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15 1998

FINANCE (NO. 2) ACT, 1998

PART 2

Stamp Duties

Interpretation (Part 2).

5. —In this Part—

the Act of 1891” means the Stamp Act, 1891;

the Commissioners” means the Revenue Commissioners;

the First Schedule” means the First Schedule (as amended by the Finance Act, 1970 , and subsequent enactments) to the Act of 1891.

Commencement (Part 2).

6. —(1) Subject to subsection (2), this Part shall have effect as respects instruments executed on or after the 23rd day of April, 1998.

(2) Sections 11 , 12 and 14 shall not apply as respects any instrument executed prior to the 1st day of January, 1999, where the instrument contains a statement in such form as the Commissioners may specify, certifying that the instrument was executed in pursuance of a contract which was evidenced in writing prior to the 23rd day of April, 1998.

(3) The furnishing of an incorrect certificate for the purposes of subsection (2) shall be deemed to constitute the delivery of an incorrect statement for the purposes of section 94 of the Finance Act, 1983 .

Amendment of First Schedule.

7. —The First Schedule is hereby amended—

(a) by the substitution of the Heading set out in Part 1 of the Schedule for the Heading (as amended by the Finance Act, 1997 ) “CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance”, and

(b) by the substitution of the subparagraphs set out in Part 2 of the Schedule for subparagraph (a) of paragraph (3) (inserted by the Finance Act, 1997 ) of the Heading “LEASE”.

Amendment of section 4 (instruments to be separately charged with duty in certain cases) of Act of 1891.

8. —Section 4 of the Act of 1891 is hereby amended by the insertion of the following paragraph after paragraph (b):

“(c) Without prejudice to the generality of paragraphs (a) and (b), where the consideration (other than rent) for the sale or lease of any property is partly attributable to residential property and partly attributable to property which is not residential property the instrument of conveyance or transfer or lease shall be chargeable to ad valorem stamp duty on the basis that it is a separate conveyance or transfer or lease of residential property to the extent that that consideration is attributable to residential property and also a separate conveyance or transfer or lease of property which is not residential property to the extent that that consideration is attributable to property which is not residential property.”.

Amendment of section 58 (direction as to duty in certain cases) of Act of 1891.

9. —Section 58 of the Act of 1891 is hereby amended by the substitution of the following subsection for subsection (1A) (inserted by the Finance Act, 1997 ):

“(1A) Where—

(a) any property which consists partly of an interest in residential property is sold to any person and the sale (hereinafter in this subsection referred to as ‘the first-mentioned sale’) does not form part of a larger transaction or of a series of transactions, or

(b) the sale to any person of property consisting in whole or in part of such an interest forms part of a larger transaction or of a series of transactions,

the consideration attributable to the first-mentioned sale and the aggregate consideration (other than rent) attributable to that larger transaction or series of transactions, as the case may be, shall be apportioned, on such basis as is just and reasonable, as between that interest in residential property and the other property or part concerned, and that aggregate consideration shall likewise be apportioned as between each other such interest (if any) comprised in that larger transaction or series of transactions and the other property or parts concerned, and notwithstanding the amount or value of the consideration set forth in any instrument—

(i) the consideration so apportioned to that interest shall be deemed to be the amount or the value of the consideration for the sale which is attributable to that interest and the consideration so apportioned to the aggregate of all such interests comprised in that larger transaction or series of transactions shall be deemed to be the amount or value of that aggregate consideration which is attributable to residential property, and

(ii) the consideration so apportioned to the other property or part or parts concerned shall be deemed to be the amount or value of the consideration for the sale, or of that aggregate consideration, as the case may be, which is attributable to property which is not residential property.”.

Amendment of section 77 (directions as to duty in certain cases) of Act of 1891.

10. —Section 77 of the Act of 1891 is hereby amended by the substitution of the following subsection for subsection (6) (inserted by the Finance Act, 1997 ):

“(6) Where—

(a) any property which consists partly of an interest in residential property is leased to any person and that lease (hereinafter in this subsection referred to as ‘the first-mentioned lease’) does not form part of a larger transaction or of a series of transactions, or

(b) the lease to any person of property consisting in whole or in part of such an interest forms part of a larger transaction or of a series of transactions,

the consideration attributable to the first-mentioned lease and the aggregate consideration (other than rent) attributable to that larger transaction or series of transactions, as the case may be, shall be apportioned, on such basis as is just and reasonable, as between that interest in residential property and the other property or part concerned, and that aggregate consideration shall likewise be apportioned as between each other such interest (if any) comprised in that larger transaction or series of transactions and the other property or parts concerned, and notwithstanding the amount or value of the consideration set forth in any instrument—

(i) the consideration so apportioned to that interest shall be deemed to be the amount or the value of the consideration for the lease which is attributable to that interest and the consideration so apportioned to the aggregate of all such interests comprised in that larger transaction or series of transactions shall be deemed to be the amount or value of that aggregate consideration which is attributable to residential property, and

(ii) the consideration so apportioned to the other property or part or parts concerned shall be deemed to be the amount or value of the consideration for the lease, or of that aggregate consideration, as the case may be, which is attributable to property which is not residential property.”.

Amendment of section 49 (exemption of certain instruments from stamp duty) of Finance Act, 1969.

11. Section 49 of the Finance Act, 1969 , is hereby amended—

(a) by the substitution of the following subsection for subsection (1):

“(1) Subject to subsection (2B) of this section, an instrument giving effect to the purchase of a dwellinghouse or apartment upon the erection thereof shall be exempt from all stamp duties.”,

(b) in subsection (2B) (inserted by the Finance Act, 1996 ) by the substitution in paragraph (a) of the following subparagraphs for subparagraph (i):

“(i) the instrument gives effect to the purchase of a dwellinghouse or apartment upon the erection thereof, and

(ia) until the expiration of the period of 5 years commencing on the date of the execution of the instrument or the subsequent sale (other than a sale the contract for which, if it were a written conveyance, would not, apart from section 50 of the Finance Act, 1979 , be charged with full ad valorem duty or a sale to a company under the control of the vendor or of any person entitled to a beneficial interest in the dwellinghouse or apartment immediately prior to the sale or to a company which would, in relation to a notional gift of shares in that company taken, immediately prior to the sale, by any person so entitled, be under the control of the donee or successor within the meaning of section 16 of the Capital Acquisitions Tax Act, 1976 , irrespective of the shares the subject-matter of the notional gift) of the dwellinghouse or apartment concerned, whichever event first occurs, that dwellinghouse or apartment will be occupied as the only or principal place of residence of the purchaser, or if there be more than one purchaser, of any one or more of the purchasers or of some other person in right of the purchaser or, if there be more than one purchaser, of some other person in right of any one or more of the purchasers and that no person, other than by virtue of a title prior to that of the purchaser, will derive any rent or payment in the nature of rent for the use of that dwellinghouse or apartment, or of any part of it, during that period, and”,

and

(c) by the insertion of the following paragraph after paragraph (a):

“(aa) Where, in relation to an instrument which is exempted from stamp duty by virtue of subsection (1) and at any time during the period referred to in paragraph (a)(ia), some person, other than by virtue of a title prior to that of the purchaser, derives any rent or payment in the nature of rent for the use of the dwellinghouse or apartment concerned, or of any part of it, the purchaser, or where there be more than one purchaser, each such purchaser, shall—

(i) jointly and severally become liable to pay to the Revenue Commissioners a fine equal to the amount of the duty which would have been charged in the first instance if the dwellinghouse or apartment had been conveyed or transferred or leased by an instrument to which this section had not applied together with interest on that amount charged at a rate of 1 per cent per month or part of a month from the date when the rent or payment is first received to the date the fine is remitted, and

(ii) the person who receives the rent or payment shall, within 6 months after the date of the payment, notify the payment to the Revenue Commissioners on a form provided, or approved of, by them for the purposes of this section, unless that person is already aware that the Revenue Commissioners have already received such a notification from another source.”.

Amendment of section 112 (stamp duty on transfers of building land) of Finance Act, 1990.

12. Section 112 of the Finance Act, 1990 , is hereby amended—

(a) in subsection (1) (inserted by the Finance Act, 1993 ) by the substitution of the following paragraphs for paragraphs (a) and (b):

“(a) in the case of such sale, under the Heading ‘CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance’ in the First Schedule (as amended by the Finance Act, 1970 , and subsequent enactments) to the Stamp Act, 1891, as if the property concerned were residential property on an amount equal to the aggregate of—

(i) any consideration paid in respect of the sale of that land, and

(ii) any consideration paid, or to be paid, in respect of the building of the dwellinghouse or apartment on that land;

(b) in the case of such lease, under subparagraph (a) of paragraph (3) of the Heading ‘LEASE’ in the First Schedule (as amended by the Finance Act, 1970 , and subsequent enactments) to the Stamp Act, 1891, as if the property concerned were residential property on an amount equal to the aggregate of—

(i) any consideration (other than rent) paid in respect of the lease of that land, and

(ii) any consideration paid, or to be paid, in respect of the building of the dwellinghouse or apartment on that land.”,

and

(b) in paragraph (a) of subsection (3) by the substitution of “the aggregate consideration which is chargeable under subsection (1)” for “such aggregate consideration”.

Amendment of section 121 (surcharges) of Finance Act, 1997.

13. Section 121 of the Finance Act, 1997 , is hereby amended in subsection (2) by the deletion of the proviso thereto.

Relief from stamp duty for certain new houses or apartments.

14. —(1) (a) Where, in relation to an instrument to which this subsection applies—

(i) the instrument gives effect to the purchase of a dwellinghouse or apartment upon the erection thereof and section 49 of the Finance Act, 1969 , and section 112 (as amended by this Act) of the Finance Act, 1990 , do not apply, the consideration (other than rent) for the sale shall for the purposes of ad valorem duty be treated as being reduced by 75 per cent, and

(ii) the instrument is one to which section 112 (as amended by this Act) of the Finance Act, 1990 , applies, that section shall apply to that instrument as if the following paragraphs were substituted for paragraphs (a) and (b) of subsection (1) of that section and paragraph (b) of section 12 did not apply:

“(a) in the case of such sale, under the Heading ‘CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities, or a policy of insurance, or a policy of life insurance’ in the First Schedule (as amended by the Finance Act, 1970 , and subsequent enactments) to the Stamp Act, 1891, as if the property concerned were residential property on an amount which is the greater of—

(i) any consideration paid in respect of the sale of that land, and

(ii) 25 per cent of the aggregate of the consideration at subparagraph (i) and the consideration paid, or to be paid, in respect of the building of the dwellinghouse or apartment on that land;

(b) in the case of such lease, under the Heading ‘LEASE’ in the First Schedule (as amended by the Finance Act, 1970 , and subsequent enactments) to the Stamp Act, 1891, as if the property concerned were residential property on an amount which is the greater of—

(i) any consideration (other than rent) paid in respect of the lease of that land, and

(ii) 25 per cent of the aggregate of the consideration at subparagraph (i) and the consideration paid, or to be paid, in respect of the building of the dwellinghouse or apartment on that land.”.

(b) This subsection applies to an instrument which contains a statement, in such form as the Commissioners may specify, certifying that—

(i) the instrument—

(I) gives effect to the purchase of a dwellinghouse or apartment upon the erection thereof and that section 49 of the Finance Act, 1969 , and section 112 (as amended by this Act) of the Finance Act, 1990 , do not apply, or

(II) is one to which section 112 (as amended by this Act) of the Finance Act, 1990 , applies,

and

(ii) until the expiration of the period of 5 years commencing on the date of the execution of the instrument or the subsequent sale (other than a sale the contract for which, if it were a written conveyance, would not, apart from section 50 of the Finance Act, 1979 , be charged with full ad valorem duty or a sale to a company under the control of the vendor or of any person entitled to a beneficial interest in the dwellinghouse or apartment immediately prior to the sale or to a company which would, in relation to a notional gift of shares in that company taken, immediately prior to the sale, by any person so entitled, be under the control of the donee or successor within the meaning of section 16 of the Capital Acquisitions Tax Act, 1976 , irrespective of the shares the subject-matter of the notional gift) of the dwellinghouse or apartment concerned, whichever event first occurs, that dwellinghouse or apartment will be occupied as the only or principal place of residence of the purchaser, or if there be more than one purchaser, of any one or more of the purchasers or of some other person in right of the purchaser or, if there be more than one purchaser, of some other person in right of any one or more of the purchasers and that no person, other than by virtue of a title prior to that of the purchaser, will derive any rent or payment in the nature of rent for the use of that dwellinghouse or apartment, or of any part of it, during that period.”.

(2) Where subsection (1) applies to an instrument and at any time during the period referred to in paragraph (b)(ii) of that subsection, some person, other than by virtue of a title prior to that of the purchaser, derives any rent or payment in the nature of rent for the use of the dwellinghouse or apartment concerned, or of any part of it, the purchaser, or where there be more than one purchaser, each such purchaser, shall—

(a) jointly and severally become liable to pay to the Commissioners a fine equal to the difference between the amount of the duty which would have been charged in the first instance if the dwellinghouse or apartment had been conveyed or transferred or leased by an instrument to which subsection (1) had not applied and the amount of duty which was actually charged together with interest on that amount charged at a rate of 1 per cent per month or part of a month from the date when the rent or payment is first received to the date the fine is remitted, and

(b) the person who receives the rent or payment shall, within 6 months after the date of the payment, notify the payment to the Commissioners on a form provided, or approved of, by them for the purposes of this section, unless that person is already aware that the Commissioners have already received such a notification from another source.