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33 1968

FINANCE ACT, 1968

PART IV

Corporation Profits Tax

Investment trust companies.

27. —(1) In this section—

company” means any body corporate;

corporation tax” means the tax in Northern Ireland and Great Britain known as corporation tax;

investment trust company” means a company which complies with the following conditions:

(a) it is incorporated and resident in the State,

(b) it has issued for public subscription not less than eighty per cent. in nominal value of its shares carrying voting rights, whether immediate or to arise in certain future circumstances,

(c) its business consists mainly in the making of investments,

(d) the distribution as dividend of surpluses arising from the realisation of investments is prohibited by the company's memorandum or articles of association;

Irish securities” means securities of the Government, securities guaranteed by the Minister for Finance and any stocks, shares, debentures, bonds or obligations of any municipal corporation in the State, or any company or other body corporate incorporated in the State;

securities” includes stocks, shares, bonds and obligations of any Government, municipal corporation, company or other body corporate.

(2) In respect of any accounting period ending after the 31st day of December, 1967, the profits of an investment trust company shall not, for the purposes of corporation profits tax, include dividends and other distributions received from a company liable to corporation tax to the extent that such dividends and distributions have been paid out of profits which have borne that tax:

Provided that—

(a) throughout the accounting period the following conditions are satisfied:

(i) the value of the Irish securities held by the investment trust company was not less than fifteen per cent. of the value of the securities held by the investment trust company,

(ii) the securities (whether of one class or more than one class) held by the investment trust company in any one company, other than an investment trust company, did not represent more than fifteen per cent. by value of the first-mentioned investment trust company's securities,

(iii) the number of shareholders was not less than fifty and no one shareholder was the beneficial owner of more than forty-nine per cent. of the shares of the investment trust company,

(iv) the value of the securities quoted on a recognised stock exchange which were held by the investment trust company was not less than eighty-five per cent. of the value of the securities held by the investment trust company,

and

(b) the investment trust company did not retain in respect of any accounting period ending on or after the passing of this Act more than fifteen per cent. of its actual profits in that accounting period.

(3) The Minister for Finance may, after consultation with the Revenue Commissioners, authorise in respect of any accounting period the relief provided by this section notwithstanding that one or more of the conditions stated in subsection (2) (a) was or were not complied with and notification of any authorisation under this subsection shall be published in Iris Oifigiúil as soon as may be after it is given.

Deductions for directors' remuneration.

28. —In respect of every accounting period ending after the 31st day of December, 1967, proviso (c) to section 53 (2) of the Finance Act, 1920, and section 36 (4) of the Finance Act, 1941 , shall be construed and have effect as if for “two thousand five hundred pounds” there were substituted “four thousand pounds”.

Continuance of certain exemptions from corporation profits tax.

29. —The exemptions from corporation profits tax specified in section 33 (1) of the Finance Act, 1929, shall be given in respect of the period beginning on the 1st day of January, 1968, and ending on the 31st day of December, 1970.

Amendment of section 69 of Finance Act, 1959.

30. —(1) Any reference in section 69 of the Finance Act, 1959 , to a deduction allowed under section 241 of the Income Tax Act, 1967 , shall be construed as including a reference to that deduction as determined pursuant to that section and section 4 (2).

(2) Section 69 of the Finance Act, 1959 , is hereby amended by the addition to subsection (2) of the following proviso:

“Provided that in relation to an allowance made by virtue of the proviso to section 244 (3) of the Income Tax Act, 1967 , this subsection shall have effect as if the following paragraph were inserted after paragraph (a)—

‘(aa) it is made in charging the profits or gains of a trade a part of which is, or is comprised in, that business,’”.