Number 2/1999: Chapter 2 Income Tax

2 1999

FINANCE ACT, 1999

Chapter 2

Income Tax

Amendment of provisions relating to exemption from income tax.

2. —As respects the year of assessment 1999-2000 and subsequent years of assessment, Chapter 1 of Part 7 of the Principal Act is hereby amended—

(a) in section 187, by the substitution, in subsection (1), of the following for paragraph (a):

“(a) in the case of an individual referred to in paragraph (a) of the definition of ‘specified amount’ in section 461(1) (inserted by the Finance Act, 1999), £8,200, and”,

and

(b) in section 188, by the substitution of the following for subsection (2):

“(2) In this section, ‘the specified amount’ means, subject to section 187 (2)—

(a) in the case of an individual referred to in paragraph (a) of the definition of ‘specified amount’ in section 461(1) (inserted by the Finance Act, 1999), £13,000, and

(b) in any other case £6,500.”.

Alteration of rates of income tax.

3. —Section 15 of the Principal Act is hereby amended, as respects the year of assessment 1999-2000 and subsequent years of assessment, by the substitution of the following Table for the Table to that section:

“TABLE

PART 1

Part of taxable income				Rate of tax	Description of rate
(1)				(2)	(3)
The first £14,000	...	...	...	24 per cent	the standard rate
The remainder	...	...	...	46 per cent	the higher rate

PART 2

Part of taxable income				Rate of tax	Description of rate
(1)				(2)	(3)
The first £28,000	...	...	...	24 per cent	the standard rate
The remainder	...	...	...	46 per cent	the higher rate

Personal reliefs.

4. —As respects the year of assessment 1999-2000 and subsequent years of assessment, the Principal Act is hereby amended—

(a) by the substitution of the following for section 461:

“Standard rated personal allowances.

461.—(1) In this section—

‘appropriate percentage’, in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year;

‘the specified amount’, in relation to an individual for a year of assessment, means—

(a) £8,400, in a case in which the claimant is—

(i) a married person who—

(I) is assessed to tax for the year of assessment in accordance with the provisions of section 1017, or

(II) proves that his or her spouse is not living with him or her but is wholly or mainly maintained by him or her for the year of assessment and that the claimant is not entitled, in computing his or her income for tax purposes for that year, to make any deduction in respect of the sums paid by him or her for the maintenance of his or her spouse,

(ii) a widowed person, other than a person to whom subparagraph (i) applies, whose spouse has died in the year of assessment,

and

(b) £4,200 in the case of any other claimant.

(2) The income tax to be charged on an individual, other than in accordance with section 16(2), for a year of assessment shall be reduced by an amount which is the lesser of—

(a) an amount equal to the appropriate percentage of the specified amount in relation to the individual for that year, or

(b) the amount which reduces that income tax to nil.

Additional allowance for widowed person.

461A.—For the purpose of ascertaining his or her taxable income for a year of assessment, a widowed person, other than a person referred to in paragraph (a) of the definition of ‘specified amount’ in section 461(1), shall be entitled to a deduction of £500.”,

and

(b) in the Table to section 458—

(i) by the substitution, in Part 1, of “section 461A” for “section 461”, and

(ii) by the insertion, in Part 2, after “section 244” of “section 461(2)”.

Reliefs for widowed parents and other single parents.

5. —As respects the year of assessment 1999-2000 and subsequent years of assessment, the Principal Act is hereby amended—

(a) by the substitution of the following for section 462:

“Widowed parents and other single parents: standard rated allowance.

462.—(1) (a) In this section—

‘appropriate percentage’, in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year;

‘qualifying child, in relation to any claimant and year of assessment, means—

(i) a child—

(I) born in the year of assessment,

(II) who, at the commencement of the year of assessment, is under the age of 18 years, or

(III) who, if over the age of 18 years at the commencement of the year of assessment—

(A) is receiving full-time instruction at any university, college, school or other educational establishment, or

(B) is permanently incapacitated by reason of mental or physical infirmity from maintaining himself or herself and had become so permanently incapacitated before he or she had attained the age of 21 years or had become so permanently incapacitated after attaining the age of 21 years but while he or she had been in receipt of such full-time instruction,

and

(ii) a child who is a child of the claimant or, not being such a child, is in the custody of the claimant and is maintained by the claimant at the claimant's own expense for the whole or part of the year of assessment.

‘the specified amount’ means £1,050.

(b) This section shall apply to an individual other than an individual referred to in paragraph (a) of the definition of ‘specified amount’ in section 461(1).

(2) Subject to subsection (3), where a claimant, being an individual to whom this section applies, proves for a year of assessment that a qualifying child is resident with him or her for the whole or part of the year, the income tax to be charged on the individual, other than in accordance with section 16(2), for that year of assessment shall be reduced by an amount which is the lesser of—

(a) an amount equal to the appropriate percentage of the specified amount in relation to the individual, or

(b) the amount which reduces that income tax to nil,

but this section shall not apply for any year of assessment in the case of a husband or a wife where the husband and wife are living together, or in the case of a man and woman living together as man and wife.

(3) A claimant shall be entitled to only one reduction of tax under subsection (2) for any year of assessment irrespective of the number of qualifying children resident with the claimant in that year.

(4) (a) The references in subsection (1)(a) to a child receiving full-time instruction at an educational establishment shall include references to a child undergoing training by any person (in this subsection referred to as ‘the employer’) for any trade or profession in such circumstances that the child is required to devote the whole of his or her time to the training for a period of not less than 2 years.

(b) For the purposes of a claim in respect of a child undergoing training, the inspector may require the employer to furnish particulars with respect to the training of the child in such form as may be prescribed by the Revenue Commissioners.

(5) (a) Where in any year of assessment a qualifying child is entitled in his or her own right to an income exceeding £720 in that year, the specified amount shall be reduced by the amount of the excess up to the limit of the specified amount.

(b) In calculating the income of the child for the purposes of paragraph (a), no account shall be taken of any income to which the child is entitled as the holder of a scholarship, bursary or other similar educational endowment.

(6) Where any question arises as to whether any person is entitled to reduction of tax under this section in respect of a child over the age of 18 years as being a child who is receiving full-time instruction referred to in this section, the Revenue Commissioners may consult the Minister for Education and Science.

Additional allowance for widowed parents and other single parents.

462A.—(1) (a) For the purposes of this section, ‘qualifying child’, in relation to a claimant and a year of assessment, has the same meaning as in section 462, and the question of whether a child is a qualifying child shall be determined on the same basis as it would be for the purposes of section 462, and subsections (4), (5)(b) and (6) of that section shall apply accordingly.

(b) This section shall apply to an individual other than an individual referred to in paragraph (a) of the definition of ‘specified amount’ in section 461(1).

(a) if he or she is a widowed person, to a deduction of £2,650, or

(b) if he or she is an individual other than a widowed person, to a deduction of £3,150,

(3) A claimant shall be entitled to only one deduction under subsection (2) for any year of assessment irrespective of the number of qualifying children resident with the claimant in that year.

(4) No deduction shall be allowed under this section for any year of assessment in respect of any child who is entitled in his or her own right to an income exceeding £1,770 in that year except that, if the amount of the excess is less than the deduction which would be allowable apart from this subsection, a deduction reduced by that amount shall be allowed.”,

and

(b) in the Table to section 458—

(i) by the substitution, in Part 1, of “section 462A” for “section 462”, and

(ii) by the insertion, in Part 2, of “section 462” after “section 461 (2)” (inserted by this Act).

Amendment of Chapter 1 of Part 15 of the Principal Act.

6. —Chapter 1 of Part 15 of the Principal Act is hereby amended—

(a) in section 465, by the substitution, in each place where it occurs, of “18 years” for “16 years” in paragraphs (a) and (b) of subsection (1) and paragraph (a) of subsection (2), and

(b) in section 469, by the substitution in subsection (1), in the definition of “dependant”, of “18 years” for “16 years” in each place where it occurs.

Employee allowance.

7. —As respects the year of assessment 1999-2000 and subsequent years of assessment, the Principal Act is hereby amended—

(a) in the Table to section 458—

(i) by the deletion of “section 472” from Part 1, and

(ii) by the insertion, in Part 2, of “section 472” after “section 462” (inserted by this Act),

and

(b) in section 472—

(i) in subsection (1)(a):

(I) by the insertion before the definition of “emoluments” of the following definition—

“appropriate percentage', in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year;”,

and

(II) by the insertion after the definition of “proprietary director” of the following definition—

“‘the specified amount’, in relation to an individual for a year of assessment, means the lesser of—

(a) £1,000, or

(b) the amount which is included in the individual's total income for the year of assessment in respect of emoluments,

and, in the case where the claimant is a married person assessed to tax in accordance with section 1017, the specified amount in relation to the individual's spouse shall be the amount which would have been the specified amount in relation to that spouse if he or she had been assessed in accordance with section 1016;”,

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

“(4) Where, for any year of assessment, a claimant proves that his or her total income for the year consists in whole or in part of emoluments, the income tax to be charged on the individual, other than in accordance with section 16(2), for that year of assessment shall be reduced by an amount which is the lesser of—

(a) an amount equal to the appropriate percentage of the specified amount in relation to that individual and, where the claimant is a married person assessed to tax in accordance with section 1017, the specified amount in relation to that individual's spouse, or

(b) the amount which reduces that income tax to nil.”,

and

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

“(5) Where a reduction under this section is to be made from income charged to tax for any year of assessment by virtue of the operation of subsection (2), such reduction shall be given by means of repayment of tax.”.

Amendment of section 468 (relief for blind persons) of Principal Act.

8. —As respects the year of assessment 1999-2000 and subsequent years of assessment, section 468 of the Principal Act is hereby amended in subsection (2) by the substitution of “£1,500” for “£1,000” (inserted by the Finance Act, 1998 ) in both places where it occurs and of “£3,000” for “£2,000” (as so inserted).

Employed person taking care of incapacitated individual.

9. —As respects the year of assessment 1999-2000 and subsequent years of assessment, the Principal Act is hereby amended by the substitution of the following for section 467:

“467.—(1) In this section ‘relative’, in relation to an individual, includes a relation by marriage and a person in respect of whom the individual is or was the legal guardian.

(2) Subject to this section, where an individual for a year of assessment proves—

(a) that throughout the year of assessment either he or she or a relative of the individual was totally incapacitated by physical or mental infirmity, and

(b) that for the year of assessment the individual, or in a case to which section 1017 applies, the individual's spouse, has employed a person (including a person whose services are provided by or through an agency) for the purpose of having care of the individual (being the individual or the individual's relative) who is so incapacitated,

the individual shall, in computing the amount of his or her taxable income, be entitled to a deduction from his or her total income of the lesser of—

(i) the amount ultimately borne by him or her or the individual's spouse in the year of assessment in employing the employed person, and

(ii) £8,500 in respect of each such incapacitated individual.

(3) Where 2 or more individuals are entitled for a year of assessment to a deduction under this section in respect of the same incapacitated individual, the following provisions shall apply:

(a) the aggregate of the deductions to be granted to those individuals shall not exceed £8,500, and

(b) the relief to be granted under this section in relation to the incapacitated individual shall be apportioned between them in proportion to the amount ultimately borne by each of them in employing the employed person.

(4) Where for any year of assessment a deduction is allowed to an individual under this section, the individual shall not be entitled to a deduction in respect of the employed person (including a person whose services are provided by or through an agency) under section 465 or section 466.”.

Amendment of section 122 (preferential loan arrangements) of Principal Act.

10. — Section 122 of the Principal Act is hereby amended, as respects the year 1999-2000 and subsequent years of assessment, by the substitution in the definition of “the specified rate” in paragraph (a) of subsection (1) of—

(a) “6 per cent” for “7 per cent” in both places where it occurs, and

(b) “10 per cent” for “11 per cent”,

and the said definition, as so amended, is set out in the Table to this section.

TABLE

“the specified rate”, in relation to a preferential loan, means—

(i) in a case where—

(I) the interest paid on the preferential loan qualifies for relief under section 244, or

(II) if no interest is paid on the preferential loan, the interest which would have been paid on that loan (if interest had been payable) would have so qualified,

the rate of 6 per cent per annum or such other rate (if any) prescribed by the Minister for Finance by regulations,

(ii) in a case where—

(I) the preferential loan is made to an employee by an employer,

(II) the making of loans for the purposes of purchasing a dwelling house for occupation by the borrower as a residence, for a stated term of years at a rate of interest which does not vary for the duration of the loan, forms part of the trade of the employer, and

(III) the rate of interest at which, in the course of the employer's trade at the time the preferential loan is or was made, the employer makes or made loans at arm's length to persons, other than employees, for the purposes of purchasing a dwelling house for occupation by the borrower as a residence is less than 6 per cent per annum or such other rate (if any) prescribed by the Minister for Finance by regulations,

the first-mentioned rate in subparagraph (III), or

(iii) in any other case, the rate of 10 per cent annum or such other rate (if any) prescribed by the Minister for Finance by regulations.

Amendment of section 126 (tax treatment of certain benefits payable under Social Welfare Acts) of Principal Act.

11. —Section 126 of the Principal Act is hereby amended by the substitution, in subsection (8), of the following for paragraph (b) (inserted by the Finance Act, 1998 ):

“(b) Notwithstanding subsection (3) and the Finance Act, 1992 (Commencement of Section 15) (Unemployment Benefit and Pay-Related Benefit) Order, 1994 (S.I. No. 19 of 1994) subsection (3)(b) shall not apply in relation to unemployment benefit paid or payable in the period commencing on the 6th day of April, 1997, and ending on the 5th day of April, 2000, to a person employed in short-time employment.”.

Treatment of income arising as a result of certain public subscriptions raised on behalf of incapacitated individuals.

12. —The Principal Act is hereby amended—

(a) in Chapter 1 of Part 7 by the insertion of the following section after section 189:

“Special trusts for permanently incapacitated individuals.

189A.—(1) In this section—

‘incapacitated individual’ means an individual who is permanently and totally incapacitated, by reason of mental or physical infirmity, from being able to maintain himself or herself;

‘public subscriptions’ means subscription, in the form of money or other property, raised, following an appeal made in that behalf to members of the public, for the benefit of one or more incapacitated individual or individuals, whose identity or identities is or are known to the persons making the subscriptions, being subscriptions that meet either of the following conditions, namely—

(a) the total amount of the subscriptions does not exceed £300,000, or

(b) no amount of the subscriptions, at any time on or after the specified return date for the chargeable period for which exemption is first claimed under either subsection (2) or (3), constitutes a subscription made by any one person that is greater than 30 per cent of the total amount of the subscriptions;

‘qualifying trust’ means a trust established by deed in respect of which it is shown to the satisfaction of the inspector or, on appeal, to the Appeal Commissioners, that—

(a) the trust has been established exclusively for the benefit of one or more specified incapacitated individual or individuals, for whose benefit public subscriptions, within the meaning of this section, have been raised,

(b) the trust requires that—

(i) the trust funds be applied for the benefit of that individual or those individuals, as the case may be, at the discretion of the trustees of the trust, and

(ii) in the event of the death of that individual or those individuals, as the case may be, the undistributed part of the trust funds be applied for charitable purposes or be appointed in favour of the trustees of charitable bodies.

and

(c) none of the trustees of the trust is connected (within the meaning of section 10) with that individual or any of those individuals, as the case may be;

‘specified return date for the chargeable period’ has the same meaning as in section 950;

‘trust funds’ means, in relation to a qualifying trust—

(a) public subscriptions, raised for the benefit of the incapacitated individual or individuals, the subject or subjects of the trust, and

(b) all moneys and other property derived directly or indirectly from such public subscriptions.

(2) Income arising to the trustees of a qualifying trust in respect of the trust funds, being income consisting of dividends or other income which but for this section would be chargeable to tax under Schedule C or under Case III, IV (by virtue of section 59 or section 745) or V of Schedule D or under Schedule F, shall be exempt from income tax and shall not be reckoned in computing total income for the purposes of the Income Tax Acts.

(3) Income (in this subsection referred to as ‘the relevant income’) which—

(a) consists of payments made by the trustees of a qualifying trust to or in respect of any incapacitated individual, being a subject of the trust, or

(b) arises to such an incapacitated individual from the investment in whole or in part of payments made by the trustees of a qualifying trust or of income derived from such payments, being income consisting of dividends or other income which but for this section would be chargeable to tax under Schedule C or under Case III, IV (by virtue of section 59 or section 745) or V of Schedule D or under Schedule F,

shall be exempt from income tax and shall not be reckoned in computing total income for the purposes of the Income Tax Acts; but this subsection shall not apply in a case unless the relevant income is the sole or main income of the individual to or in respect of whom the relevant income arises.

(4) The provisions of the Income Tax Acts relating to the making of returns of total income shall apply as if this section had not been enacted.

(5) This section shall have effect as respects the year 1997-98 and subsequent years of assessment.”,

and

(b) in section 267, as respects relevant interest paid on or after the 6th day of April, 1997, by the insertion—

(i) in subsection (2)(a), of “section 189A(2) or” after “by virtue of”, and

(ii) in subsection (3), of “or would, but for the provisions of section 189(2), section 189A(3) or section 192(2), have included relevant interest,” after “any relevant interest” where those words first occur.

Amendment of Chapter 1 (income tax) of Part 7 of Principal Act.

13. —Chapter 1 of Part 7 of the Principal Act is hereby amended—

(a) in section 189, by the substitution in subsection (2) of “(by virtue of section 59 or section 745)” for “(by virtue of section 59)”, and

(b) in section 192, by the substitution in subsection (2)(b) of “(by virtue of section 59 or section 745)” for “(by virtue of section 59)”.

Amendment of section 201 (exemptions and reliefs in respect of tax under section 123) of Principal Act.

14. —(1) Section 201(1)(a) of the Principal Act is hereby amended, by the substitution in the definition of “basic exemption” of “£8,000” for “£6,000” and of “£600” for “£500”.

(2) Subsection (1) shall apply and have effect as respects payments made on or after the 1st day of December, 1998.

Seafarer allowance, etc.

15. —Section 472B (inserted by the Finance Act, 1998 ) of the Principal Act is hereby amended by the substitution, in subsection (2), of the following for paragraph (b):

“(b) a port outside the State shall be deemed to include a mobile or fixed rig, platform or installation of any kind in any maritime area.”.

Amendment of Part 16 (income tax relief for investment in corporate trades — business expansion scheme and seed capital scheme) of Principal Act.

16. —Part 16 of the Principal Act is hereby amended—

(a) in section 488, by the substitution, as on and from the 6th day of April, 1997, in the definition of “unquoted company” in subsection (1), of the following paragraph for paragraph (b):

“(b) quoted on an unlisted securities market of a stock exchange other than—

(i) on the market known, and referred to in this definition, as the Developing Companies Market of the Irish Stock Exchange, or

(ii) on the Developing Companies Market of the Irish Stock Exchange and on any similar or corresponding market of the stock exchange of one or more Member States of the European Communities; but this subparagraph shall not apply unless the shares, stocks or debentures are quoted on the Developing Companies Market of the Irish Stock Exchange before or at the same time as they are firstly quoted on an unlisted securities market of a stock exchange of another Member State of the European Communities.”,

(b) in section 489, by the substitution in subsection (15), of “5th day of April, 2001” for “5th day of April, 1999”, and

Amendment of Schedule 13 (accountable persons for purposes of Chapter 1 of Part 18) to Principal Act.

17. —Schedule 13 to the Principal Act is hereby amended by—

(a) the deletion of paragraphs 23, 47 and 63, and

(b) the addition of the following paragraphs after paragraph 82:

“83. The Office of the Director of Telecommunications Regulation.

84. The Law Reform Commission.

85. Northern Regional Fisheries Board — Bord Iascaigh Réigiúnach an Tuaisceart.

86. The Office for Health Management.

87. Hospital Bodies Administration Bureau.

88. National Social Services Board.

89. National Standards Authority of Ireland.

90. Enterprise Ireland.

91. Dublin Docklands Development Authority.

92. A commission established by the Government or a Minister of the Government for the purpose of providing information to the public in relation to a referendum referred to in section 1 of Article 47 of the Constitution.

93. The Office of the Ombudsman.

94. The Public Offices Commission.

95. The Office of the Information Commissioner.”.

Amendment of Chapter 2 (payments to subcontractors in certain industries) of Part 18 of Principal Act.

18. —(1) The Principal Act is hereby amended, in Chapter 2 of Part 18—

(a) in section 530(1)—

(i) by the insertion of the following definition after the definition of “forestry operations”:

“‘income tax month’ means a month beginning on the 6th day of any of the months of April to March in any year;”,

(ii) by the substitution of the following for the definition of “qualifying period”:

“‘qualifying period’ means the period of 3 years, or such shorter period as the inspector may allow, ending on the 5th day of April in the year preceding the year of assessment which is the first year of assessment of the period, in respect of which a certificate of authorisation is sought together with the period, if any, from the 6th day of April in the said first year of assessment to the date on which the application for the said certificate is received by the Revenue Commissioners;”,

and

(iii) in the definition of “relevant contract” by the substitution of the following for paragraph (c):

“(c) to furnish the contractor's own labour or the labour of others in the carrying out of relevant operations or to arrange for the labour of others to be furnished for the carrying out of such operations,”,

and

(b) in section 531—

(i) by the insertion of the following subsection after subsection (3):

“(3A) (a) Within 9 days from the end of an income tax month, a principal or any person who was previously a principal and who has been required to do so by notice in writing from the Revenue Commissioners, shall—

(i) make a return to the Collector-General, on the prescribed form, of the amount, if any, of tax which that person was liable under this section to deduct from payments made to uncertified sub-contractors during that income tax month, and

(ii) remit to the Collector the amount of the tax, if any, which the person was so liable to deduct.

(b) The Collector-General shall furnish the person concerned with a receipt in respect of the payment; such a receipt shall consist of whichever of the following the Collector-General considers appropriate, namely—

(i) a separate receipt on the prescribed form in respect of each such payment, or

(ii) a receipt on the prescribed form in respect of all such payments that have been made within a period specified in the receipt.”,

(ii) by the substitution in the portion of subsection (6) that precedes paragraphs (a) to (h) of that subsection of “assessment (including estimated assessment), estimation, charge, collection and recovery of tax deductible under subsection (1)” for “assessment (including estimated assessment), charge, collection and recovery of tax deductible under subsection (1)”,

(iii) by the substitution of the following for subsection (10):

“(10) Subsection (9) shall apply to tax recoverable from a person by virtue of a notice issued under the Income Tax (Construction Contracts) Regulations, 1971 (S.I. No. 1 of 1971), as if the tax were tax which the person was liable under subsection (3A) to remit—

(i) where the notice relates to an income tax month or months, for the respective income tax month or months referred to in the notice, and

(ii) where the notice relates to a year, the last income tax month of the year to which the notice relates.”,

(iv) in paragraph (a) of subsection (11)—

(I) by the deletion of “and” after subparagraph (iv),

(II) by the substitution, in subparagraph (v), for “qualifying period.” of “qualifying period, and”, and

(III) by the addition of the following subparagraph after the subparagraph (v):

“(vi) in the case of a person who was resident outside the State at some time during the qualifying period, that the person has throughout the qualifying period complied with all the obligations comparable to those mentioned in subparagraph (iv) imposed by the laws of the country in which that person was resident at any time during the qualifying period.”,

(v) by the substitution of the following for subsection (12):

“(12) (a) Where a subcontractor to whom a certificate of authorisation has been issued produces it to a principal, the principal shall apply to the Revenue Commissioners for a card (in this Chapter referred to as a ‘relevant payments card’) in respect of the subcontractor.

(b) Notwithstanding paragraph (a), where—

(i) a subcontractor has notified the Revenue Commissioners of details of the bank account, held in the State in the name of the subcontractor or in the case of a subcontractor who is not resident in the State, held either in the State or in the State in which the subcontractor is resident, into which payments in respect of relevant contracts are to be made (hereafter in this subsection referred to as ‘the nominated bank account’), and

(ii) the principal undertakes to make all payments to the subcontractor in question directly to the nominated bank account,

the principal may apply to the Revenue Commissioners for a relevant payments card where the subcontractor has provided details of the certificate of authorisation to the principal together with details of the nominated bank account into which payments are to be made by the principal.

(c) Notwithstanding paragraphs (a) and (b), a principal may apply for a relevant payments card in respect of a subcontractor even though the subcontractor has not produced or provided details of a certificate of authorisation for the year to which the relevant payments card relates, where—

(i) the principal has been issued with a relevant payments card in relation to that subcontractor for the immediately preceding year, and

(ii) the relevant contract between the principal and the subcontractor in relation to which the relevant payments card is required is ongoing at the end of that year.

(d) Where on such application the Revenue Commissioners are satisfied that a relevant payments card in respect of the subcontractor ought to be issued to the principal, they shall issue such a card to the principal who, on receiving the card shall, subject to subsection (13), be entitled during the income tax year (or the unexpired portion of the income tax year) to which the relevant payments card relates to make payment without deduction of tax to the subcontractor named on the card but, in the case of an application to which paragraph (b) applies or an application to which paragraph (c) applies where the relevant payments card mentioned in subparagraph (i) of that paragraph was issued following an application made under and in accordance with paragraph (b), any such payments shall be made by the principal directly to the nominated bank account.”,

(vi) by the insertion of the following subsection after subsection (17):

“(17A) Any person who is aggrieved by the cancellation of a certificate of authorisation by the Revenue Commissioners in accordance with subsection (13) may, by notice in writing to that effect given to the Revenue Commissioners within 30 days from the date of such cancellation, appeal against such cancellation to the Appeal Commissioners but, pending the decision of the Appeal Commissioners in the matter, unless the Revenue Commissioners, on application to them, reinstate the certificate of authorisation pending the making of that decision, the certificate shall remain cancelled.”,

and

(vii) by the insertion in subsection (18) of “or subsection (17A)” after “subsection (17)”.

(2) (a) Paragraphs (a) and (b), other than subparagraph (v) of paragraph (b), of subsection (1) shall apply as respects the year 1999-2000 and subsequent years of assessment.

(b) Subparagraph (v) of paragraph (b) of subsection (1) shall apply as respects applications for relevant payments cards made on or after the 6th day of October, 1999.

Retirment benefits.

19. —(1) The Principal Act is hereby amended—

(a) in Chapter 1 of Part 30—

(i) by the insertion in section 770, of the following definitions, namely—

(I) before the definition of “director” of:

“‘approved retirement fund’ has the meaning assigned to it by section 784A;

‘approved minimum retirement fund’ has the meaning assigned to it by section 784C;”,

and

(II) after the definition of “pension” of:

“‘proprietary director’ means a director who, either alone or together with his or her spouse and minor children is or was, at any time within three years of the date of—

(a) the specified normal retirement date,

(b) an earlier retirement date, where applicable, or

the beneficial owner of shares which, when added to any shares held by the trustees of any settlement to which the director or his or her spouse had transferred assets, carry more than 20 per cent of the voting rights in the company providing the benefits or in a company which controls that company;”,

and

(ii) in section 772—

(I) by the substitution in paragraph (f) of subsection (3), of “that, subject to subsection (3A),” for “that”, and

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

“(3A) (a) The Revenue Commissioners shall not approve a retirement benefits scheme for the purposes of this Chapter unless it appears to them that the scheme provides for any individual entitled to a pension under the scheme, being a proprietary director of a company to which the scheme relates, to opt, on or before the date on which that pension would otherwise become payable, for the transfer, on or after that date, to—

(i) the individual, or

(ii) an approved retirement fund,

of an amount equivalent to the amount determined by the formula—

A - B

where—

A is the amount equal to the value of the individual's accrued rights under the scheme exclusive of any lump sum paid in accordance with paragraph (f) of subsection (3), and

B is the amount or value of assets which the trustees, administrator or other person charged with the management of the scheme (hereafter in this section referred to as ‘the trustees’) would, if the assumptions in paragraph (b) were made, be required, in accordance with section 784C, to transfer to an approved minimum retirement fund held in the name of the individual or to apply in purchasing an annuity payable to the individual with effect from the date of the exercise of the said option.

(b) The assumptions in this paragraph are—

(i) that the retirement benefit scheme was an annuity contract approved in accordance with section 784,

(ii) that the trustees of the retirement benefit scheme were a person lawfully carrying on the business in the State of providing annuities on human life with whom the said contract had been made, and

(iii) that the individual had opted in accordance with subsection (2A) of section 784.

(3B) Where an individual opts in accordance with subsection (3A) then—

(a) the provisions of subsection (2B) of section 784 and of sections 784A, 784B, 784C, 784D and 784E shall, with any necessary modifications, apply as if—

(i) any reference in those sections to the person lawfully carrying on in the State the business of granting annuities on human life were a reference to the trustees of the retirement benefit scheme,

(ii) any reference in those sections to the annuity contract were references to the retirement benefit scheme, and

(iii) any reference in those sections to Case IV of Schedule D were a reference to Schedule E, and

(b) paragraph (f) of subsection (3) shall apply as if the reference to ‘a lump sum or sums not exceeding in all three-eightieths of the employee's final remuneration for each year of service up to a maximum of 40 years’ were a reference to ‘a lump sum not exceeding 25 per cent of the value of the pension which would otherwise be payable’.”,

and

(III) by the insertion of the following paragraph after paragraph (b) of subsection (4):

“(c) Notwithstanding paragraphs (a) and (b), the Revenue Commissioners shall not approve a scheme unless it appears to them that the scheme complies with the provisions of subsection (3A).”,

(b) in Chapter 2 of Part 30—

(i) in paragraph (a) of section 783(1), by the insertion of the following definitions before the definition of “director”:

“‘approved retirement fund’ has the meaning assigned to it by section 784A;

‘approved minimum retirement fund’ has the meaning assigned to it by section 784C;”,

(ii) in section 784—

(I) in subsection (1), by the substitution of the following paragraph for paragraph (b):

“(b) pays a premium or other consideration under an annuity contract for the time being approved by the Revenue Commissioners as being a contract by which the main benefit secured is, or would, but for the exercise of an option by the individual under subsection (2A), be a life annuity for the individual in his or her old age or under a contract for the time being approved under section 785 (in this Chapter referred to as a ‘qualifying premium’),”,

(II) in paragraph (a) of subsection (2)—

(A) by the substitution for “Subject to subsection (3),” of “Subject to subsections (2A) and (3) and to section 786,”,

(B) in subparagraph (iii)(II), by the substitution for “70 years” of “75 years”,

and

(III) by the substitution of the following paragraphs for paragraph (b) of subsection (2):

“(b) Notwithstanding paragraph (a)—

(i) the contract may provide for the payment to the individual, at the time the annuity commences to be payable or, where the individual opts in accordance with subsection (2A), at the time of the transfer referred to in that subsection, of a lump sum by means of commutation of part of the annuity where the individual elects, at or before the time when the annuity first becomes payable to him or her or before the date of such transfer, to be paid the lump sum, and

(ii) the amount payable under subparagraph (i) shall not exceed 25 per cent of the value of the annuity payable or the value of the annuity which would have been payable if the individual had not opted in accordance with subsection (2A).

(c) The reference in paragraph (b)(i) to the commutation of part of the annuity shall, in a case where the individual has opted in accordance with subsection (2A), be construed as a reference to the commutation of the annuity which would, but for such election, be payable if the individual opted to have the annuity paid with effect from the date of the transfer referred to in that subsection.”,

(IV) by the insertion of the following subsections after subsection (2):

“(2A) The Revenue Commissioners shall not approve a contract unless it appears to them that the contract provides for the individual entitled to an annuity under the contract to exercise, on or before the date on which that annuity would otherwise become payable, an option for the transfer by the person with whom the contract is made, on or after that date, to—

(a) the individual, or

(b) an approved retirement fund,

of an amount equivalent to the amount determined by the formula—

A - B

where—

A is the amount equal to the value of the individual's accrued rights under the contract exclusive of any lump sum paid in accordance with paragraph (b) of subsection (2), and

B is the amount or value of assets which the person with whom the contract is made is required, in accordance with section 784C, to transfer to an approved minimum retirement fund held in the name of the individual or to apply in purchasing an annuity payable to the individual with effect from the date of the exercise of the said option.

(2B) Where an individual opts in accordance with paragraph (a) of subsection (2A), the amount paid to the individual by virtue of that paragraph other than the amount payable by virtue of paragraph (b) of subsection (2) shall be regarded as income of the individual chargeable to income tax under Case IV of Schedule D for the year of assessment in which the payment is made.”,

and

(V) in subsection (3), by the deletion of paragraph (d),

(iii) by the insertion of the following sections after section 784:

“Approved retirement fund.	784A.—(1) (a) In this section— ‘approved retirement fund’ means a fund which is managed by a qualifying fund manager and which complies with the conditions of section 784B; ‘qualifying fund manager’ means— (a) a person who is a holder of a licence granted under section 9 of the Central Bank Act, 1971 , (b) a building society within the meaning of section 256, (c) a trustee savings bank within the meaning of the Trustee Savings Banks Act, 1989 , (d) ACC Bank plc, (e) ICC Bank plc, (f) ICC Investment Bank Limited, (g) the Post Office Savings Bank, (h) a credit union within the meaning of the Credit Union Act, 1997 , (i) a collective investment undertaking within the meaning of section 172A, (j) a person lawfully carrying on in the State the business of granting annuities on human life, (k) a person— (i) which is an authorised member firm of the Irish Stock Exchange, within the meaning of the Stock Exchange Act, 1995 , or a member firm (which carries on a trade in the State through a branch or agency) of a stock exchange of any other Member State of the European Communities, and (ii) which has sent to the Revenue Commissioners a notification of its name and address and of its intention to act as a qualifying fund manager, or (l) such other person as the Minister for Finance may by order approve of for the purposes of this section; ‘tax reference number’, in relation to an individual, has the meaning assigned to it by section 885 in relation to a specified person within the meaning of that section. (b) For the purposes of this Chapter, references to an approved retirement fund shall be construed as a reference to assets in an approved retirement fund which are managed for an individual by a qualifying fund manager and which are beneficially owned by the individual. (2) The beneficial owner of assets in an approved retirement fund shall, subject to the provisions of the Income Tax Acts and the Capital Gains Tax Acts, be chargeable to income tax or capital gains tax, as the case may be, in respect of any income, profits or gains arising in respect of those assets or any chargeable gains on disposals of such assets. (3) (a) A qualifying fund manager shall maintain a record (in this section and in section 784B referred to as ‘the income and gains account’) of the aggregate— (i) of all income, profits and gains arising in respect of an approved retirement fund, and (ii) of all gains and losses on disposal of investments made by the qualifying fund manager in relation to the approved retirement fund, reduced by the aggregate of all distributions made in respect of the approved retirement fund. (b) In calculating at any time the residue of the assets transferred to an approved retirement fund (in this section and in section 784B referred to as ‘the residue’) by the person lawfully carrying on in the State the business of granting annuities on human life— (i) distributions made at or before that time shall be treated as made primarily out of the income and gains account, (ii) in so far as the distributions made from the fund exceed the aggregate of the balance on the income and gains account, they shall be treated as made out of the residue, and, where assets in an approved retirement fund are transferred to another approved retirement fund, the residue in relation to those assets shall be calculated as if the assets had at all times been held in the approved retirement fund to which those assets had originally been transferred. (c) Any reference in this section to a distribution in relation to an approved retirement fund shall be construed as including any payment or transfer of assets out of the fund or any assignment of assets out of the fund, including a payment, transfer or assignment to the individual beneficially entitled to the assets, other than a payment, transfer or assignment to another approved retirement fund the beneficial owner of the assets in which is the individual who is beneficially entitled to the assets in the first-mentioned approved retirement fund, whether or not the payment, transfer or assignment is made to the said individual. (4) Within 3 months after the end of a year of assessment, a qualifying fund manager shall provide a statement for that year of assessment to each individual, on whose behalf an approved retirement fund was managed at any time during that year of— (a) the income, profits or gains and the chargeable gains and allowable losses, as may be appropriate, in respect of the assets held in the approved retirement fund at any time during that year, (b) the tax, if any, deducted from such income, profits or gains, (c) the income and gains account in relation to the fund, and (d) the residue including, in particular, any distributions made out of the residue in the year of assessment. (5) The amount or value of any distribution out of the residue of an approved retirement fund other than a distribution to which subsection (7)(a) applies shall be treated as income of the individual beneficially entitled to the assets of the fund and shall be chargeable to income tax under Case IV of Schedule D for the year of assessment in which the said distribution is made. (6) Subject to subsection (7), where the distribution referred to in subsection (5) occurs following the death of the individual, who was prior to death beneficially entitled to the assets of the approved retirement fund— (a) the amount or value of the said distribution shall be treated as the income of the said individual for the year of assessment in which that individual dies, and (b) the qualifying fund manager shall be liable to pay to the Collector-General income tax at the higher rate on the value of such distribution; the qualifying fund manager may deduct an amount on account of such tax and the person beneficially entitled to the residue of the approved retirement fund, including the personal representatives of the deceased individual, shall allow such deduction; but, where there are no such funds or insufficient funds available out of which the qualifying fund manager may satisfy the tax required to be deducted, the amount of such tax shall be a debt due to the qualifying fund manager from the estate of the deceased individual. (7) (a) This subsection shall apply to the extent that the distribution, made following the death of the individual beneficially entitled to the assets in the approved retirement fund, is made to— (i) another such fund (hereafter in this subsection referred to as ‘the second-mentioned fund’) the beneficial owner of the assets in which is the spouse of the said individual, or (ii) to or for the sole benefit of any child of the individual who has not, at the date of the individual's death, attained the age of 21 years. (b) Where the beneficial owner of the assets in the second-mentioned fund dies, subsection (6) shall apply as regards any distributions out of the residue of that approved retirement fund following that spouse's death as if the reference to the higher rate were a reference to a rate of 25 per cent. (c) Where, in accordance with paragraph (b), the qualifying fund manager is required to account for tax at a rate of 25 per cent, the amount so charged to tax shall not, notwithstanding any provisions of the Income Tax Acts, be treated as income for any other purposes of those Acts.
Conditions relating to an approved retirement fund.	784B.—(1) The conditions of this section are— (a) an approved retirement fund shall be held by a qualifying fund manager in the name of the individual who is beneficially entitled to the assets in the fund, (b) assets held in an approved retirement fund shall consist of and only of one or more of— (i) assets transferred to the fund by virtue of an option exercised by the individual in accordance with section 784(2A), (ii) assets which were previously held in another approved retirement fund held in the name of the individual or the individual's deceased spouse, and (iii) assets derived from such assets as are referred to in subparagraphs (i) and (ii), (c) the individual referred to in paragraph (a) shall, on the opening of an approved retirement fund, make a declaration of the kind mentioned in paragraph (d) to the qualifying fund manager, and (d) the declaration referred to in paragraph (c) shall be a declaration, in writing, to the qualifying fund manager which— (i) is made by the individual who is beneficially entitled to the assets in the approved retirement fund, (ii) is made in such form as may be prescribed or authorised by the Revenue Commissioners, (iii) contains the full name, address and tax reference number of the individual referred to in subparagraph (i), (iv) declares that the assets included in the fund consist only of assets referred to in paragraph (b) to which the individual was beneficially entitled, and (v) contains such other information as the Revenue Commissioners may reasonably require for the purposes of this Act. (2) A qualifying fund manager shall not accept any assets into an approved retirement fund unless the fund manager receives a certificate to which subsection (3) applies in relation to those assets from a person lawfully carrying on in the State the business of granting annuities on human life or from another qualifying fund manager. (3) A certificate to which this subsection applies is a certificate stating— (a) that the assets in relation to which the certificate refers are assets to which the individual named on the certificate is beneficially entitled and which are being transferred to the approved retirement fund, or have previously been transferred to an approved retirement fund, in accordance with subsection (2A) of section 784, (b) that the assets in relation to which the certificate is given do not form part of an approved minimum retirement fund within the meaning of section 784C, and (c) the amount of the balance on the income and gains account, and the residue in relation to the approved retirement fund, the assets of which are being transferred or assigned to the qualifying fund manager. (4) Subsection (2) of section 263 shall apply to a declaration made in accordance with subsection (1)(c) or a certificate to which subsection (3) applies as it applies in relation to declarations of a kind mentioned in that section. (5) The Minister for Finance may by order specify requirements regarding the operation of approved retirement funds.
Approved minimum retirement fund.	784C.—(1) In this section, ‘an approved minimum retirement fund’ means a fund managed by a qualifying fund manager (within the meaning of section 784A) and which complies with the conditions of section 784D. (2) Subject to subsections (3) and (4), where an individual, who has not attained the age of 75 years, exercises an option in accordance with subsection (2A) of section 784, the amount referred to as B in the formula in the said subsection which the person with whom the annuity contract is made shall— (a) transfer to an approved minimum retirement fund in respect of that individual, or (b) apply in the purchase of an annuity payable to the individual, shall be the lesser of— (i) the amount referred to as A in that formula, or (ii) £50,000. (3) Where the individual has already exercised an option in accordance with subsection (2A) of section 784, the amount referred to as B in the formula in subsection (2A) shall be such amount as will result in the aggregate of the amount required in respect of all such options, in accordance with subsection (2A), to be transferred to an approved minimum retirement fund or applied in the purchase of an annuity payable to the individual being the lesser of— (a) the aggregate of the amount referred to as A in that formula in relation to each contract, or (b) £50,000. (4) (a) Where, at the date of exercise of an option under subsection (2A) of section 784, the individual by whom the option is exercised is entitled to specified income amounting to £10,000 per annum, the amount referred to as B in the formula in the said section 784(2A) shall be nil. (b) For the purposes of this subsection, ‘specified income’ means a pension or annuity which is payable for the life of the individual, including a pension payable under the Social Welfare (Consolidation) Act, 1993 , and any pension to which the provisions of section 200 apply. (5) Subject to subsection (6), the qualifying fund manager shall not make any payment or transfer of assets out of the approved minimum retirement fund other than— (a) a transfer of all the assets of the fund to another qualifying fund manager to be held as an approved minimum retirement fund, or (b) a payment or transfer of income, profits or gains, or gains on disposal of investments received by the qualifying fund manager in respect of assets held in the approved fund to the individual beneficially entitled to the assets in the fund. (6) Where the individual referred to in subsection (2) attains the age of 75 years or dies, the approved minimum retirement fund shall, thereupon, become an approved retirement fund and the provisions of section 784A, subsections (1) and (5) of section 784B and section 784E shall apply accordingly. (7) Any assets held as part of an approved minimum retirement fund shall be the property of the individual on whose behalf the fund is held and, subject to the provisions of the Income Tax Acts and the Capital Gains Tax Acts, that individual shall be chargeable to income tax or capital gains tax, as the case may be, in respect of any income, profits or gains arising in respect of those assets or any chargeable gain on disposal of such assets. (8) Within 3 months after the end of the year of assessment, a qualifying fund manager shall provide a statement for that year of assessment to each individual for that year of assessment, on whose behalf an approved minimum retirement fund was managed at any time during that year of— (a) the income, profits or gains and the chargeable gains and allowable losses, as may be appropriate, in respect of the assets held in the approved minimum retirement fund at any time during that year, and (b) the tax, if any, deducted from such income, profits or gains. (9) The provisions of subsection (8) of section 784E shall apply as regards an approved minimum retirement fund as if references to an approved retirement fund were references to an approved minimum retirement fund.
Conditions relating to an approved minimum retirement fund.	784D.—(1) The conditions of this section are— (a) an approved minimum retirement fund shall be held in the name of the individual who is beneficially entitled to the assets in the fund, (b) assets held in an approved minimum retirement fund shall consist of one or more of the following— (i) assets transferred to the fund by virtue of an option exercised by the individual in accordance with section 784(2A), (ii) assets which were previously held in another approved minimum retirement fund held in the name of the individual, and (iii) assets derived from such assets as are referred to in subparagraphs (i) and (ii), (c) the individual referred to in paragraph (a) shall make a declaration of the kind mentioned in paragraph (d) to the qualifying fund manager, (d) the declaration referred to in paragraph (c) shall be a declaration, in writing, to the qualifying fund manager which— (i) is made by the individual who is beneficially entitled to the assets in the approved minimum retirement fund, (ii) is made in such form as may be prescribed or authorised by the Revenue Commissioners, (iii) contains the full name, address and tax reference number of the individual referred to in subparagraph (i), (iv) declares that assets included in the fund consist only of assets referred to in paragraph (b) to which the individual was beneficially entitled in accordance with section 784(2A), and (v) contains such other information as the Revenue Commissioners may reasonably require for the purposes of this Act. (2) A qualifying fund manager shall not accept any assets into an approved minimum retirement fund unless the fund manager receives a certificate to which subsection (3) applies in relation to those assets from a person lawfully carrying on in the State the business of granting annuities on human life or from another qualifying fund manager. (3) A certificate to which this subsection applies is a certificate stating— (a) that the assets in relation to which the certificate is given are the assets of an approved minimum retirement fund to which the individual named on the certificate is beneficially entitled and which are being transferred to the approved minimum retirement fund or have previously been transferred to such a fund in accordance with subsection (2A) of section 784, (b) in the case of assets transferred by another qualifying fund manager, the amount or value of assets transferred to the approved minimum retirement fund for the purposes of subsection (3) of section 784C. (4) Subsection (2) of section 263 shall apply to a declaration made in accordance with subsection (1)(c) or a certificate to which subsection (3) applies as it applies in relation to declarations of a kind mentioned in that section. (5) The Minister for Finance may specify requirements regarding the operation of approved minimum retirement funds.
Returns, and payment of tax, by qualifying fund managers.	784E.—(1) A qualifying fund manager shall, within 14 days of the end of the month in which a distribution is made out of the residue of an approved retirement fund, make a return to the Collector-General which shall contain details of— (a) the name and address of the person in whose name the approved retirement fund is or was held, (b) the tax reference number of that person, (c) the name and address of the person to whom the distribution was made, (d) the amount of the distribution, and (e) the tax which the qualifying fund manager is required to account for in relation to that distribution (hereafter in this section referred to as ‘the appropriate tax’). (2) The appropriate tax in relation to a distribution which is required to be included in a return shall be due at the time by which the return is to be made and shall be paid by the qualifying fund manager to the Collector-General, and the appropriate tax so due shall be payable by the qualifying fund manager without the making of an assessment; but appropriate tax which has become so due may be assessed on the qualifying fund manager (whether or not it has been paid when the assessment is made) if that tax or any part of it is not paid on or before the due date. (3) Where it appears to the inspector that there is any amount of appropriate tax in relation to a distribution which ought to have been but has not been included in a return, or where the inspector is dissatisfied with any return, the inspector may make an assessment on the qualifying fund manager to the best of his or her judgement, and any amount of appropriate tax in relation to a distribution due under an assessment made by virtue of this subsection shall be treated for the purposes of interest on unpaid tax as having been payable at the time when it would have been payable if a correct return had been made. (4) Where any item has been incorrectly included in a return as a distribution, the inspector may make such assessments, adjustments or set-offs as may in his or her judgement be required for securing that the resulting liabilities to tax, including interest on unpaid tax, whether of the qualifying fund manager or any other person, are in so far as possible the same as they would have been if the item had not been so included. (5) (a) Any appropriate tax assessed on a qualifying fund manager under this Chapter shall be due within one month after the issue of the notice of assessment (unless that tax is due earlier under subsection (1)) subject to any appeal against the assessment, but no such appeal shall affect the date when any amount is due under subsection (1). (b) On the determination of an appeal against an assessment under this section, any appropriate tax overpaid shall be repaid. (6) (a) The provisions of the Income Tax Acts relating to— (i) assessment to income tax, (ii) appeals against such assessments (including the rehearing of appeals and the statement of a case for the opinion of the High Court), and (iii) the collection and recovery of income tax, shall, in so far as they are applicable, apply to the assessment, collection and recovery of appropriate tax. (b) Any amount of appropriate tax payable in accordance with this Chapter without the making of an assessment shall carry interest at the rate of 1 per cent for each month or part of a month from the date when the amount becomes due and payable until payment. (c) Subsections (2) and (4) of section 1080 shall apply in relation to interest payable under paragraph (b) as they apply in relation to interest payable under section 1080. (d) In its application to any appropriate tax charged by any assessment made in accordance with this section, section 1080 shall apply as if subsection (1)(b) of that section were deleted. (7) Every return shall be in a form prescribed or authorised by the Revenue Commissioners and shall include a declaration to the effect that the return is correct and complete. (8) (a) A qualifying fund manager shall, on or before the specified return date for the chargeable period, within the meaning of section 950, prepare and deliver to the appropriate inspector, within the meaning of that section, a return in relation to each approved retirement fund held by that fund holder at any time during the year of assessment. (b) The return under paragraph (a) shall, in relation to each approved retirement fund, contain— (i) the name, address and tax reference number of the individual beneficially entitled to the assets in the fund, (ii) details of any income, profits and gains, and any chargeable gains derived from assets held in the fund and of any tax deducted from income, profits or gains received, (iii) details of any distributions made out of the assets held in the approved retirement fund, and (iv) such further details as the Revenue Commissioners may reasonably require for the purposes of this section.”,

(iv) in section 785, by the substitution in paragraph (b) of subsection (1) and in paragraph (b) of subsection (2) of “75 years” for “70 years (or any greater age approved under section 784(3)(d))”,

(v) in section 786, by the substitution of the following subsection for subsection (1):

“(1) The Revenue Commissioners shall not approve an annuity contract under section 784 unless the contract provides that the individual by whom it is made may require a sum representing the value of his or her accrued rights under the contract—

(a) to be paid by the person with whom it is made to such other person as the individual may specify, and

(b) to be applied by such other person in payment of the premium or other consideration under an annuity contract made between the individual and that other person and approved by the Revenue Commissioners under that section,

if the first-mentioned contract is otherwise to be approved by the Revenue Commissioners under that section.”,

(vi) in section 787—

(I) by the insertion of the following subsections after subsection (2):

“(2A) Notwithstanding subsection (2), for the purposes of relief under this section an individual's net relevant earnings shall not exceed £200,000 or such other amount as shall be specified in regulations made by the Minister for Finance.

(2B) Where regulations are proposed to be made under subsection (2A), a draft of the regulations shall be laid before Dáil Éireann and the regulations shall not be made until a resolution approving of the draft has been passed by Dáil Éireann.”,

(II) by the substitution of the following subsections for subsection (8):

“(8) Subject to this section, the amount which may be deducted or set off in any year of assessment (whether in respect of one or more qualifying premiums and whether or not including premiums in respect of a contract approved under section 785) shall not be more than—

(a) in the case of an individual who at any time during the year of assessment was of the age of 30 years or over but had not attained the age of 40 years, 20 per cent,

(b) in the case of an individual who at any time during the year of assessment was of the age of 40 years or over but had not attained the age of 50 years, 25 per cent,

(c) in the case of an individual who at any time during the year of assessment was of the age of 50 years or over or who for the year of assessment was a specified individual, 30 per cent, and

(d) in any other case, 15 per cent,

of the individual's net relevant earnings for that year, and the amount to be deducted shall to the greatest extent possible include qualifying premiums in respect of contracts approved under section 785.

(8A) For the purposes of this section, ‘specified individual’, in relation to a year of assessment, means an individual whose relevant earnings for the year of assessment were derived wholly or mainly from an occupation or profession specified in Schedule 23A.

(8B) The Minister for Finance may, after consultation with the Minister for Tourism, Sport and Recreation, by regulations extend or restrict the meaning of specified individual by adding or deleting one or more occupations or professions to or from, as the case may be, the list of occupations and professions specified in Schedule 23A.

(8C) Where regulations are proposed to be made under subsection (8B), a draft of the regulations shall be laid before Dáil Éireann and the regulations shall not be made until a resolution approving of the draft has been passed by Dáil Éireann.”,

and

“Section 787.

SCHEDULE 23A

Specified Occupations and Professions

Athlete

Badminton Player

Boxer

Cyclist

Footballer

Golfer

Jockey

Motor Racing Driver

Rugby Player

Squash Player

Swimmer

Tennis Player”.

(2) (a) Paragraph (a) of subsection (1) shall apply as respects any retirement benefits scheme (within the meaning of section 771 of the Principal Act) approved on or after the 6th day of April, 1999.

(b) Paragraph (b), other than subparagraph (vi), of subsection (1) shall apply as respects any annuity contract for the time being approved by the Revenue Commissioners under section 784 of the Principal Act entered into on or after the 6th day of April, 1999.

(c) Subparagraph (vi) of paragraph (b), and paragraph (c), of subsection (1) shall apply as respects the year of assessment 1999-2000 and subsequent years.

(d) Notwithstanding any provision of Part 30 of the Principal Act, a retirement benefits scheme or an annuity contract which was approved by the Revenue Commissioners before the 6th day of April, 1999, shall not cease to be an approved scheme or contract, as the case may be, because the rules of the scheme or the terms of the contract are altered on or after that date to enable an individual to whom the scheme or the contract applies to exercise an option under subsection (3A) of section 772 or subsection (2A) of section 784 of the Principal Act, as may be appropriate, which that individual would be in a position to exercise in accordance with the terms of those subsections as regards a scheme or contract approved on or after the 6th day of April, 1999, and as regards such a scheme or contract, the provisions of this section shall apply as if the scheme or contract were one approved on or after that date.

(e) Notwithstanding subsection (3A) of section 772 and subsection (2A) of section 784 of the Principal Act, where a pension or annuity first became payable on or after the 2nd day of December, 1998, and before the 6th day of April, 1999, paragraph (d) shall apply as if the references in the said subsections to the exercise of an option on or before the date on which a pension or an annuity would otherwise become payable were a reference to the exercise of an option within six months of the date on which the pension or annuity became payable.

Purchased life annuities.

20. —(1) Section 788(2) of the Principal Act is hereby amended—

(a) in paragraph (d), by the deletion of “or” after “section 787,”,

(b) in paragraph (e), by the substitution of “capital), or” for “capital).”, and

“(f) any annuity where the whole or part of the consideration for the grant of the annuity consisted of assets which, at the time of application of the said assets for the purchase of the annuity, were assets in an approved retirement fund, within the meaning of section 784A, or in an approved minimum retirement fund, within the meaning of section 784C.”.

Amendment of section 823 (deduction for income earned outside the State) of Principal Act.

21. —(1) Section 823 of the Principal Act is hereby amended—

(a) in subsection (1), by the substitution of the following for the definition of “the specified amount”:

“‘the specified amount’ in relation to an office or employment means an amount determined by the formula—

	D x E
	365

where—

D is the number of qualifying days in relation to the office or employment in the year of assessment concerned, and

E is all the income, profits or gains from any office, employment or pension whether chargeable under Schedule D or E (including income from offices or employments the duties of which are performed in the State) of an individual in that year after deducting any contribution or qualifying premium in respect of which there is provision for a deduction under section 774(7) or 787 but excluding—

(a) any expense to which section 118 applies,

(b) any amount treated as emoluments of an employment under section 121(2)(b)(ii) by virtue of a car being made available by reason of the employment,

(d) any payment to which section 123 applies,

(e) any sum deemed to be profits or gains arising or accruing from an office or employment by virtue of section 127(2), or

(f) any gain to which section 128 applies.”,

and

(b) in subsection (3), by the insertion of the following after “the specified amount”:

“in relation to that office or employment or the amount of the income, profits or gains whichever is the lesser”.

(2) This section shall apply—

(a) as respects the year of assessment 1999-2000 and subsequent years of assessment, and

(b) as respects the year of assessment 1998-99 to the extent that the income, profits or gains to be included in computing the specified amount accrues to an individual on or after the 10th day of March, 1999.

Amendment of section 869 (delivery, service and evidence of notices and forms) of Principal Act.

22. — Section 869 of the Principal Act is hereby amended by the substitution of the following subsection for subsection (3):

“(3) Prima facie evidence of any notice given or served under the Tax Acts or the Capital Gains Tax Acts by the Revenue Commissioners or an inspector or other officer of the Revenue Commissioners may be given in any proceedings by the production of a document purporting—

(a) to be a copy of the notice, or

(b) if the details specified in the notice are contained in an electronic, photographic or other record maintained by the Revenue Commissioners, to reproduce those details in so far as they relate to the said notice,

and it shall not be necessary to prove the official positions or position of the persons or person by whom the notice purports to be given or served or, where it is signed, the signatures or signature or that the persons or person signing and giving or serving it were or was authorised to do so.”.

Amendment of section 961 (issue of demand notes and receipts) of Principal Act.

23. — Section 961 of the Principal Act is hereby amended, as on and from the 6th day of April, 1999, by the substitution of the following subsection for subsection (2):

“(2) On payment of income tax, the Collector-General shall furnish the person concerned with a receipt in respect of that payment; such a receipt shall consist of whichever of the following the Collector-General considers appropriate, namely—

(a) a separate receipt on the prescribed form in respect of each such payment, or

(b) a receipt on the prescribed form in respect of all such payments that have been made within a period specified in the receipt.”.

Amendment of Chapter 4 (collection and recovery of income tax on certain emoluments (PAYE system)) of Part 42 of Principal Act.

24. —Chapter 4 of Part 42 of the Principal Act is hereby amended, as on and from the 6th day of April, 1999, by the insertion of the following section after section 990:

“Generation of estimates by electronic, photographic or other process.

990A.—For the purposes of this Chapter—

(a) where the inspector, any officer of the Revenue Commissioners nominated by them for the purposes of section 989 or 990 (in this section referred to as ‘the nominated officer’) or any other officer of the Revenue Commissioners acting with the knowledge of the inspector or the nominated officer causes, for the purposes of section 989 or 990, to be issued, manually or by any electronic, photographic or other process, and to be served, a notice bearing the name of the inspector or the nominated officer, the estimate to which that notice relates shall be deemed—

(i) if that notice was issued for the purposes of section 989, to have been made by the nominated officer, and

(ii) if that notice was issued for the purposes of section 990, to have been made by the inspector or the nominated officer, as the case may be, to the best of his or her opinion,

and

(b) the provisions of section 928 shall, subject to any necessary modifications, apply in relation to estimates made in accordance with the provisions of section 990 as they apply in relation to assessments to income tax.”.

Amendment of section 987 (penalties for breach of regulations) of Principal Act.

25. —Section 987 of the Principal Act is hereby amended—

(a) by the substitution of the following subsection for subsection (1)—

“(1) Where any person does not comply with any provision of regulation under this Chapter requiring that person to send any return, statement, notification or certificate, other than the end of year return required under Regulation 35 of the Income Tax (Employments) Regulations, 1960 (S.I. No. 28 of 1960), or to remit income tax to the Collector-General or fails to make any deduction or repayment in accordance with any regulation made pursuant to section 986(1)(g), that person shall be liable to a penalty of £1,200.”,

(b) by the insertion after subsection (1) of the following subsection:

“(1A) Where any person fails to send an end of year return to the Collector-General in accordance with Regulation 35 of the Income Tax (Employments) Regulations, 1960 (S.I. No. 28 of 1960), that person shall be liable to a penalty of £500 for each month or part of a month during which the said return remains outstanding, subject to a maximum penalty of £2,000.”,

and

Relief for fees paid to publicly funded colleges in the European Union for full-time third level education.

26. —The Principal Act is hereby amended—

(a) in Chapter 1 of Part 15, by the insertion in Part 2 of the Table to section 458 of “Section 474A” after “Section 474”,

(b) in Chapter 2 of Part 15, by the insertion of the following section after section 474:

“Relief for fees paid to publicly funded colleges in the European Union for full-time third level education.

474A.—(1) In this section—

‘academic year’, in relation to an approved course, means a year of study commencing on a date not earlier than the 1st day of August in a year of assessment;

‘appropriate percentage’, in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year;

‘dependant’, in relation to an individual, means a spouse or child of the individual or a person in respect of whom the individual is or was the legal guardian;

‘the Minister’ means the Minister for Education and Science;

‘qualifying college’ means any university or similar institution of higher education in a Member State of the European Union (other than the State) which is maintained or assisted by recurrent grants from public funds of that or any other Member State of the European Union (including the State);

‘qualifying course’ means a full-time undergraduate course of study in a qualifying college which is of at least 2 academic years' duration, other than a course of study in medicine, dentistry, veterinary medicine or in teacher training;

‘qualifying fees’, in relation to a qualifying course and an academic year, means so much of the amount of fees chargeable in respect of tuition to be provided in relation to that course in that year as is equal to the amount of fees determined by the Minister, with the consent of the Minister for Finance, to be the qualifying fees for the purposes of this section in relation to the class of qualifying course specified in the determination to which the particular course concerned belongs.

(2) Subject to this section, where an individual for a year of assessment proves that he or she has, on his or her own behalf or on behalf of his or her dependant, made a payment in respect of qualifying fees in respect of a qualifying course for the academic year in relation to that course commencing in that year of assessment, the income tax to be charged on the individual for that year of assessment, other than in accordance with section 16(2), shall be reduced by an amount which is the lesser of—

(a) the amount equal to the appropriate percentage of the aggregate of all such payments proved to be so made, and

(b) the amount which reduces that income tax to nil.

(3) For the purpose of this section, a payment in respect of qualifying fees shall be regarded as not having been made in so far as any sum in respect of or by reference to such fees has been or is to be received, directly or indirectly, by the individual, or, as the case may be, his or her dependant, from any source whatever by means of grant, scholarship or otherwise.

(4) Any claim for relief under this section made by an individual shall be accompanied by a statement in writing made by the qualifying college concerned stating each of the following, namely—

(a) that the college is a qualifying college for the purposes of this section,

(b) the details of the course undertaken by the individual or his or her dependant,

(d) the amount of the fees paid in respect of the course.

(5) Where for the purposes of this section any question arises as to whether—

(a) a college is a qualifying college, or

(b) a course of study is a qualifying course,

the Revenue Commissioners may consult with the Minister.”,

and