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3 2000

FINANCE ACT, 2000

Chapter 6

Capital Gains Tax

Amendment of section 598 (disposals of business or farm on “retirement”) of Principal Act.

85. —Section 598(2) of the Principal Act is amended as respects disposals made on or after 1 December 1999 in paragraph (a) by the substitution of “£375,000” for “£250,000” in each place where it occurs.

Amendment of section 649A (relevant disposals: rate of charge) of Principal Act.

86. —Section 649A of the Principal Act is amended by the substitution for subsections (1) and (2) of the following:

“(1) Notwithstanding section 28(3) and subject to subsection (2), the rate of capital gains tax in respect of a chargeable gain accruing to a person on a relevant disposal shall be—

(a) in the case of a relevant disposal made in the period from 3 December 1997 to 30 November 1999, 40 per cent,

(b) in the case of a relevant disposal, other than a relevant disposal referred to in paragraph (c), made on or after 1 December 1999, 20 per cent, and

(c) in the case of a relevant disposal made on or after 6 April 2002, being a disposal of land which, in accordance with a development objective (as indicated in the development plan of the planning authority concerned), is for use solely or primarily for residential purposes, 60 per cent.

(2) (a) Subsection (1) shall not apply to a relevant disposal to which this subsection applies and, accordingly, the rate of capital gains tax in respect of a chargeable gain on such a relevant disposal shall be 20 per cent.

(b) This subsection shall apply to the following:

(i) a relevant disposal to which section 650 refers;

(ii) a relevant disposal made in the period from 23 April 1998 to 30 November 1999, being a disposal of land to a housing authority (within the meaning of section 23 of the Housing (Miscellaneous Provisions) Act, 1992 ) which land is specified in a certificate given by the housing authority as land required for the purposes of the Housing Acts, 1966 to 1998;

(iii) a relevant disposal made in the period from 10 March 1999 to 30 November 1999, being a disposal of land to the National Building Agency Limited or to a body approved for the purposes of section 6 of the Housing (Miscellaneous Provisions) Act, 1992 , which land is specified in a certificate given by a housing authority or the National Building Agency Limited, as appropriate, as land required for the purposes of the Housing Acts, 1966 to 1998;

(iv) a relevant disposal made in the period from 23 April 1998 to 30 November 1999, being a disposal of land in respect of the whole of which, at the time at which the disposal is made, permission for residential development has been granted under section 26 of the Local Government(Planning and Development) Act, 1963, and such permission has not ceased to exist, other than a disposal to which paragraph (c) applies;

(v) a relevant disposal made in the period from 10 March 1999 to 30 November 1999, being a disposal of land in respect of the whole of which, at the time at which the disposal is made, is, in accordance with a development objective (as indicated in the development plan of the planning authority concerned), for use solely or primarily for residential purposes other than a disposal to which paragraph (c) applies.

(c) This paragraph shall apply to a relevant disposal being a disposal—

(i) by a person (in this paragraph referred to as the “disponer”) to a person who is connected with the disponer, or

(ii) of land under a relevant contract in relation to the disposal.”.

Amendment of section 980 (deduction from consideration on disposal of certain assets) of Principal Act.

87. —(1) Section 980 of the Principal Act is amended—

(a) by the substitution in subsection (3) for “£150,000” of “£300,000”,

(b) by the substitution in subsection (4) for paragraph (b) of the following:

“(b) Where the person disposing of the asset produces to the person acquiring the asset—

(i) a certificate issued under subsection (8) in relation to the disposal, or

(ii) if the asset concerned is land on which a new house has been built or land on which a new house is in the course of being built, a certificate issued under subsection (8) in relation to the disposal or one of the certificates specified in subsection (8A) which, in either case, has been issued to the person disposing of the asset,

no deduction referred to in paragraph (a) shall be made.

(c) In paragraph (b)(ii)—

‘house’ has the same meaning as it has in section 329;

‘new house’ means a house which hasbeen developed or is being developed by or on behalf of the person disposing of it and which has not been used at any time before its disposal.”,

(c) by the insertion after subsection 8 of the following:

“(8A) (a) The certificates referred to in subsection (4) (b) are—

(i) a certificate of authorisation (within the meaning of section 531) issued for the purposes of that section, the period of validity of which, as provided for by regulations under subsection (6) of that section, has not expired,

(ii) a tax clearance certificate (within the meaning of section 1094) issued for the purposes of that section, the period of validity of which has not expired,

(iii) a tax clearance certificate (within the meaning of section 1095) issued for the purposes of that section, the period of validity of which has not expired, or

(iv) where a person has not been issued with such a certificate of authorisation or such a tax clearance certificate, a certificate such as is referred to in paragraph (b).

(b) Where a person has not been issued with a certificate of authorisation or a tax clearance certificate such as is referred to in subparagraph (i), (ii) or (iii) of paragraph (a), the person disposing of an asset referred to in subsection (4)(b)(ii) may apply in that behalf, for the purposes of this paragraph, to the Collector-General for the issue of a certificate and such an application shall be deemed to be an application made under section 1095 for the issuing of a tax clearance certificate thereunder and that section shall, accordingly, apply with the following and any other necessary modifications, that is to say, for the reference in subsection (2) of section 1095 to the scheme there shall be substituted a reference to subsection (4)(b) of this section.”,

and

(d) by the substitution for subparagraph (iii) of subsection (9)(a) of the following:

“(iii) the person disposing of the asset does not, at or before the time at which the acquisition is made, produce to the person acquiring the asset a certificate under subsection (8) in relation to the disposal or one of the certificates specified in subsection (8A), being a certificate which, in either case, has been issued to the person disposing of the asset.”.

(2) This section shall apply as respects disposals made on or after the date of the passing of this Act.

Amendment of section 1030 (separated spouses: transfers of assets) of Principal Act.

88. —(1) Section 1030(2) of the Principal Act is amended—

(a) by the deletion of “or” in paragraph (c),

and

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

“(d) a relief order (within the meaning of the Family Law Act, 1995 ) made following the dissolution of a marriage or following the legal separation of spouses, or

(e) an order or other determination to like effect, which is analogous to an order referred to in paragraph (d), of a court under the law of a territory other than the State made under or in consequence of the dissolution of a marriage or the legal separation of spouses, being a dissolution or legal separation that is entitled to be recognised as valid in the State,”.

(2) Subsection (1) shall apply as respects disposals made on or after 10 February 2000.