Legalize / Ireland / Act

Finance Act 2000

Type Act

Publication 2000-03-23

State In force

Source Irish Statute Book

articles 166

Reform history JSON API

(I) by the substitution in the definition of “shares” of “stock;” for “stock.”, and

(II) by the insertion after the definition of “shares” of the following:

“specified age’ means an age that is not less than 60 years and not more than pensionable age (within the meaning of section 2 of the Social Welfare (Consolidation) Act, 1993).”,

(ii) by the insertion after paragraph 2(4) of the following:

“(5) The scheme shall indicate the specified age for the purposes of the scheme.”,

(iii) in paragraph 20(b), by the substitution of “the specified age” for “pensionable age (within the meaning of section 2 of the Social Welfare (Consolidation) Act, 1993)”, and

(iv) in paragraph 21 by the substitution of “the specified age” for “pensionable age”.

52 Reduction in tax on certain transactions in land.

52.—(1) Chapter 1 of Part 22 of the Principal Act is amended by the insertion after section 644 of the following sections:

“Relief from income tax in respect of income from dealing in residential development land.	644A.—(1) In this section—
‘basis period’ has the same meaning as in section 127(1);
	‘construction operations’, in relation to residential development land, means operations of any of the descriptions referred to in the definition of ‘construction operations’ in section 530(1) other than such operations as consist of—
	(a) the demolition or dismantling of any building or structure on the land,
	(b) the construction or demolition of any works forming part of the land, being roadworks, water mains, wells, sewers or installations for the purposes of land drainage, or
	(c) any other operations which are preparatory to residential development on the land other than the laying of foundations for such development;
	‘residential development’ includes any development which is ancillary to the development and which is necessary for the proper planning and development of the area in question;
	‘residential development land’ means land—
	(a) disposed of to—
	(i) a housing authority (within the meaning of section 23 of the Housing (Miscellaneous Provisions) Act, 1992),
	(ii) the National Building Agency Limited (being the company referred to in section 1 of the National Building Agency Limited Act, 1963), or
	(iii) a body standing approved of for the purposes of section 6 of the Housing (Miscellaneous Provisions) Act, 1992,
	which land is specified in a certificate in writing given by a housing authority or the National Building Agency Limited, as appropriate, as land being required for the purposes of the Housing Acts, 1966 to 1998,
	(b) in respect of which 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, or
	(c) which 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.
	(2) This section applies to profits or gains being—
	(a) profits or gains arising from dealing in or developing residential development land in the course of a business consisting of or including dealing in or developing land which is, or is regarded as, a trade within Schedule D or a part of such a trade, or
	(b) any gain of a capital nature arising from the disposing of residential development land which, by virtue of section 643, constitutes profits or gains chargeable to tax under Case IV of Schedule D.
	(3) Notwithstanding any other provision of the Tax Acts and subject to subsections (4) and (5)—
	(a) to the extent to which profits or gains of a basis period for a year of assessment consist of profits or gains to which this section applies, those profits or gains—
	(i) shall be chargeable to income tax for that year at the rate of 20 per cent, and
	(ii) shall not be reckoned in computing total income for that year for the purposes of the Income Tax Acts,
	and
	(b) the provisions of sections 187 and 188, and the reductions specified in Part 2 of the Table to section 458 shall not apply as regards income tax so charged.
	(4) For the purposes of this section—
	(a) where a trade consists partly of dealing in residential development land and partly of other operations or activities, the part of the trade consisting of dealing in residential development land and the part of the trade consisting of other operations or activities shall each be treated as a separate trade, and the total amount receivable from sales made and services rendered in the course of the trade, and of expenses incurred in the trade, shall be apportioned to each such part,
	(b) in computing the profits or gains to which this section applies, no account shall be taken, in determining those profits or gains, of that part, if any, of profits or gains which are attributable to construction operations on the land, and
	(c) where, in order to give effect to the provisions of this section, an apportionment of profits and gains, amounts receivable or expenses incurred is required to be made, such apportionment shall be made in a manner that is just and reasonable.
	(5) This section shall not apply to profits or gains arising to a person in a year of assessment if that person so elects by notice in writing to the inspector on or before the specified return date for the chargeable period (within the meaning of section 950).
Relief from corporation tax in respect of income from dealing in residential development land.	644B.—(1) In this section—
‘excepted trade’ has the same meaning as in section 21A;
	‘residential development’ and ‘residential development land’ have the same meaning as each has in section 644A.
	(2) (a)Where in an accounting period a company carries on an excepted trade the operations or activities of which consist of or include dealing in land which, at the time at which it is disposed of by the company, is residential development land, the corporation tax payable by the company for the accounting period, in so far as it is referable to trading income from dealing in residential development land, shall be reduced by one-fifth.
	(b) For the purposes of paragraph (a)—
	(i) the corporation tax payable by a company for an accounting period which is referable to trading income from dealing in residential development land shall be such amount as bears to the amount of corporation tax for the period referable to income of an excepted trade the same proportion as—
	(I) the amount receivable by the company in the accounting period from the disposal in the course of the excepted trade of residential development land, exclusive of so much of that amount as is attributable to construction operations (within the meaning of section 21A) carried out by or for the company on the land, bears to
	(II) the total amount receivable by the company in the accounting period, exclusive of so much of that amount as is attributable to construction operations (within the meaning of section 21A) carried out by or for the company on land disposed of by it, in the course of the excepted trade,
	and
	(ii) corporation tax referable to income from an excepted trade for an accounting period shall be such sum as bears to the amount of corporation tax charged for the period in accordance with section 21A at the rate of 25 per cent the same proportion as the amount of the company's profits treated under section 21A as consisting of income from the excepted trade bears to the total amount of the profits of the company for the period so charged at the rate of 25 per cent.
	(3)(a) Where in an accounting period income of a company which is chargeable under Case IV of Schedule D by virtue of section 643 consists of or includes an amount in respect of a gain obtained from disposing of land which, at the time of its disposal, is residential development land, the corporation tax payable by the company for the accounting period, in so far as it is referable to that gain, shall be reduced by one-fifth.
	(b) For the purposes of paragraph (a)—
	(i) the corporation tax payable by a company for an accounting period which is referable to a gain from disposing of residential development land shall be such amount as bears to the amount of corporation tax for the accounting period referable to a gain charged to tax in accordance with section 643 the same proportion as so much of the amount (in this subparagraph referred to as the ‘specified amount’) of the last-mentioned gain as is attributable to the disposal of residential development land (exclusive of any part of the gain as is referable to construction operations, within the meaning of section 644A, carried out by the company) bears to the specified amount, and
	(ii) corporation tax referable to a gain from disposing of land which is treated by virtue of section 643 as income chargeable under Case IV of Schedule D shall be such sum as bears to the amount of corporation tax charged for the accounting period in accordance with section 21A at the rate of 25 per cent the same proportion as the amount of the company's profits which consists of income chargeable under Case IV of Schedule D by virtue of section 643 bears to the total amount of the profits of the company for the period so charged at the rate of 25 per cent.
	(4) (a)Where a company makes a claim in that behalf, the corporation tax payable by the company for an accounting period ending before 1 January 2001 shall be computed as if subparagraph (ii) of paragraph (a) of the definition of excepted operations in section 21A did not have effect in relation to residential development land.
	(b) For the purposes of this subsection where an accounting period of a company begins before 1 January 2001 and ends on or after that day, it shall be divided into two parts, one beginning on the day on which the accounting period begins and ending on 31 December 2000 and the other beginning on 1 January 2001 and ending on the day on which the accounting period ends, and both parts shall be treated for the purpose of this section as if they were separate accounting periods of the company.”.

(2) (a) This section shall apply—

(i) as respects income tax, in relation to profits or gains arising on or after 1 December 1999, and

(ii) as respects corporation tax, in relation to accounting periods ending on or after 1 January 2000.

(b)For the purposes of this section where an accounting period of a company begins before 1 January 2000 and ends on or after that day, it shall be divided into two parts, one beginning on the day on which the accounting period begins and ending on 31 December 1999 and the other beginning on 1 January 2000 and ending on the day on which the accounting period ends, and both parts shall be treated for the purpose of this section as if they were separate accounting periods of the company.

53 Amendment of Part 26 (life assurance companies) of Principal Act.

53.— The Principal Act is amended in Part 26 by the insertion after Chapter 3 of the following Chapters:

Taxation of Assurance Companies — New Basis

Profits of life business: new basis.	730A.—(1) In this Chapter and Chapter 5 of this Part—
	‘assurance company’ means an assurance company chargeable to corporation tax;
	‘new basis business’ means—
	(a) where an assurance company was carrying on life business on 1 April 2000, other than where the assurance company's trading operations at that time consisted solely of foreign life assurance business within the meaning of section 451(1)—
	(i) all policies and contracts commenced by the assurance company on or after 1 January 2001, and
	(ii) all policies and contracts commenced by the assurance company before that date in so far as they relate to—
	(I) pension business and general annuity business, and
	(II) permanent health insurance, in respect of which the profits arising to the assurance company were before 1 January 2001 charged to tax under Case I of Schedule D,
	(b) where an assurance company was carrying on life business on 1 April 2000, and the assurance company's trading operations at that time consisted solely of foreign life assurance business within the meaning of section 451(1), all policies and contracts commenced by the assurance company on or after 1 January 2001, and
	(c) where an assurance company was not carrying on life business on 1 April 2000, subject to subsection (2), all policies and contracts commenced by the assurance company from the time it began to carry on life business.
	(2) Where an assurance company begins to carry on life business after 1 April 2000 and before 31 December 2000, the assurance company may elect that all policies and contracts commenced by it before 31 December 2000 be treated as not being new basis business in so far as they relate to life business (other than pension business and general annuity business).
	(3) Life business of an assurance company, in so far as it comprises new basis business, shall for the purposes of the Corporation Tax Acts be treated as though it were a separate business, that is, a business separate from other business (if any) carried on by the assurance company.
	(4) Notwithstanding Chapters 1 and 3 of this Part, an assurance company shall be charged to corporation tax in respect of the profits of new basis business under Case I of Schedule D and those profits shall, subject to subsection (5), be computed in accordance with the provisions applicable to that Case of that Schedule.
	(5) Where all or part of the profits of an assurance company are, under this Chapter, to be computed in accordance with the provisions applicable to Case I of Schedule D, the following provisions shall also apply—
	(a) such part of those profits as belongs or is allocated to, or is expended on behalf of, policyholders or annuitants shall be excluded in making the computation, and
	(b) there shall not be excluded in making the computation any remaining part of those profits reserved for policyholders or annuitants.
Chapter 5
Policyholders — New Basis
Taxation of policyholders.	730B.—(1) In this Chapter ‘return’ means a return under section 730G.
	(2) Subject to subsection (3), this Chapter applies for the purpose of imposing certain charges to tax in respect of a policy of assurance on the life of any person (in this Chapter referred to as a ‘life policy’) where the life policy is new basis business of the assurance company which commenced the life policy.
	(3) This Chapter does not apply to a life policy which relates to pension business, general annuity business or permanent health insurance business, of an assurance company.
Chargeable event.	730C.—(1) Subject to the provisions of this section, in this Chapter—
	(a) ‘chargeable event’, in relation to a life policy, means—
	(i) the maturity of the life policy, other than in respect of any death or disability giving rise to benefits under the life policy,
	(ii) the surrender in whole or in part of the rights conferred by the life policy, other than in respect of any death or disability giving rise to benefits under the life policy,
	(iii) the assignment in whole or in part, of those rights, and
	(b)in the case of a life policy issued by an assurance company which could have made an election under section 730A(2), but did not so do, a chargeable event shall be deemed to happen on 31 December 2000, where the life policy was commenced before that date.
	(2) No account shall be taken for the purposes of subsection (1) of any assignment effected by way of security for a debt, or the discharge of a debt secured by the rights concerned.
Gain arising on a chargeable event.	730D.—(1) On the happening of a chargeable event in relation to a life policy, there shall, subject to subsection (2), be treated as arising—
	(a) if the chargeable event is the maturity of the life policy or the surrender in whole of the rights thereby conferred, a gain in the amount determined under subsection (3)(a),
	(b) if the chargeable event is an assignment of the whole of the rights conferred by the life policy, a gain in the amount determined under subsection (3)(b),
	(c) if the chargeable event is the assignment of part of the rights conferred by the life policy, a gain in the amount determined under subsection (3)(d), and
	(e) if the chargeable event is deemed to happen on 31 December 2000 under section 730C(1)(b), a gain in the amount determined under subsection (3)(e).
	(2) A gain shall not be treated as arising on the happening of a chargeable event in relation to a life policy where, immediately before the chargeable event, the assurance company which commenced the life policy—
	(a) is in possession of a declaration, in relation to the life policy, of a kind referred to in—
	(i) section 730E(2), or
	(ii) where the policyholder (within the meaning of section 730E) is not a company, section 730E(3), and
	(b) is not in possession of any information which would reasonably suggest that—
	(i) the information contained in that declaration is not, or is no longer, materially correct,
	(ii) the policyholder (within the meaning of section 730E) failed to comply with the undertaking referred to in section 730E(2)(f) or, as the case may be, section 730E(3)(f), or
	(iii) immediately before the chargeable event, the policyholder (within the said meaning) is resident or ordinarily resident in the State.
	(3) The amount referred to—
	(a) in subsection (1)(a) is the amount determined by the formula—
	B — P,
	(b) in subsection (1)(b) is the amount determined by the formula—
	V — P,
	(c) in subsection (1)(c) is the amount determined by the formula—
B	—
---	---
V
	(d) in subsection (1)(d) is the amount determined by the formula—
---	---
A	—
---	---
V
	and
---	---
	(e) in subsection (1)(e) is the amount determined by the formula—
	V — P,
	where—
	B is the amount or value of the sum payable and other benefits arising by reason of the chargeable event,
	P is subject to subsection (4), an amount of premiums (in this section referred to as ‘allowable premiums’) being the total of all premiums paid in respect of the life policy immediately before the chargeable event, to the extent that they have not been taken into account in determining a gain on the previous happening of a chargeable event,
	V is the value of the rights and other benefits conferred by the life policy immediately before the chargeable event, and
	A is the value of the part of the rights and other benefits conferred by the life policy, which has been assigned,
	without having regard to any amount of appropriate tax (within the meaning of section 730F) in connection with the chargeable event.
	(4) (a)For the purposes of subsection (3), the amount of premiums taken into account in determining a gain on the happening of a chargeable event is, where the gain is determined—
	(i) under paragraph (c) of subsection (3), an amount equal to—
	(P X B)
---	---
	V
	and
---	---
	(ii) under paragraph (d) of subsection (3), an amount equal to—
	(P X A)
---	---
	V
	where P, A, B and V have, respectively, the meanings assigned to them in subsection (3).
---	---
	(b)Where a chargeable event in relation to a life policy is deemed to happen on 31 December 2000 then, for the purposes of determining a gain arising on the happening of a subsequent chargeable event, the allowable premiums immediately after 31 December 2000 shall be deemed to be the greater of—
	(i) an amount equal to the value of the policy immediately after 31 December 2000, and
	(ii) the allowable premiums immediately before 31 December 2000.
	(c)Where a chargeable event in relation to a life policy is an assignment of the whole of the rights conferred by the life policy then, for the purposes of determining a gain arising on the happening of a subsequent chargeable event, the allowable premiums immediately after the time of assignment shall be deemed to be the greater of—
	(i) an amount equal to the value of the policy immediately after the time of the assignment, and
	(ii) the allowable premiums immediately before the assignment.
	(d)Where a chargeable event in relation to a life policy is the assignment of part of the rights conferred by the life policy then the policy shall, for the purposes of determining a gain arising on the happening of any subsequent chargeable event, be treated as if it were comprised of 2 policies, that is—
	(i) one policy conferring the part of the rights assigned, the allowable premiums in respect of which immediately after the assignment are an amount equal to the value of the policy immediately after the assignment, and
	(ii) the other policy conferring the rights which were not assigned, the allowable premiums in respect of which immediately after the assignment are the amount of the allowable premiums immediately before the assignment reduced by the amount of premiums taken into account in determining a gain on the assignment.
Declarations.	730E.—(1) In this section and in section 730F, ‘policyholder’, in relation to a life policy, at any time means—
	(a) where the rights conferred by the life policy are vested at that time in a person as beneficial owner, such person,
	(b) where the rights conferred by the life policy are held at that time on trusts created by a person, such person, and
	(c) where the rights conferred by the life policy are held at that time as security for a debt owed by a person, such person.
	(2) The declaration referred to in section 730D(2)(a)(i) in relation to a life policy is, subject to subsection (4), a declaration in writing to the assurance company which—
	(a) is made by the policyholder at or about the time the life policy commenced,
	(b) is signed by the policyholder,
	(c) is made in such form as may be prescribed or authorised by the Revenue Commissioners,
	(d) declares that the policyholder is not resident in the State at the time of making the declaration,
	(e) contains—
	(i) the name of the policyholder,
	(ii) the address of the principal place of residence of the policyholder,
	(f) contains an undertaking by the policyholder that if the policyholder becomes resident in the State, the policyholder will notify the assurance company accordingly, and
	(g) contains such other information as the Revenue Commissioners may reasonably require for the purposes of this Chapter.
	(3) The declaration referred to in section 730D(2)(a)(ii) in relation to a life policy is, subject to subsection (4), a declaration in writing to the assurance company which—
	(a) is made by the policyholder,
	(b) is signed by the policyholder,
	(c) is made in such form as may be prescribed or authorised by the Revenue Commissioners,
	(d)declares that the policyholder, at the time the declaration is made, is neither resident nor ordinarily resident in the State,
	(e)contains the name and address of the policyholder,
	(f)contains an undertaking by the policyholder that if the policyholder becomes resident in the State, the policyholder will notify the assurance company accordingly, and
	(g)contains such other information as the Revenue Commissioners may reasonably require for the purposes of this Chapter.
	(4) Where, immediately before the happening of a chargeable event, the rights conferred by a life policy were vested beneficially in 2 or more persons, or were held on trusts created, or as security for a debt owed, by 2 or more persons, this section and section 730D shall have effect in relation to each of those persons as if he or she had been the sole owner, settlor or, as the case may be, debtor, but with references to the amount of the gain construed as references to the part of it proportionate to his or her share in the rights at the time of the event, or, as the case may require, when the trusts were created.
Deduction of tax on the happening of a chargeable event.	730F.—(1) In this section and in section 730G, ‘appropriate tax’, in connection with a chargeable event in relation to a life policy, means a sum representing income tax on the amount of the gain treated in accordance with section 730D as thereby arising—
	(a) where the chargeable event falls on or after 1 January 2001, at a rate determined by the formula—
	(S + 3) per cent,
	where S is the standard rate per cent (within the meaning of section 4), and
	(b) where the chargeable event falls on or before 31 December 2000, at a rate of 40 per cent.
	(2) An assurance company shall account for appropriate tax in accordance with section 730G.
	(3) (a) An assurance company which is liable to account for appropriate tax in connection with a chargeable event in relation to a life policy shall, at the time of the chargeable event, be entitled—
	(i) where the chargeable event is the maturity or surrender whether in whole or in part of the rights conferred by the life policy, to deduct from the proceeds payable to the policyholder on maturity, or as the case may be, surrender in whole or in part, an amount equal to the appropriate tax,
	(ii) where the chargeable event—
	(I) is the assignment, in whole or in part, of the rights conferred by the life policy, or
	(II) is deemed to happen on 31 December 2000 under section 730C(1)(b),
	to appropriate and realise sufficient assets underlying the life policy, to meet the amount of appropriate tax for which the assurance company is liable to account,
	(b)the policyholder shall allow such deduction or, as the case may be, such appropriation, and
	(c)the assurance company shall be acquitted and discharged of so much as is represented by the deduction or, as the case may be, the appropriation as if the amount of the deduction or the value of the appropriation had been paid to the policyholder.
Returns and collection of appropriate tax.	730G.—(1) Notwithstanding any other provision of the Tax Acts, this section shall apply for the purposes of regulating the time and manner in which appropriate tax in connection with a chargeable event in relation to a life policy shall be accounted for and paid.
	(2) An assurance company shall for each financial year make to the Collector-General—
	(a) a return of the appropriate tax in connection with chargeable events happening on or prior to 30 June, within 30 days of that date, and
	(b) a return of appropriate tax in connection with chargeable events happening between 1 July and 31 December, within 30 days of that later date, and
	where it is the case, the return shall specify that there is no appropriate tax for the period in question.
	(3) The appropriate tax in connection with a chargeable event 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 assurance company to the Collector-General, and the appropriate tax so due shall be payable by the assurance company without the making of an assessment; but appropriate tax which has become so due may be assessed on the assurance company (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.
	(4) Where it appears to the inspector that there is an amount of appropriate tax in relation to a chargeable event 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 assurance company to the best of his or her judgement, and any amount of appropriate tax in connection with a chargeable event 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.
	(5) Where any item has been incorrectly included in a return as appropriate tax, 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 assurance company making the return or of any other person, are in so far as possible the same as they would have been if the item had not been included.
	(6) (a) Any appropriate tax assessed on an assurance company shall be due within one month after the issue of the notice of assessment (unless that tax is due earlier under subsection (3)) subject to any appeal against the assessment, but no appeal shall affect the date when any amount is due under subsection (3).
	(b) On determination of the appeal against an assessment under this Chapter, any appropriate tax over-paid shall be repaid.
	(7) (a) The provisions of the Income Tax Acts relating to—
	(i) assessments 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 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 Chapter, section 1080 shall apply as if subsection (1) (b) of that section were deleted.
	(8) Every return shall be in form prescribed by the Revenue Commissioners and shall include a declaration to the effect that the return is correct and complete.”.

54 Amendment of section 420 (losses, etc. which may be surrendered by means of group relief) of Principal Act.

54.—Section 420 of the Principal Act is amended by the substitution for subsection (9) of the following:

“(9) (a)References in the preceding subsections to a surrendering company shall not include references to a company carrying on life business except to the extent that such life business is new basis business within the meaning of section 730A (inserted by the Finance Act, 2000).

(b) For the purposes of this section ‘life business’ shall be construed in accordance with section 706(1).”.

55 Amendment of section 595 (life assurance policy or deferred annuity contract entered into or acquired by a company) of Principal Act.

55.—Section 595 of the Principal Act is amended in subsection (1)(a) by the substitution for the definition of “relevant policy” of the following definition:

“‘relevant policy’ means a policy of life assurance or a contract for a deferred annuity on the life of a person, entered into or acquired by a company on or after 11 April 1994, which is not—

(a) a policy to which section 594 applies, or

(b) new basis business within the meaning of section 730A (inserted by the Finance Act, 2000).”.

56 Amendment of section 710 (profits of life business) of Principal Act.

56.—(1) Section 710 of the Principal Act is amended in subsection (2)(a)—

(a) by the substitution for “where a company's trading operations consist solely of a foreign life assurance business” of “where a company's trading operations on 31 December 2000 consisted solely of foreign life assurance business”, and

(b) by the deletion of subparagraphs (iii) and (iv).

(2) Subsection (1) shall apply as respects the financial year 2001 and subsequent financial years.

57 Amendment of Chapter 1 (unit trusts) of Part 27 of Principal Act.

57.—The Principal Act is amended in Part 27, in Chapter 1—

(a) by the substitution in subsection (1) of section 737 for the definition of “special investment units” of the following definition:

“‘special investment units’ means units sold to an individual on or after 1 February 1993 and before 1 January 2001 by the management company or trustee under an authorised unit trust scheme in respect of which—

(a) the conditions specified in subsection (3) are satisfied, and

(b) a declaration of the kind specified in subsection (4) has been made to the management company or trustee;”,

(b) in section 738, in subsection (2) by the substitution for paragraph (b)(i) of the following paragraph:

“(b) (i) As respects an undertaking for collective investment which is a company, the corporation tax which is chargeable on its profits on which corporation tax falls finally to be borne for a chargeable period shall, for the purposes of the Tax Acts, be such tax before it is reduced by any credit, relief or other reduction under those Acts, computed as if the rate of corporation tax were equal to the standard rate for the year of assessment in which the chargeable period falls.”,

and

“Reorganisation of undertakings for collective investment.	739A.— (1) (a) In this section ‘undertaking for collective investment’ has the meaning assigned to it in section 738(1).
	(b) Where an undertaking for collective investment (in this section referred to as the ‘first undertaking’) disposes of assets (in this section referred to as ‘transferred assets’) to another undertaking for collective investment in exchange for the issue of units to the first undertaking by that other undertaking for collective investment, no chargeable gains shall accrue to the first undertaking on that disposal.
	(2) For the purposes of computing a gain accruing to the first undertaking on a disposal or first deemed disposal, under section 738(4)(a)(i), of the units referred to in subsection (1), notwithstanding any other provision of the Capital Gains Tax Acts, the amount or value of the consideration in money or money's worth given by the first undertaking for the acquisition of the units is—
	(a) where the transferred assets fell within section 738(4)(a)(i), the value of the transferred assets on their latest deemed disposal by the first undertaking under that section, and
	(b) where the transferred assets did not fall within section 738(4)(a)(i), the cost incurred by the first mentioned undertaking in acquiring the transferred assets.”.

58 Investment undertakings.

58.—The Principal Act is amended—

(a) in Part 27 by the insertion after Chapter 1 of the following Chapter:

Investment Undertakings

Interpretation and application.	739B.—(1) In this Chapter and in Schedule 2B—
	‘the Acts’ means the Tax Acts and the Capital Gains Tax Acts;
	‘approved minimum retirement fund’ has the meaning assigned to it in section 784C;
	‘approved retirement fund’ has the meaning assigned to it in section 784A;
	‘chargeable event’, in relation to an investment undertaking in respect of a unit holder, means—
	(a) the making of a relevant payment by the investment undertaking,
	(b) the making of any other payment by the investment undertaking to a person, by virtue of that person being a unit holder (whether or not in respect of the cancellation, redemption or repurchase of a unit) other than a payment made on the death of a unit holder,
	(c) the transfer by a unit holder, by way of sale or otherwise (other than as a result of the death of the unit holder), of entitlement to a unit in the investment undertaking, and
	(d) a chargeable event shall be deemed to happen on 31 December 2000 in respect of all unit holders (if any) at that date in relation to an investment undertaking—
	(i) which commenced on or after 1 April 2000, or
	(ii) which was on 31 March 2000 a specified collective investment undertaking,
	but does not include—
	(A) any exchange of units in a sub-fund of an investment undertaking which is an umbrella scheme, for units in another sub-fund of that investment undertaking, and
	(B) any transaction in relation to, or in respect of, units which are held in a recognised clearing system;
	‘collective investor’, in relation to an authorised investment company (within the meaning of Part XIII of the Companies Act, 1990), means an investor, being a life assurance company, pension fund or other investor—
	(a) who invests in securities or any other property whatever with moneys contributed by 50 or more persons—
	(i) none of whom has at any time directly or indirectly contributed more than 5 per cent of such moneys, and
	(ii) each of a majority of whom has contributed moneys to the investor with the intention of being entitled, otherwise than on death of any person or by reference to a risk of any kind to any person or property, to receive from the investor—
	(I) a payment which, or
	(II) payments the aggregate of which,
	exceeds those moneys by a part of the profits or income arising to the investor,
	and
	(b) who invests in the authorised investment company primarily for the benefit of those persons;
	‘distribution’ has the same meaning as in the Corporation Tax Acts;
	‘intermediary’ means a person who—
	(a) carries on a business which consists of, or includes, the receipt of payments from an investment undertaking on behalf of other persons, or
	(b) holds units in an investment undertaking on behalf of other persons;
	‘investment undertaking’ means—
	(a) a unit trust scheme, other than—
	(i) a unit trust mentioned in section 731(5)(a), or
	(ii) a special investment scheme,
	which is or is deemed to be an authorised unit trust scheme (within the meaning of the Unit Trusts Act, 1990) and has not had its authorisation under that Act revoked,
	(b) any other undertaking which is an undertaking for collective investment in transferable securities within the meaning of the relevant Regulations, being an undertaking which holds an authorisation, which has not been revoked, issued pursuant to the relevant Regulations,
	(c) any authorised investment company (within the meaning of Part XIII of the Companies Act, 1990)—
	(i) which has not had its authorisation under that Part of that Act revoked, and
	(ii)(I) which has been designated in that authorisation as an investment company which may raise capital by promoting the sale of its shares to the public and has not ceased to be so designated, or
	(II) each of the shareholders of which is a collective investor,
	and
	(d) an investment limited partnership (within the meaning of the Investment Limited Partnerships Act, 1994),
	which is not an offshore fund (within the meaning of section 743); but includes any company limited by shares or guarantee which—
	(A) is wholly owned by such an investment undertaking or its trustees, if any, for the benefit of the holders of units in that undertaking, and
	(B) is so owned solely for the purpose of limiting the liability of that undertaking or its trustees, as the case may be, in respect of futures contracts, options contracts or other financial instruments with similar risk characteristics, by enabling it or its trustees, as the case may be, to invest or deal in such investments through the company,
	which is not an offshore fund (within the meaning of section 743);
	‘pension scheme’ means an exempt approved scheme within the meaning of section 774 or a retirement annuity contract or a trust scheme to which section 784 or 785 applies;
	‘qualifying fund manager’ has the meaning assigned to it in section 784A;
	‘qualifying management company’ has the meaning assigned to it in section 734(1);
	‘recognised clearing system’ means any system for clearing units which is for the time being designated for the purposes of this Chapter by order of the Revenue Commissioners as a recognised clearing system;
	‘relevant gains’, in relation to an investment undertaking, means gains accruing to the investment undertaking, being gains which would constitute chargeable gains in the hands of a person resident in the State including gains which would so constitute chargeable gains if all assets concerned were chargeable assets and no exemption from capital gains tax applied;
	‘relevant income’, in relation to an investment undertaking, means any amounts of income, profits or gains which arise to or are receivable by the investment undertaking, being amounts of income, profits or gains—
	(a) which are or are to be paid to unit holders as relevant payments,
	(b) out of which relevant payments are or are to be made to unit holders, or
	(c) which are or are to be accumulated for the benefit of, or invested for the benefit of, unit holders,
	and which if they arose to an individual resident in the State would in the hands of the individual constitute income for the purposes of income tax;
	‘relevant payment’ means a payment including a distribution made to a unit holder by an investment undertaking by reason of rights conferred on the unit holder as a result of holding a unit or units in the investment undertaking, where such payments are made annually or at more frequent intervals, other than a payment made in respect of the cancellation, redemption or repurchase of a unit;
	‘relevant profits’, in relation to an investment undertaking, means the relevant income and relevant gains of the investment undertaking;
	‘relevant Regulations’ means the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations, 1989 (S.I. No. 78 of 1989);
	‘return’ means a return under section 739F;
	‘specified collective investment undertaking’ and ‘specified company’ have, respectively, the meanings assigned to them in section 734(1);
	‘special investment scheme’ has the same meaning as in section 737;
	‘standard rate’ has the same meaning as in section 3(1);
	‘umbrella scheme’ means an investment undertaking—
	(a) which is divided into a number of sub-funds, and
	(b) in which the unit holders are entitled to exchange units in one sub-fund for units in another;
	‘unit’ includes any investment made by a unit holder, such as a subscription for shares or a contribution of capital, in an investment undertaking, being an investment which entitles the investor—
	(a) to a share of the investments or relevant profits of, or
	(b) to receive a relevant payment from,
	the investment undertaking;
	‘unit holder’, in relation to an investment undertaking, means any person who by reason of the holding of a unit, or under the terms of a unit, in the investment undertaking is entitled to a share of any of the investments or relevant profits of, or to receive a relevant payment from, the investment undertaking.
	(2) For the purposes of this Chapter, Schedule 2B and section 904D, references to an investment undertaking (other than in this subsection) shall be construed so as to include a reference to a trustee, management company or other such person who—
	(a) is authorised to act on behalf, or for the purposes, of the investment undertaking, and
	(b) habitually does so,
	to the extent that such construction brings into account for the purposes of this Chapter, Schedule 2B and section 904D any matter relating to the investment undertaking, being a matter which would not otherwise be brought into account for those purposes; but such construction shall not render the trustee, management company or other such person liable in a personal capacity to any tax imposed by this Chapter on an investment undertaking.
	(3) This Chapter applies to an investment undertaking and the unit holders in relation to that investment undertaking where the investment undertaking—
	(a) is on 31 March 2000 a specified collective investment undertaking, from 1 April 2000, or
	(b) first issued units on or after 1 April 2000, from the day of such first issue.
	(4) Where this Chapter applies to an investment undertaking, sections 734, 738 and 739 shall not apply to that investment undertaking or to unit holders in relation to that investment undertaking.
	(5) Schedule 2B has effect for the purposes of supplementing this Chapter.
	(6) For the purposes of this Chapter and Schedule 2B, where a holder of units in an investment undertaking is—
	(a) an investment undertaking
	(b) a special investment scheme, or
	(c) a unit trust to which section 731(5)(a) applies,
	the unit holder shall be treated as being entitled to the units so held.
Charge to tax.	739C.—(1) Notwithstanding anything in the Acts, an investment undertaking to which this Chapter applies shall not be chargeable to tax in respect of relevant profits otherwise than to the extent provided for in this Chapter.
	(2) Notwithstanding Chapter 4 of Part 8, that Chapter shall apply to a deposit (within the meaning of that Chapter) to which an investment undertaking is for the time being entitled as if such deposit were not a relevant deposit within the meaning of that Chapter.
Gain arising on a chargeable event.	739D.—(1) In this Chapter—
	(a) references to a chargeable event in relation to an investment undertaking in respect of a unit holder are, where the investment undertaking is an umbrella fund, references to a chargeable event in relation to each sub-fund of the umbrella fund in respect of a unit holder in that sub-fund, as if the sub-fund were the investment undertaking,
	(b) references to an amount invested by a unit holder in an investment undertaking for the acquisition of a unit (in this paragraph referred to as the ‘original unit’), where the original unit is a unit in a sub-fund of an umbrella scheme and the original unit has been exchanged for a unit or units of another sub-fund of the umbrella scheme, are references to the amount invested by the unit holder for the acquisition of the original unit, and
	(c) references to an amount invested by a unit holder in an investment undertaking for the acquisition of a unit shall, where the investment undertaking was on 31 March 2000 a specified collective investment undertaking and the unit was at that time a unit (within the meaning of section 734(1)) held by the unit holder as a unit holder (within the meaning of the said section) in relation to the specified collective investment undertaking, be references to the amount invested by the unit holder for the acquisition of the unit (within the said meaning) of the specified collective investment undertaking, or where that unit was otherwise acquired by the unit holder, the value of that unit at its date of acquisition by the unit holder.
	(2) On the happening of a chargeable event in relation to an investment undertaking in respect of a unit holder, there shall, subject to this section, be treated as arising to the investment undertaking a gain in the amount of—
	(a) where the chargeable event is the making of a relevant payment, the amount of the relevant payment,
	(b) where the chargeable event is the making of any other payment by the investment undertaking to a person, by virtue of that person being a unit holder, otherwise than on the cancellation, redemption or repurchase of a unit, the amount of the payment,
	(c) where the chargeable event is the making of a payment by the investment undertaking to a unit holder, on the cancellation, redemption or repurchase of a unit—
	(i) the amount determined under subsection (3), or
	(ii) where the investment undertaking has made an election under subsection (5), the amount of the payment reduced by the amount invested by the unit holder in the investment undertaking in acquiring the unit, and where the unit was otherwise acquired by the unit holder, the amount so invested shall be the value of the unit at the time of its acquisition by the unit holder,
	(d) where the chargeable event is the transfer by a unit holder of entitlement to a unit,
	(i) the amount determined under subsection (4), or
	(ii) where the investment undertaking has made an election under subsection (5), the value of the unit transferred at the time of transfer reduced by the amount invested by the unit holder in the investment undertaking in acquiring the unit, and where the unit was otherwise acquired by the unit holder, the amount so invested shall be the value of the unit at the time of its acquisition by the unit holder, and
	(e) where the chargeable event is deemed to happen on 31 December 2000, the excess (if any) of the value of the units held by the unit holder on that day over the total amount invested in the investment undertaking by the unit holder for the acquisition of the units, and where any unit was otherwise acquired by the unit holder, the amount so invested to acquire that unit shall be the value of the unit at the time of its acquisition by the unit holder.
	(3) The amount referred to in subsection (2)(c) is the amount determined by the formula—
	P —
---	---
	N2
	where—
---	---
	P is the amount in money or money's worth payable to the unit holder on the cancellation, redemption or repurchase of units, without having regard to any amount of appropriate tax (within the meaning of section 739E) thereby arising,
	C is the total amount invested by the unit holder in the investment undertaking to acquire the units held by the unit holder immediately before the chargeable event and—
	(a) where any unit was otherwise acquired by the unit holder, or
	(b) where a chargeable event was deemed to happen on 31 December 2000 in respect of the unit holder of that unit,
	the amount so invested to acquire the unit is—
	(i) where paragraph (a) applies, the value of the unit at the time of its acquisition by the unit holder, and
	(ii) where paragraph (b) applies, the value of the unit on 31 December 2000, without having regard to any amount of appropriate tax (within the meaning of section 739E) thereby arising,
	N1 is the number of units being cancelled, redeemed or, as the case may be, repurchased on the happening of the chargeable event, and
	N2 is the total number of units held by the unit holder immediately before the chargeable event.
	(4) The amount referred to in subsection (2)(d) is the amount determined by the formula—
	V —
---	---
	N2
	where—
---	---
	V is the value of the units transferred, at the time of transfer, without having regard to any amount of appropriate tax (within the meaning of section 739E) thereby arising,
	C is the total amount invested by the unit holder in the investment undertaking to acquire the units held by the unit holder immediately before the chargeable event and—
	(a) where any unit was otherwise acquired by the unit holder, or
	(b) where a chargeable event was deemed to happen on 31 December 2000 in respect of the unit holder of that unit,
	the amount so invested to acquire the unit is—
	(i) where paragraph (a) applies, the value of the unit at the time of its acquisition by the unit holder, and
	(ii) where paragraph (b) applies, the value of the unit on 31 December 2000, without having regard to any amount of appropriate tax (within the meaning of section 739E) thereby arising,
	N1 is the number of units transferred on the happening of the chargeable event, and
	N2 is the total number of units held by the unit holder immediately before the chargeable event.
	(5) The election referred to in paragraphs (c) and (d) of subsection (2) is an irrevocable election made by an investment undertaking—
	(a) at the time it is set up or commenced, or
	(b) where the investment undertaking was on 31 March 2000 a specified collective investment undertaking, on 1 April 2000,
	in respect of all its unit holders at that time or any future time, so that, for the purposes of identifying units acquired with units subsequently disposed of by a unit holder, units acquired at an earlier time are deemed to have been disposed of before units acquired at a later time.
	(6) A gain shall not be treated as arising to an investment undertaking on the happening of a chargeable event in respect of a unit holder where, immediately before the chargeable event, the unit holder—
	(a) is a pension scheme which has made a declaration to the investment undertaking in accordance with paragraph 2 of Schedule 2B,
	(b) is a company carrying on life business within the meaning of section 706, and which company has made a declaration to the investment undertaking in accordance with paragraph 3 of Schedule 2B,
	(c) is another investment undertaking which has made a declaration to the investment undertaking in accordance with paragraph 4 of Schedule 2B,
	(d) is a special investment scheme which has made a declaration to the investment undertaking in accordance with paragraph 5 of Schedule 2B,
	(e) is a unit trust to which section 731(5)(a) applies, and the unit trust has made a declaration to the investment undertaking in accordance with paragraph 6 of Schedule 2B,
	(f) is a person who—
	(i) is entitled to exemption from income tax by virtue of section 207(1)(b), and
	(ii) has made a declaration to the investment undertaking in accordance with paragraph 7 of Schedule 2B,
	(g) is a qualifying management company or a specified company and has made a declaration to the investment undertaking in accordance with paragraph 8 of Schedule 2B, or
	(h) is a person who is entitled to exemption from income tax and capital gains tax by virtue of section 784A(2) (as amended by the Finance Act, 2000) and the units held are assets of an approved retirement fund or an approved minimum retirement fund and the qualifying fund manager has made a declaration to the investment undertaking in accordance with paragraph 9 of Schedule 2B,
	and the investment undertaking is in the possession of the declaration immediately before the chargeable event.
	(7) Subject to subsection (8), a gain shall not be treated as arising to an investment undertaking on the happening of a chargeable event in respect of a unit holder where, immediately before the chargeable event, the investment undertaking—
	(a) is in possession of a declaration of a kind referred to in—
	(i) paragraph 10 of Schedule 2B, or
	(ii) where the unit holder is not a company, paragraph 11 of that Schedule, and
	(b) is not in possession of any information which would reasonably suggest that—
	(i) the information contained in that declaration is not, or is no longer, materially correct,
	(ii) the unit holder failed to comply with the undertaking referred to in paragraph 10(g) or 11(f), as the case may be, of Schedule 2B, or
	(iii) immediately before the chargeable event the unit holder is resident or ordinarily resident in the State.
	(8) (a) A gain shall not be treated as arising to an investment undertaking on the happening of a chargeable event in respect of a unit holder where—
	(i) the investment undertaking was on 31 March 2000 a specified collective investment undertaking and the unit holder was a unit holder (within the meaning of section 734(1)) in relation to that specified collective investment undertaking at that time, and
	(ii) the investment undertaking on or before 30 June 2000 makes to the Collector-General a declaration in accordance with paragraph 12 of Schedule 2B,
	otherwise than, subject to paragraph (b), in respect of a unit holder (in this subsection and in section 739G referred to as an ‘excepted unit holder’)—
	(A) whose name is included in the schedule to the declaration by virtue of paragraph 12(d) of Schedule 2B, and
	(B) who has not made a declaration of a kind referred to in subsection (6) to the investment undertaking.
	(b) A gain shall not be treated as arising to an investment undertaking on the happening of a chargeable event in respect of an excepted unit holder where the chargeable event is deemed to happen on 31 December 2000.
	(9) A gain shall not be treated as arising to an investment undertaking on the happening of a chargeable event in respect of a unit holder who is an intermediary, where immediately before the chargeable event the investment undertaking—
	(a) is in possession of a declaration of a kind referred to in paragraph 13 of Schedule 2B, and
	(b) is not in possession of any information which would reasonably suggest that—
	(i) the information contained in that declaration is not, or is no longer, materially correct,
	(ii) the intermediary failed to comply with the undertaking referred to in paragraph 13(e) of Schedule 2B, or
	(iii) any of the persons, on whose behalf the intermediary holds units of, or receives payments from, the investment undertaking, is resident or ordinarily resident in the State.
	(10) An investment undertaking shall keep and retain declarations made to it in accordance with Schedule 2B for a period of 6 years from the time the unit holder of the units in respect of which a declaration was made, ceases to be such a unit holder.
Deduction of tax on the occurrence of a chargeable event.	739E.—(1) In this section and sections 739F and 739G, ‘appropriate tax’, in connection with a chargeable event in relation to an investment undertaking in respect of a unit holder, means a sum representing income tax on the amount of the gain arising to an investment undertaking—
	(a) where the amount of the gain is provided by section 739D(2)(a), at the standard rate for the year of assessment in which the gain arises,
	(b) where the chargeable event happens on or after 1 January 2001 and the amount of the gain is provided by paragraph (b), (c) or (d) of section 739D(2), at a rate determined by the formula—
	(S + 3) per cent,
	where S is the standard rate per cent (within the meaning of section 4), and
	(c) where the chargeable event happens in the period commencing on 1 April 2000 and ending on 31 December 2000 and the amount of the gain is provided by paragraph (b), (c), (d) or (e) of section 739D(2), at a rate of 40 per cent.
	(2) An investment undertaking shall account for the appropriate tax in connection with a chargeable event in relation to a unit holder in accordance with section 739F.
	(3) An investment undertaking which is liable to account for appropriate tax in connection with a chargeable event in relation to a unit holder shall, at the time of the chargeable event, where the chargeable event is—
	(a) the making of a payment to a unit holder, be entitled to deduct from the payment an amount equal to the appropriate tax,
	(b)(i) the transfer by a unit holder of entitlement to a unit, or
	(ii) deemed to happen on 31 December 2000,
	be entitled to appropriate or cancel such units of the unit holder as are required to meet the amount of appropriate tax,
	and the investment undertaking shall be acquired and discharged of such deduction or, as the case may be, such appropriation or cancellation as if the amount of appropriate tax had been paid to the unit holder and the unit holder shall allow such deduction or, as the case may be, such appropriation or cancellation.
Returns and collection of appropriate tax.	739F.—(1) Notwithstanding any other provision of the Tax Acts, this section shall apply for the purposes of regulating the time and manner in which appropriate tax in connection with a chargeable event in relation to a unit holder shall be accounted for and paid.
	(2) An investment undertaking shall for each financial year make to the Collector-General—
	(a) a return of the appropriate tax in connection with chargeable events happening on or prior to 30 June, within 30 days of that date, and
	(b) a return of appropriate tax in connection with chargeable events happening between 1 July and 31 December, within 30 days of that later date,
	and where it is the case, the return shall specify that there is no appropriate tax for the period in question.
	(3) The appropriate tax in connection with a chargeable event 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 investment undertaking to the Collector-General, and the appropriate tax so due shall be payable by the investment undertaking without the making of an assessment; but appropriate tax which has become so due may be assessed on the investment undertaking (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.
	(4) Where it appears to the inspector that there is an amount of appropriate tax in relation to a chargeable event 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 investment undertaking to the best of his or her judgement, and any amount of appropriate tax in connection with a chargeable event 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.
	(5) Where any item has been incorrectly included in a return as appropriate tax, 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 investment undertaking making the return or of any other person, are in so far as possible the same as they would have been if the item had not been included.
	(6) (a) Any appropriate tax assessed on an investment undertaking shall be due within one month after the issue of the notice of assessment (unless that tax is due earlier under subsection (3)) subject to any appeal against the assessment, but no appeal shall affect the date when any amount is due under subsection (3).
	(b) On determination of the appeal against an assessment under this Chapter, any appropriate tax over-paid shall be repaid.
	(7) (a) The provisions of the Income Tax Acts relating to—
	(i) assessments 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 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 Chapter section 1080 shall apply as if subsection (1)(b) of that section were deleted.
	(8) Every return shall be in a form prescribed by the Revenue Commissioners and shall include a declaration to the effect that the return is correct and complete.
Taxation of unit holders in investment undertakings.	739G.—(1) Where a chargeable event in relation to an investment undertaking in respect of a unit holder is deemed to happen on 31 December 2000 and the unit holder is an excepted unit holder referred to in section 739D(8), the unit holder shall be treated for all the purposes of the Capital Gains Tax Acts as if the amount of the gain which, but for section 739D(8)(b), would have arisen to the investment undertaking on the happening of the chargeable event, were a chargeable gain accruing to the unit holder at that time and notwithstanding section 28, the rate of capital gains tax in respect of that chargeable gain shall be 40 per cent.
	(2) As respects a payment in money or money's worth to a unit holder by reason of rights conferred on the unit holder as a result of holding units in an investment undertaking to which this Chapter applies—
	(a) where the unit holder is not a company and the payment is a payment from which appropriate tax has been deducted, the payment shall not be reckoned in computing the total income of the unit holder for the purposes of the Income Tax Acts and shall not be treated as giving rise to a chargeable gain under the Capital Gains Tax Acts,
	(b) where the unit holder is not a company and the payment is a payment from which appropriate tax has not been deducted, the amount of the payment shall be treated for the purposes of the Tax Acts as income arising to the unit holder, constituting profits or gains chargeable to tax under Case IV of Schedule D.
	(c) where the unit holder is a company, the payment is a relevant payment and appropriate tax has been deducted from the payment, the amount received by the unit holder shall, subject to paragraph (g), be treated for the purposes of the Tax Acts as the net amount of an annual payment chargeable to tax under Case IV of Schedule D from the gross amount of which income tax has been deducted at the standard rate,
	(d) where the unit holder is a company, the payment is a relevant payment and appropriate tax has not been deducted from the payment, the amount of the payment shall, subject to paragraph (g), be treated for the purposes of the Tax Acts as income arising to the unit holder, constituting profits or gains chargeable to tax under Case IV of Schedule D,
	(e) where the unit holder is a company, the payment is not a relevant payment and appropriate tax has been deducted therefrom, such payment shall, subject to paragraph (g), not be taken into account for the purposes of the Tax Acts,
	(f) where the unit holder is a company, the payment is not a relevant payment and appropriate tax has not been deducted from the payment, the amount of such payment shall, subject to paragraph (g), be treated for the purposes of the Tax Acts as income arising to the unit holder, constituting profits or gains chargeable to tax under Case IV of Schedule D,
	(g) where the unit holder is a company chargeable to tax on the payment under Case I of Schedule D—
	(i) subject to subparagraph (ii), the amount received by the unit holder increased by the amount (if any) of appropriate tax deducted shall be income of the unit holder for the chargeable period in which the payment is made,
	(ii) where the payment is made on the cancellation, redemption or repurchase of units by the investment undertaking, such income shall be reduced by the amount of the consideration in money or money's worth given by the unit holder for the acquisition of those units, and
	(iii) the amount (if any) of appropriate tax deducted shall be set off against corporation tax assessable on the unit holder for the chargeable period in which the payment is made,
	(h) the amount of a payment made to a unit holder by an investment undertaking, where the unit holder is a company which is not resident in the State or the unit holder, not being a company, is neither resident not ordinarily resident in the State, shall not be chargeable to income tax, and
	(i) no repayment of appropriate tax shall be made to any person who is not a company within the charge to corporation tax.
Investment undertakings: reconstructions and amalgamations.	739H.—(1) In this section—
‘exchange’, in relation to a scheme of reconstruction or amalgamation, means the issue of units (in this section referred to as ‘new units’) by an investment undertaking (in this section referred to as the ‘new undertaking’) to the unit holders of another investment undertaking (in this section referred to as the ‘old undertaking’) in respect of and in proportion to (or as nearly as may be in proportion to) their holdings of units (in this section referred to as ‘old units’) in the old undertaking in exchange for the transfer by the old undertaking of all its assets and liabilities to the new undertaking where the exchange is entered into for the purposes of or in connection with a scheme of reconstruction or amalgamation;
	‘scheme of reconstruction or amalgamation’ means a scheme for the reconstruction of any investment undertaking or investment undertakings or the amalgamation of any 2 or more investment undertakings.
	(2) The cancellation of old units arising from an exchange in relation to a scheme of reconstruction or amalgamation shall not be a chargeable event and the amount invested by a unit holder for the acquisition of the new units shall for the purposes of this Chapter be the amount invested by the unit holder for the acquisition of the old units.”,
and

(b) by the insertion after Schedule 2A of the following Schedule:

This document does not substitute the official text published in the Irish Statute Book. We accept no responsibility for any inaccuracies arising from the transcription of the original into this format.

This text is published under Irish Statute Book's own terms of reuse, not a Legalize or public-domain licence. Irish Statute Book
CC-BY 4.0 (Oireachtas Open Data PSI Licence)
Contains Irish Public Sector Information licensed under the Oireachtas (Houses of the Oireachtas) Open Data PSI Licence / Creative Commons Attribution 4.0 International, sourced from https://www.irishstatutebook.ie.