First Previous (Chapter 2 Miscellaneous) Next (PART 4 Stamp Duties)

2 1999

FINANCE ACT, 1999

PART 3

Value-Added Tax

Interpretation (Part 3).

119. —In this Part—

“the Principal Act” means the Value-Added Tax Act, 1972 ;

“the Act of 1978” means the Value-Added Tax (Amendment) Act, 1978 ;

“the Act of 1992” means the Finance Act, 1992 ;

“the Act of 1995” means the Finance Act, 1995 ;

“the Act of 1997” means the Finance Act, 1997 ;

“the Act of 1998” means the Finance Act, 1998 .

Amendment of section 3 (supply of goods) of Principal Act.

120. —Section 3 of the Principal Act is hereby amended—

(a) in paragraph (g) (inserted by the Act of 1992) of subsection (1) by the substitution of the following subparagraph for subparagraph (ii):

“(ii) the transfer of goods to another person under the circumstances specified in paragraph (i) of the Second Schedule and the transfer of the goods referred to in paragraphs (v), (va), (vb) and (x) of the Second Schedule,”,

(b) in subsection (5) by the insertion of the following paragraph after paragraph (b):

“(c) Where a person, in this subsection referred to as an ‘owner’—

(i) supplies financial services of the kind specified in subparagraph (i)(e) of the First Schedule in respect of a supply of goods within the meaning of paragraph (b) of subsection (1), being goods which are of such a kind or were used in such circumstances that no part of the tax, if any, chargeable on that supply of those goods was deductible by the person to whom that supply was made, and

(ii) enforces such owner's right to recover possession of those goods,

then the disposal of those goods by such owner shall be deemed for the purposes of this Act not to be a supply of goods.”,

and

(c) in paragraph (A) of the proviso (inserted by the European Communities (Value-Added Tax) Regulations, 1992 (S.I. No. 413 of 1992)) to paragraph (d) of subsection (6) by the substitution of “£27,565” for “£27,000”.

Amendment of section 5 (supply of services) of Principal Act.

121. —Section 5 of the Principal Act is hereby amended by the insertion of the following paragraph after paragraph (ddd) (inserted by the Act of 1998) in subsection (6):

“(dddd) Notwithstanding the provisions of subsection (5), the place of supply of services consisting of the hiring out of means of transport by a person established in the State shall be deemed to be outside the Community where such means of transport are, or are to be, effectively used and enjoyed outside the Community.”.

Special scheme for investment gold.

122. —The Principal Act is hereby amended by the insertion of the following section after section 6:

“6A.—(1) (a) In this section—

‘intermediary’ means a person who intervenes for another person in a supply of investment gold while acting in the name and for the account of that other person;

‘investment gold’ means—

(i) gold in the form of—

(I) a bar, or

(II) a wafer,

of a weight accepted by a bullion market and of a purity equal to or greater than 995 parts per one thousand parts, and

(ii) gold coins which—

(I) are of a purity equal to or greater than 900 parts per one thousand parts,

(II) are minted after 1800,

(III) are or have been legal tender in their country of origin, and

(IV) are normally sold at a price which does not exceed the open market value of the gold contained in the coins by more than 80 per cent.

(b) For the purposes of the definition of investment gold in paragraph (a), gold coins which are listed in the ‘C’ series of the Official Journal of the European Communities as fulfilling the criteria referred to in that definition in respect of gold coins shall be deemed to fulfil the said criteria for the whole year for which the list is published.

(2) The provisions of this section shall apply to—

(a) investment gold which is represented by securities or represented by certificates for allocated or unallocated gold or traded on gold accounts and including, in particular, gold loans and swaps, involving a right of ownership or a claim in respect of investment gold, and

(b) transactions concerning investment gold involving futures and forward contracts leading to a transfer of a right of ownership or a claim in respect of investment gold.

(3) Notwithstanding subsection (1) of section 6, a person who produces investment gold or transforms any gold into investment gold, may, in accordance with conditions set out in regulations, waive such person's right to exemption from tax on a supply of investment gold to another person who is engaged in the supply of goods and services in the course or furtherance of business.

(4) Where a person waives, in accordance with subsection (3), such person's right to exemption from tax in respect of a supply of investment gold, an intermediary who supplies services in respect of that supply of investment gold may, in accordance with conditions set out in regulations, waive that intermediary's right to exemption from tax in respect of those services.

(5) (a) Where a person waives, in accordance with subsection (3), such person's right to exemption from tax in respect of a supply of investment gold, then, for the purposes of this Act, the person to whom the supply of investment gold is made shall, in relation thereto, be a taxable person and be liable to pay the tax chargeable on that supply as if such taxable person had made that supply of investment gold for consideration in the course or furtherance of business and the person who waived the right to exemption in respect of that supply shall not be liable to pay the said tax.

(b) Where a person is liable for tax in accordance with paragraph (a) in respect of a supply of investment gold, such person shall, notwithstanding the provisions of section 12, be entitled, in computing the amount of tax payable by such person in respect of the taxable period in which that liability to tax arises, to deduct the tax for which such person is liable on that supply, if such person's subsequent supply of that investment gold is exempt from tax.

(6) (a) A taxable person may, in computing the amount of tax payable by such person in respect of any taxable period and notwithstanding section 12, deduct—

(i) the tax charged to such person during that period by other taxable persons by means of invoices, prepared in the manner prescribed by regulations, in respect of supplies of gold to such person,

(ii) the tax chargeable during that period, being tax for which such person is liable in respect of intra-Community acquisitions of gold, and

(iii) the tax paid by such person, or deferred, as established from the relevant customs documents kept by such person in accordance with section 16(3) in respect of gold imported by such person in that period,

where that gold is subsequently transformed into investment gold and such person's subsequent supply of that investment gold is exempt from tax.

(b) A person may claim, in accordance with regulations, a refund of—

(i) the tax charged to such person on the purchase of gold, other than investment gold, by such person,

(ii) the tax chargeable to such person on the intra-Community acquisition of gold, other than investment gold, by such person, and

(iii) the tax paid or deferred on the importation by such person of gold other than investment gold,

where that gold is subsequently transformed into investment gold and such person's subsequent supply of that investment gold is exempt from tax.

(7) (a) A taxable person may, in computing the amount of tax payable by such person in respect of a taxable period and notwithstanding section 12, deduct the tax charged to such person during that period by other taxable persons by means of invoices, prepared in the manner prescribed by regulations, in respect of the supply to the first-mentioned person of services consisting of a change of form, weight or purity of gold where that person's subsequent supply of that gold is exempt from tax.

(b) A person may claim, in accordance with regulations, a refund of the tax charged to such person in respect of the supply to such person of services consisting of a change of form, weight or purity of gold where such person's subsequent supply of that gold is exempt from tax.

(8) (a) A taxable person who produces investment gold or transforms any gold into investment gold may, in computing the amount of tax payable by such person in respect of a taxable period and notwithstanding section 12, deduct—

(i) the tax charged to such person during that period by other taxable persons by means of invoices, prepared in the manner prescribed by regulations in respect of supplies of goods or services to the first-mentioned person,

(ii) the tax chargeable during that period, being tax for which such person is liable in respect of intra-Community acquisitions of goods, and

(iii) the tax paid by such person, or deferred, as established from the relevant customs documents kept by such person in accordance with section 16(3) in respect of goods imported by such person in that period,

where those goods or services are linked to the production or transformation of that gold, and such person's subsequent supply of that investment gold is exempt from tax.

(b) A person who produces investment gold or transforms any gold into investment gold may claim, in accordance with regulations, a refund of—

(i) the tax charged to such person on the purchase by such person of goods or services,

(ii) the tax chargeable to such person on the intra-Community acquisition of goods by such person, and

(iii) the tax paid or deferred by such person on the importation of goods by such person,

where those goods or services are linked to the production or transformation of that gold, and such person's subsequent supply of that gold is exempt from tax.”.

Amendment of section 8 (taxable persons) of Principal Act.

123. —Section 8 of the Principal Act is hereby amended in subparagraph (ia) of paragraph (a) of subsection (3) by the substitution for “livestock”, in each place where it occurs, of “bovine”.

Amendment of section 10 (amount on which tax is chargeable) of Principal Act.

124. —Section 10 of the Principal Act is hereby amended in subsection (4B) (inserted by the Act of 1992) by the substitution for “open market price” of “cost of the goods to the person making the supply or, in the absence of such a cost, the cost price of similar goods in the State, and where an intra-Community acquisition occurs in the State following a supply of goods in another Member State which, if such supply was carried out in similar circumstances in the State would be a supply of goods in accordance with section 3(1)(g), then the amount on which tax is chargeable in respect of that intra-Community acquisition shall be the cost to the person making the supply in that Member State or, in the absence of a cost to that person, the cost price of similar goods in that other Member State”.

Amendment of section 10A (margin scheme goods) of Principal Act.

125. —Section 10A (inserted by the Act of 1995) of the Principal Act is hereby amended in subsection (1)—

(a) by the substitution of the following definition for the definition of “margin scheme goods”:

“‘margin scheme goods’ means any works of art, collectors' items, antiques or second-hand goods supplied within the Community to a taxable dealer—

(a) by a person, other than a person referred to in paragraph (c), who was not entitled to deduct, under section 12, any tax in respect of that person's purchase, intra-Community acquisition or importation of those goods:

Provided that person is not a taxable person who acquired those goods from—

(i) a taxable dealer who applied the margin scheme to the supply of those goods to that taxable person, or

(ii) an auctioneer within the meaning of section 10B who applied the auction scheme within the meaning of section 10B to the supply of those goods to that taxable person,

or

(b) by a person in another Member State who was not entitled to deduct, under the provisions implementing Article 17 of Council Directive No. 77/388/EEC of 17 May 1977, in that Member State, any value-added tax referred to in that Directive in respect of that person's purchase, intra-Community acquisition or importation of those goods, or

(c) by another taxable dealer who has applied the margin scheme to the supply of those goods or applied the provisions implementing Article 26a (inserted by Council Directive No. 94/5/EC of 14 February 1994) of Council Directive No. 77/388/EEC of 17 May 1977, in another Member State to the supply of those goods,

and also includes goods acquired by a taxable dealer as a result of a disposal of goods by a person to such taxable dealer where that disposal was deemed not to be a supply of goods in accordance with section 3(5)(c).”,

and

(b) in the definition of “second-hand goods” by the insertion after “means of transport,” of “agricultural machinery (within the meaning of section 12C),”.

Amendment of section 10B (special scheme for auctioneers) of Principal Act.

126. —Section 10B (inserted by the Act of 1995) of the Principal Act is hereby amended in subsection (1) by the insertion in the definition of “auction scheme goods” of the following paragraph after paragraph (a):

“(aa) an owner within the meaning of section 3(5)(c) who enforced such owner's right to recover possession of those goods under the circumstances set out in section 3(5)(c), or”.

Amendment of section 11 (rates of tax) of Principal Act.

127. —Section 11 of the Principal Act is hereby amended in subsection (1) (inserted by the Act of 1992) by the substitution in paragraph (f) of “4 per cent” for “3.6 per cent” (inserted by the Act of 1998).

Amendment of section 12 (deduction for tax borne or paid) of Principal Act.

128. —Section 12 of the Principal Act is hereby amended by the insertion in paragraph (a) of subsection (1) of—

(a) the following subparagraph after subparagraph (iiid) (inserted by the Act of 1997):

“(iiie) the tax chargeable during the period, being tax for which he is liable by virtue of section 6A(5)(a) in respect of investment gold (within the meaning of section 6A) received by him,”

and

(b) the following subparagraph after subparagraph (vi) (inserted by the Act of 1995):

“(via) the residual tax referred to in section 12C, being residual tax contained in the price charged to him for the purchase of agricultural machinery (within the meaning of section 12C), by means of invoices issued to him during the period by flat-rate farmers,”.

Amendment of section 12A (special provisions for tax invoiced by flat-rate farmers) of Principal Act.

129. —Section 12A (inserted by the Act of 1978) of the Principal Act is hereby amended in subsection (1) by the substitution of “4 per cent” for “3.6 per cent” (inserted by the Act of 1998).

Amendment of section 12B (special scheme for means of transport supplied by taxable dealers) of Principal Act.

130. —Section 12B (inserted by the Act of 1995) of the Principal Act is hereby amended—

(a) in subsection (2)—

(i) by the insertion of “(other than in the circumstances where an owner as referred to in paragraph (c) of subsection (5) of section 3, enforces such owner's right to recover possession of a means of transport)” after “purchases or acquires”, and

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

“(aa) a means of transport from a person where the disposal of that means of transport by such person to such taxable dealer was deemed not to be a supply of goods in accordance with section 3(5)(c), or”,

and

(b) in subsection (3) in the definition of “means of transport” by the insertion after “other than” of “agricultural machinery (within the meaning of section 12C), and”.

Special scheme for agricultural machinery.

131. —The Principal Act is hereby amended by the insertion of the following section after section 12B (inserted by the Act of 1995):

“12C.—(1) A taxable dealer who purchases agricultural machinery from a flat-rate farmer shall, subject to the provisions of this section and in accordance with subparagraph (via) of paragraph (a) of subsection (1) of section 12, be entitled to deduct the residual tax contained in the price payable by such taxable dealer in respect of that purchase.

(2) A flat-rate farmer who supplies agricultural machinery to a taxable dealer shall, subject to section 17(2A), issue an invoice in respect of that supply.

(3) The residual tax referred to in subsection (1) shall be determined by the formula—

A x

B

B + 100

where—

A   is the purchase price of the agricultural machinery payable by the taxable dealer, and

B   is the percentage rate of tax specified in section 11(1)(a).

(4) Where a taxable dealer supplies agricultural machinery in respect of which such dealer was entitled to deduct residual tax and where the tax chargeable in respect of that supply is less than the residual tax deducted by that dealer in respect of the purchase of that machinery, then the excess of the residual tax over the tax payable on that supply shall be deemed to be tax chargeable in respect of that supply.

(5) In this section—

‘agricultural machinery’ means machinery or equipment, other than a motor vehicle as defined in subsection (3) of section 12, which has been used by a flat-rate farmer for the purpose of such farmer's Annex A activity in circumstances where any tax charged on the supply of that machinery or equipment to that farmer would have been deductible by such farmer if such farmer had elected to be a taxable person at the time of that supply of the machinery or equipment to such farmer;

‘taxable dealer’ means a taxable person who in the course or furtherance of business, whether acting on that person's own behalf, or on behalf of another person pursuant to a contract under which commission is payable on purchase or sale, purchases agricultural machinery as stock-in-trade with a view to resale.”.

Amendment of section 13 (remission of tax on goods exported, etc.) of Principal Act.

132. —Section 13 of the Principal Act is hereby amended in paragraph (iii) of subsection (1A) (inserted by the Act of 1997) by the insertion after “the supply,” of “and where an amount so notified is expressed in terms of a percentage or a fraction, such percentage or fraction shall relate to the tax remitted or repayable under this subsection,”.

Amendment of section 16 (duty to keep records) of Principal Act.

133. —Section 16 of the Principal Act is hereby amended by the insertion of the following subsection after subsection (1):

“(1A) Every person who trades in investment gold (within the meaning of section 6A) shall, in accordance with regulations, keep full and true records of that person's transactions in investment gold.”.

Amendment of section 17 (invoices) of Principal Act.

134. —Section 17 of the Principal Act is hereby amended by the insertion of the following subsection after subsection (2) (inserted by the Act of 1978):

“(2A) A flat-rate farmer who, in accordance with section 12C, is required to issue an invoice in respect of a supply of agricultural machinery shall, in respect of each supply, issue an invoice in the form and containing such particulars as may be specified by regulations if the following conditions are fulfilled:

(a) the issue of the invoice is requested by the taxable dealer,

(b) the taxable dealer provides the form for the purpose of the invoice and enters the appropriate particulars thereon, and

(c) the taxable dealer gives to the flat-rate farmer a copy of the invoice,

but may issue the invoice if those conditions or any one of them are not fulfilled.”.

Amendment of section 19 (tax due and payable) of Principal Act.

135. —Section 19 of the Principal Act is hereby amended in clause (I) of subparagraph (i) of paragraph (a) of subsection (4) (inserted by the Finance Act, 1993 ) by the insertion after “registration of the vehicle” of “or, if section 131 of the Finance Act, 1992 , does not provide for registration of the vehicle, at a time not later than the time when the tax is due in accordance with subsection (1A)”.

Generation of estimates and assessments by electronic, photographie or other process.

136. —The Principal Act is hereby amended by the insertion of the following section after section 22:

“22A.—For the purposes of this Act and regulations, where an officer of the Revenue Commissioners nominated in accordance with regulations for the purposes of section 22 or an inspector of taxes or an officer of the Revenue Commissioners authorised for the purposes of section 23, or any other officer of the Revenue Commissioners acting with the knowledge of such nominated officer or such inspector or such authorised officer causes to issue, manually or by any electronic, photographic or other process, a notice of estimation or assessment of tax bearing the name of such nominated officer or such inspector or such authorised officer, that estimate or assessment to which the notice of estimation or assessment of tax relates shall be deemed—

(a) in the case of an estimate made under section 22, to have been made by such nominated officer, and

(b) in the case of an assessment made under section 23, to have been made by such inspector or such authorised officer, as the case may be, to the best of such inspector's or such authorised officer's opinion.”.

Amendment of section 32 (regulations) of Principal Act.

137. —Section 32 of the Principal Act is hereby amended in subsection (1) by the insertion of the following subparagraphs after subparagraph (h):

(ha) the keeping by persons trading in investment gold (within the meaning of section 6A) of records and the retention of such records and supporting documents or other recorded data;

(hb) the conditions under which a person may waive his right to exemption from tax on the supply of investment gold (within the meaning of section 6A);

(hc) the conditions under which an intermediary (within the meaning of section 6A) may waive his right to exemption from tax on his supply of services;

(hd) the conditions under which a person may claim a refund of tax in accordance with subsections (6)(b), (7)(b) and (8)(b) of section 6A, and the manner in which such refund may be claimed;”.

Amendment of First Schedule to Principal Act.

138. —The First Schedule (inserted by the Act of 1978) to the Principal Act is hereby amended—

(a) by the insertion in subparagraph (g) (inserted by the Finance Act, 1991 ) of paragraph (i) of the following clause after clause (I):

“(Ia) a special investment scheme within the meaning of section 737 of the Taxes Consolidation Act, 1997 , or”,

and

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

“(xviiia) supply, intra-Community acquisition and importation of investment gold (within the meaning of section 6A) other than supplies of investment gold to the Central Bank of Ireland;

(xviiib) supply of services of an intermediary (as defined in section 6A) acting in that capacity;”.

Amendment of Second Schedule to Principal Act.

139. —The Second Schedule (inserted by the Finance Act, 1976 ) to the Principal Act is hereby amended in paragraph (i) by the insertion of the following subparagraph after subparagraph (a):

“(aa) subject to a condition that they are to be dispatched or transported directly outside the Community by or on behalf of the purchaser of the goods where that purchaser is established outside the State,”.