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FINANCE ACT, 1996
Capital Gains Tax
Amendment of paragraph 11 (disposal of certain assets) of Schedule 4 to Capital Gains Tax Act, 1975.
(a) in subparagraph (8) by the substitution for “the consideration” of “the amount or value of the consideration, in money or money's worth,”, and
(b) in subparagraph (10A) (inserted by the Finance Act, 1995) by the insertion of the following proviso:
“Provided that this subparagraph shall not apply where there is a disposal of an asset by virtue of a capital sum being derived from the asset under a policy of insurance of the risk of any kind of damage to the asset.”.
Amendment of section 26 (disposal of business or farm on retirement) of Capital Gains Tax Act, 1975.
“Provided that where a company which is a holding company, would not, but for this proviso, be an individual's family company, but would be such a company if the individual had not at any time on or after the 6th day of April, 1987, and before the 6th day of April, 1990, disposed of shares in the company to a child (within the meaning of section 27) of the individual, the company shall be deemed to be the individual's family company;”.
(2) This section shall apply and have effect as on and from the 23rd day of April, 1996.
Amendment of section 46 (debts) of Capital Gains Tax Act, 1975.
“(7) For the purposes of this section a debenture issued by any company shall be deemed to be a security (within the meaning assigned by paragraph 3 of Schedule 2) if it is issued—
(a) on a reorganisation (as provided for in paragraph 2 (1) of Schedule 2) or in pursuance of its allotment on any such reorganisation,
(b) in exchange for shares in or debentures of another company where the requirements of paragraph 4 (2) of Schedule 2 are satisfied in relation to the exchange,
(c) under any such arrangements as are referred to in paragraph 5 (1) of Schedule 2, or
(d) in pursuance of rights attached to any debenture falling within paragraph (a), (b) or (c).”.
(2) Subsection (1) shall apply and have effect as respects the disposal of a debenture on or after the 28th day of March, 1996.
Amendment of section 27 (relief for individuals on certain reinvestment) of Finance Act, 1993.
“(2A) (a) Where an individual who is not entitled to be treated in accordance with subsection (2) solely by reason of not having satisfied the requirements of either or both paragraph (a) and (d) of subsection (5) of this section, and—
(i) all the other requirements of the section have been satisfied,
(ii) the capital gains tax on the disposal of the original holding has been paid in full, and
(iii) the individual has, throughout a period of 2 years beginning within the specified period, been a full-time employee or a full-time director of the qualifying company,
then the individual shall—
(I) be entitled on making a claim in that behalf to such repayment of capital gains tax as would secure that the tax which is ultimately borne by the individual does not exceed the tax which would have been borne by the individual if the said individual had been entitled to be treated in accordance with subsection (2), and
(II) be treated for the purposes of the Capital Gains Tax Acts as if the chargeable gain accruing on the disposal of the original holding did not accrue until he disposes of the qualifying investment, and the proviso to subsection (2) shall have effect for the purposes of this subsection as it has for the purposes of that subsection.
(b) Any repayment of tax under this subsection shall not carry interest.”.
(2) This section shall apply and have effect as respects disposals made on or after the 6th day of April, 1996.
Amendment of section 66 (reduced rate of capital gains tax on certain disposals of shares by individuals) of Finance Act, 1994.
(a) by the substitution in subsection (6) of “3 years” for “5 years”, and
(b) by the substitution in paragraph (a) and paragraph (b) of subsection (8) of “3 years” for “5 years”.
(2) (a) Subsection (1) shall apply and have effect as respects a disposal effected by an individual of qualifying shares in a qualifying company on or after the 6th day of April, 1996.
Exemption of certain milk boards and associated companies from capital gains tax.
64. —(1) In this section—
“the Boards” means—
(a) the Dublin District Milk Board established under the Dublin District Milk Board Order, 1936 (S.R. & O. No. 254 of 1936), and
(b) the Cork District Milk Board established under the Cork District Milk Board Order, 1937 (S.R. & O. No. 91 of 1937);
“the companies” means—
(a) the company incorporated on the 19th day of November, 1991, as Dairysan Limited, and
(b) the company incorporated on the 14th day of February, 1994, as Glenlee (Cork) Limited;
“the Interim Board” means the Interim Board established under the Milk (Regulation of Supply) (Establishment of Interim Board) Order, 1994, (S.I. No. 408 of 1994).
(a) by the Boards or the companies to the Interim Board, and
(b) by the Interim Board,
as it applies to a gain accruing to a body specified in that section.