Chapter II

Miscellaneous

136. —In this Chapter “the Principal Act” means the Capital Acquisitions Tax Act, 1976 .

137. —(1) Section 109 of the Finance Act, 1993 , is hereby amended by the insertion of the following definitions after the definition of “the Act of 1965”:

“‘agricultural property’ has the same meaning as it has in section 19 (as amended by the Finance Act, 1994) of the Principal Act but excluding farm machinery, livestock and bloodstock;

‘agricultural value’ means the market value of agricultural property reduced by 30 per cent. of that value;”.

(2) This section shall have effect in relation to persons dying after the 17th day of June, 1993.

138. —(1) Section 111 of the Finance Act, 1993 , is hereby amended—

(a) by the deletion of “and” in subparagraph (ii) of paragraph (g) and by the insertion after that subparagraph of the following subparagraph:

“(iia) in so far as the inheritance consists of agricultural property, the reference to market value in subsection (1) of the said section 18 were a reference to agricultural value, and”,

(b) by the insertion of the following proviso to subparagraph (iii) of paragraph (g) of that section—

“Provided that nothing in this subparagraph shall have effect so as to reduce the tax which would but for this subparagraph be borne by property which at the date ofdeath of the deceased represented the share in the estate of the deceased of a person who was not on that date a dependent child or a dependent relative of the deceased;”.

(2) Paragraph (a) of subsection (1) shall have effect in relation to persons dying after the 17th day of June, 1993.

139. —(1) Section 112 of the Finance Act, 1993 , is hereby amended—

(a) by the deletion of paragraph (c) of that section, and

(b) by the substitution of the following paragraph for paragraph (d) of that section:

“(d) the dwelling-house comprised in an inheritance which, on the date of death of the deceased, is taken under the will or other testamentary disposition or under the intestacy of the deceased, by a person who was on that date a dependent child of the deceased or a dependent relative of the deceased and whose place of normal residence was on that date the dwelling-house:

Provided that—

(i) the total income from all sources of that dependent child or that dependent relative, for income tax purposes, in the year of assessment ending on the 5th day of April next before that date, did not exceed the ‘specified amount’ referred to in subsection (1A) of section 142 of the Income Tax Act, 1967 ,

(ii) the amount of the exemption shall (subject, with any necessary modifications, to the provisions of section 18 (4) (a) of the Principal Act in the case of a limited interest, and to the provisions of section 20 of that Act in the case of a contingency) be the whole or, as the case may be, the appropriate part (within the meaning of section 5 (5) of the Principal Act) of the net market value of the dwelling-house, and

(iii) the amount of the exemption shall not be reduced by virtue of the provisions of section 20 of the Principal Act where an entitlement ceasing within the meaning of that section ceases because of an enlargement of that entitlement.”.

(2) This section shall have effect in relation to persons dying on or after the date of the passing of this Act.

140. —(1) Chapter 1 of Part VI of the Finance Act, 1993 , is hereby amended by the insertion after section 115 of the following section—

“115A.—(1) Where the spouse of a deceased survives the deceased, probate tax chargeable by virtue of section 110 which is borne by property which, at the date of death of the deceased, represents the share of that spouse in the estate of the deceased, shall be abated to a nil amount:

Provided that—

(a) where the same property represents more than one person's share in the estate of the deceased and that spouse's interest in that property at that date is not a limited interest to which paragraph (b) relates, only a proportion of the probate tax borne by that property shall be abated to a nil amount and that proportion shall be the proportion which the value of that interest at that date bears to the total value of the property at that date, and for this purpose the value of that interest at that date shall not include the value of any interest in expectancy created by the will or other testamentary disposition of the deceased;

(b) where a limited interest to which that spouse became beneficially entitled in possession on that date was created by the will or other testamentary disposition of the deceased, probate tax borne by the property in which that limited interest subsisted on that date shall not be abated to a nil amount, but, notwithstanding section 117 (a), that tax shall not become due and payable until the date of the cesser of that limited interest and every person who (on the cesser of that limited interest) takes an inheritance which consists of all or part of the property in which that limited interest subsisted immediately prior to that cesser (hereinafter in this proviso referred to as ‘the said property’) and every trustee or other person in whose care the said property or the income therefrom is placed at the date of that cesser and every person in whom the said property is vested after that date, other than a bona fide purchaser or mortgagee for full consideration in money or money's worth, or a person deriving title from or under such a purchaser or mortgagee shall, notwithstanding any other provision to the contrary, be the only persons accountable for the payment of that tax and that tax shall be a charge on the said property in all respects as if the date of the inheritance in respect of which that tax is chargeable were the date of such cesser and the said property were property of which, for the purpose of section 47 of the Principal Act, that inheritance consisted at that date;

(c) if consideration in money or money's worth is paid to that spouse on the coming to an end of the limited interest referred to in paragraph (b) of this proviso before the event on which that interest was limited to cease, an appropriate proportion of the probate tax borne by the said property shall be abated to a nil amount and that proportion shall be the proportion which the value of that consideration bears to the value of the said property at the date of the cesser.

(2) Where the spouse of a deceased survives the deceased, probate tax chargeable by virtue of section 110 which is borne by the dwelling-house, or by any part thereof, shall, notwithstanding subsection (1) and section 117 (a), not become due and payable until the date of death of that spouse and, notwithstanding any provision to the contrary, the only persons who shall be accountable for that tax shall be the following, that is to say—

(a) any person who takes an inheritance under the will or other testamentary disposition of the deceased which consists in whole or in part of the dwelling-house, or part thereof, or which consists of property which represents that dwelling-house or part; and

(b) any trustee in whom the property comprised in any such inheritance is vested at the date of death of that spouse or at any time thereafter and any other person in whom the property comprised in any such inheritance becomes vested for a beneficial interest in possession at any time thereafter, other than a bona fide purchaser or mortgagee for full consideration in money or money's worth, or a person deriving title from or under such a purchaser or mortgagee.

(3) Where the date upon which tax becomes due and payable is postponed by virtue of subsection (1) (b) or subsection (2), then, notwithstanding paragraph (b) of section 117, interest upon that tax shall not be payable in respect of the period commencing on the valuation date and ending 9 months after the date on which that tax actually becomes due and payable.”.

(2) This section shall have effect in relation to persons dying after the 17th day of June, 1993.

141. —(1) Section 19 of the Principal Act is hereby amended—

(a) by the substitution of the following definition for the definition of “agricultural property”:

“‘agricultural property’ means agricultural land, pasture and woodland situate in the State and crops, trees and underwood growing on such land and also includes such farm buildings, farm houses and mansion houses (together with the lands occupied therewith) as are of a character appropriate to the property, and farm machinery, livestock and bloodstock thereon;”,

(b) by the substitution of the following definition for the definition of “agricultural value”:

“‘agricultural value’ means—

(a) in the case of farm machinery, livestock and bloodstock, 75 per cent. of the market value of such property,

(b) in the case of a gift of agricultural property, other than farm machinery, livestock and bloodstock, 70 per cent. of the market value of the agricultural property comprised in the gift reduced by 50 per cent. of that market value or by a sum of £150,000, whichever is the lesser, and

(c) in the case of an inheritance of agricultural property, other than farm machinery, livestock and bloodstock, 70 per cent. of the market value of the agricultural property comprised in the inheritance reduced by 35 per cent. of that market value or by a sum of £105,000, whichever is the lesser;”,

(c) by the substitution of the following subsection for subsection (4):

“(4) In relation to the deduction, in respect of agricultural property, of—

(a) in the case of a gift, 50 per cent. of its market value, or £150,000, whichever is the lesser, and

(b) in the case of an inheritance, 35 per cent. of its market value, or £105,000, whichever is the lesser,

the amount deductible shall not exceed £150,000 in the case of a gift and £105,000 in the case of an inheritance, in respect of the aggregate of—

(i) all taxable gifts taken on or after the 28th day of February, 1969, and

(ii) all taxable inheritances taken on or after the 1st day of April, 1975, which consist in whole or in part of agricultural property, taken by the same person, as donee or successor, from the same disponer.”,

(d) by the substitution of the following definition for the definition of “farmer”:

“‘farmer’, in relation to a donee or successor, means an individual who is domiciled and ordinarily resident in the State and in respect of whom not less than 80 per cent. of the market value of the property to which the individual is beneficially entitled in possession is represented by the market value of property in the State which consists of agricultural property, and, for the purposes of this definition, no deduction shall be made from the market value of property for any debts or incumbrances.”,

and

(e) in subsection (5), by the substitution of the following paragraph for paragraph (a):

“(a) The agricultural value shall cease to be applicable to agricultural property, other than crops, trees or underwood, if and to the extent that such property, or any agricultural property which directly or indirectly replaces such property—

(i) is sold or compulsorily acquired within the period of six years after the date of the gift or the date of the inheritance; and

(ii) is not replaced, within a year of the sale or compulsory acquisition, by other agricultural property,

and tax shall be chargeable in respect of the gift or inheritance as if the property were not agricultural property:

Provided that this paragraph shall not have effect where the donee or successor dies before the property is sold or compulsorily acquired.”.

(2) This section shall have effect in relation to gifts or inheritances taken on or after the 11th day of April, 1994.

142. —(1) The Second Schedule to the Principal Act is hereby amended by the substitution of the following Part for Part II (inserted by section 115 of the Finance Act, 1991 ):

“PART II

TABLE

”.

(2) This section shall have effect in relation to gifts and inheritances taken on or after the 11th day of April, 1994.

143. —(1) In this section—

“earlier relevant inheritance” means a relevant inheritance deemed to be taken on the date of death of the disponer;

“later relevant inheritance” means a relevant inheritance which, after the date of death of the disponer, is deemed to be taken by a discretionary trust by virtue of there ceasing to be a principal object of that trust who is under the age of 21 years;

“relevant inheritance” means an inheritance which, by virtue of section 106 (1) of the Finance Act, 1984 , is, on or after the 11th day of April, 1994, deemed to be taken by a discretionary trust;

“the relevant period” means—

(a) in relation to an earlier relevant inheritance, the period of five years commencing on the date of death of the disponer, and

(b) in relation to a later relevant inheritance, the period of five years commencing on the latest date on which a later relevant inheritance was deemed to be taken from the disponer;

“the appropriate trust”, in relation to a relevant inheritance, means the trust by which that inheritance was deemed to be taken.

(2) Section 109 of the Finance Act, 1984 , is hereby amended by the substitution of “six per cent.” for “three per cent.”:

Provided that where, in the case of each and every earlier relevant inheritance or each and every later relevant inheritance, as the case may be, taken from one and the same disponer, one or more objects of the appropriate trust became beneficially entitled in possession before the expiration of the relevant period to an absolute interest in the entire of the property of which that inheritance consisted on and at all times after the date of that inheritance (other than property which ceased to be subject to the terms of the appropriate trust by virtue of a sale or exchange of an absolute interest in that property for full consideration in money or money's worth), then, in relation to all such earlier relevant inheritances or all such later relevant inheritances, as the case may be, this section shall cease to apply and tax shall be computed accordingly in accordance with the provisions of the said section 109 as if this section had not been enacted.

(3) Where two or more persons are together beneficially entitled in possession to an absolute interest in property, those persons shall not, by reason only that together they are beneficially so entitled in possession, be regarded for the purposes of subsection (2) as beneficially so entitled in possession.

(4) Notwithstanding the provisions of section 46 of the Principal Act, interest shall not be payable on any repayment of tax which arises by virtue of the provisions of this section.

144. —(1) Section 117 of the Finance Act, 1991 , is hereby amended by the substitution in subsection (1) of “60 per cent.” for “50 per cent.” and “£60,000” for “£50,000”.

(2) This section shall have effect in relation to inheritances taken on or after the 11th day of April, 1994.

145. — Section 128 of the Finance Act, 1990 , is hereby amended by the substitution of the following subsection for subsection (1) (including the proviso thereto):

“(1) In computing in accordance with the provisions of the Second Schedule to the Principal Act the tax chargeable on the taxable value of a taxable gift or a taxable inheritance taken by a donee or successor on or after 11th day of April, 1994, the class threshold, as defined in paragraph 1 (inserted by section 111 of the Finance Act, 1984 ) of Part I of that Schedule, in respect of each taxable gift or taxable inheritance included in any aggregate of taxable values referred to in paragraph 3 (inserted by the said section 111) of Part I shall be adjusted by multiplying each such class threshold by the figure, rounded to the nearest third decimal place, determined by dividing by 133.5 the consumer price index number for the year immediately preceding the year in which that taxable gift or taxable inheritance is taken, and the references to the class threshold (including the reference to the class thresholds) in the definition of ‘revised class threshold’ and the proviso thereto in the said paragraph 1 shall be construed accordingly.”.

146. —(1) After the passing of this Act a person shall not be registered as owner of property in a register of ownership maintained under the Act of 1964 on foot of an application made to the Registrar on or after the 11th day of April, 1994, which is—

(a) based on possession, and

(b) made under the Rules of 1972, or any other rule made for carrying into effect the objects of the Act of 1964,

unless the applicant produces to the Registrar a certificate issued by the Commissioners to the effect that the Commissioners are satisfied—

(i) that the property did not become charged with gift tax or inheritance tax during the relevant period, or

(ii) that any charge for gift tax or inheritance tax to which the property became subject during that period has been discharged, or will (to the extent that it has not been discharged) be discharged within a time considered by the Commissioners to be reasonable.

(2) In the case of an application for registration in relation to which a solicitor's certificate is produced for the purpose of rule 19 (3), 19 (4) or 35 of the Rules of 1972, the Registrar may accept that the application is not based on possession if the solicitor makes to the Registrar a declaration in writing to that effect.

(3) Where, on application to them by the applicant for registration, the Commissioners are satisfied that they may issue a certificate for the purpose of subsection (1), they shall issue a certificate for that purpose, and the certificate and the application therefor shall be on a form provided by the Commissioners.

(4) A certificate issued by the Commissioners for the purpose of subsection (1) shall be in such terms and subject to such qualifications as the Commissioners think fit, and shall not be a certificate for any other purpose.

(5) In this section—

“the Act of 1964” means the Registration of Title Act, 1964 ;

“the Registrar” means the Registrar of Titles;

“relevant period”, in relation to a person's application to be registered as owner of property, means the period commencing on the 28th day of February, 1974, and ending on the date as of which the registration was made:

Provided that—

(a) where the certificate referred to in subsection (1) is a certificate for a period ending prior to the date of the registration, the period covered by the certificate shall be deemed to be the relevant period if, at the time of the registration, the Registrar had no reason to believe that a death relevant to the application for registration occurred after the expiration of the period covered by the certificate, and

(b) where the registration of the person (if any) who, at the date of that application, was the registered owner of the property had been made as of a date after the 28th day of February, 1974, the relevant period shall commence on the date as of which that registration was made;

“the Rules of 1972” means the Land Registration Rules, 1972 (S.I. No. 230 of 1972).

147. —Without prejudice to the meaning of section 5 of the Principal Act as enacted, that section shall have effect and be deemed always to have had effect as if the provisions of section 121 of the Finance Act, 1993 , had not been enacted, except where the consideration referred to in the said section 5, being consideration in relation to a disposition, could not reasonably be regarded (taking into account the disponer's position prior to the disposition) as representing full consideration to the disponer for having made such a disposition.

148. —Without prejudice to the meaning of section 11 of the Principal Act as enacted, that section shall have effect and be deemed always to have had effect as if the provisions of section 123 of the Finance Act, 1993 , had not been enacted, except where the consideration referred to in the said section 11, being consideration in relation to a disposition, could not reasonably be regarded (taking into account the disponer's position prior to the disposition) as representing full consideration to the disponer for having made such a disposition.