LegalizeFinance (No. 2) Act 2023
PART 1 Universal Social Charge, Income Tax, Corporation Tax and Capital Gains Tax
CHAPTER 1 Interpretation
1. Interpretation (Part 1)
1. In this Part, “Principal Act” means the Taxes Consolidation Act 1997.
CHAPTER 2 Universal Social Charge
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 the substitution of “€25,760” for “€22,920”,
(b) in subsection (4), by the substitution of “2026” for “2024”, and
(c) by the substitution of the following for Part 1 of the Table to that section:
“Part 1
| Part of aggregate income (1) | Rate of universal social charge (2) |
|---|---|
| The first €12,012 | 0.5 per cent |
| The next €13,748 | 2 per cent |
| The next €44,284 | 4 per cent |
| The remainder | 8 per cent |
”.
(2) Subsection (1) applies for the year of assessment 2024 and each subsequent year of assessment.
CHAPTER 3 Income Tax
3. Exemption in respect of Clinical Placement Allowance
3. Chapter 1 of Part 7 of the Principal Act is amended by the insertion of the following section after section 192N:
“192O. (1) In this section—
‘Act of 2011’ means the Nurses and Midwives Act 2011;
‘qualifying course’ means an undergraduate programme in nursing or midwifery approved by the Nursing and Midwifery Board of Ireland under section 85(2) of the Act of 2011;
‘qualifying payment’ means a payment, generally referred to and commonly known as a Clinical Placement Allowance, which is made periodically by or on behalf of the Minister for Health;
‘qualifying student’ means an undergraduate student who is registered in the candidate register maintained by the Nursing and Midwifery Board of Ireland under section 46 of the Act of 2011 and who is undertaking what is generally referred to and commonly known as a Supernumerary Clinical Placement as part of a qualifying course.
(2) A qualifying payment made to a qualifying student on or after 1 January 2024 shall be exempt from income tax and shall not be reckoned in computing the total income of the qualifying student for the purposes of the Income Tax Acts.
(3) A qualifying payment which is made to a qualifying student before 1 January 2024 shall be treated as if it were exempt from income tax in the year of assessment to which it relates and shall not be reckoned in computing the total income of the qualifying student for that year of assessment for the purposes of the Income Tax Acts.
(4) A qualifying payment shall be deemed not to be a payment to which Chapter 4 of Part 42 applies.”.
4. Exemption in respect of allowance for maternity-related administrative support
4. Chapter 1 of Part 7 of the Principal Act is amended by the insertion of the following section after section 192O:
“192P. (1) In this section—
‘qualifying individual’ means a member of a local authority (within the meaning of the Local Government Act 2001) who is entitled to the benefit of a qualifying payment;
‘qualifying payment’ means an allowance paid, by or on behalf of the Minister for Housing, Local Government and Heritage, to a qualifying individual of maternity-related administrative support (within the meaning of the Regulations of 2023) subject to and in accordance with the Regulations of 2023;
‘Regulations of 2023’ means the Local Government Act 2001 (Section 142) (Allowance for Maternity-Related Administrative Support) Regulations 2023 (S.I. No. 404 of 2023).
(2) A qualifying payment which is made to a qualifying individual on or after 1 January 2023 shall be exempt from income tax and shall not be reckoned in computing the total income of the qualifying individual for the purposes of the Income Tax Acts.
(3) A qualifying payment shall be deemed not to be a payment to which Chapter 4 of Part 42 applies.”.
5. Time limits for certain assessments and repayments
5. (1) Section 531AOA of the Principal Act is amended by the insertion of the following subsections after subsection (5):
“(6) (a) Where an employer makes a return under subsection (2) after the expiry of a period of 4 years commencing at the end of the year of assessment in which the income tax month falls, that employer shall not be entitled in the case of a repayment referred to in Regulation 4 of the Universal Social Charge Regulations 2018 (S.I. No. 510 of 2018) to be paid it, or given credit for it, by the Revenue Commissioners.
(b) Notwithstanding paragraph (a), where, in a return made by an employer under subsection (2), the amount the employer is liable to pay pursuant to Regulation 4 of the Universal Social Charge Regulations 2018 (S.I. No. 510 of 2018) exceeds the amount of a repayment pursuant to the said Regulation 4 then credit may be given by the Revenue Commissioners against the amount the employer is liable to pay in that return.
(7) Where, in relation to a return made under subsection (2) which includes a repayment, the Revenue Commissioners are of the opinion that the requirements of this section have not been met, they shall decide to refuse the repayment and shall notify the employer in writing of the decision and the reasons for it.
(8) A person aggrieved by a decision of the Revenue Commissioners in relation to subsection (7) may appeal the decision to the Appeal Commissioners, in accordance with section 949I, within the period of 30 days after the date of the notice of that decision.”.
(2) Section 984B of the Principal Act is amended by the insertion of “subject to subsections (6A) and (6B) of section 985G,” after “and shall,”.
(3) Section 985G of the Principal Act is amended by the insertion of the following subsections after subsection (6):
“(6A) (a) Where an employer makes a return under subsection (3)(a) after the expiry of a period of 4 years commencing at the end of the year of assessment in which the income tax month falls, that employer shall not be entitled in the case of a repayment referred to in section 984B to be paid it, or be given credit for it, by the Revenue Commissioners.
(b) Notwithstanding paragraph (a), where, in a return made by an employer under subsection (3)(a), the amount the employer is liable to pay pursuant to section 984B exceeds the amount of a repayment pursuant to section 984B then credit may be given by the Revenue Commissioners against the amount the employer is liable to pay in that return.
(6B) Where, in relation to a return made under subsection (3)(a) which includes a repayment, the Revenue Commissioners are of the opinion that the requirements of this section have not been met, they shall decide to refuse the repayment and shall notify the employer in writing of the decision and the reasons for it.
(6C) A person aggrieved by a decision of the Revenue Commissioners in relation to subsection (6B) may appeal the decision to the Appeal Commissioners, in accordance with section 949I, within the period of 30 days after the date of the notice of that decision.”.
(4) Section 990 of the Principal Act is amended by the insertion of the following subsections after subsection (4):
“(5) Subject to subsections (6), (7) and (8), an inspector or other officer shall not, in respect of a return made by an employer for an income tax month, make—
(a) an assessment under subsection (1), or
(b) an amendment of an assessment under subsection (2),
after the expiry of a period of 4 years commencing at the end of the year following the year of assessment in which the income tax month falls.
(6) Nothing in subsection (5) shall prevent an inspector or other officer from, at any time, making or amending an assessment for an income tax month in order to—
(a) give effect to—
(i) a determination of an appeal against an assessment,
(ii) a determination of an appeal, other than one made under subparagraph (i), that affects the amount of tax charged by an assessment, or
(iii) an agreement within the meaning of section 949V,
(b) take account of any fact or matter arising by reason of an event occurring after the return is made,
(c) correct an error in calculation in the assessment, or
(d) correct a mistake of fact whereby any matter in the assessment does not properly reflect the facts disclosed by the employer,
and tax shall be paid or repaid (notwithstanding any limitation in subsection (6A) of section 985G or subsection (6) of section 531AOA) where appropriate in accordance with any such amendment.
(7) Notwithstanding subsection (5) and any limitation in the Tax Acts on the period within which a claim for relief from tax is required to be made, an inspector or other officer may, at any time, make or amend an assessment for an income tax month to give effect to a mutual agreement reached, under an arrangement having the force of law by virtue of section 826(1), between the competent authority of the State and a competent authority of another jurisdiction and tax shall be paid or repaid (notwithstanding any limitation in subsection (6A) of section 985G or subsection (6) of section 531AOA) where appropriate in accordance with any such assessment or amended assessment.
(8) (a) Notwithstanding subsection (5), an inspector or other officer may, at any time, make or amend an assessment for an income tax month where he or she has reasonable grounds for believing that any form of fraud or neglect has been committed by or on behalf of an employer in connection with or in relation to tax due under this Chapter.
(b) In this subsection, ‘neglect’ has the same meaning as it has in section 959AD and subsection (2) of that section shall apply accordingly.”.
(5) Section 997 of the Principal Act is amended, in subsection (1A), by the substitution of “959AB, 959AC and 959AD” for “959AB and 959AD”.
(6) Subsections (1), (2) and (3) shall apply in respect of returns made for income tax months commencing on or after 1 January 2019.
6. Amendment of section 477C of Principal Act (Help to Buy)
6. (1) Section 477C of the Principal Act is amended—
(a) in subsection (1), by—
(i) the insertion of the following definition:
“ ‘affordable dwelling contribution’ shall be construed in accordance with section 12(2) of the Act of 2021;”,
(ii) the substitution of the following definition for the definition of “loan-to-value ratio”:
“ ‘loan-to-value ratio’ means—
(a) in the case of a contract referred to in subsection (3)(a) that was entered into before 11 October 2023, the amount of the qualifying loan as a proportion of the purchase value of the qualifying residence, and
(b) in all other cases, the amount that is the aggregate of—
(i) the amount of the qualifying loan, and
(ii) in the case of a qualifying residence, the amount of the affordable dwelling contribution, if any, in respect of the qualifying residence,
as a proportion of the purchase value of the qualifying residence or the self-build qualifying residence, as the case may be;”,
and
(iii) in the definition of “qualifying period”, the substitution of “2025” for “2024”,
(b) in subsection (5A), by the substitution of “2025” for “2024”,
(c) in subsection (8)(b), by the substitution of “2025” for “2024”,
(d) in subsection (12)(a), by the insertion of the following subparagraphs after subparagraph (viii):
“(viiia) the amount of the affordable dwelling contribution, if any, in respect of the qualifying residence,
(viiib) evidence of the affordable dwelling purchase arrangement (within the meaning of section 12 of the Act of 2021), if any, entered into, in respect of the qualifying residence,”,
(e) in subsection (16)(a), in subparagraphs (ii) and (iii), by the substitution of “2025” for “2024” in each place where it occurs, and
(f) in subsection (25), by the substitution of “2025” for “2024”.
(2) Paragraphs (a) (i) and (ii) and (d) of subsection (1) shall have effect on and from 11 October 2023.
7. Amendment of section 121 of Principal Act (Benefit of use of car)
7. Section 121 of the Principal Act is amended, in subsection (4A)—
(a) in paragraph (aa)—
(i) in subparagraph (ii), by the substitution of “subject to paragraph (ab), €35,000” for “€20,000”,
(ii) in subparagraph (iii)—
(I) by the substitution of “€35,000” for “€10,000”, and
(II) by the substitution of “December 2025;” for “December 2025.”,
and
(iii) by the insertion of the following subparagraphs after subparagraph (iii):
“(iv) €20,000 in respect of a car made available in the period 1 January 2026 to 31 December 2026;
(v) €10,000 in respect of a car made available in the period 1 January 2027 to 31 December 2027.”,
(b) in paragraph (ab)—
(i) by the substitution of “years of assessment 2023 and 2024” for “year of assessment 2023”, and
(ii) in subparagraph (i)—
(I) by the substitution of “subparagraph (i) or (ii), as the case may be, of paragraph (aa)” for “paragraph (aa)(i)”, and
(II) in clause (I), by the substitution of “subparagraph (i) or (ii), as the case may be, of paragraph (aa)” for “paragraph (aa)(i)”,
and
(c) in paragraph (ba), by the substitution of “years of assessment 2023 and 2024” for “year of assessment 2023”.
8. Amendment of section 121A of Principal Act (Benefit of use of van)
8. Section 121A of the Principal Act is amended, in paragraph (b) of subsection (2)—
(a) in subparagraph (vii)—
(i) in clause (II), by the substitution of “subject to subparagraph (viii), €35,000” for “€20,000”,
(ii) in clause (III)—
(I) by the substitution of “€35,000” for “€10,000”, and
(II) by the substitution of “December 2025;” for “December 2025, and”,
and
(iii) by the insertion of the following clauses after clause (III):
“(IV) €20,000 in respect of a van made available in the period 1 January 2026 to 31 December 2026;
(V) €10,000 in respect of a van made available in the period 1 January 2027 to 31 December 2027, and”,
and
(b) in subparagraph (viii)—
(i) by the substitution of “years of assessment 2023 and 2024” for “year of assessment 2023”, and
(ii) in clause (I)—
(I) by the substitution of “clause (I) or (II), as the case may be, of subparagraph (vii) applies” for “subparagraph (vii)(I) applies”, and
(II) in subclause (A), by the substitution of “clause (I) or (II), as the case may be, of subparagraph (vii)” for “subparagraph (vii)(I)”.
9. Rate of charge and personal tax credits
9. As respects the year of assessment 2024 and subsequent years of assessment, the Principal Act is amended—
(a) in section 15—
(i) in paragraph (i) of subsection (3), by the substitution of “€33,000” for “€31,000”, and
(ii) by the substitution of 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 €42,000 | 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 €46,000 | 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 €51,000 | 20 per cent | the standard rate |
| The remainder | 40 per cent | the higher rate |
”,
(b) in section 461—
(i) in paragraph (a), by the substitution of “€3,750” for “€3,550”,
(ii) in paragraph (b), by the substitution of “€3,750” for “€3,550”, and
(iii) in paragraph (c), by the substitution of “€1,875” for “€1,775”,
(c) in section 462B, in subsection (3), by the substitution of “€1,750” for “€1,650”,
(d) in section 465, in subsection (1), by the substitution of “€3,500” for “€3,300”,
(e) in section 466A, in subsection (2), by the substitution of “€1,800” for “€1,700”,
(f) in section 472, in subsection (4), by the substitution of “€1,875” for “€1,775” in each place where it occurs, and
(g) in section 472AB—
(i) in subsection (2), by the substitution of “€1,875” for “€1,775” in each place where it occurs, and
(ii) in subsection (3), by the substitution of “€1,875” for “€1,775” in each place where it occurs.
10. Amendment of section 472BB of Principal Act (sea-going naval personnel credit)
10. Section 472BB of the Principal Act is amended, in subsection (3), by the substitution of “, 2023 or 2024” for “or 2023”.
11. Amendment of section 473B of Principal Act (Rent tax credit)
11. (1) Section 473B of the Principal Act is amended—
(a) by the insertion of the following subsection after subsection (6):
“(6A) Notwithstanding anything in this section, where, in respect of a year of assessment—
(a) an individual is entitled, in respect of a residential property, to an allowance to which subsection (1), (1A) or (1B) of section 836 applies, or
(b) an individual is allowed, in accordance with section 836(2), a deduction under section 114 in respect of expenses in maintaining a residential property,
this section shall not apply to a qualifying payment made in that year in respect of that residential property.”,
(b) by the substitution of the following subsection for subsection (8):
“(8) Where—
(a) a claimant, or
(b) in a case where subsection (4) applies, a claimant’s spouse or civil partner, proves that he or she made a qualifying payment in respect of a residential property used by his or her child as his or her principal private residence the claimant shall, upon making a claim in that regard, be entitled to the same rent tax credit as if the qualifying payment was made in respect of a residential property which was used by the claimant as his or her own principal private residence where—
(i) neither the individual nor the child is a relative of the landlord,
(ii) the child was undertaking an approved course and using the property to facilitate his or her participation in that course during the period to which the qualifying payment relates, and
⋯
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