Finance Act 2001

	“Relief for premiums under qualifying long-term care policies.	470A.—(1) In this section— ‘activities of daily living’ means one or more of the following, that is to say, washing, dressing, feeding, toileting, mobility and transferring; ‘appropriate percentage’, in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year; ‘long-term care services’ means necessary diagnostic, preventive, therapeutic, curing, treating, mitigating and rehabilitative services and maintenance or personal care services carried out by or on the advice of a practitioner; ‘maintenance or personal care services’ means any care the primary purpose of which is the provision of needed assistance with any of the disabilities as a result of which an individual is a relevant individual (including protection from threats to health and safety due to severe cognitive impairment); ‘mobility’ means the ability to move indoors from room to room on level surfaces; ‘policy’ means a policy of insurance; ‘PPS Number’, in relation to an individual, means that individual's Personal Public Service Number within the meaning of section 223 of the Social Welfare (Consolidation) Act, 1993; ‘practitioner’ means any person who is registered in the register established under section 26 of the Medical Practitioners Act, 1978, or, in relation to long-term care services provided outside the State, is entitled under the laws of the territory in which such services are provided to practice medicine there; ‘qualifying individual’ in relation to an individual and a qualifying long-term care policy, means— (a) the individual, (b) the spouse or a child of the individual, or (c) a relative of the individual or of the spouse of the individual; ‘qualifying insurer’ means, subject to subsection (2), the holder of— (i) an authorisation issued by the Minister for Enterprise, Trade and Employment under the European Communities (Life Assurance) Regulations of 1984 (S.I. No. 57 of 1984) as amended, or (ii) an authorisation granted by the authority charged by law with the duty of supervising the activities of insurance undertakings in a Member State of the European Communities, other than the State, in accordance with Article 6 of Directive No. 79/267/EEC[^1], who is carrying on the business of life assurance in the State, or (iii) an official authorisation to undertake insurance in Iceland, Liechtenstein and Norway pursuant to the EEA Agreement within the meaning of the European Communities (Amendment) Act, 1993, and who is carrying on the business of life assurance in the State; ‘qualifying long-term care policy’ means a policy which provides for the discharge or reimbursement of expenses of long-term care services for a relevant individual and which, in accordance with the provisions of this section, is approved of by the Revenue Commissioners for the purposes of this section; ‘relative’, in relation to an individual or the spouse of the individual, includes a relation by marriage and a person in respect of whom the individual is or was the legal guardian; ‘relevant individual’, in relation to a qualifying long-term care policy, means a qualifying individual in relation to that policy in respect of whom a practitioner has certified that the individual is— (a) unable to perform (without substantial assistance from another individual) at least 2 of the activities of daily living for a period of at least 90 days due to a loss of functional capacity, or (b) requires substantial supervision to protect such individual from threats to health and safety due to severe cognitive impairment; ‘transferring’ means the ability to move from a bed to an upright chair or a wheelchair and vice versa. (2) (a) A person shall not be a qualifying insurer until such time as the person has been entered in a register maintained by the Revenue Commissioners for the purposes of this section and any regulations made thereunder. (b) Where at any time a qualifying insurer— (i) is not resident in the State, or (ii) is not carrying on business in the State through a fixed place of business, the qualifying insurer shall ensure that there is a person resident in the State and appointed by the qualifying insurer to be responsible for the discharge of all the duties and obligations imposed on the qualifying insurer by this section and any regulations made thereunder. (c) Where a qualifying insurer appoints a person in accordance with paragraph (b), that insurer shall advise the Revenue Commissioners of the identity of that person and the fact of the person's appointment. (3) (a) The Revenue Commissioners shall not approve a policy for the purposes of this section unless they are satisfied that— (i) the only benefits provided under the policy are the discharge or reimbursement of expenses of long-term care services in respect of an individual who is a relevant individual in relation to the policy, (ii) the policy is either not expressed to be terminable by the insurer under the terms of the policy, or is expressed to be so terminable only in special circumstances mentioned in the policy, (iii) the policy secures that for the purposes of the policy the question of whether an individual is a relevant individual shall be determined by reference to at least 5 activities of daily living, (iv) subject to paragraph (b), the policy does not provide for— (I) a lump sum payment on termination, (II) a cash surrender value, or (III) any other money, that can be paid or assigned to any person, borrowed, or pledged as collateral for a loan, and (v) the policy is not connected with any other policy. (b) A policy shall not fail to meet the requirements of paragraph (a)(iv) merely because it provides for the payment of periodic amounts of money without regard to the expenses incurred on the services provided during the period to which the payments relate. (c) A policy is connected with another policy, whether held by the same person or another person, if— (i) either policy was issued in respect of an assurance made with reference to the other, or with a view to enabling the other to be made on particular terms, or with a view to facilitating the making of the other on particular terms, and (ii) the terms on which either policy was issued would have been different if the other policy had not been issued. (4) (a) A long-term care policy shall be a qualifying long-term care policy within the meaning of this section if it conforms with a form which at the time it is issued is either— (i) a standard form approved by the Revenue Commissioners as a standard form of qualifying long-term care policy, or (ii) a form varying from a standard form so approved in no other respects than by making such alterations to that standard form as are, at the time the policy is issued, approved by the Revenue Commissioners as being compatible with a qualifying long-term care policy when made to that standard form and satisfying any conditions subject to which the alterations are so approved. (b) In approving a policy, or a standard form of a policy, as a qualifying long-term care policy for the purposes of this section, the Revenue Commissioners may disregard any provision of the policy which appears to them insignificant. (5) Where, for any year of assessment, an individual, who is resident in the State, makes a payment to a qualifying insurer in respect of a premium under a qualifying long-term care policy, the beneficiary of which is a qualifying individual in relation to the individual, the individual making the payment shall, subject to the condition specified in subsection (6), be entitled to relief under this section in accordance with subsection (8). (6) The condition specified in this subsection is that, at the time the long-term care policy is entered into, the individual (in this subsection referred to as the ‘declarer’) furnishes to the qualifying insurer a declaration in writing which— (a) is made and signed by the declarer, (b) is made in such form as may be prescribed or authorised by the Revenue Commissioners, (c) contains the declarer's full name, the address of his or her permanent residence and his or her PPS Number, (d) declares that— (i) at the time the declaration is made that he or she is resident in the State, and (ii) the beneficiary under the policy is a qualifying individual in relation to the declarer, and (e) contains an undertaking that if, at any time while the long-term care policy is in force, the declarer ceases to be resident in the State he or she will notify the qualifying insurer accordingly. (7) (a) A qualifying insurer shall— (i) keep and retain for the longer of the following periods— (I) a period of 6 years, and (II) a period which, in relation to the long-term care policy in respect of which the declaration is made, ends not later than 3 years after the date on which premiums have ceased to be paid or payable in respect of the policy. all declarations of the kind mentioned in subsection (6) which have been made in respect of qualifying long-term care policies issued by the qualifying insurer, and (ii) on being so required by notice given to that insurer in writing by an inspector, make available within the State to the inspector, within the time specified in the notice, all or any of the declarations of the kind mentioned in subsection (6). (b) The inspector may examine or take extracts from or copies of any declarations made available to him or her under paragraph (a). (8) (a) Where an individual makes a payment to a qualifying insurer in respect of which he or she is entitled to relief under this section, the individual shall be entitled to deduct and retain out of the payment an amount equal to the appropriate percentage for the year of assessment in which payment of the premium falls due. (b) The qualifying insurer to whom a payment referred to in paragraph (a) is made— (i) shall accept the amount paid after deduction in discharge of the individual's liability to the same extent as if the deduction had not been made, and (ii) may, on making a claim in accordance with regulations, recover from the Revenue Commissioners an amount equal to the amount deducted. (9) (a) The Revenue Commissioners shall make regulations providing generally as to administration of this section and those regulations may, in particular and without prejudice to the generality of the foregoing, include provision— (i) for the registration of persons as qualifying insurers for the purposes of this section and those regulations, (ii) that a claim under subsection (8)(b)(ii) by a qualifying insurer shall— (I) be made in such form and manner, (II) be made at such time, and (III) be accompanied by such documents, as provided for in the regulations, (iii) for the making of annual information returns by qualifying insurers, in such form (including electronic form) and manner as may be prescribed, and containing specified details in relation to— (I) each individual making payments to such insurers under qualifying long-term care policies in a year of assessment, (II) the total amount of premiums paid under a qualifying long-term care policy by that individual in the year of assessment, and (III) the total amount deducted by that individual under subsection (8)(a), and (iv) for the furnishing of information to the Revenue Commissioners for the purposes of the regulations. (b) Every regulation made under this section shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annualling the regulation is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder. (10) (a) Where any amount is paid to a qualifying insurer by the Revenue Commissioners as an amount recoverable by virtue of subsection (8)(b)(ii) but is an amount to which that qualifying insurer is not entitled, that amount shall be repaid by the qualifying insurer. (b) There shall be made such assessments, adjustments or set-offs as may be required for securing repayment of the amount referred to in paragraph (a) and the provisions of this Act relating to the assessment, collection and recovery of income tax shall, in so far as they are applicable and with necessary modification, apply in relation to the recovery of such amount. (11) Where relief is given under this section in respect of a payment, relief shall not be given under any other provision of the Income Tax Acts in respect of that payment. (12) The Revenue Commissioners may nominate any of their officers, including an inspector, to perform any acts and discharge any functions authorised by this section, other than those specified in subsection (9), to be performed or discharged by them.”,

(b) in Chapter 1 of Part 44, by the substitution in section 1024(2)(a) of the following for subparagraph (vi):

“(vi) relief under sections 470, 470A and 473, to the husband or to the wife according as he or she made the payment giving rise to the relief;”,

and

(c) in Schedule 29, by the insertion, in column 1, after “section 121” of “section 470A and Regulations under that section”.

21 Taxation of certain perquisites.

21.—As respects the year of assessment 2001 and subsequent years of assessment, the Principal Act is amended in Chapter 1 of Part 5 by the insertion of the following section after section 112:

“112A.—(1) In this section—

‘appropriate percentage’, ‘authorised insurer’, ‘relevant contract’ and ‘relievable amount’ have the same meanings, respectively, as in section 470, and

‘qualifying insurer’ and ‘qualifying long-term care policy’ have the same meanings, respectively, as in section 470A.

(2) Section 112 shall apply in relation to a perquisite comprising the payment to—

(a) an authorised insurer under a relevant contract, or

(b) a qualifying insurer under a qualifying long-term care policy

as if any deduction authorised by—

(i) in a case in which paragraph (a) applies, section 470(3)(a), or

(ii) in a case in which paragraph (b) applies, section 470A(8)(a),

had not been made.

(3) Where, for any year of assessment, an employer (within the meaning of section 983)—

(a) makes a payment of emoluments consisting of a perquisite of the kind mentioned in subsection (2), and

(b) deducts therefrom and retains in accordance with—

(i) section 470(3)(a), an amount equal to the appropriate percentage for the year of assessment of the relievable amount in relation to the payment, or

(ii) section 470A(8)(a), an amount equal to the appropriate percentage for the year of assessment of the payment,

the employer shall be assessed and charged to income tax in an amount equal to the amount so deducted and retained and that amount shall be allowable as a deduction in charging to tax the profits or gains of such employer.

(4) Subsections (3) to (6) of section 238 shall apply, with necessary modifications, in relation to a payment referred to in subsection (3) as they apply in relation to a payment to which that section applies.”.

22 Amendment of Chapter 4 (revenue powers) of Part 38 of Principal Act.

22.—(1) As respects the year of assessment 2001 and subsequent years of assessment, the Principal Act is amended in Chapter 4 of Part 38 by the insertion of the following after section 904D (inserted by the Finance Act, 2000):

“Power of inspection: claims by authorised insurers.

904E.—(1) In this section— ‘authorised insurer’ has the same meaning as in section 470; ‘authorised officer’ means an officer of the Revenue Commissioners authorised by them in writing to exercise the powers conferred by this section. (2) An authorised officer may at all reasonable times enter any premises or place of business of an authorised insurer for the purpose of auditing for a year of assessment claims made by the authorised insurer under section 470(3)(b)(ii). (3) Without prejudice to the generality of subsection (2), the authorised officer may— (a) examine the procedures put in place by the authorised insurer in relation to the vouching of claims referred to in that subsection, and (b) check a sample of the cases in respect of which such a claim has been made to determine whether the procedures referred to in paragraph (a) have been observed in practice and whether they are adequate. (4) An authorised officer may require an authorised insurer or an employee of the authorised insurer to furnish information, explanations and particulars and to give all assistance which the authorised officer reasonably requires for the purposes of his or her audit and examination under subsections (2) and (3). (5) An authorised officer when exercising or performing his or her powers or duties under this section shall, on request, produce his or her authorisation for the purposes of this section. (6) An employee of an authorised insurer who fails to comply with the requirements of the authorised officer in the exercise or performance of the authorised officer's powers or duties under this section shall be liable to a penalty of £1,000. (7) An authorised insurer which fails to comply with the requirements of the authorised officer in the exercise or performance of the authorised officer's powers or duties under this section shall be liable to a penalty of £15,000 and, if that failure continues, a further penalty of £2,000 for each day on which the failure continues.”.

(2) As respects the year of assessment 2002 and subsequent years of assessment, section 904E (inserted by subsection (1)) of the Principal Act is amended—

(a) by the substitution in subsection (6) of “€1,265” for “£1,000”, and

(b) by the substitution in subsection (7) of—

(i) “€19,045” for “£15,000”, and

(ii) “€2,535” for “£2,000”.

(3) As respects the year of assessment 2002 and subsequent years of assessment, the Principal Act is amended in Chapter 4 of Part 38 by the insertion of the following after section 904E (inserted by subsection (1)):

“Power of inspection: claims by qualifying lenders.

904F.—(1) In this section— ‘authorised officer’ means an officer of the Revenue Commissioners authorised by them in writing to exercise the powers conferred by this section; ‘books, records or other documents’ includes— (a) any records used in the business of a qualifying lender whether— (i) comprised in bound volume, loose-leaf binders or other loose-leaf filing system, loose-leaf ledger sheets, pages, folios or cards, or (ii) kept on microfilm, magnetic tape or in any non-legible form (by the use of electronics or otherwise) which is capable of being reproduced in a legible form, and (b) every electronic or other automatic means, if any, by which any such thing in non-legible form is so capable of being reproduced, and (c) documents in manuscript, documents which are typed, printed, stencilled or created by any other mechanical or partly mechanical process in use from time to time and documents which are produced by any photographic or photostatic process, and (d) correspondence and records of other communications between a qualifying lender and an individual having a qualifying mortgage loan from that qualifying lender; ‘qualifying lender’ and ‘qualifying mortgage loan’ have the same meanings respectively as in section 244A. (2) An authorised officer may at all reasonable times enter any premises or place of business of a qualifying lender for the purpose of auditing for a year of assessment claims made by the qualifying lender under section 244A(2)(b)(ii). (3) Without prejudice to the generality of subsection (2), the authorised officer may— (a) examine the procedures put in place by the qualifying lender in relation to the vouching of claims referred to in that subsection, and (b) check a sample of the cases in respect of which such a claim has been made to determine whether the procedures referred to in paragraph (a) have been observed in practice and whether they are adequate. (4) An authorised officer may require a qualifying lender or an employee of the qualifying lender to produce books, records or other documents and to furnish information, explanations and particulars and to give all assistance, which the authorised officer reasonably requires for the purposes of his or her audit and examination under subsections (2) and (3). (5) An authorised officer may make extracts from or copies of all or any part of the books, records or other documents or other material made available to him or her or require that copies of books, records, or other documents be made available to him or her, in exercising or performing his or her powers or duties under this section. (6) An authorised officer when exercising or performing his or her powers or duties under this section shall, on request, produce his or her authorisation for the purposes of this section. (7) An employee of a qualifying lender who fails to comply with the requirements of the authorised officer in the exercise or performance of the authorised officer's powers or duties under this section shall be liable to a penalty of €1,265. (8) A qualifying lender which fails to comply with the requirements of the authorised officer in the exercise or performance of the authorised officer's powers or duties under this section shall be liable to a penalty of €19,045 and if that failure continues a further penalty of €2,535 for each day on which the failure continues.”.

(4) As respects the year of assessment 2001 and subsequent years of assessment, the Principal Act is amended in Chapter 4 of Part 38 by the insertion of the following after section 904F (inserted by subsection (3)):

“Power of inspection: claims by qualifying insurers.

904G.—(1) In this section— ‘authorised officer’ means an officer of the Revenue Commissioners authorised by them in writing to exercise the powers conferred by this section; ‘qualifying insurer’ and ‘qualifying long-term care policies’ have the same meanings respectively as in section 470A. (2) An authorised officer may at all reasonable times enter any premises or place of business of a qualifying insurer for the purpose of auditing for a year of assessment claims made by the qualifying insurer under section 470A(8)(b)(ii). (3) Without prejudice to the generality of subsection (2), the authorised officer may— (a) examine the procedures put in place by the qualifying insurer in relation to the vouching of claims referred to in that subsection, and (b) check a sample of the cases in respect of which such a claim has been made to determine whether the procedures referred to in paragraph (a) have been observed in practice and whether they are adequate. (4) An authorised officer may require a qualifying insurer or an employee of the qualifying insurer to furnish information, explanations and particulars and to give all assistance which the authorised officer reasonably requires for the purposes of his or her audit and examination under subsections (2) and (3). (5) An authorised officer when exercising or performing his or her powers or duties under this section shall, on request, produce his or her authorisation for the purposes of this section. (6) An employee of a qualifying insurer who fails to comply with the requirements of the authorised officer in the exercise or performance of the authorised officer's powers or duties under this section shall be liable to a penalty of £1,000. (7) A qualifying insurer which fails to comply with the requirements of the authorised officer in the exercise or performance of the authorised officer's powers or duties under this section shall be liable to a penalty of £15,000 and, if that failure continues, a further penalty of £2,000 for each day on which the failure continues.

Power of inspection: qualifying savings managers.

904H.—(1) In this section— ‘authorised officer’ means an officer of the Revenue Commissioners authorised by them in writing to exercise the powers conferred by this section; ‘qualifying savings manager’ has the same meaning as in section 848B (inserted by the Finance Act, 2001); ‘special savings incentive account’ has the same meaning as in section 848B (inserted by the Finance Act, 2001). (2) An authorised officer may at all reasonable times enter any premises or place of business of a qualifying savings manager, or a person (in this section referred to as an ‘appointed person’) appointed by a qualifying savings manager in accordance with section 848R (inserted by the Finance Act, 2001), for the purposes of auditing compliance with the provisions of Part 36A (inserted by the Finance Act, 2001) and without prejudice to the generality of the foregoing the authorised officer may— (a) audit the returns made in accordance with sections 848P and 848Q (inserted by the Finance Act, 2001), (b) examine the procedures put in place by the qualifying savings manager, or as the case may be, the appointed person, so as to ensure compliance with the obligations imposed by Part 36A (inserted by the Finance Act, 2001), (c) examine all, or a sample of, special savings incentive accounts to determine— (i) whether those procedures have been observed in practice, (ii) whether the terms under which each such account was commenced and continues, are in accordance with the terms referred to in section 848C (inserted by the Finance Act, 2001), and (iii) whether the qualifying savings manager, in respect of each such account, is, where appropriate, in possession of a declaration referred to in sections 848F, 848I, and 848O (inserted by the Finance Act, 2001), and is not in possession of any information which would reasonably suggest that any such declaration is incorrect, and (d) examine any notice and declaration referred to in section 848N(3) (inserted by the Finance Act, 2001). (3) An authorised officer may require a qualifying savings manager, or (as the case may be) the appointed person, or an employee of either such person, to produce all or any of the records relating to the management by him or her of special savings incentive accounts and furnish information, explanations and particulars and to give all assistance, which the authorised officer reasonably requires for the purposes of his or her audit and examination under subsection (2). (4) An employee of a qualifying savings manager or of an appointed person who fails to comply with the requirements of the authorised officer in the exercise or performance of the authorised officer's powers or duties under this section shall be liable to a penalty of £1,000. (5) A qualifying savings manager or an appointed person who fails to comply with the requirements of the authorised officer in the exercise or performance of the authorised officer's powers or duties under this section shall be liable to a penalty of £15,000 and, if that failure continues, a further penalty of £2,000 for each day on which the failure continues.”.

(5) As respects the year of assessment 2002 and subsequent years of assessment—

(a) section 904G (inserted by subsection (4)) of the Principal Act is amended—

(i) by the substitution in subsection (6) of “€1,265” for “£1,000”, and

(ii) by the substitution in subsection (7) of—

(I) “€19,045” for “£15,000”, and

(II) “€2,535” for “£2,000”,

and

(b) section 904H (inserted by subsection (4)) of the Principal Act is amended—

(i) by the substitution in subsection (4) of “€1,265” for “£1,000”, and

(ii) by the substitution in subsection (5) of—

(I) “€19,045” for “£15,000”, and

(II) “€2,535” for “£2,000”.

23 Tax relief at source for certain interest.

23.—(1) As respects the year of assessment 2002 and subsequent years of assessment, the Principal Act is amended in Chapter 3 of Part 8 by the insertion of the following section after section 244:

“Application of section 244 (relief for interest paid on certain home loans) of Principal Act.

244A.—(1) (a) In this section— (i) ‘qualifying dwelling’, in relation to an individual, means a qualifying residence situated in the State; ‘qualifying lender’ has the meaning assigned to it by subsection (3); ‘qualifying mortgage interest’, in relation to an individual and a year of assessment, means the qualifying interest paid by the individual in the year of assessment in respect of a qualifying mortgage loan; ‘qualifying mortgage loan’, in relation to an individual, means a qualifying loan or loans secured by the mortgage of freehold or leasehold estate or interest in a qualifying dwelling, and (ii) ‘appropriate percentage’, ‘qualifying interest’, ‘qualifying loan’, ‘qualifying residence’ and ‘relievable interest’ have the same meanings, respectively, as they have in section 244. (b) This section provides for a scheme whereby relief due under section 244 shall, in certain circumstances, be given by way of deduction at source (‘the tax relief at source scheme’) under subsection (2)(a) and in no other manner. (2)(a) Where an individual makes a payment of qualifying mortgage interest to a qualifying lender in respect of which relief is due under section 244, the individual shall be entitled in accordance with regulations to deduct and retain out of it an amount equal to the appropriate percentage, for the year of assessment in which the payment is due, of the relievable interest. (b) A qualifying lender to which a payment referred to in paragraph (a) is made— (i) shall accept in accordance with regulations the amount paid after deduction in discharge of the individual's liability to the same extent as if the deduction had not been made, and (ii) may, on making a claim in accordance with regulations, recover from the Revenue Commissioners an amount equal to the amount deducted. (3) The following bodies shall be qualifying lenders— (a) a bank holding a licence under section 9 of the Central Bank Act, 1971; (b) a building society incorporated or deemed to be incorporated under the Building Societies Act, 1989; (c) a trustee savings bank within the meaning of the Trustee Savings Banks Act, 1989; (d) ACC Bank plc; (e) a local authority; (f) a body which— (i) (I) holds a licence or similar authorisation, corresponding to a licence referred to in paragraph (a), or (II) has been incorporated in a manner corresponding to that referred to in paragraph (b), under the law of any other Member State of the European Communities, and (ii) provides qualifying mortgage loans; and (g) a body which applies to the Revenue Commissioners for registration as a qualifying lender and in respect of which the Revenue Commissioners, having regard to the activities and objects of the body, are satisfied is entitled to be so registered. (4) (a) The Revenue Commissioners shall maintain, and publish in such manner as they consider appropriate, a register for the purposes of subsection (3). (b) If the Revenue Commissioners are satisfied that an applicant for registration is entitled to be registered, they shall register the applicant with effect from such date as may be specified by them. (c) If it appears to the Revenue Commissioners at any time that a body which is registered under this subsection would not be entitled to be registered if it applied for registration at that time, the Revenue Commissioners may, by written notice given to the body, cancel its registration with effect from such date as may be specified by them in the notice. (d) Any body which is aggrieved by the failure of the Revenue Commissioners to register it or by the cancellation of its registration, may, by notice given to the Revenue Commissioners before the end of the period of 30 days beginning with the date on which the body is notified of the Revenue Commissioners' decision, require the matter to be determined by the Appeal Commissioners and the Appeal Commissioners shall hear and determine the matter in like manner as an appeal. (5) (a) The Revenue Commissioners shall make regulations providing generally as to administration of this section and those regulations may, in particular and without prejudice to the generality of the foregoing, include provision— (i) that a claim under subsection (2)(b)(ii) shall be— (I) made in such form and manner, (II) made at such time, and (III) accompanied by such documents, as provided for in the regulations, (ii) that, in circumstances specified in regulations, a claim may be made under subsection (2)(b)(ii) where a payment is due but not made; (iii) for the making by qualifying lenders, in such form and manner as may be prescribed, of monthly returns containing particulars in relation to— (I) each individual making payments of qualifying mortgage interest, (II) the amount of qualifying mortgage interest paid or due by the individual to date in the year of assessment, (III) the amount deducted by the individual, or the amount he or she would have been entitled to deduct, under subsection (2)(a), (IV) the estimated qualifying mortgage interest to be paid by the individual in the year of assessment, (V) the total amount of qualifying mortgage loans of the qualifying lender outstanding at the date of the return, (VI) the total amount claimed by the qualifying lender under subsection (2)(b)(ii) for the month to which the return relates, (VII) qualifying mortgage loans repaid in full in that month, and (VIII) such other matters as may be specified; (iv) for the transmission by the Revenue Commissioners to qualifying lenders, on a monthly basis, of such details as may be specified in the regulations in relation to— (I) qualifying mortgage loans, and (II) individuals with qualifying mortgage loans, which are necessary for the operation of this section; (v) in relation to the obligations and entitlements of individuals with qualifying mortgage loans under the tax relief at source scheme; (vi) in relation to the obligations and entitlements of qualifying lenders under the tax relief at source scheme; (vii) for deeming of certain qualifying mortgage loans, in such circumstances as may be specified in the regulations, as being no longer entitled to relief under this section; (viii) for the granting of appropriate relief in any case where inadequate or excessive relief has been granted under this section; and (ix) for the implementation of this section where a qualifying lender disposes of all or part of its qualifying mortgage loans. (b) Every regulation made under this section shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the regulation is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder. (6) (a) Where any amount is paid to a qualifying lender by the Revenue Commissioners as an amount recoverable by virtue of subsection (2)(b)(ii) but is an amount to which that qualifying lender is not entitled, that amount shall be repaid by the qualifying lender. (b) There shall be made such assessments, adjustments or set-offs as may be required for securing repayment of the amount referred to in paragraph (a) and the provisions of this Act relating to the assessment, collection and recovery of income tax shall, in so far as they are applicable and with necessary modification, apply in relation to the recovery of such amount.”.

(2) Schedule 29 to the Principal Act is amended in column 1 by the insertion after “section 121” of “section 244A and Regulations under that section”.

24 Provision of certain information: transitional.

24.—(1) In this section “qualifying lender” has the same meaning as in section 244A (inserted by this Act) of the Principal Act.

(2) (a) A qualifying lender shall, on receipt of a request from the Revenue Commissioners, furnish to them the information specified in paragraph (b) in relation to every individual having a loan or loans, secured by the mortgage of freehold or leasehold estate or interest in a dwelling, with that qualifying lender in the year of assessment 2001.

(b) The information referred to in paragraph (a) is as follows—

(i) the name and address of the individual, and

(ii) the account number of the qualifying lender relating to the loan or loans referred to in paragraph (a).

(3) The information referred to in subsection (2) shall be used by the Revenue Commissioners for the purpose of facilitating the granting of relief under section 244A of the Principal Act and shall not be used for any other purpose.

(4) The provisions of section 872 of the Principal Act shall not apply or have effect in relation to information acquired by the Revenue Commissioners under the provisions of this section.

25 Amendment of section 120A (exemption from benefit-in-kind of certain childcare facilities) of Principal Act.

25.—Section 120A of the Principal Act is amended in the definition of “qualifying premises”—

(a) by the substitution in paragraph (b) of “service” for “service, or” and by the insertion in paragraph (c) of “or” after “service,”,

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

“(d) are made available by the employer jointly with other persons or are made available by any other person or persons and the employer is wholly or partly responsible for capital expenditure on the construction or refurbishment of the premises,”,

and

(c) by the insertion after subsection (2) of the following:

“(3) In the case of a qualifying premises within the meaning of paragraph (d) of the definition of ‘qualifying premises’, the exemption provided for in subsection (2) shall be limited to the amount expended by the employer on capital expenditure on the construction or refurbishment of the premises.”.

26 Amendment of section 669A (interpretation (Chapter 3)) of Principal Act.

26.—Section 669A of the Principal Act is amended by the substitution of the following for paragraph (b) of the definition of “qualifying quota”:

“(b) a milk quota purchased by a lessee who entered into a lease agreement with a lessor in respect of that quota prior to 13 October 1999 and which ends on or after 31 March 2000 and which complies with the provisions of Council Regulation (EEC) No. 857/84 of 31 March 1984[^1] or Council Regulation (EEC) No. 3950 of 28 December 1992;”.

27 Amendment of section 669C (effect of sale of quota) of Principal Act.

27.—Section 669C of the Principal Act is amended in subsection (2) by the substitution of “chargeable period” for “accounting period.”.

28 Amendment of section 530 (interpretation (Chapter 2)) of Principal Act.

28.—Section 530 of the Principal Act is amended in subsection (1):

(a) by the insertion before the definition of “construction operations” of the following definition:

“‘certified subcontractor’, in relation to a principal, means a subcontractor—

(a) in respect of whom the principal holds, at the time of making a payment under a relevant contract to the subcontractor, a relevant payments card for the year in which the payment is made, and

(b) in respect of whom the principal has not received a notice under paragraph (a) of subsection (13) of section 531;”,

and

(b) by the insertion after the definition of “subcontractor” of the following definition:

“‘uncertified subcontractor’ means a subcontractor who is not a certified subcontractor.”.

29 Relief for fees paid for third level education, etc.

29.—(1) Chapter 1 of Part 15 of the Principal Act, is amended by the insertion of the following after section 473—

“Relief for fees paid for third level education, etc.

473A.—(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; ‘approved college’, in relation to a year of assessment, means— (a) a college or institution of higher education in the State which— (i) provides courses to which a scheme approved by the Minister under the Local Authorities (Higher Education Grants) Acts, 1968 to 1992, applies, or (ii) operates in accordance with a code of standards which from time to time may, with the consent of the Minister for Finance, be laid down by the Minister, and which the Minister approves for the purposes of this section; (b) any university or similar institution of higher education in a Member State of the European Union (other than the State) which— (i) is maintained or assisted by recurrent grants from public funds of that or any other Member State of the European Union (including the State), or (ii) is a duly accredited university or institution of higher education in the Member State in which it is situated; (c) a college or institution in another Member State of the European Union providing distance education in the State, which— (i) provides courses to which a scheme approved by the Minister under the Local Authority (Higher Education Grants) Acts, 1968 to 1992, applies, or (ii) operates in accordance with a code of standards which from time to time may, with the consent of the Minister for Finance, be laid down by the Minister, and which the Minister approves for the purposes of this section; (d) any university or similar institution of higher education in any country, other than the State or a Member State of the European Union which— (i) is maintained or assisted by recurrent grants from public funds of that country, or (ii) is a duly accredited university or institution of higher education in the country in which it is situated; ‘approved course’ means— (a) a full-time or part-time undergraduate course of study provided by a college to which paragraph (a), (b) or (c) of the definition of ‘approved college’ relates which— (i) is of at least 2 academic years' duration, and (ii) in the case of a course provided by a college to which paragraph (a)(ii) or (c)(ii) of the definition of ‘approved college’ relates, the Minister, having regard to a code of standards which from time to time may, with the consent of the Minister for Finance, be laid down by the Minister in relation to the quality of education to be offered on such approved course, approves of for the purposes of this section; (b) a postgraduate course of study leading to a postgraduate award, based on a thesis or on the results of an examination or both, in an approved college— (i) of not less than one academic year, but not more than 4 academic years, in duration, (ii) that requires an individual, undertaking the course, to have been conferred with a degree or an equivalent qualification, and (iii) that, in the case of a course provided by a college to which paragraph (a)(ii) of the definition of ‘approved college’ relates, the Minister, having regard to any code of standards which from time to time may, with the consent of the Minister for Finance, be laid down by the Minister in relation to the quality of education to be offered on such approved course, approves for the purposes of this section; ‘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 fees’, in relation to an approved course and an academic year, means the amount of fees chargeable in respect of tuition to be provided in relation to that course in that year which, with the consent of the Minister for Finance, the Minister approves of for the purposes of this section. (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 an approved 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) In the case of an individual who is a married person assessed to tax for a year of assessment in accordance with section 1017, any payment in respect of qualifying fees made by the individual's spouse shall, except where section 1023 applies, be deemed to have been made by the individual. (4) For the purposes 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. (5) (a) Where the Minister is satisfied that an approved college, within the meaning of paragraph (a)(ii) or (c)(ii) of the definition of ‘approved college’, or an approved course in that college, no longer meets the appropriate code of standards laid down, the Minister may by notice in writing given to the approved college withdraw, with effect from the year of assessment following the year of assessment in which the notice is given, the approval of that college or course, as the case may be, for the purposes of this section. (b) Where the Minister withdraws the approval of any college or course for the purposes of this section, notice of its withdrawal shall be published as soon as may be in Iris Oifigiúil. (6) Any claim for relief under this section made by an individual in respect of fees paid to an approved college shall be accompanied by a statement in writing made by the approved college concerned stating each of the following, namely— (a) that the college is an approved college for the purposes of this section, (b) the details of the course undertaken by the individual or his or her dependant, (c) the duration of the course, and (d) the amount of the fees paid in respect of the course. (7) Where for the purposes of this section any question arises as to whether— (a) a college is an approved college, or (b) a course of study is an approved course, the Revenue Commissioners may consult with the Minister. (8) On or before 1 July in each year of assessment, the Minister shall furnish the Revenue Commissioners with full details of— (a) all colleges and courses in respect of which approval has been granted and not withdrawn for the purposes of this section, and (b) the amount of the qualifying fees in respect of each such course for the academic year commencing in that year of assessment.”.

(2) Chapter 1 of Part 15 of the Principal Act is further amended by the deletion in Part 2 of the Table to section 458 of “section 474”, “section 474A”, “section 475” and “section 475A” and by the insertion of “section 473A” after “section 473”.

(3) Sections 474, 474A, 475 and 475A of the Principal Act, are repealed.

30 Seafarer allowance, etc.

30.—Section 472B of the Principal Act is amended—

(a) in subsection (4)—

(i) as respects the year of assessment 2001, by the substitution of “125 days” and “£3,700” for “169 days” and “£5,000”, respectively, and

(ii) as respects the year of assessment 2002 and subsequent years of assessment, by the substitution of “€6,350” for “£5,000”,

and

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

“(4A) (a) Notwithstanding subsection (4), but subject to paragraph (b)—

(i) as respects the year of assessment 2001, the reference in that subsection to ‘125 days’ shall be construed as a reference to ‘119 days’, and

(ii) as respects the year of assessment 2002 and subsequent years of assessment, the reference in that subsection to ‘169 days’ shall be construed as a reference to ‘161 days’.

(b) Paragraph (a) shall come into operation on such day as the Minister for Finance may by order appoint.”.

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

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

(a) in subsection (1)—

(i) by the substitution of the following for the definition of “qualifying day”:

“‘qualifying day’, in relation to an office or employment of an individual, means a day on or before 31 December 2003 which is one of at least 11 consecutive days throughout the whole of which the individual is absent from the State for the purposes of the performance of the duties of the office or employment or of those duties and the duties of other offices or employments of the individual outside the State and which (taken as a whole) are substantially devoted to the performance of such duties, but no day shall be counted more than once as a qualifying day;”,

and

(ii) in the formula in the definition of “the specified amount”, by the substitution as respects the year of assessment 2001, of “270” for “365”,

and

(b) in subsection (3)—

(i) after “90 days” by the insertion of “or, in the case where subparagraph (i) applies and the year of assessment concerned is the year of assessment 2001, 67 days”, and

(ii) by the substitution as respects the year of assessment 2001, of “£18,500” for “£25,000”.

(2) Subparagraph (a)(i) of subsection (1) shall apply as on and from 26 January 2001.

32 Rent-a-room relief.

32.—(1) The Principal Act is amended in Chapter 1 of Part 7 by the insertion of the following after section 216:

“216A.—(1) In this section—

‘qualifying residence’, in relation to an individual for a year of assessment, means a residential premises situated in the State which is occupied by the individual as his or her sole or main residence during the year of assessment;

‘relevant sums’ means all sums arising in respect of the use for the purposes of residential accommodation, of a room or rooms in a qualifying residence and includes sums arising in respect of meals, cleaning, laundry and other similar goods and services which are incidentally supplied in connection with that use;

‘residential premises’ means a building or part of a building used as a dwelling.

(2) (a) This subsection applies if—

(i) relevant sums, chargeable to income tax under Case IV or Case V of Schedule D, arise to an individual (regardless of whether the relevant sums are chargeable to income tax under Case IV or Case V or under both Case IV and Case V), and

(ii) the amount of the relevant sums does not exceed the individual's limit for the year of assessment.

(b) In ascertaining the amount of relevant sums for the purposes of this subsection no deduction shall be made in respect of expenses or any other matter.

(c) Where this subsection applies the following shall be treated as nil for the purposes of the Income Tax Acts—

(i) the profits or gains of the year of assessment, and

(ii) the losses of any such year of assessment, in respect of relevant sums arising to an individual.

(d) Where an individual has relevant sums chargeable to income tax under Case V of Schedule D and an election under subsection (3)(a) has not been made, an allowance under section 284, which would on due claim being made be granted, shall be deemed to have been granted.

(3) (a) Subsection (2) shall not apply for a year of assessment if an individual 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).

(b) An election under this subsection shall have effect only for the year of assessment for which it is made.

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

(5) Subject to subsections (6) and (7), the limit of an individual referred to in subsection (2) is £6,000.

(6) As respects the year of assessment 2001 the limit referred to in subsection (5) is £4,440.

(7) Where relevant sums arise to more than one individual in respect of a qualifying residence the limits referred to in subsections (5) and (6) shall be divided by the number of such individuals.

(8) Where subsection (2) applies, the receipt of relevant sums shall not operate so as to restrict or reduce any entitlement to relief under section 244 or 604.”.

(2) Section 216A (inserted by subsection (1)) of the Principal Act is amended as respects the year of assessment 2002 and subsequent years of assessment—

(a) in subsection (5) by the substitution of “€7,620” for “£6,000”, and

(b) by the deletion of subsection (6).

Chapter 3 Income Tax, Corporation Tax and Capital Gains Tax

33 Special savings incentive accounts.

33.—(1) The Principal Act is amended by the insertion after Part 36 of the following:

	“PART 36A Special savings incentive accounts
Interpretation.	848B.—(1) In this Part— ‘deposit account’ means an account beneficially owned by an individual, which is— (a) an account into which a deposit (within the meaning of section 256(1)) is made, or (b) an account with a relevant European institution into which repayable funds are lodged; ‘investment undertaking’ has the meaning assigned to it in section 739B and ‘units in an investment undertaking’ shall be construed accordingly; ‘PPS Number’, in relation to an individual, means that individual's Personal Public Service Number within the meaning of section 223 of the Social Welfare (Consolidation) Act, 1993; ‘qualifying assets’, subject to section 848G, means— (a) deposit accounts, (b) shares within the meaning of section 2(1) of the Credit Union Act, 1997, (c) units in an investment undertaking, (d) units in, or shares of, a relevant UCITS, (e) relevant life assurance policies, (f) shares issued by a company, wherever incorporated, officially listed on a recognised stock exchange, and (g) securities issued by or on behalf of a government; ‘qualifying individual’ means an individual who at the time of opening a special savings incentive account— (a) is 18 years of age, or older, and (b) is resident in the State; ‘qualifying savings manager’ means— (a) a person who is a holder of a licence granted under section 9 of the Central Bank Act, 1971, or a person who holds a licence or other similar authorisation under the law of any other Member State of the European Communities which corresponds to a licence granted under that section, (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) the Post Office Savings Bank, (f) a credit union within the meaning of the Credit Union Act, 1997, (g) an investment undertaking, (h) the holder of— (i) an authorisation issued by the Minister for Enterprise, Trade and Employment under the European Communities (Life Assurance) Regulations of 1984 (S.I. No. 57 of 1984), as amended, or, (ii) an authorisation granted by the authority charged by law with the duty of supervising the activities of insurance undertakings in a Member State of the European Communities, other than the State, in accordance with Article 6 of Directive No. 79/267/EEC[^1], who is carrying on the business of life assurance in the State, or (iii) an official authorisation to undertake insurance in Iceland, Liechtenstein and Norway pursuant to the EEA Agreement within the meaning of the European Communities (Amendment) Act, 1993, and who is carrying on the business of life assurance in the State, (i) a person 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, (j) a firm approved under section 10 of the Investment Intermediaries Act, 1995, which is authorised to hold client money, other than a firm authorised as a Restricted Activity Investment Product Intermediary, where the firm's authorisation permits it to engage in the proposed activities, or a business firm which has been authorised to provide similar investment business services under the laws of a Member State of the European Communities which correspond to that Act, or (k) the Minister for Finance, acting through the Agency (within the meaning of section (1) of the National Treasury Management Agency Act, 1990); ‘relevant European institution’ means an institution which is a credit institution (within the meaning of the European Communities (Licensing and Supervision of Credit Institutions) Regulations, 1992 (S.I. No. 395 of 1992)) which has been authorised by the Central Bank of Ireland to carry on business of a credit institution in accordance with the provisions of the supervisory enactments (within the meaning of those Regulations); ‘relevant UCITS’ means a UCITS situated in a Member State of the European Communities, other than the State, which has been authorised by the competent authorities of the Member State in which it is situated; ‘relevant life assurance policy’ means a policy of assurance which satisfies the conditions specified in subsection (3); ‘special savings incentive account’ has the meaning assigned to it in section 848C; ‘tax credit’, in relation to a subscription, has the meaning assigned to it in section 848D(1); ‘UCITS’ means undertakings for collective investment in transferable securities within the meaning of Article 1 of Council Directive 85/611[^2] and references to— (a) ‘the Member State in which UCITS is situated’ and (b) a UCITS which has been ‘authorised by the competent authorities of the Member State in which it is situated’, shall have the same meanings as in Articles 3 and 4 respectively of that Directive; ‘units in, or shares of, a relevant UCITS’ means the rights or interests (however described) of the holder of units or shares in that relevant UCITS. (2) Nothing in this Part shall be construed as authorising or permitting a person who is a qualifying savings manager to provide any services which that person would not otherwise be authorised or permitted to provide in the State. (3) The conditions referred to in the definition of ‘relevant life assurance policy’ in subsection (1) are that the policy of assurance is on the life of a person who beneficially owns the policy, and that the terms and conditions of the policy provide— (a) for an express prohibition of any transfer of the policy, or the rights conferred by the policy or any share or interest in the policy or rights respectively, other than the cash proceeds from the termination of the policy or a partial surrender of the rights conferred by the policy, to that person, (b) the policy, the rights conferred by the policy and any share or interest in the policy or rights respectively, shall not be capable of assignment, other than that the proceeds on the termination of the policy (other than on the death of the policyholder) may be transferred from a qualifying savings manager to another qualifying savings manager in accordance with the provisions of this Part, and (c) the policy is not issued in the course of annuity business or pension business, within the meaning of section 706.
Special savings incentive account.	848C.—A special savings incentive account is a scheme of investment commenced on or after 1 May 2001 and on or before 30 April 2002 by a qualifying individual with a qualifying savings manager (who is registered in accordance with section 848R) under terms which include the following— (a) apart from tax credits, in relation to subscriptions, subscribed by the qualifying savings manager under section 848E(1)(b)(ii) only the qualifying individual, or the spouse of that individual, may subscribe to the account, (b) such subscriptions are funded by the qualifying individual, or the spouse of that individual, from funds available to either or both of them out of their own resources without recourse to borrowing, or the deferral of repayment (whether in respect of capital or interest) of sums already borrowed, (c) subject to paragraph (d), such subscriptions, ignoring any amounts withdrawn from the account by the qualifying individual— (i) in the month the account is commenced and in each of the 11 months immediately after that month, are of an amount agreed between the qualifying individual and the qualifying savings manager when the account is commenced, which amount shall not be less than £10, and (ii) in any one month, do not exceed £200, (d) such subscriptions, made in the month which is the month in which the fifth anniversary of the day of commencing the account falls, or thereafter, shall not be subscriptions for the purposes of section 848D, (e) such subscriptions and tax credits, in relation to such subscriptions, are to be used, and used only, by the qualifying savings manager to acquire qualifying assets which— (i) are held in the account and managed by the qualifying savings manager, and (ii) are beneficially owned by the qualifying individual, (f) all or any of the qualifying assets can not be assigned or otherwise pledged, as security for a loan, (g) on commencing the account, the qualifying individual makes a declaration of a kind referred to in section 848F, (h) for the account to be treated as maturing (otherwise than in respect of the death of the qualifying individual) in accordance with section 848H(1), the qualifying individual shall make a declaration of a kind referred to in section 848I within the period commencing 60 days before and ending 30 days after the fifth anniversary of the commencement of the account, (i) that at the request of the qualifying individual, and within such time as shall be agreed, the account, with all rights and obligations of the parties thereto may be transferred to another qualifying savings manager in accordance with the provisions of this Part, (j) that the qualifying savings manager will notify the qualifying individual if he or she ceases to be a qualifying savings manager, or ceases to be registered in accordance with section 848R, and (k) that the qualifying savings manager will take reasonable measures— (i) to establish that the PPS Number, contained in the declaration referred to in paragraph (g), made by a qualifying individual, is the PPS Number in relation to that individual, and (ii) to ensure that the terms, provided for in this section, under which the account is commenced are and continue to be complied with, and (l) that the qualifying savings manager will retain a copy of all material used to establish the correctness of each PPS Number contained in a declaration in accordance with paragraph (k)(i), for so long as the declaration is required to be retained under section 848R(11) and on being so required by an inspector, will make such material available for inspection.
Tax credits.	848D.—Where a qualifying individual, or the spouse of that individual, subscribes to a special savings incentive account— (a) the qualifying individual shall be treated, for the purposes of the Tax Acts, as having paid a grossed up amount, which amount, after deducting income tax at the standard rate for the year of assessment 2001, leaves the amount of the subscription, and (b) the qualifying individual shall be entitled to be credited with the amount of income tax (in this Part referred to as the ‘tax credit’, in relation to the subscription) treated as having been so deducted, in accordance with the provisions of this Part and not under any other provision of the Tax Acts.
Payment of tax credit.	848E.—(1) Where a qualifying individual subscribes to a special savings incentive account, and the qualifying savings manager of that account complies with the provisions of section 848P in relation to that subscription— (a) the Revenue Commissioners shall, subject to that section, pay to the qualifying savings manager the tax credit in relation to that subscription, and (b) that tax credit shall— (i) be beneficially owned by the qualifying individual, and (ii) on receipt, be immediately subscribed by the qualifying savings manager to the special savings incentive account. (2) Subject to this Part, exemption from income tax and capital gains tax shall be allowed in respect of the income and chargeable gains arising in respect of qualifying assets held in a special savings incentive account. (3) A deposit (within the meaning of section 256(1)) made to a deposit account which is a qualifying asset, shall not be a relevant deposit (within the meaning of that section) for the purposes of Chapter 4 of Part 8. (4) Notwithstanding subsection (2), where in a year of assessment an individual commences a special savings incentive account, the individual is obliged to include in a return, required to be delivered by the individual under section 951, or as the case may be, section 879, in respect of that year of assessment, a statement to the effect that the individual has commenced such an account.
Declaration on commencement.	848F.—The declaration referred to in section 848C(g) is a declaration in writing made by the qualifying individual to the qualifying savings manager which— (a) is made and signed by the qualifying individual, (b) is made in such form— (i) as may be prescribed or authorised by the Revenue Commissioners, and (ii) which contains a reference to the offence of making a false declaration under section 848T, (c) contains the qualifying individual's— (i) name, (ii) address of his or her permanent residence, (iii) PPS Number, and (iv) date of birth, (d) declares at the time the declaration is made, that the qualifying individual— (i) is resident in the State, (ii) has not commenced another special savings incentive account, (iii) is the person who will beneficially own the qualifying assets to be held in the account, (iv) will subscribe to the account from funds available to him or her, or his or her spouse, from their own resources, without recourse to borrowing, or the deferral of repayment (whether in respect of capital or interest) of sums already borrowed, and (v) will not assign or otherwise pledge qualifying assets to be held in the account as security for a loan, and (e) contains an undertaking that if at any time the declaration ceases to be materially correct, the qualifying individual will advise the qualifying savings manager accordingly.
Acquisition of qualifying assets.	848G.—(1) Qualifying assets held in a special savings incentive account, managed by a qualifying savings manager and beneficially owned by a qualifying individual may not at any time— (a) be purchased (or otherwise acquired) by the qualifying savings manager, otherwise than— (i) out of money which the qualifying savings manager holds in the account, and (ii) by way of a bargain made at arm's length, (b) be purchased from the qualifying individual or any person connected with that individual (within the meaning of section 10), or (c) be connected with any other asset or liability of the qualifying individual or any other person connected with that individual (within the meaning of section 10) and for this purpose a qualifying asset is connected with another asset or a liability if the terms under which either asset or the liability is acquired and held would be different if the qualifying asset, the other asset or the liability, had not been acquired and held. (2) Shares fulfil the condition as to official listing in paragraph (f) of the definition of ‘qualifying assets’ in section 848B(1) if in pursuance of a public offer, a qualifying savings manager applies for the allotment or allocation to him or her of shares in a company which are due to be admitted to such listing within 30 days of the allocation or allotment, and which, when admitted to such a listing, would be qualifying assets.
Termination of special savings incentive account.	848H.—(1) A special savings incentive account is treated as maturing— (a) 30 days after the fifth anniversary of the end of the month in which a subscription was first made to the account where the qualifying individual has made a declaration of a kind referred to in section 848I, or, (b) on the day of the death of the qualifying individual, whichever event first occurs. (2) A special savings incentive account is treated as ceasing, where at any time before the account is treated as maturing— (a) any of the terms referred to in section 848C are not complied with, or (b) the qualifying individual is neither resident nor ordinarily resident in the State. (3) Where a special savings incentive account is treated as maturing or ceasing— (a) the account thereafter shall not be a special savings incentive account for the purposes of section 848E, and (b) the assets remaining in the account after having regard to all liabilities to tax on gains treated as accruing to the account under this Part shall— (i) where the assets are shares, securities, or units in, or shares of, a relevant UCITS, be treated for the purposes of the Capital Gains Tax Acts, as having been acquired by the qualifying individual at their then market value at that time, (ii) where the asset is a relevant life assurance policy, be treated as if it were a policy commenced at that time and in respect of which premiums in an amount equal to the market value of the policy at that time had been paid at that time, for the purposes of Chapter 5 of Part 26, and (iii) where the asset is units in an investment undertaking, be treated as if the units had been acquired at that time, for their market value at that time, for the purposes of Chapter IA of Part 27.
Declaration on maturity.	848I.—The declaration referred to in section 848C(h) is a declaration in writing made by the qualifying individual to the qualifying savings manager which— (a) is made and signed by the qualifying individual, (b) is made in such form— (i) as may be prescribed or authorised by the Revenue Commissioners, and (ii) which contains a reference to the offence of making a false declaration under section 848T, (c) contains the qualifying individual's— (i) name, (ii) address of his or her permanent residence, (iii) PPS Number, and (iv) date of birth, (d) declares that at all times in the period from which the account was commenced until the date the declaration is made, the qualifying individual— (i) was the beneficial owner of the qualifying assets held in the account, (ii) had only one special savings incentive account, (iii) was resident or ordinarily resident in the State, (iv) subscribed to the account from funds available to the qualifying individual or his or her spouse without recourse to borrowing, or the deferral of repayment (whether of capital or interest) of sums borrowed when the account was commenced, and (v) did not assign or otherwise pledge qualifying assets held in the account as security for a loan.
Gain on maturity.	848J.—(1) On the day on which a special savings incentive account is treated as maturing, a gain shall be treated as accruing on the account in an amount determined under subsection (2). (2) The amount of the gain referred to in subsection (1) is an amount equal to the aggregate market value of all assets (including cash) held in the account on the day the account is treated as maturing, less the sum of all subscriptions (including subscriptions made by the qualifying savings manager under section 848E(1)(b)(ii)), made to the account on or before that day to the extent that they have not previously been treated, in accordance with subsection (3), as having been withdrawn from the account. (3) For the purposes of subsection (2) where there is a withdrawal from an account, the amount withdrawn (before being reduced by any tax liability arising under this Part in respect of any gain treated as accruing to the account as a result of the withdrawal) shall be treated as a withdrawal of subscriptions to the extent that the amount withdrawn does not exceed the total amount of subscriptions (including subscriptions made by the qualifying savings manager in accordance with section 848E(1)(b)(ii)) made to the account since commencement, reduced by the amount of such subscriptions previously treated as subscriptions withdrawn from the account under this subsection. (4) For the purposes of subsection (3) where there is a withdrawal of assets (other than cash) from an account the amount withdrawn shall be the amount which is the market value of those assets at the time of their withdrawal.
Gain on cessation.	848K.—(1) On the day on which a special savings incentive account is treated as ceasing, a gain shall be treated as accruing on the account in an amount determined under subsection (2). (2) The amount of the gain referred to in subsection (1) is an amount equal to the aggregate market value of all assets (including cash) held in the account on the day the account is treated as ceasing.
Gain on withdrawal.	848L.—(1) Where before a special savings incentive account is treated as maturing or ceasing (as the case may be) a qualifying individual withdraws cash or other assets from the account, a gain shall be treated as accruing on the account in an amount determined under subsection (2). (2) The amount of the gain referred to in subsection (1) is— (a) where the withdrawal is in cash, the amount of that cash, and (b) where the withdrawal is of assets (other than cash) an amount equal to the market value of such assets on the day of withdrawal.
Taxation of gains.	848M.—(1) A qualifying savings manager shall be liable to tax (in this Part referred to as ‘relevant tax’) on a gain treated under this Part as accruing to a special savings incentive account in an amount equal to 23 per cent of the amount of that gain. (2) A qualifying savings manager who becomes liable under subsection (1) to an amount of relevant tax shall be entitled to withdraw sufficient funds from the account to which the gain is treated as accruing to satisfy that liability and the qualifying individual shall allow such withdrawal; but where there are no funds or insufficient funds available in the account out of which the qualifying savings manager may satisfy, or fully satisfy, such liability, the amount of relevant tax for which there are insufficient funds so available shall be a debt due to the qualifying savings manager from the qualifying individual. (3) Subject to section 848P, the relevant tax in respect of a gain which in accordance with that section, 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 without the making of an assessment; but relevant tax which has become so due may be assessed on the qualifying savings 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. (4) Where it appears to the inspector that there is any amount of relevant tax 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 savings manager to the best of his or their judgment, and any amount of relevant tax 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) (a) Any relevant tax assessed on a qualifying savings 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 (3)) subject to any appeal against the assessment, but no such appeal shall affect the date when any amount is due under subsection (3). (b) On the determination of an appeal against an assessment under this section any relevant tax overpaid shall be repaid. (6) (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 relevant tax. (b) Any amount of relevant tax payable in accordance with this Part 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. (c) Subsections (2) to (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 relevant 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.
Transfer of special savings incentive account.	848N.—(1) Where arrangements are made by a qualifying individual to transfer his or her special savings incentive account from one qualifying savings manager (in this section referred to as the ‘transferor’) to another qualifying savings manager (in this section referred to as the ‘transferee’) or the account is transferred in consequence of the transferor ceasing to act or to be a qualifying savings manager, the following provisions of this section shall apply. (2) Where a transfer takes place under subsection (1)— (a) all subscriptions to the special savings incentive account in so far as they have not been applied to acquire qualifying assets, and all qualifying assets in the account, must be made to a single transferee, (b) the qualifying individual shall make a declaration of a kind referred to in section 848O to the transferee, and (c) the transferee shall thereafter for the purposes of this Part be the qualifying savings manager of the special savings incentive account transferred. (3) The transferor shall within 30 days after the date of transfer— (a) give to the transferee a notice containing the information specified in subsection (4) and the declaration specified in subsection (5), and (b) pay to the transferee the aggregate of the amounts referred to in subsection (4)(b)(vi). (4) The information referred to in subsection (3) is— (a) as regards the qualifying individual his or her— (i) name, (ii) address of permanent residence, (iii) date of birth, (iv) PPS Number, and (b) as respects the special savings incentive account transferred pursuant to this section— (i) the date of transfer, (ii) the date the account was commenced, (iii) the identification of the assets held in the account, (iv) the total of all subscriptions made to the account by the qualifying individual, or the spouse of that individual, (v) the total of all tax credits, in relation to subscriptions, subscribed to the account, (vi) the amount of any dividends, and other amounts payable in respect of qualifying assets held in the account and amounts of tax credits, which have not been received by the transferor at the date of transfer, and (vii) the amount of each withdrawal from the account and the date of each such withdrawal. (5) The declaration referred to in subsection (3) is a declaration in writing made and signed by the transferor to the effect that— (a) the transferor has fulfilled all obligations under this Part, (b) the transferor has transferred to the transferee all money and qualifying assets held in the account and that where registration of any such transfer is required, the transferor has taken the necessary steps to ensure that those qualifying assets can be registered in the name of the transferee, and (c) that, to the best of the qualifying savings manager's knowledge and belief, the information contained in the notice referred to in subsection (3) is correct. (6) Notwithstanding section 848C, where a special savings incentive account is being transferred in accordance with this section it shall not be treated as ceasing should, during the period of the transfer, the qualifying assets held in the account, temporarily cease to be managed by a qualifying savings manager, or a qualifying savings manager who is registered in accordance with section 848R.
Declaration on transfer.	848O.—The declaration referred to in section 848N(2)(b) is a declaration in writing made by the qualifying individual to the qualifying savings manager who is the transferee referred to in that section, which— (a) is made and signed by the qualifying individual, (b) is made in such form— (i) as may be prescribed or authorised by the Revenue Commissioners, and (ii) which contains a reference to the offence of making a false declaration under section 848T. (c) contains the qualifying individual's— (i) name, (ii) address of his or her permanent residence, (iii) PPS Number, and (iv) date of birth, and (d) declares— (i) at the time the declaration is made, that the qualifying individual— (I) has not commenced another special savings incentive account, and (II) is the person who beneficially owns the qualifying assets held in the account being transferred, (ii) at the time the special savings incentive account was commenced, the qualifying individual was resident in the State, (iii) that subscriptions to the account have been and will continue to be made from funds available to him or her, or his or her spouse, out of their own resources without recourse to borrowing, or the deferral of repayment (whether in respect of capital or interest) of sums borrowed when the account was commenced, and (iv) has not and will not assign or otherwise pledge qualifying assets held in the account as security for a loan.
Monthly returns.	848P.—A qualifying savings manager who is or was registered in accordance with section 848R, shall, within 15 days of the end of every month, make a return (including, where it is the case, a nil return) to the Revenue Commissioners, which— (a) specifies in respect of all special savings incentive accounts managed by the qualifying savings manager in that month— (i) the aggregate amount of tax credits, in relation to the aggregate of subscriptions made to those accounts in that month, (ii) the aggregate amount of relevant tax to which the qualifying savings manager is liable in respect of gains treated as accuring on those accounts in that month, and (iii) the net amount (being the difference between the amounts specified in paragraphs (a) and (b)) due from or, as the case may be, to, the Revenue Commissioners, and (b) contains a declaration in a form prescribed or authorised by the Revenue Commissioners that, to the best of the qualifying savings manager's knowledge and belief, the information referred to in paragraph (a) is correct.
Annual returns.	848Q.—A qualifying savings manager who is or was registered in accordance with section 848R shall in respect of each year of assessment, on or before 28 February in the year following the year of assessment, make a return (including, where it is the case, a nil return), to the Revenue Commissioners which in respect of the year of assessment— (a) specifies in respect of each special incentive savings account managed by the qualifying savings manager— (i) the name of the qualifying individual, (ii) the address of that individual's permanent residence, (iii) the PPS Number of the individual, (iv) the date the account was commenced, (v) the total amount of subscriptions made by the qualifying individual, or the spouse of that individual, to the account, (vi) the total amount of tax credits, in respect of subscriptions, subscribed to the account, and (vii) in respect of each gain accuring on the account— (I) the amount of relevant tax to which the qualifying savings manager has thereby become liable, and (II) whether the gain accrued under section 848J, 848K or 848L. and (b) containing a declaration, in a form prescribed or authorised by the Revenue Commissioners, that to the best of the qualifying savings manager's knowledge and belief— (i) in respect of each special savings incentive account referred to in the return, the terms referred to in section 848C have been and are being complied with, and (ii) the information referred to in paragraph (a) and the declaration referred to in subparagraph (i) is correct.
Registration etc.	848R.—(1) A person can not be a qualifying savings manager unless the person is included in a register maintained by the Revenue Commissioners of persons registered in accordance with subsection (5). (2) Where at any time a qualifying savings manager does not have a branch or business establishment in the State, or has such a branch or business establishment but does not intend to carry out all the functions as a qualifying savings manager at that branch or business establishment, the qualifying savings manager shall not be registered in accordance with subsection (5) unless the qualifying savings manager appoints for the time being a person, who— (a) where an individual, is resident in the State, and (b) where not an individual, has a business establishment in the State, to be responsible for securing the discharge of the obligations which fall to be discharged by the qualifying savings manager under this Part, and advises the Revenue Commissioners of the identity of that person and the fact of that person's appointment. (3) Where a person has been appointed in accordance with subsection (2), and subject to subsection (4) that person shall— (a) be entitled to act on the qualifying savings manager's behalf for any of the purposes of the provisions of this Part, (b) shall secure (where appropriate by acting on the qualifying savings manager's behalf) the qualifying savings manager's compliance with and discharge of the obligations under this Part, and (c) shall be personally liable in respect of any failure of the qualifying savings manager to comply with or discharge any such obligations as if the obligations imposed on the qualifying savings manager were imposed jointly and severally on the qualifying savings manager and the person concerned. (4) The appointment of a person in accordance with subsection (2) shall be treated as terminated in circumstances where— (a) the Revenue Commissioners have reason to believe that the person concerned— (i) has failed to secure the discharge of any of the obligations imposed on a qualifying savings manager under this Part, or (ii) does not have adequate resources to discharge those obligations, and (b) the Revenue Commissioners have notified the qualifying savings manager and that person that they propose to treat the appointment of that person as having terminated with effect from the date of the notice. (5) If the Revenue Commissioners are satisfied that an applicant for registration is entitled to be registered, they shall register the applicant with effect from such date as may be specified by them. (6) If it appears to the Revenue Commissioners at any time that a qualifying savings manager who is registered under this section— (a) would not be entitled to be registered if it applied for registration at that time, or (b) has not complied with the provisions of this Part, the Revenue Commissioners may, by written notice given to the qualifying savings manager, cancel its registration with effect from such date as may be specified in the notice. (7) Any qualifying savings manager who is aggrieved by the failure of the Revenue Commissioners to register it or by the cancellation of its registration, may, by notice given to the Revenue Commissioners before the end of the period of 30 days beginning with the date on which the qualifying savings manager was notified of the Revenue Commissioners decision, require the matter to be determined by the Appeal Commissioners and the Appeal Commissioners shall hear and determine the matter in like manner as an appeal. (8) A qualifying savings manager shall give notice to the Revenue Commissioners and the qualifying individuals whose special savings incentive accounts he or she manages of his or her intention to cease to act as the qualifying savings manager not less than 30 days before he or she so ceases so that his or her obligations to the Revenue Commissioners can be conveniently discharged at or about the time he or she ceases to so act, and the notice to the qualifying individuals shall inform them of their right to transfer their special savings incentive accounts under section 848N. (9) Subject to subsection (10), every return to be made by a qualifying savings manager under section 848P and 848Q shall be made in electronic format approved by the Revenue Commissioners and shall be accompanied by a declaration made by the qualifying savings manager, in a form prescribed or authorised for that purpose by the Revenue Commissioners, to the effect that the return is correct. (10) Where the Revenue Commissioners are satisfied that a qualifying savings manager does not have the facilities to make a return under section 848P or 848Q in the format referred to in subsection (9), such returns shall be made in writing in a form prescribed or authorised by the Revenue Commissioners, and shall be accompanied by a declaration made by the qualifying savings manager, on a form prescribed or authorised for that purpose by the Revenue Commissioners, to the effect that the return is correct. (11) A qualifying savings manager shall retain— (a) in respect of each special savings incentive account which is treated as maturing, the declarations of a kind referred to in sections 848F, 848I and 848O for a period of 3 years after the date on which the account was treated as maturing, and (b) in respect of each special savings incentive account which is treated as ceasing, the declarations of a kind referred to in sections 848F and 848O for a period of 3 years after the date on which the account was treated as ceasing, and on being so required by notice given to him or her in writing by an inspector, make available for inspection all or any such declarations.
Regulations.	848S.—(1) The Revenue Commissioners shall make regulations providing generally as to the administration of this Part and those regulations may, in particular and without prejudice to the generality of the foregoing include provisions— (a) as to the manner in which a qualifying savings manager is to register under section 848R, (b) as to the manner in which a return is to be made under section 848P, (c) as to the manner in which a return is to be made under section 848Q, (d) as to the manner in which tax credits are to be paid under section 848E(1), or the net amount referred to in section 848P(a)(iii), (e) as to the circumstances in which the Revenue Commissioners may require a qualifying savings manager to give a bond or guarantee to the Revenue Commissioners which is sufficient to indemnify the Commissioners against any loss arising by virtue of the fraud or negligence of the qualifying savings manager in relation to the operation of the provisions of this Part, and (f) as to the manner in which a qualifying savings manager ensures compliance with the terms of special savings incentive accounts provided for in section 848C. (2) Every regulation made under this section shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the regulation is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the regulation is laid before it, the regulation shall be annulled accordingly but without prejudice to the validity of anything previously done thereunder.
Offences.	848T.—A person who makes a declaration under section 848F, section 848I, section 848O or section 848N(5) which is false, shall be guilty of an offence and shall be liable on summary conviction to a fine of £1,500, or, at the discretion of the court, to imprisonment for a term not exceeding 6 months or to both the fine and the imprisonment.
Disclosure of information.	848U.—Notwithstanding any obligation as to secrecy or other restriction upon disclosure of information imposed by or under statute or otherwise, where a qualifying savings manager has reasonable grounds to suspect that the terms, provided for under section 848C, under which a special savings incentive account was commenced, are not being complied with, the qualifying savings manager shall inform the Revenue Commissioners accordingly.”.

(2) (a) The Principal Act is amended in Part 36A (inserted by subsection (1))—

(i) in section 848C(b)(i) by the substitution of “€12.50” for “£10”,

(ii) in section 848C(b)(ii) by the substitution of “€254” for “£200”, and

(iii) in section 848T by the substitution of “€1,900” for “£1,500”.

(b) This subsection shall apply as on and from 1 January 2002.

34 Amendment of section 97 (computational rules and allowable deductions) of Principal Act.

34.—Section 97 (as amended by the Finance (No. 2) Act, 1998) of the Principal Act is amended—

(a) in subsection (2B)—

(i) by the substitution in paragraph (d) for “1997, or” of “1997,”,

(ii) by the substitution in paragraph (e) for “during the year.” of “during the year, or”, and

(iii) by the insertion of the following after paragraph (e):

“(f) in the purchase, improvement or repair of a premises which complies with the conditions of subsection (2F).”,

and

(b) by the insertion of the following after subsection (2E):

“(2F) (a) The conditions of this subsection are—

(i) the premises was converted into multiple residential units prior to 1 October 1964,

(ii) the premises was acquired by the chargeable person under a contract which was evidenced in writing on or after 5 January 2001,