Chapter VII

Corporation Tax

39. —(1) Section 6 of the Corporation Tax Act, 1976 , is hereby amended in subsection (4) (inserted by the Finance Act, 1985 )—

(a) by the substitution of “six months” for “seven months” (inserted by the Finance Act, 1990 ), and

(b) by the addition of the following proviso to that subsection:

“Provided that where the last day of the period within which the corporation tax falls to be paid is a day after the 28th day of the month in which that period ends the corporation tax shall be paid not later than the 28th day of the said month.”.

(2) This section shall apply and have effect as respects accounting periods ending on or after the 1st day of May, 1993.

40. —As respects accounting periods ending on or after the 1st day of May, 1993, section 18 of the Finance Act, 1988 , is hereby amended in subsection (1) (inserted by the Finance Act, 1991 )—

(a) by the substitution of the following paragraph for paragraph (c):

“(c) where the chargeable period is an accounting period of a company, within the period of 6 months from the end of the accounting period:

Provided that where the last day of the period within which the preliminary tax is due and payable is a day after the 28th day of the month in which that period ends the preliminary tax shall be due and payable not later than the 28th day of the said month,”,

and

(b) by the substitution of “, the last day of that period of 6 months or the 28th day of the month in which that period of 6 months ends, as the case may be” for “or the last day of that period of 7 months, as the case may be”.

41. — Section 50 (as amended by the Finance Act, 1990 ) of the Finance Act, 1983 , is hereby amended, as respects accounting periods ending on or after the 1st day of May, 1993, by the insertion after subsection (6) of the following proviso to that subsection:

“Provided that where the last day of the period within which the advance corporation tax is due is a day after the 28th day of the month in which that period ends the advance corporation tax shall be due not later than the 28th day of the said month.”.

42. —(1) Section 1 (5) (as amended by section 29 of the Finance Act, 1990 ) of the Corporation Tax Act, 1976 , is hereby amended by the insertion in paragraph (a) after “body corporate” of “and includes a trustee savings bank within the meaning of the Trustee Savings Banks Act, 1989 ,”, and the said paragraph (a), as so amended, other than subparagraphs (i) to (iv) thereof, is set out in the Table to this section.

(2) This section shall have and be deemed to have had effect as on and from the 1st day of April, 1993.

TABLE

(a) “company” means any body corporate and includes a trustee savings bank within the meaning of the Trustee Savings Banks Act, 1989 , but does not include—

43. —(1) Section 337 (as amended by section 61 of the Finance Act, 1990 ) of the Income Tax Act, 1967 , shall not apply or have effect in relation to any interest, dividends, profits or gains arising to a trustee savings bank, within the meaning of the Trustee Savings Banks Act, 1989 , on or after the 1st day of April, 1993:

Provided that the trading income of a trustee savings bank shall, for the purpose of assessment to corporation tax, be reduced—

(a) as respects accounting periods falling in the period beginning on the 1st day of April, 1993, and ending on the 31st day of March, 1994, by 75 per cent. of the amount of that income,

(b) as respects accounting periods falling in the period beginning on the 1st day of April, 1994, and ending on the 31st day of March, 1995, by 50 per cent. of the amount of that income, and

(c) as respects accounting periods falling in the period beginning on the 1st day of April, 1995, and ending on the 31st day of March, 1996, by 25 per cent. of the amount of that income.

(2) For the purposes of this section—

(a) where an accounting period begins before the 1st day of April, 1994, and ends on or after that day, it shall be divided into two parts, one beginning on the day on which the accounting period begins and ending on the 31st day of March, 1994, and the other beginning on the 1st day of April, 1994, and ending on the day on which the accounting period ends,

(b) where an accounting period begins before the 1st day of April, 1995, and ends on or after that day, it shall be divided into two parts, one beginning on the day on which the accounting period begins and ending on the 31st day of March, 1995, and the other beginning on the 1st day of April, 1995, and ending on the day on which the accounting period ends, and

(c) where an accounting period begins before the 1st day of April, 1996, and ends on or after that day, it shall be divided into two parts, one beginning on the day on which the accounting period begins and ending on the 31st day of March, 1996, and the other beginning on the 1st day of April, 1996, and ending on the day on which the accounting period ends,

and, in each case, both of the parts shall be treated as if they were separate accounting periods.

44. —(1) Section 39 (as amended by section 47 ) of the Finance Act, 1980 , is hereby amended—

(a) in subsection (3), by the insertion, after paragraph (a), of the following proviso:

“Provided that the rendering to the intervention agency of services consisting of the subjecting of meat belonging to the agency to a process of manufacture that is carried out in an establishment specified in subsection (1CC6) (a) shall not be regarded as a sale of goods to the agency.”,

(b) in subsection (1CC9) (inserted by section 47 of the Finance Act, 1992 )—

(i) in paragraph (a)—

(I) by the substitution of the following definitions for the definitions of “qualifying company” and “qualifying trade”:

“‘qualifying company’ means a company to which a certificate under paragraph (b) relates;”,

“‘qualifying trade’ means a trade carried on by a company which consists wholly or mainly of the manufacture of milk products;”, and

(II) by the insertion of the following subparagraph after the definition of “relevant product”:

“For the purposes of this subsection, other than this subparagraph, where a trade consists partly of the manufacture of milk products, then, unless the trade consists mainly of the application of a process of pasteurisation to milk, the part of the trade which consists of the manufacture of milk products shall be treated as a separate trade.”,

and

(ii) by the substitution for paragraph (b) of the following paragraph:

“(b) (i) Where the Minister for Agriculture, Food and Forestry is satisfied that a company—

(I) carried on a qualifying trade during the whole of the period of 3 years ending immediately before the day from which the certificate specified subsequently in this paragraph has effect,

(II) is carrying on a qualifying trade and intends to continue to carry it on for a period which when added to the period for which it has been carrying it on will amount to not less than 3 years, or

(III) intends to carry on a qualifying trade for a period of not less than 3 years,

he may, after consultation with the Minister for Finance, give a certificate to the company stating that the company may, for the purposes of this subsection, be treated as a qualifying company, and, whenever such a certificate is given to a company, it shall be so treated during the period for which the certificate has effect.

(ii) A certificate under this subsection—

(I) shall have effect for the period beginning on such day, whether before or after the day on which it is given, as may be specified therein and ending on the day which is 2 years after that day, and

(II) may be revoked by the Minister for Agriculture, Food and Forestry, after consultation with the Minister for Finance.

(iii) Notice of a revocation under subparagraph (ii) shall be published as soon as may be in Iris Oifigiúil and the revocation shall have effect as on and from the thirtieth day after the day on which it is so published.”,

and

(c) by the insertion after subsection (1CC10) of the following subsection:

“(1CC11) (a) In this subsection ‘newspaper’ means a newspaper—

(i) the contents of each issue of which consist wholly or mainly, as regards the quantity of printed matter contained therein, of information on the principal current events and topics of general public interest,

(ii) the format of which is commonly regarded as newspaper format, and

(iii) which is—

(I) printed on newsprint,

(II) intended to be sold to the public, and

(III) normally published at least fortnightly.

(b) The following provisions shall apply for the purposes of relief under this Chapter in relation to a company that carries on a trade which consists of or includes the production in the State of a newspaper:

(i) the production of the newspaper (including the rendering of advertising services in the course of the production of the newspaper) by the company shall be regarded as the manufacture within the State of goods,

(ii) any amount receivable—

(I) from the sale of copies of the newspaper, or

(II) from the rendering by the company of advertising services in the course of the production of the newspaper,

shall be regarded as an amount receivable from the sale of goods,

and

(iii) subsection (1D) shall have effect as respects the company in relation to a claim by it for relief from tax by virtue of this subsection as it has effect as respects a company in relation to a claim by it for relief from tax by virtue of subsection (1B) or (1C).”,

and

(d) in subsection (6), by the substitution for “For the purposes” of “Subject to subsection (1CC11), for the purposes”.

(2) This section shall have and be deemed to have had effect in relation to a company—

(a) as respects paragraph (a) of subsection (1), for any relevant accounting period (within the meaning of section 38 of the Finance Act, 1980 ) of the company, and

(b) as respects paragraphs (b), (c) and (d) of subsection (1), for accounting periods of the company ending on or after the 1st day of April, 1992.

45. —(1) Section 84A (as amended by section 40 of the Finance Act, 1992 ) of the Corporation Tax Act, 1976 , is hereby amended—

(a) by the substitution of the following paragraph for paragraph (c) of subsection (3A):

“(c) For the purposes of this subsection and subsection (3B)—

(i) relevant principal advanced by a company at any time on or after a day includes any relevant principal advanced on or after that day to a borrower under an agreement entered into before that day, and

(ii) where, on or after the 6th day of May, 1993, a period of repayment of relevant principal advanced by a company is extended (whether or not the right to such an extension arose out of the terms of the agreement to advance the said relevant principal), the company shall be treated as having—

(I) received repayment of the said relevant principal, and

(II) advanced a corresponding amount of relevant principal,

on the date on which, apart from the said extension, the said relevant principal fell to be repaid.”,

and

(b) by the substitution of the following subparagraph for subparagraph (iii) of paragraph (b) of subsection (3B):

“(iii) the borrower is not a company which carries on relevant trading operations (within the meaning of section 39B of the Finance Act, 1980 ) or intends to carry on such trading operations:”.

(2) Subsection (1) (b) shall be deemed to have applied and have effect as on and from the 1st day of August, 1992.

46. —(1) This section applies to a distribution made by a company (hereafter in this section referred to as the “distributing company”) which carries on a specified trade (being a specified trade within the meaning assigned to it by section 84A (6) of the Corporation Tax Act, 1976 ) and which is a distribution by virtue only of subparagraph (ii), (iii) (I) or (v) of section 84 (2) (d) of the Corporation Tax Act, 1976 .

(2) If a distribution to which this section applies, made on or after the 25th day of May, 1993, or part of such a distribution, is not otherwise a relevant distribution for the purposes of subsection (3) of section 45 (as amended by the Finance Act, 1989 ) of the Finance Act, 1980 , then, notwithstanding any provision to the contrary in the said section 45, the distribution or part of it, as the case may be, shall be deemed, for the purposes of the said subsection (3), to be a relevant distribution.

(3) Where, on or after the 1st day of January, 1992, and before the 25th day of May, 1993, a company makes a distribution to which this section applies, the distributing company and the recipient of the distribution may, by notice in writing, jointly elect that subsection (2) shall apply to that distribution as if the reference therein to the 25th day of May, 1993, were a reference to the 1st day of January, 1992, and where such an election is made, subsection (2) shall apply to the said distribution accordingly.

(4) An election under subsection (3) shall be included with the return which is required, under section 10 of the Finance Act, 1988 , to be made by the distributing company for the accounting period in which the distribution is made:

Provided that, notwithstanding that an election was not included with any return made on or before the 31st day of May, 1993, it shall be deemed to have been so included if the election is delivered to the appropriate inspector (within the meaning of section 9 of the Finance Act, 1988 ) within a period of two months after that date.

(5) Section 45 (7) (as amended by the Finance Act, 1989 ) of the Finance Act, 1980 , is hereby amended by the insertion, after “this section”, of “and section 46 of the Finance Act, 1993”:

Provided that to the extent that an assessment under the said section 45 (7) would, apart from this proviso, have fallen to be made on a distributing company but would not have fallen to be so made if an election under subsection (3) had not been made, an assessment under the said section 45 (7) shall not be made on the company.

(6) This section shall be deemed to have had effect as on and from the 1st day of January, 1992.

47. —(1) In this section—

“relevant liability”, in relation to an accounting period, means relevant principal—

(a) denominated in a currency other than the currency of the State, and

(b) the interest in respect of which—

(i) falls to be treated as a distribution for the purposes of the Corporation Tax Act, 1976 , and

(ii) is computed on the basis of a rate which, at any time in that accounting period, exceeds 80 per cent. of the specified rate at that time;

“relevant principal” means an amount of money advanced to a borrower by a company the ordinary trading activities of which include the lending of money where—

(a) the consideration given by the borrower for that amount is a security falling within subparagraph (ii), (iii) (I) or (v) of section 84 (2) (d) of the Corporation Tax Act, 1976 , and

(b) interest or any other distribution is paid out of the assets of the borrower in respect of that security;

“specified rate” means—

(a) the rate known as the three month Dublin Interbank Offered Rate a record of which is maintained by the Central Bank of Ireland, or

(b) where such a record was not maintained, the rate known as the Interbank market three month fixed rate as published in the statistical appendices of the bulletins and annual reports of the Central Bank of Ireland.

(2) Notwithstanding any other provision of the Tax Acts or the Capital Gains Tax Acts, a profit or loss from any foreign exchange transaction, being a profit or loss which arises in an accounting period—

(a) in connection with relevant principal which, in relation to the accounting period, is a relevant liability, and

(b) to a company which, in relation to the said relevant liability, is the borrower,

shall, for the purposes of those Acts, be deemed to be a profit or gain or a loss, as the case may be, of the trade carried on by the borrower in the course of which trade the relevant liability is used.

(3) Section 39 of the Finance Act, 1980 , is hereby amended by the insertion, after subsection (1CC9), of the following subsection—

“(1CC10) The following provisions shall apply, for the purposes of relief under this Chapter, to a company to which a profit or loss specified in section 47 of the Finance Act, 1993, arises:

(a) the amount of any profit which is deemed by that section to be a profit or gain of the trade carried on by the company shall be regarded as an amount receivable from the sale of goods, and

(b) subsection (ID) shall have effect as respects the company in relation to a claim by it for relief from tax by virtue of this subsection as it has effect as respects a company in relation to a claim by it for relief from tax by virtue of subsection (IB) or (1C).”.

(4) This section shall have and be deemed to have had effect in relation to a company—

(a) as respects subsection (2), for all accounting periods (within the meaning of section 9 of the Corporation Tax Act, 1976 ) of the company, and

(b) as respects subsection (3), for any relevant accounting period (within the meaning of section 38 of the Finance Act, 1980 ) of the company.

48. — Section 35 of the Finance Act, 1987 , is hereby amended, as respects relevant investments made on or after the 6th day of May, 1993—

(a) in subsection (1)—

(i) by the substitution of the following definition for the definition of “qualifying film”:

“ ‘qualifying film’ means a film in respect of which—

(a) not less than 75 per cent. of the work on the production of the film is carried out in the State, and

(b) not more than 60 per cent. of the cost of the production of the film is met by relevant investments:

Provided that where paragraph (b) is complied with in relation to a film and paragraph (a) is not but not less than 10 per cent, of the said work is carried out in the State and the Minister for Arts, Culture and the Gaeltacht gives a certificate to the qualifying company concerned stating that the film may be treated as a qualifying film for the purposes of this section, the film shall be so treated and the certificate shall be published in Iris Oifigiúil as soon as may be after it is given:

Provided also that where, in relation to a film referred to in the foregoing proviso, the percentage of the work aforesaid carried out in the State (referred to subsequently in this proviso as the specified percentage) is less than 60 per cent., paragraph (b) shall be construed as if the reference to 60 per cent. were a reference to the specified percentage;”,

(ii) by the insertion of the following definition after the definition of “qualifying film”:

“ ‘qualifying individual’ means, in relation to a qualifying company, an individual who is not connected with the company;”,

(iii) by the substitution of the following definition for the definition of “qualifying period” (as amended by section 58 of the Finance Act, 1992 ):

“ ‘qualifying period’ means—

(a) in relation to an allowable investor company, the period commencing on the 9th day of July, 1987, and ending on the 31st day of March, 1996, and

(b) in relation to a qualifying individual, the period commencing on the 6th day of May, 1993, and ending on the 5th day of April, 1996;”,

and

(iv) by the substitution of the following paragraphs for paragraphs (a) and (b) of the definition of “relevant investment”:

“(a) paid in the qualifying period to a qualifying company, whether in respect of shares in the company or otherwise, by an allowable investor company on its own behalf or by a qualifying individual on his own behalf, and

(b) paid by the allowable investor company or the qualifying individual, as the case may be, for the purpose of enabling the qualifying company to produce a qualifying film, and”,

(b) in subsection (2), by the substitution of “on making a claim in that behalf” for “on due claim and on proof of the facts”,

(c) in subsection (3) (inserted by section 28 of the Finance Act, 1989 ), by the substitution of “£350,000” for “£200,000”, in each place where it occurs, and of “£1,050,000” for “£600,000”, in both places where it occurs,

(d) by the insertion of the following subsections after subsection (3):

“(3A) Subject to the provisions of this section, where, in any year of assessment, a qualifying individual makes a relevant investment, he shall, on making a claim in that behalf, be given a deduction of the amount of that investment from his total income for that year of assessment.

(3B) A deduction shall not be given under this section in respect of any relevant investment made by a qualifying individual in a qualifying company in any year of assessment unless the amount of that relevant investment, or the total amount of the relevant investments, made by him in the qualifying company in that year is £200 or more:

Provided that, in the case of a qualifying individual who is a husband assessed to tax for a year of assessment in accordance with the provisions of section 194 (inserted by section 18 of the Finance Act, 1980 ) of the Income Tax Act, 1967 , any relevant investment made by his spouse in the qualifying company in that year of assessment shall be deemed to have been made by him.

(3C) A deduction shall not be given to a qualifying individual under this section for a year of assessment to the extent to which the amount of the relevant investment, or the total amount of the relevant investments (whether or not made in the same qualifying company), made by him in that year of assessment exceeds £25,000.

(3D) If, for any year of assessment, a greater deduction would be given to a qualifying individual under this section but for either or both of the following reasons, that is to say—

(a) an insufficiency of total income, or

(b) the operation of subsection (3C),

the amount of the deduction which would be given to him under this section but for either or both of those reasons, less the amount of the deduction which is given to him under this section for that year of assessment shall be carried forward to the next year of assessment and shall be treated for the purposes of this section as a relevant investment made by him in that following year:

Provided that this subsection shall not apply or have effect for any year of assessment after the year 1995-96.

(3E) If, and so far as, an amount once carried forward to a year of assessment under subsection (3D) (and treated as a relevant investment made by a qualifying individual in that year of assessment) is not deducted from the qualifying individual's total income for that year of assessment, it shall be carried forward again to the next following year of assessment (and treated as a relevant investment made by him in that next following year), and so on for succeeding years of assessment:

Provided that this subsection shall not apply or have effect for any year of assessment after the year 1995-96.

(3F) A deduction under this section shall be given to a qualifying individual for any year of assessment as follows:

(a) firstly, in respect of an amount carried forward from an earlier year of assessment in accordance with the provisions of subsection (3D) or (3E), and, in respect of such an amount so carried forward, for an earlier year of assessment in priority to a later year of assessment, and

(b) then, and only then, in respect of any other amount for which a deduction is to be given in that year of assessment.”,

(e) in subsection (4)—

(i) by the deletion of “the inspector is satisfied that”, and

(ii) by the substitution of “the company or the individual, as the case may be, making the claim” for “it appears that the company making the claim”,

(f) by the substitution of the following subsection for subsection (5):

“(5) An allowable investor company or a qualifying individual shall not be entitled to relief in respect of a relevant investment unless the relevant investment—

(a) has been made for bona fide commercial reasons and not as part of a scheme or arrangement the main purpose or one of the main purposes of which is the avoidance of tax,

(b) has been, or will be, used in the production of a qualifying film, and

(c) is made at the risk of the allowable investor company or the qualifying individual, as the case may be, and—

(i) in a case where it is made by an allowable investor company, neither the company nor any person who would be regarded as connected with the company, or,

(ii) in a case where it is made by a qualifying individual, neither the individual nor any person who would be regarded as connected with him,

is entitled to receive directly or indirectly, any payment from the qualifying company other than a payment made on an arm's length basis for goods or services supplied or a payment out of the proceeds of exploiting the film to which the allowable investor company or the qualifying individual, as the case may be, is entitled under the terms subject to which the relevant investment is made.”,

(g) in subsection (6), by the substitution for “by making an assessment to corporation tax under Case IV of Schedule D for the accounting period or accounting periods in which relief was given,” of “by making an assessment to corporation tax or income tax, as the case may be, under Case IV of Schedule D for the accounting period or accounting periods, or the year of assessment or years of assessment, as the case may be, in which relief was given”,

(h) in subsection (7)—

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

“(aa) Subject to paragraph (b), where a qualifying individual is entitled to relief under this section in respect of any sum, or any part of a sum, or would be so entitled on making due claim, as a deduction from his total income for any year of assessment—

(i) he shall not be entitled to any relief for that sum or part in computing his total income, or as a deduction from his total income, for any year of assessment under any other provision of the Income Tax Acts, and

(ii) that sum or part shall be treated as a sum which, by reason of paragraph 4 of Schedule 1 to the Capital Gains Tax Act, 1975 , is to be excluded from the sums allowable as a deduction in the computation of gains and losses for the purposes of the Capital Gains Tax Acts.”,

and

(ii) by the substitution of the following paragraphs for paragraph (b) and paragraph (bb) (inserted by section 28 of the Finance Act, 1989 ):

“(b) Where an allowable investor company or a qualifying individual has made a relevant investment by way of a subscription for new ordinary shares of a qualifying company and none of those shares are disposed of by the allowable investor company or the qualifying individual, as the case may be, within three years of their acquisition by that company or that individual, as the case may be, then the sums allowable as deductions from the consideration in the computation for the purpose of capital gains tax of the gain or loss accruing to the company or the individual, as the case may be, on the disposal of those shares shall be determined without regard to any relief under this section which the company or the individual, as the case may be, has obtained, or would be entitled on due claim to obtain, except that where those sums exceed the consideration they shall be reduced by an amount equal to—

(i) the amount in respect of which the allowable investor company or the qualifying individual, as the case may be, has obtained relief under this section in respect of the subscription for those shares, or

(ii) the amount of the excess,

whichever is the less:

Provided that, if the disposal of shares is by a qualifying individual, and the disposal falls within section 13 (5) of the Capital Gains Tax Act, 1975 , the preceding provisions of this paragraph shall not apply.

(bb) Notwithstanding paragraph (b), where, on or after the 6th day of May, 1993, an allowable investor company or a qualifying individual has made a relevant investment (hereafter in this paragraph referred to as ‘the first relevant investment’) by way of a subscription for new ordinary shares of a qualifying company and those shares are disposed of by the allowable investor company or the qualifying individual, as the case may be, on a day which is not earlier than 12 months after the date of their acquisition by the allowable investor company or the qualifying individual, as the case may be, and—

(i) the consideration upon such disposal is used, and used only, by the allowable investor company or the qualifying individual, as the case may be, within the period of 12 months commencing on that day for the purpose of making a further relevant investment by way of a subscription for new ordinary shares of a qualifying company, and

(ii) the qualifying company uses the sum invested to produce a qualifying film other than a qualifying film on the production of which the first relevant investment was expended,

then, the provisions of paragraph (b) regarding the determination, in respect of the computation of a gain or loss for the purpose of capital gains tax, of sums allowable as deductions from a consideration to which paragraph (b) relates shall apply in respect of the consideration used for the purpose of making the further relevant investment as they apply in respect of the consideration to which paragraph (b) relates:

Provided that where an allowable investor company has made a relevant investment by way of a subscription for new ordinary shares of a qualifying company and that relevant investment is one to which paragraph (b) of subsection (3) refers, then, if those shares are disposed of by the allowable investor company not earlier than 12 months after the date of their acquisition by that company, this paragraph (other than so much thereof as would require the consideration upon the disposal to be used for making a further relevant investment) shall apply—

(I) in case the relevant investment, or the aggregate of that investment and any other relevant investment made by the allowable investor company for the purposes of enabling the qualifying company to make the qualifying film concerned, is not less than £1,050,000, in respect of the consideration upon such disposal, or

(II) in case the relevant investment, or the aggregate of that investment and any other relevant investment made by the allowable investor company for the purposes of enabling the qualifying company to make the qualifying film concerned, is less than £1,050,000, in respect of such part of the consideration upon such disposal as bears to the total consideration on disposal the same proportion as the excess of the relevant investment, or the excess of the aggregate of that investment and any other relevant investment made by the allowable investor company for the purposes aforesaid, over £350,000 bears to the total amount of the relevant investment, or the aggregate of the total amount of that investment and the total amount of any other relevant investments made by the allowable investor company for the purposes aforesaid.”,

and

(i) by the insertion, after subsection (8), of the following subsections:

“(9) In the case of an individual, all such provisions of the Income Tax Acts as apply in relation to the deductions specified in sections 138 to 142 of the Income Tax Act, 1967 , shall, with any necessary modifications, apply in relation to relief under this section.

(10) Section 198 (inserted by section 18 of the Finance Act, 1980 ) of the Income Tax Act, 1967 , is hereby amended, in subsection (1) (a), by the insertion of the following subparagraph after subparagraph (xii) (inserted by section 4 of the Finance Act, 1989 ):

‘(xiii) so far as it flows from relief under section 35 of the Finance Act, 1987 , in the proportions in which they made the relevant investment giving rise to the relief,’.”.

49.— (1) (a) In this section—

“beneficiary”, in relation to a trust, means any person who, directly or indirectly, is beneficially entitled, or may through the exercise of any power or powers conferred on any person or persons become so beneficially entitled, under the trust to income or capital or to have any income or capital applied for his benefit or to receive any other benefit;

“relevant person” means a person who—

(i) (I) is a trustee under a unit trust scheme which is, or is deemed to be, an authorised unit trust scheme within the meaning of the Unit Trusts Act, 1990 , and which has not had its authorisation under that Act revoked,

(II) is a trustee of any other undertaking which is an undertaking for collective investment in transferable securities within the meaning of the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations, 1989 (S.I. No. 78 of 1989), being an undertaking which holds an authorisation issued pursuant to the said Regulations and that authorisation has not been revoked,

(III) in the opinion of the Central Bank of Ireland, is an appropriate person to be a trustee (being a trustee to whom subparagraph (I) or (II) of this definition relates), or

(IV) is a holder of a licence granted under section 9 of the Central Bank Act, 1971 , or is otherwise exempt from holding a licence by virtue of Regulation 11 of the European Communities (Licensing and Supervision of Credit Institutions) Regulations, 1992 (S.I. No. 395 of 1992),

(ii) is authorised, under any enactment which provides for such authorisation, by the Central Bank of Ireland to engage in the management of trusts in the course of its business,

(iii) carries on a business in the State which consists of or includes such management of trusts, and

(iv) is, in the course of that business, involved in the management of the trusts;

“settlor”, in relation to a trust, includes any person who has provided or undertaken to provide assets or income directly or indirectly for the purposes of the trust;

“trust” means any trust established by deed entered into by one or more than one settlor, or any trust arising under a testamentary disposition, whereby—

(i) assets, which may or may not change from time to time in the course of the management of the trust, or

(ii) income, the sources and nature of which may or may not also so change from time to time,

beneficially owned by the settlor or settlors are or is vested in a person or persons (in this section referred to as the “trustee” or “trustees”) to be—

(I) either or both held and managed for,

(II) paid over to, or

(III) applied for,

the benefit of any beneficiary or beneficiaries.

(b) For the purposes of this section—

(i) a trust shall, at any time, be a “foreign trust” where at that time it is established to the satisfaction of—

(I) the inspector concerned with whether or not any tax or duty applies, or

(II) such other officer of the Revenue Commissioners as is so concerned,

in relation to the trust or to any person who in relation to the trust is a settlor, a trustee or a beneficiary, that all of the following conditions are satisfied at that time with respect to the trust—

(A) no person who is a settlor was at the time the trust was created (or in the case of a trust arising under a testamentary disposition, at the time of his death) domiciled, resident or ordinarily resident in the State,

(B) all of the assets of the trust are situated outside the State,

(C) all of the income of the trust arises from sources situated outside the State,

(D) none of the persons who at that time are or may be beneficiaries in relation to the trust is domiciled, resident or ordinarily resident in the State, and

(E) none of the persons who are trustees in relation to the trust is resident or ordinarily resident in the State:

Provided that, notwithstanding anything in the terms of the trust or in any of the foregoing provisions of this subparagraph, a person shall not for the purposes of this clause be regarded as a trustee in relation to a trust if that person is a relevant person, and

(ii) section 48 of the Capital Gains Tax Act, 1975 , shall apply for the purposes of determining the situation of assets.

(2) Notwithstanding anything in the Income Tax Acts, for the purposes of those Acts the income of a foreign trust shall not be regarded as the income of any person resident or ordinarily resident in the State.

(3) Notwithstanding anything in the Capital Gains Tax Acts and without prejudice to the proviso to subsection (1) of section 15 of the Capital Gains Tax Act, 1975 , for the purposes of those Acts the assets of a foreign trust shall not be regarded as the assets of any person resident or ordinarily resident in the State.

(4) This section shall not come into effect until such time as legislation governing the regulation of trustees by the Central Bank of Ireland is enacted and shall come into effect subject to such legislation and on such date as the Minister for Finance shall by order appoint.

50. —Section 10A (inserted by section 46 of the Finance Act, 1992 ) of the Corporation Tax Act, 1976 , is hereby amended in subsection (3), as respects accounting periods ending on or after the 1st day of April, 1992—

(a) by the insertion in paragraph (a) immediately before “for the purposes of subsection (2)” of “for any accounting period”, and

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

“(aa) Notwithstanding the provisions of subsection (10) (b) of section 155, in determining the income of a company, referred to in the expression ‘total income brought into charge to corporation tax’, for any accounting period for the purposes of subsection (2) of the said section 41, it shall be the sum determined by the said subsection (10) (b) for that period reduced by any charges on income paid for the purposes of the sale of goods which are allowed as a deduction against the total profits of the company for that period and paid on or after the 1st day of April, 1992.”,

and the said paragraph (a), as so amended, is set out in the Table to this section.

TABLE

(a) Notwithstanding the provisions of subsection (3) of section 41 of the Finance Act, 1980 , in determining the income of a company, referred to in the expression “the income from the sale of those goods”, for any accounting period for the purposes of subsection (2) of the said section 41, it shall be the sum determined by subsection (3) of the said section 41 for that period reduced by any charges on income paid for the purpose of the sale of goods which are allowed as a deduction against the total profits of the company for that period and paid on or after the 1st day of April, 1992.

51. —(1) In this section “First Step” means the company incorporated under the Companies Acts, 1963 to 1990, on the 20th day of September, 1990, as First Step Limited.

(2) This section applies to a gift of money which—

(a) on or after the 1st day of June, 1993, and before the 1st day of June, 1995, is made to First Step,

(b) is applied by First Step solely for the objects for which it was incorporated, and

(c) is not deductible in computing for the purposes of corporation tax the profits or gains of a trade or profession or is not income to which the provisions of section 439 of the Income Tax Act, 1967 , apply.

(3) Where a company makes a gift to which this section applies and claims relief from tax by reference thereto, the net amount thereof shall, for the purposes of corporation tax, be deemed to be a loss incurred by the company in a separate trade in the accounting period of the company in which the gift is made:

Provided that—

(a) in determining the net amount of the gift for the purposes of this section, the amount or value of any consideration received by the company as a result of making the gift, whether received directly or indirectly from First Step or any other person, shall be deducted from the amount of the gift, and

(b) relief under this section shall not be given to a company for an accounting period—

(i) if the net amount of the gift (or the aggregate of the net amounts of gifts) made by it in that accounting period, being a gift or gifts, as the case may be, to which this section applies, does not exceed £500,

(ii) to the extent to which the net amount of the gift (or the aggregate of the net amounts of gifts) made by it in that accounting period, being a gift or gifts, as the case may be, to which this section applies, exceeds £100,000,

(iii) in respect of a gift made at any time in the year ended on the 31st day of May, 1994, if, at that time, the aggregate of the net amounts of all gifts to which this section applies made to First Step within the said year exceeds £1,500,000, or

(iv) in respect of a gift made at any time in the year ended on the 31st day of May, 1995, if, at that time, the aggregate of the net amounts of all gifts to which this section applies made to First Step within the said year exceeds £1,500,000.

(4) A claim under this section shall be made with the return required to be delivered under section 10 of the Finance Act, 1988 , for the accounting period in which the gift is made.

(5) Where a company makes a gift in respect of which relief is not to be given by virtue of subparagraph (iii) or (iv) of paragraph (b) of the proviso to subsection (3), First Step shall, by notice in writing given to the company within 30 days of the making of the gift, advise the company accordingly.

(6) Where a gift to which this section applies is made by a company in an accounting period of the company which is less than 12 months, the amounts specified in subparagraphs (i) and (ii) of paragraph (b) of the proviso to subsection (3) shall be proportionately reduced.