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19 1972

FINANCE ACT, 1972

PART II

Death Duties

Alteration of rates of estate duty.

26 .—In the case of persons dying on or after the 19th day of April, 1972, the scale of rates set out in the Second Schedule to this Act shall be, and shall have effect as, the scale of rates of estate duty in lieu of the scale set out in the Second Schedule to the Finance Act, 1971 , and appropriate repayments shall be made accordingly.

Provisions consequential on alteration of rates of estate duty.

27 .—(1) Section 26 (1) of the Finance Act, 1961 , is hereby amended by the substitution of “seven thousand five hundred pounds” for “five thousand pounds”.

(2) Section 29 of the Finance Act, 1931 , is hereby amended by the substitution of “seven thousand five hundred pounds” for “five thousand pounds” (inserted by the Finance Act, 1960 ).

(3) Where the net value of the property, real and personal, in respect of which estate duty is payable, exclusive of property settled otherwise than by the will of the deceased, exceeds seven thousand five hundred pounds, the amount of legacy and succession duty payable in respect of the property shall not exceed the amount by which the net value of the property as estimated for the purpose of estate duty exceeds seven thousand five hundred pounds.

(4) This section shall have effect only in relation to persons dying on or after the 19th day of April, 1972, and appropriate repayments shall be made accordingly.

Amendment of section 24 of Finance Act, 1965.

28 .—In the case of persons dying on or after the 19th day of April, 1972, section 24 (1) of the Finance Act, 1965 , is hereby amended—

(a) by the substitution for paragraph (d) (i) of the following paragraph:

“(d) (i) Where the aggregate value of all death benefits payable on a death to or for the benefit of the widow or dependent children of the deceased does not exceed £7,500, the benefits so payable shall be exempt from estate duty.”,

and

(b) by the substitution of “£7,500” for “£5,000” in both places where it occurs in paragraph (d) (ii),

and appropriate repayments shall be made accordingly.

Abatement of estate duty.

29. —(1) Section 45 of the Finance Act, 1969 , is hereby amended by the substitution of “£2,000” for “£1,500” (inserted by the Finance Act, 1971 ) and of “£1,000” for “£750” (inserted by the said Finance Act, 1971 ) in each place where they respectively occur in subsections (2), (3), (4) and (5).

(2) This section shall have effect only in relation to benefits (within the meaning of the said section 45) accruing on or after the 19th day of April, 1972, and appropriate repayments shall be made accordingly.

Amendment of section 7 of Finance Act, 1894

30 .—(1) Section 7 (2) of the Finance Act, 1894, is hereby amended by the deletion of “personal” in both places where it occurs.

(2) This section shall have effect only in cases in which the deceased dies after the passing of this Act.

Amendment of section 33 of Finance (1909-10) Act, 1910.

31 .—Section 33 of the Finance (1909-10) Act, 1910, is hereby amended by the substitution of “fifty thousand” for “five hundred” in the proviso to subsection (4).

Discretionary trusts.

32 .—(1) In this section—

deceased” has the meaning specified in subsection (2) of this section;

payment” includes, in relation to a deceased, any disposition of property in favour of the deceased or in favour of any other person on behalf of or for the benefit of the deceased or in consequence of which the deceased received directly or indirectly a benefit and also includes a set-off or release of an obligation;

relevant period” means, in relation to a deceased, the period of five years ending at his death or the period from the date of the commencement of the trust up to the date of his death, whichever is the shorter;

market value” means the price which, in the opinion of the Revenue Commissioners, the property to which subsection (6) of this section relates would fetch if sold in the open market at the time of the death of the deceased;

trustee” includes any person who, whether the property the subject of the trust is vested in him or not, exercises or has a discretion to exercise a power or make a decision in relation to the nature or extent of, or any matter affecting, a payment under a trust of the kind referred to in subsection (2) of this section.

(2) Where—

(a) property is or has been at any time vested in a trustee upon trusts under which the income or capital, or part of the income or capital, of the property may, at his discretion, be paid to or applied for the benefit of—

(i) any person, or

(ii) any one or more of a number or class of persons, as the trustee may, at his discretion, decide,

with or without a trust or power to accumulate income, and

(b) (i) that person or any one or more of those persons dies or die, or,

(ii) if a body corporate is or was an object of the trust, a person who was a member, a director or an employee of the body, dies,

after the passing of this Act,

any person so dying who at any time during the relevant period received a payment either directly or indirectly out of the property or out of the income of the property (in this section referred to as the deceased), shall, for all purposes of estate duty, be deemed to have had an interest ceasing on his death in the property and that interest shall be deemed to have been an interest in possession.

(3) The interest of the deceased to which subsection (2) of this section refers shall be deemed to have been an annuity equivalent to the average annual amount of the aggregate of all payments made out of the income or capital of the trust property to the deceased during the relevant period or received or enjoyed by him during that period or made to or received by or disposed of by any other person on his behalf during that period, and the annuity shall be deemed to have been paid each year during the relevant period and the property or a proportion of the property which would be required to provide the annuity shall be deemed to have been set aside and retained to meet the annuity during the relevant period:

Provided that a payment out of the capital of the property shall not be treated as a payment for the purposes of this subsection save where there is a trust or power to accumulate income as an addition to the property and then only to the extent to which the payment does not exceed the amount of income accumulated to the date of such payment.

(4) The value of the benefit accruing or arising from the cesser of the deceased's interest shall be the principal value of the property or of the proportion of the property deemed to have been set aside and retained to meet the annuity.

(5) Where property passes on the death of the deceased by reason of his failure to attain a certain age or where a person becomes entitled to property by reason of the failure of the deceased to attain a certain age, the interest of the deceased shall be deemed to have ceased on his death and his interest shall be deemed to have been an interest in possession in the property:

Provided that where the property is held by the trustee on trust for minor children subject only to their interests or the interest of any one of them being divested or defeated on his or their failure to attain full age, estate duty shall not be payable under this subsection on the death under age of any such child other than the last of such children to die without attaining full age.

(6) If at any time during the relevant period the deceased had been in occupation or possession of land or chattels subject to the trust, the following provision shall have effect for the purpose of determining the amount of the annuity referred to in subsection (3) of this section.

For each year or part of a year during which the deceased was the only object of the trust in occupation or possession, the occupation or possession shall be deemed to have been a payment of income at the annual rate of six per cent. of the market value of the land or chattels (as the case may be) at the date of the termination of the occupation or possession.

For each year or part of a year during which a number of objects of the trust including the deceased was in occupation or possession, the deceased's occupation or possession shall be deemed to have been a payment of income at an annual rate of six (divided by the number of individuals who are objects of the trust of full age including the deceased) per cent. of such market value.

(7) The estate duty payable on the death of the deceased by virtue of this section shall be a first charge on the property comprised in the trust at any time during the relevant period, and the provisions of section 8 (4) of the Finance Act, 1894, shall apply to that property in the same manner as they apply to the property referred to in that section.

(8) The settlor or the person who was the financial source of the property the subject of the trust shall be deemed, for the purposes of section 24 of the Finance Act, 1940 , to be the disponer in relation to the trust.

(9) In relation to property in which an interest is by this section deemed to have subsisted, section (2) (1) (b) of the Finance Act, 1894, shall have effect as if “holder of an office, or” were omitted.

(10) Where—

(a) the trustee may become accountable for estate duty payable by virtue of this section, and

(b) it is intended that the property or any part thereof shall cease to be subject to the trust,

then, if the trustee obtains from the Revenue Commissioners a certificate of the amount which, in the opinion of the Revenue Commissioners, may properly be treated as the prospective amount of any duty which may be payable by virtue of this section and gives the Revenue Commissioners all the information and evidence required by the Revenue Commissioners in connection with the application for the certificate, he shall not be accountable as trustee for the duty to which the certificate relates, to an amount in excess of the amount certified.

Appeals in certain cases to Appeal Commissioners against valuation of property for estate duty.

33. —(1) In this section—

account” includes an affidavit;

assessable property” means any stocks, shares or other securities which are not dealt in on a stock exchange and includes the benefit accruing by the cesser of an interest under section 20 (4) of the Finance Act, 1965 ;

accountable person” has the meaning assigned to it by subsection (2) of this section;

Appeal Commissioners” means the persons appointed in accordance with section 156 of the Income Tax Act, 1967 , to be Appeal Commissioners for the purposes of the Income Tax Acts;

appellant” means a person who appeals to the Appeal Commissioners under subsection (3) of this section.

(2) A person who is accountable for the payment of estate duty in respect of assessable property and who has delivered to the Revenue Commissioners an account for the assessment of the duty (in this section referred to as an accountable person) may, in accordance with the provisions of this section, appeal to the Appeal Commissioners against a decision of the Revenue Commissioners as to the principal value of the assessable property and the appeal shall be heard and determined by the Appeal Commissioners whose determination shall be final and conclusive unless the appeal is required to be reheard by a judge of the Circuit Court or a case is required to be stated in relation to it for the opinion of the High Court.

(3) Notice in such form as may be prescribed by the Revenue Commissioners of a decision of the Revenue Commissioners as to the principal value of assessable property shall be served by the Revenue Commissioners upon the accountable person concerned and, if the accountable person intends to appeal against the decision, he shall give notice in writing of his intention to the Revenue Commissioners within 21 days after the date of the notice aforesaid.

(4) (a) Subject to the provisions of this section, the provisions of the Income Tax Acts relating to—

(i) the appointment of times and places for the hearing of appeals;

(ii) the giving of notice to each person who has given notice of appeal of the time and place appointed for the hearing of his appeal;

(iii) the determination of an appeal by agreement between the appellant and an inspector of taxes or other officer appointed by the Revenue Commissioners in that behalf;

(iv) the determination of an appeal by the appellant giving notice of his intention not to proceed with the appeal;

(v) the hearing and determination of an appeal by the Appeal Commissioners, including the hearing and determination of an appeal by one Appeal Commissioner;

(vi) the determination of an appeal through the neglect or refusal of a person who has given notice of appeal to attend before the Appeal Commissioners at the time and place appointed;

(vii) the extension of the time for giving notice of appeal, and the readmission of appeals by the Appeal Commissioners;

(viii) the rehearing of an appeal by a judge of the Circuit Court and the statement of a case for the opinion of the High Court on a point of law;

(ix) the procedures for appeal,

shall, with any necessary modifications, apply to an appeal under this section as if the appeal were an appeal against an assessment to income tax.

(b) The Revenue Commissioners shall, subject to their giving notice in writing in that behalf to the appellant within ten days after the determination of an appeal by the Appeal Commissioners, have the same right as the appellant to have the appeal reheard by a judge of the Circuit Court.

(c) The rehearing of an appeal under this section by a judge of the Circuit Court shall be by the judge of the Circuit Court in whose circuit the appellant or one of the appellants resides or (in the case of a body corporate) has its principal place of business:

Provided that—

(i) in any case where no appellant is resident in, or (in the case of a body corporate) has a place of business in, the State, or

(ii) in any case in which there is a doubt or dispute as to the circuit,

the appeal shall be reheard by a judge of the Circuit Court assigned to the Dublin Circuit.

(5) The right of an appellant to require the Appeal Commissioners to state a case for the opinion of the High Court or to have an appeal reheard by a judge of the Circuit Court may be exercised only on payment of the estate duty on the account delivered by him to the Revenue Commissioners and such duty shall be calculated on the principal value which is not in dispute of the property included in the account and on the value as determined by the Appeal Commissioners of the assessable property:

Provided that—

(a) if too much duty has been paid, the excess shall be repaid with interest at the rate of nine per cent. per annum for such period as appears to the Court just, or

(b) if too little duty has been paid, the additional duty shall be payable and be treated as duty in arrear.

(6) (a) Where a notice or other document which is required or authorised to be served by this section falls to be served on a body corporate, such notice shall be served on the secretary or other officer of the body corporate who has delivered to the Revenue Commissioners the account relating to the assessable property referred to in the notice.

(b) Any notice or other document which is required or authorised by this section to be served by the Revenue Commissioners or by an appellant may be served by post, and—

(i) in the case of a notice or other document addressed to the Revenue Commissioners, shall be sent to The Secretaries, Revenue Commissioners, Estate Duty Branch, Dublin, 2, and

(ii) in the case of a notice or other document addressed to the appellant, shall be sent to the address of the appellant shown on the account delivered by him to the Revenue Commissioners.

(c) Any notice or other document which is required or authorised to be served by the Revenue Commissioners on an appellant under this section may be sent to the solicitor, accountant or other agent of the appellant and a notice thus served shall be deemed to have been served on the appellant unless the appellant proves to the satisfaction of the Appeal Commissioners or the Circuit Court, as the case may be, that he had, before the notice or other document was served, withdrawn the authority of such solicitor, accountant or other agent to act on his behalf.

(7) (a) Any act or thing authorised or required to be done by the Revenue Commissioners under this section may be done by an officer of the Revenue Commissioners authorised by them for the purpose and any notice required by this section to be given by the Revenue Commissioners may be signed and given by an officer of the Revenue Commissioners authorised by them for the purpose and any act done or notice signed and given by such authorised officer shall be as valid and effectual as if done or signed and given by the Revenue Commissioners.

(b) Prima facie evidence of any notice given under this section by the Revenue Commissioners or by an officer of the Revenue Commissioners may be given in any proceedings by production of a document purporting to be a copy of the notice and it shall not be necessary to prove the official position of the person by whom the notice purports to be given or, if it is signed, the signature, or that the person signing and giving it was authorised so to do.

(8) Every person accountable for the payment of any estate duty in connection with a particular death and every person from whom a rateable part of any such estate duty may be recovered in connection with that death shall be bound by the value of the property as determined under this section in connection with that death.

(9) Where the Revenue Commissioners make an assessment of estate duty under the provisions of section 30 or 31 of the Finance Act, 1935 , and any assessable property is included in the property in respect of which the assessment is made, the person from whom it is sought to recover the duty so assessed shall have the same right of appeal under this section in relation to the assessable property as he would have if the assessment had been made on an account delivered by him unless the principal value of such property has already been determined in an appeal under this section in relation to the relevant death.

(10) An appeal shall not lie under section 10 of the Finance Act, 1894, where the question in dispute is a question of the principal value of any assessable property.

(11) This section shall have effect in relation to any death occurring on or after the date of the passing of this Act.