2) and, except where provided in subsection (3), they continue to be so satisfied until the end of the relevant period, and

(b) is a company—

(i) to which section 490(3)(a)(i) relates, or

(ii) which exists solely for the purpose of carrying on any trade which consists solely of any one or more of the following relevant trading activities—

(I) the purchase of goods or materials for use by the qualifying company or its subsidiaries,

(II) the sale of goods or materials produced by the qualifying company or its subsidiaries, or

(III) the rendering of services to or on behalf of the qualifying company or its subsidiaries.

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

(a) that the subsidiary is a 51 per cent subsidiary of the qualifying company,

(b) that no other person has control of the subsidiary, and

(c) that no arrangements are in existence by virtue of which the conditions specified in paragraphs (a) and (b) could cease to be satisfied.

(3) A company shall not be regarded as ceasing to be a qualifying subsidiary by reason only of the fact that it is wound up or dissolved without winding up if—

Chapter 3

Qualifying investments

Interpretation (Chapter 3)

493. In this Chapter—

‘business plan’ means a written business plan which contains details of product, sales and profitability development, establishing ex-ante financial viability and which includes both quantitative and qualitative details of the activities the investment is sought to support;

‘expansion risk finance investment’ means the issue of eligible shares to fund entering a new product on the market or entering a new geographic market;

‘follow-on risk finance investment’ means the issue of eligible shares subsequent to an initial risk finance investment or an expansion risk finance investment;

‘initial risk finance investment’ means the first issue of eligible shares other than an expansion risk finance investment.

Eligible shares

494. (1) In this Part ‘eligible shares’ means new shares forming part of a company’s share capital and which comply with this section.

(2) Shares subscribed for, issued to, held by or disposed of for an individual by a nominee, shall be treated for the purposes of this Part as subscribed for, issued to, held by or disposed of by that individual where the nominee has complied with the requirements of sections 892 and 894 in respect of those shares.

(3) The shares, other than where relief under section 507 is claimed, may—

(a) carry a right to preferential rights to a dividend or to repayment of capital on a winding up, and

(b) be redeemable.

Anti-avoidance: eligible shares

495. (1) In this section ‘distribution’ has the same meaning as in the Corporation Tax Acts.

(2) For the purposes of this section, an amount specified or implied shall include an amount specified or implied in a foreign currency.

(3) This section applies to shares in a company where any agreement, arrangement or understanding exists which could reasonably be considered to substantially reduce the risk that the person beneficially owning those shares—

(a) might, at or after a time specified in or implied by that agreement, arrangement or understanding, be unable to realise directly or indirectly in money or money’s worth an amount so specified or implied, other than a distribution, in respect of those shares, or

(b) might not receive an amount so specified or implied of distributions in respect of those shares.

(4) The reference in this section to the person beneficially owning shares shall be deemed to be a reference to both that person and any person connected with that person.

(5) Relief from income tax shall not be allowed under this Part in respect of the amount subscribed for any shares to which this section applies.

(6) Without prejudice to the generality of subsection (3), such agreements, arrangements or understandings may include—

(a) the rights associated with the shares as set out in the company’s constitution other than those permitted under section 494(3),

(b) the terms of any shareholders agreement, or

(c) any other agreement, arrangement or understanding with any member of the RICT group or any person connected with any member of the RICT group, including but not limited to—

(i) personal guarantees from existing shareholders that the investor will be able to dispose of the shares after the relevant period, or

(ii) rights over the assets of the qualifying company or its qualifying subsidiaries, in the event that the investor is not able to dispose of the shares after the relevant period.

Qualifying investment (company perspective)

496. (1) In this Part, an investment shall be a qualifying investment where—

(a) an individual subscribes for eligible shares in a qualifying company, and

(b) the company employs the amount subscribed wholly or mainly for a qualifying purpose within the relevant period, and

(2) In this Part, a qualifying purpose—

(a) includes employing the amounts in the qualifying company, ora qualifying subsidiary following an investment under section 490(4)(b)—

(i) for the purposes of carrying on relevant trading activities, or

(ii) in the case of a company which has not commenced to trade, for the purpose of carrying on R&D+I which is connected with and undertaken with a view to the carrying on of relevant trading activities,

where the use of the money will contribute directly to the creation or maintenance of employment in the company, and

(b) does not include employing the amounts on the acquisition (other than by way of subscription pursuant to section 490(4)(b)), directly or indirectly, of—

(i) an interest in another company such that that company becomes a qualifying subsidiary,

(ii) a further interest in a qualifying subsidiary, or

(iii) a trade.

(3) If only a portion of the amount subscribed is employed wholly or mainly for a qualifying purpose then references to a qualifying investment shall be read as referring to the corresponding proportion of that investment.

(4) An investment shall not be a qualifying investment unless it is based on a business plan.

(5) An initial risk finance investment shall only be a qualifying investment where the RICT group which issues the eligible shares made its first commercial sale less than 7 years prior to the initial risk finance investment.

(6) An expansion risk finance investment shall only be a qualifying investment where, based on a business plan prepared in view of entering a new product or geographical market, the amount to be raised through the issue of those shares is greater than 50 per cent of the RICT group’s average annual turnover in the preceding 5 years.

(7) A follow-on risk finance investment shall only be a qualifying investment where—

(a) the initial risk finance investment, or expansion risk finance investment, as the case may be, involved the issue of eligible shares on or after 6 April 1984 in respect of which relief was available under this Part, and

(b) the possibility of the first-mentioned investment was foreseen in the business plan upon which the initial risk finance investment, or expansion risk finance investment, as the case may be, was based.

Limits on amounts a qualifying company can raise

497. (1) For the purpose of this section—

(a) account shall not be taken of any amount subscribed for eligible shares by a person other than an individual who qualifies for relief,

(b) eligible shares includes any shares issued on or after 6 April 1984 in respect of which relief was available under this Part (including this Part as it stood enacted at any time before the commencement of section 23 of the Finance Act 2018 or, as the case may be, the commencement of section 33(1)(a) of the Finance Act 2011), and

(c) account shall be taken of any amount subscribed for eligible shares in a company which was, at any time, part of a RICT group with the qualifying company, but no account shall be taken of amounts so raised once that company was no longer part of that RICT group.

(2) The maximum amount which a RICT group may raise through the issue of eligible shares is—

(a) €5,000,000 in any 12 month period, and

(b) €15,000,000 in total in respect of the issue of eligible shares.

(3) Where a member of the RICT group raises any amount through the issue of eligible shares (in this section referred to as the ‘relevant issue’) in excess of the amount specified in subsection (2)(a), the excess over that amount determined by the formula—

A - B

where—

A is €5,000,000,

and

B is the lesser of—

(a) the amount represented by A in the formula, and

(b) the aggregate of—

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

(ii) the amount or amounts, if any, raised through the issue of eligible shares other than the relevant issue, within the period of 12 months ending with the date of that relevant issue, by the members of the RICT group,

shall not be a qualifying investment.

(4) Where a member of the RICT group raises any amount through the issue of eligible shares (in this section referred to as the ‘relevant issue’) in excess of the amount specified in subsection (2)(b), the excess over that amount determined by the formula—

A - B

where—

A is €15,000,000,

and

B is the lesser of—

(a) the amount represented by A in the formula, and

(b) an amount equal to the aggregate of all amounts raised by the members of the RICT group through the issue of eligible shares at any time before the relevant issue,

shall not be a qualifying investment.

(5) Where, as a consequence of subsection (3) or (4), the giving of relief would be precluded on claims in respect of shares issued to 2 or more individuals, the available relief shall be divided between them respectively in proportion to the amounts which have been subscribed by them for the shares to which their claims relate and which apart from this section would be eligible for relief.

Qualifying investment (investor perspective)

498. (1) Subject to section 598J(1), a subscription for eligible shares by an individual in a qualifying company of less than €250 in a year of assessment shall not be a qualifying investment.

(2) In the case of an individual who is a married person assessed to tax for a year of assessment in accordance with section 1017, or a nominated civil partner assessed to tax for a year of assessment in accordance with section 1031C, any amount subscribed by the individual’s spouse or civil partner for eligible shares issued to that spouse or civil partner in that year of assessment by the company shall be deemed to have been subscribed by the individual for eligible shares issued to the individual by the company.

Anti-avoidance: qualifying investment (investor perspective)

499. (1)(a) For the purposes of this Part, an investment shall not be a qualifying investment in respect of an individual to whom this subsection applies where at any time in the compliance period the company or any of its qualifying subsidiaries—

(i) begins to carry on a business previously carried on at any time in that period otherwise than by the company or any of its qualifying subsidiaries, or

(ii) acquires the whole or greater part of the assets used for the purposes of a business previously so carried on.

(b) This subsection applies to an individual where—

(i) any person or group of persons to whom an interest amounting in the aggregate to more than a 50 per cent share in the business (as previously carried on) belonged at any time in the compliance period is a person or a group of persons to whom such an interest in the business carried on by the company, or any of its subsidiaries, belongs or has at any such time belonged, or

(ii) any person or group of persons who controls or at any such time has controlled the company is a person or a group of persons who at any such time controlled another company which previously carried on the business,

and the individual is that person or one of those persons.

(2) An individual is not entitled to relief in respect of any shares in a company where—

(a) the company comes to acquire all of the issued share capital of another company at any time in the compliance period, and

(b) any person or group of persons who controls or has at any such time controlled the company is a person or a group of persons who at any such time controlled that other company,

and the individual is that person or one of those persons.

(3) For the purposes of subsection (1)(b)—

(a) the person or persons to whom a business belongs and, where a business belongs to 2 or more persons, their respective shares in that business shall be determined in accordance with paragraphs (a) and (b) of subsection (1), and subsections (2) and (3), of section 400, and

(b) any interest, rights or powers of a person who is an associate of another person shall be treated as those of that other person.

Chapter 4

Employment investment incentive

Qualifying investors

500. (1) In this Part, a qualifying investor is an individual who subscribes on his or her own behalf for eligible shares in a qualifying company and complies with this section.

(2) (a) An individual shall not be a qualifying investor if at any time in the compliance period he or she is connected, as determined in accordance with this section and section 501, with the company.

(b) In this Part, an individual shall be connected with a company if the individual or an associate of the individual—

(i) is a partner of the company, or any company in the RICT group,

(ii) subject to subsection (3), is a director or employee of the company, or any company in the RICT group, or

(iii) subject to subsection (5), has an interest in the capital of the company, or any company in the RICT group.

(3) Subsection (2)(b)(ii) shall only apply if the individual or the individual’s associate (or a partnership of which the individual or the individual’s associate is a member) receives a payment from a company in the RICT group during the relevant period, other than—

(a) any payment or reimbursement of travelling or other expenses wholly, exclusively and necessarily incurred by the individual or the individual’s associate in the performance of the duties of the individual or of the associate, as the case may be, as such director or employee,

(b) any interest which represents no more than a reasonable commercial return on money lent to a company in the RICT group,

(c) any dividend or other distribution paid or made by a company in the RICT group which does not exceed a normal return on the investment,

(d) any payment for the supply of goods in the course of a trade or business, which does not exceed their market value, and

(e) any reasonable and necessary remuneration which—

(i) (I) is paid for services rendered to a member of the RICT group in the course of a trade or profession, not being secretarial or managerial services or services of a kind provided by any company in the RICT group, and

(II) is taken into account in computing the profits or gains of the trade or profession under Case I or II of Schedule D or would be so taken into account if it fell in a period on the basis of which those profits or gains are assessed under that Schedule,

(ii) in a case where the individual is a director or an employee of a company in the RICT group and is not otherwise connected with any company in the RICT group, is paid for services rendered to the company of which the individual is a director or an employee, in the course of the directorship or the employment.

(4) Subsection (3) shall apply to payments—

(a) which a person is entitled to receive in respect of the relevant period as it applies to payments made in that period, or

(b) made to the individual indirectly or to the individual’s order or for the individual’s benefit.

(5) (a) Subject to subsection (6), for the purposes of this section, an individual shall have an interest in the capital of a company in the RICT group if that individual, or that individual’s associate, directly or indirectly possesses or is entitled to acquire—

(i) any of the issued share capital of any such company,

(ii) any of the loan capital of any such company,

(iii) any of the voting power in any such company, or

(iv) rights to the assets on a winding up of any such company.

(b) For the purposes of paragraph (a)(ii) and section 505(4)(b)(ii), the loan capital of a company shall be treated as including any debt incurred by the company—

(i) for any money borrowed or capital assets acquired by the company,

(ii) for any right to receive income created in favour of the company, or

(iii) for consideration the value of which to the company was (at the time when the debt was incurred) substantially less than the amount of the debt (including any premium on the debt),

but shall not include a debt incurred by the company by overdrawing an account with a person carrying on a business of banking if the debt arose in the ordinary course of that business.

(c) (i) For the purposes of paragraph (a)(iv), an individual shall have a right to the assets on a winding up if that individual, or an associate of the individual, has rights as would, in the event of the winding up of a company or in other circumstances, entitle the individual to receive any of the assets of the company which would at that time be available for distribution to equity holders of the company, and for the purposes of this subsection—

(I) the persons who are equity holders of the company, and

(II) the percentage of the assets of the company to which the individual would be entitled,

shall be determined in accordance with sections 413 and 415, with references in section 415 to the first company being construed as references to an equity holder and references to a winding up being construed as including references to any other circumstances in which assets of the company are available for distribution to its equity holders.

(ii) In applying sections 413 and 415 in determining the percentage of share capital or other amount which a shareholder beneficially owns or is beneficially entitled to under subparagraph (i), no regard shall be had to the provisions of section 411(1)(c).

(d) (i) For the purposes of this section, an individual shall have an interest in the capital of the company if he or she has control of it within the meaning of section 11.

(ii) For the purposes of this section, an individual shall be treated as having an interest in the capital of the company if he or she has at any time in the compliance period had control, within the meaning of section 11, of another company which has since that time and before the end of the relevant period become a subsidiary of the company.

(6) For the purposes of subsection (5), no account shall be taken of—

(a) shares in the company concerned which are held by the individual concerned, or an associate of that individual, where—

(i) that individual or that associate, as the case may be, was entitled to relief under this Part in respect of the acquisition of those shares, and

(ii) that individual, or a person connected with that individual, does not at any time in the compliance period control the company concerned,

(b) shares subscribed for upon the formation of the company concerned where—

(i) the company has issued no shares other than those subscribed for on formation, and

(ii) the company has not yet commenced carrying on, or made preparations for the carrying on of, any trade or business.

(7) For the purposes of this section an individual shall be treated as entitled to acquire anything which he or she is entitled to acquire at a future date or will at a future date be entitled to acquire, and there shall be attributed to any person any rights or powers of any other person who is an associate of that person.

Anti-avoidance: qualifying investors

501. Where an individual subscribes for shares in a company with which the individual is not connected, then he or she shall nevertheless be treated as connected with it if he or she subscribes for the shares as part of any arrangement which provides for another person to subscribe for shares in another company with which the individual or any other individual who is a party to the arrangement is connected.

The relief (Chapter 4)

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Finance Act 2018

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

Chapter 1 Interpretation

1. Interpretation (Part 1)

Chapter 2 Universal Social Charge

2. Amendment of section 531AN of Principal Act (rate of charge)

PART 1

PART 2

Chapter 3 Income Tax

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

PART 1

PART 2

PART 3

4. Amendment of section 472AB of Principal Act (earned income tax credit)

5. Amendment of section 466A of Principal Act (home carer tax credit)

6. Amendment of section 191 of Principal Act (taxation treatment of Hepatitis C compensation payments)

7. Exemption of certain childcare support payments

8. Certain benefits in kind: members of the Permanent Defence Force

9. Benefit in kind: relief relating to electric vehicles

10. Amendment of section 985A of Principal Act (application of section 985 to certain perquisites, etc.)

11. Amendment of section 128F of Principal Act (key employee engagement programme)

12. Retirement benefits

13. Amendment of section 126 of Principal Act (tax treatment of certain benefits payable under Social Welfare Acts)

14. Relief arising in special circumstances

15. Amendment of section 825C of Principal Act (special assignee relief programme)

Chapter 4 Income Tax, Corporation Tax and Capital Gains Tax

16. Taxation of payments under Magdalen Restorative Justice Ex-Gratia Scheme

17. Amendment of section 285A of, and Schedule 4A to, Principal Act (acceleration of wear and tear allowances for certain energy-efficient equipment)

18. Acceleration of wear and tear allowances for gas vehicles and refuelling equipment

19. Amendment of Parts 9 and 36 of, and Schedule 25B to, Principal Act (capital allowances for equipment and buildings used for the purposes of providing childcare services or a fitness centre to employees)

20. Amendment of section 438A of Principal Act (extension of section 438 to loans by companies controlled by close companies)

21. Amendment of Part 23 of Principal Act (farming and market gardening)

22. Amendment of section 486C of Principal Act (relief from tax for certain start-up companies)

23. Amendment of section 97 of Principal Act (computational rules and allowable deductions)

24. Amendment of section 216A of Principal Act (rent-a-room relief)

25. Relief for investment in corporate trades

1. **Interpretation (Part 1)**