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19 1960

FINANCE ACT, 1960

PART I.

Income Tax.

Income tax and sur-tax for the year 1960-61.

1. —(1) Income tax shall be charged for the year beginning on the 6th day of April, 1960, at the rate of seven shillings in the pound.

(2) Sur-tax for the year beginning on the 6th day of April, 1960, shall be charged in respect of the income of any individual the total of which from all sources exceeds two thousand pounds and shall be so charged at the same rates as those at which it is charged for the year beginning on the 6th day of April, 1959.

(3) Subject to the provisions of the Finance (No. 2) Act, 1959 , and of this Act, the several statutory and other provisions which were in force on the 5th day of April, 1960, in relation to income tax and sur-tax and any such provisions which came into operation on the 6th day of April, 1960, in relation thereto, other than such provisions as by their terms relate only to income tax and sur-tax to be charged for the year beginning on the 6th day of April, 1959, shall have effect in relation to the income tax and sur-tax to be charged as aforesaid for the year beginning on the 6th day of April, 1960.

Increase of deductions in respect of children.

2. —(1) Subsection (1) of section 21 of the Finance Act, 1920, is hereby amended by the substitution of “a deduction of one hundred and twenty pounds” for “a deduction of one hundred pounds” (inserted by section 2 of the Finance Act, 1955 ).

(2) Section 4 of the Finance Act, 1944 , is hereby amended by the substitution in subsection (1) of “the Social Welfare (Children's Allowances) Acts, 1944 to 1957, or those Acts and any subsequent Act together with which those Acts may be cited” for “the Social Welfare (Children's Allowances) Acts, 1944 to 1952” (inserted by section 4 of the Finance Act, 1954 ).

Amendment of section 14 of Finance Act, 1929, and section 2 of Finance Act, 1945.

3. —(1) In relation to losses to which this section applies—

(a) section 14 of the Finance Act, 1929 , is hereby amended by the substitution of “any subsequent year of assessment” for “the six following years of assessment” in subsection (1) and by the deletion of “for any year within the said six following years” and “such” in subsection (3); and

(b) section 2 of the Finance Act, 1945 , is hereby amended by the substitution of “any subsequent year of assessment” for “the six following years of assessment” in subsection (1) and the deletion of “for any year within the said six following years” and “such” in subsection (3).

(2) This section applies to losses sustained after the beginning of the year 1960-61 and to so much of any loss sustained before the beginning of that year as could, apart from this section, be carried forward to that year.

Carrying back of losses in certain cases.

4. —(1) Where a trade, profession or vocation is permanently discontinued, and any person carrying it on, either solely or in partnership, immediately before the time of the discontinuance, has sustained therein a loss to which this section applies (hereafter in this section referred to as a terminal loss), then, subject to the provisions of this section, he may claim that the amount of the terminal loss shall, as far as may be, be deducted from or set-off against the amount of profits or gains on which he has been charged to income tax under Schedule D in respect of the trade, profession or vocation for the three years of assessment last preceding that in which the discontinuance occurs, and there shall be made all such amendments of assessments or repayments of tax as may be necessary to give effect to the claim:

Provided that relief shall not be given in respect of the same matter both under this section and under some other provision of the Income Tax Acts.

(2) Any relief under this section shall be given as far as possible from the assessment for a later rather than an earlier year.

(3) The question whether a person has sustained any, and if so what, terminal loss in a trade, profession or vocation shall for the purposes of this section be determined by taking the amounts, if any, of the following (in so far as they have not been otherwise taken into account so as to reduce or relieve any charge to tax), that is to say:

(a) the loss sustained by him in the trade, profession or vocation in the year of assessment in which it is permanently discontinued;

(b) the relevant capital allowances for that year of assessment;

(c) the loss sustained by him in the trade, profession or vocation in the part of the preceding year of assessment beginning twelve months before the date of the discontinuance;

(d) the same fraction of the relevant capital allowances for that preceding year of assessment as the part beginning as aforesaid is of a year.

(4) In the last foregoing subsection “the relevant capital allowances” means, in relation to any year of assessment, the capital allowances falling to be made in charging the profits or gains of the trade, profession or vocation for that year excluding amounts carried forward from an earlier year, and, for the purposes of paragraphs (a) and (c) of that subsection, the amount of a loss shall be computed in like manner as profits or gains are computed under the provisions of the Income Tax Acts applicable to Cases I and II of Schedule D.

(5) Subject to subsection (7) of this section, the amount of the profits or gains on which a person has been charged to income tax for any year of assessment in respect of the profits or gains of a trade, profession or vocation shall, for the purposes of relief under this section from the assessment for that year, be taken to be the full amount of the profits or gains on which he was assessable for that year reduced by—

(a) a sum equal to the total amount of the deductions, if any, in respect of capital allowances made in charging the profits or gains, and

(b) a sum equal to the total amount of the deductions, if any, in respect of payments made or losses sustained, which fell to be made from the profits or gains in computing for income tax purposes the person's total income for the year, or would have fallen to be so made if the person were an individual, and

(c) in the case of a body of persons, a sum equal to so much of the profits or gains as was applied in payment of dividends:

Provided that where any deduction such as is mentioned in paragraph (b) may be treated in whole or in part either as having been made from the profits or gains or as having been made from other income, the deduction shall, as far as may be, be treated for the purposes of this subsection as made from the other income.

(6) Where, under paragraph (b) of subsection (5) of this section, the amount of the profits or gains on which a person was assessable for any year is reduced by reference to a payment made by him, a like reduction shall be made in the amount of the terminal loss for which relief may be given under this section for earlier years unless the payment was made wholly and exclusively for the purposes of the trade, profession or vocation.

(7) Where a person claiming relief under this section on a discontinuance has, since the beginning of the third year of assessment preceding that in which the discontinuance occurs, carried on the trade, profession or vocation in partnership,—

(a) the full amount of the profits or gains on which he was assessable for any year, or part of a year, for which the partnership was assessed in respect of the trade, profession or vocation, shall, for the purposes of subsection (5) of this section, be taken to be the amount of his share, computed in accordance with the Income Tax Acts, of the profits or gains on which the partnership has been charged to tax and the amount of the profits or gains on which the partnership has been so charged shall, for this purpose, be computed as it would be computed under the said subsection (5) if that subsection applied to a partnership as it applies to a person, and

(b) if he was carrying on the trade, profession or vocation in partnership immediately before the discontinuance, the amounts to be included in his terminal loss by virtue of paragraph (b) or (d) of subsection (3) of this section shall be such part only of the amounts therein mentioned (in so far as they have not been otherwise taken into account so as to reduce or relieve any charge to tax) as would fall to his share on a division made according to the shares in which the partners were then entitled to the profits of the trade, profession or vocation.

(8) For all the purposes of this section a trade, profession or vocation shall be treated as permanently discontinued and a new trade, profession or vocation set up or commenced, when it is so treated for the purposes of Rule 11 of the Rules applicable to Cases I and II of Schedule D, but—

(a) a person who continues to be engaged in carrying it on immediately after such a discontinuance shall not be entitled to relief in respect of any terminal loss on that discontinuance, and

(b) on any discontinuance, a person not continuing to be so engaged may be given relief in respect of a terminal loss against profits or gains on which he was charged in respect of the same trade, profession or vocation for a period before a previous discontinuance, if he has been continuously engaged in carrying it on between the two discontinuances, and, in his case, if the previous discontinuance occurred within twelve months before the other, it shall be disregarded for the purposes of subsection (3) of this section.

(9) In this section “capital allowances” means allowances, other than allowances falling to be made in computing profits or gains, under Rule 6 of the Rules applicable to Cases I and II of Schedule D, section 5 or section 6 of the Finance Act, 1946 , Part V of the Finance Act, 1956 , Part IV of the Finance (Miscellaneous Provisions) Act, 1956, Part V of the Finance Act, 1957 , or Part V or section 74 of the Finance Act, 1959.

(10) Any claim under subsection (1) of this section shall be made to and determined by the inspector of taxes, but any person aggrieved by any decision of the inspector of taxes on any such claim may, on giving notice in writing to the said inspector within twenty-one days after the notification to him of the decision, appeal to the Special Commissioners.

(11) The Special Commissioners shall hear and determine an appeal to them under subsection (10) of this section as if it were an appeal against an assessment to income tax, and the provisions of the Income Tax Acts relating to the rehearing of an appeal and the statement of a case for the opinion of the High Court on a point of law shall, with the necessary modifications, apply accordingly.

(12) This section shall apply where a trade, profession or vocation is permanently discontinued in the year 1960-61 or in any subsequent year of assessment.

Amendment of section 7 of Finance Act, 1932.

5. —(1) The subsection set out in paragraph (a) of subsection (1) of section 4 of the Finance Act, 1957 , is hereby amended, with effect as from the commencement of section 7 of the Finance Act, 1932 , by the insertion of “whether before or” before “after the passing of this Act”.

(2) Where a certificate is given by virtue of this section in respect of any stocks, shares or securities, relief or repayment under subsection (1) of section 7 of the Finance Act, 1932 , shall, nevertheless, not be granted in respect of any dividend or interest on the stocks, shares or securities which was payable before the date of the certificate.

Amendment of section 3 of Finance Act, 1956.

6. Section 3 of the Finance Act, 1956 , is hereby amended by the substitution of the following subsection for subsection (2):

“(2) For the purposes of subsection (1) of this section the question whether or how far the said sums exceed twenty-five pounds shall, where by virtue of section 8 of the Finance Act, 1958 , a woman's income is deemed to be her husband's, be determined separately as regards the part of his income which is his by virtue of that section and the part which is his apart from that section.”

Exemption—authority controlling harbour within the State.

7. —Exemption shall be granted from tax under Schedule D in respect of so much of the profits or gains of an authority controlling a harbour situate within the State as arise from the provision in that harbour of such facilities and accommodation for vessels, goods and passengers as are ordinarily provided by authorities controlling harbours, situate within the State, in those harbours.

Dividend from outside the State to individual formerly resident there.

8. —(1) Where an individual beneficially entitled to income arising outside the State was chargeable to tax in respect of that income for the year 1959-60 under Case III of Schedule D; the income was a dividend paid by a company whose business was managed and controlled outside the State; the individual, or the individual and his wife, or the individual and her husband, as the case may be, was or were either the beneficial owner of, or able either directly or through the medium of other companies or by any other indirect means, to control, more than 20 per cent. of the issued share capital of the company; and the Revenue Commissioners are satisfied that the income or a part thereof, had the income or part been derived from a company whose business was managed and controlled in the State, would, in relation to income tax (including sur-tax), be treated as not being income, then, the income or part, as the case may be, shall be disregarded for all the purposes of the Income Tax Acts.

(2) This section applies to an individual who is resident in the State and not resident elsewhere but who, before he came to reside in the State, was resident outside it for a continuous period of not less than ten years or for a number of discontinuous periods amounting in the aggregate to not less than ten years.

Power to obtain information as to fees, commissions, etc.

9. —(1) Every person carrying on a trade or business shall, if required to do so by notice from an inspector of taxes, make and deliver to the inspector a return of all payments of any kind specified in the notice made during a period so specified, being—

(a) payments made in the course of the trade or business, or of such part of the trade or business as may be specified in the notice, for services rendered in connection with the trade or business by persons ordinarily resident in the State and not employed in the trade or business, or

(b) payments for services rendered in connection with the formation, acquisition, development or disposal of the trade or business, or any part of it, by persons ordinarily resident in the State and not employed in the trade or business, or

(c) periodical or lump sum payments made to persons ordinarily resident in the State in respect of any copyright.

(2) Every body of persons carrying on any activity which does not constitute a trade or business shall, if required to do so by notice from an inspector of taxes, make and deliver to the inspector a return of all payments of a kind specified in the notice made during a period so specified, being—

(a) payments made in the course of carrying on the activity, or such part of the activity as may be specified in the notice, for services rendered in connection with the activity by persons ordinarily resident in the State and not employed by the said body of persons, or

(b) periodical or lump sum payments made to persons ordinarily resident in the State in respect of any copyright.

(3) A return required under either of the foregoing subsections shall, if the trade or business or other activity is carried on by an unincorporated body of persons, be made and delivered by the person who is or performs the duties of secretary of the body, and the notice shall be framed accordingly.

(4) A return under the foregoing provisions of this section shall give the name of the person to whom each payment was made, the amount of the payment and such other particulars (including particulars as to the services or rights in respect of which the payment was made, the period over which any services were rendered and any business name and any business or home address of the person to whom payment was made) as may be specified in the notice.

(5) No person shall be required under the foregoing provisions of this section to include in a return—

(a) particulars of any payment from which income tax is deductible, or

(b) particulars of payments made to any one person where the total of the payments to that person which would otherwise fall to be included in the return does not exceed fifteen pounds, or

(c) particulars of any payment made in a year of assessment ending more than three years before the service of the notice requiring him to make the return.

(6) A person who fails to deliver, within the period limited in any notice served on him under this section, a true and correct return which he is required by the notice to deliver shall be liable to a penalty of twenty pounds, together with, in the case of a continuing non-compliance, a penalty of the like amount for every day on which the non-compliance is continued.

(7) All penalties under this section may, without prejudice to any other method of recovery, be proceeded for and recovered summarily in the same manner as in summary proceedings for recovery of any fine or penalty under any Act relating to the excise.

(8) Where—

(a) a person does not comply with any notice served on him under this section requiring him to deliver any return,

(b) the notice requires compliance within a particular period, and

(c) such person continues, during a further period of two or more days, not to deliver the return,

the non-compliance shall be regarded, for the purposes of subsection (6) of this section, as a non-compliance continuing on every day, other than the first, of the further period.

(9) In proceedings for recovery of a penalty under this section—

(a) a certificate by an officer of the Revenue Commissioners which certifies that he has inspected the relevant records of the Revenue Commissioners and that it appears from them that, during a stated period, a stated return was not received from the defendant shall be evidence until the contrary is proved that the defendant did not, during that period, deliver that return,

(b) a certificate certifying as provided for by paragraph (a) of this subsection and purporting to be signed by an officer of the Revenue Commissioners may be tendered in evidence without proof and shall be deemed until the contrary is proved to have been signed by an officer of the Revenue Commissioners.

(10) In this section—

(a) references to payments for services include references to payments in the nature of commission of any kind and references to payments in respect of expenses incurred in connection with the rendering of services, and

(b) references to the making of payments include references to the giving of any valuable consideration,

and the requirement imposed by subsection (4) of this section to state the amount of a payment shall, in relation to any consideration given otherwise than in the form of money, be construed as a requirement to give particulars of the consideration.

(11) This section shall apply to payments made on or after the 6th day of April, 1960.