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13 1994

FINANCE ACT, 1994

PART VII

Miscellaneous

Chapter I

Provisions Relating to Residence of Individuals

Interpretation ( Chapter I ).

149. —In this Part—

the Acts” means—

(a) the Income Tax Acts,

(b) the Corporation Tax Acts,

(c) the Capital Gains Tax Acts, and

(d) the Capital Acquisitions Tax Act, 1976 , and the enactments amending or extending that Act,

and any instrument made thereunder;

authorised officer” means an officer of the Revenue Commissioners authorised by them in writing for the purposes of this Chapter;

present in the State”, in relation to an individual, means the personal presence of the individual in the State;

tax” means any tax payable in accordance with any provision of the Acts.

Residence.

150. —(1) For the purposes of the Acts, an individual is resident in the State for a year of assessment if the individual is present in the State—

(a) at any one time or several times in the year of assessment for a period in the whole amounting to 183 days or more, or

(b) at any one time or several times—

(i) in the year of assessment, and

(ii) in the preceding year of assessment,

for a period (being a period comprising in the aggregate the number of days on which the individual is present in the State in the year of assessment and the number of days on which the individual was present in the State in the preceding year of assessment) in the whole amounting to 280 days or more:

Provided that, notwithstanding paragraph (b), where for a year of assessment an individual is present in the State at any one time or several times for a period in the whole amounting to not more than 30 days—

(a) the individual shall not be resident in the State for the year of assessment, and

(b) no account shall be taken of the period for the purposes of the aggregate mentioned in paragraph (b).

(2) (a) Notwithstanding subsection (1), an individual—

(i) who is not resident in the State for a year of assessment, and

(ii) to whom paragraph (b) applies,

may, at any time, elect to be treated as resident in the State for that year and, where an individual so elects, the individual shall, for the purposes of the Acts, be deemed to be resident in the State for that year.

(b) This paragraph applies to an individual who satisfies an authorised officer that the individual is in the State—

(i) with the intention, and

(ii) in such circumstances,

that the individual will be resident in the State for the following year of assessment.

(3) For the purposes of this section, an individual shall be deemed to be present in the State for a day if the individual is present in the State at the end of the day.

Ordinary residence.

151. —(1) For the purposes of the Acts, an individual is ordinarily resident in the State for a year of assessment if the individual has been resident in the State for each of the 3 years of assessment preceding that year.

(2) An individual who is ordinarily resident in the State shall not, for the purposes of the Acts, cease to be ordinarily resident in the State for a year of assessment unless the individual has not been resident in the State in each of the 3 years of assessment preceding that year.

Application of Part III (Schedule C) and section 52 (Schedule D) of Income Tax Act, 1967.

152. —(1) Where an individual is not resident but is ordinarily resident in the State, Part III and section 52 of the Income Tax Act, 1967 , shall apply and have effect as if the individual were resident in the State:

Provided that this section shall not apply in respect of the income of an individual derived from one or more of the following, that is to say, a trade or profession, no part of which is carried on in the State or an office or employment all the duties of which are performed outside the State.

(2) In determining for the purposes of subsection (1) whether the duties of an office or employment are performed outside the State, any duties performed in the State, the performance of which is merely incidental to the performance of the duties of the office or employment outside the State, shall be treated for the purposes of this section as having been performed outside the State.

Split year residence.

153. —(1) For the purposes of a charge to tax on any income, profits or gains from an employment, where, during a year of assessment (“the relevant year”)—

(a) (i) an individual who has not been resident in the State for the preceding year of assessment, satisfies an authorised officer that the individual is in the State—

(I) with the intention, and

(II) in such circumstances,

that the individual will be resident in the State for the following year of assessment, or

(ii) an individual who is resident in the State, satisfies an authorised officer that the individual is leaving the State, other than for a temporary purpose,

(I) with the intention, and

(II) in such circumstances,

that the individual will not be resident in the State for the following year of assessment,

and

(b) the individual would, but for the provisions of this section, be resident in the State for the relevant year,

subsection (2) shall apply in relation to the individual.

(2) (a) An individual to whom paragraphs (a) (i) and (b) of subsection (1) apply, shall be deemed to be resident in the State for the relevant year only from the date of his or her arrival in the State.

(b) An individual to whom paragraphs (a) (ii) and (b) of subsection (1) apply, shall be deemed to be resident in the State for the relevant year only up to and including the date of his or her leaving the State.

(3) Where, by virtue of this section, an individual is resident in the State for part of a year of assessment, all the provisions of the Acts shall apply as if—

(a) income arising during that part of the year or, in a case to which the provisions of section 76 (3) of the Income Tax Act, 1967 , apply, amounts received in the State during that part of the year, were income arising or amounts received for a year of assessment in which the individual is resident in the State, and

(b) income arising or, as the case may be, amounts received in the remaining part of the year, were income arising or amounts received in a year of assessment in which the individual is not resident in the State.

Deduction for income earned outside the State.

154. —(1) Where for any year of assessment an individual who is resident in the State makes a claim in that behalf to and satisfies an authorised officer that—

(a) the duties of an office or employment to which this section applies of the individual are performed wholly or partly outside the State, and

(b) either—

(i) the number of days in that year which are qualifying days in relation to the office or employment (together with any days which are qualifying days in relation to any other such office or employment of the individual), or

(ii) the number of such days as aforesaid in a relevant period in relation to that year,

amounts to at least 90 days,

there shall be deducted from the income, profits or gains from the office or employment to be assessed under Schedule D or Schedule E, as may be appropriate, an amount equal to the specified amount.

(2) In this section—

a qualifying day”, in relation to an office or employment of an individual, is a day which is—

(a) one of at least 14 consecutive days on which the individual is absent from the State for the purposes of the performance of the duties of that 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 as aforesaid, and

(b) one of which the individual concerned is absent from the State at the end of the day:

Provided that no day shall be counted more than once as a qualifying day;

relevant period”, in relation to a year of assessment, means a continuous period of 12 months—

(a) part only of which is comprised in that year of assessment, and

(b) no part of which is comprised in another relevant period;

the specified amount” is an amount determined by the formula—

(D—N) × E

___________

365

where—

D is the number of qualifying days in the year of assessment concerned,

E is all the income, profits or gains from offices or employments to which this section applies (including income from offices or employments, the duties of which are performed in the State) of an individual in that year, and

N is—

(a) if subsection (1) (b) (i) applies, 15, or

(b) if subsection (1) (b) (ii) applies, a number which bears the same proportion to 15 as the number of qualifying days in the part of the relevant period comprised in the year of assessment bears to the number of qualifying days in that relevant period.

(3) This section applies to—

(a) an office of director of a company which is within the charge to corporation tax or would be within the charge to corporation tax if it were resident in the State and which carries on a trade or profession,

(b) an employment other than—

(i) an employment the emoluments of which are paid out of the revenue of the State, or

(ii) an employment with any board, authority or other similar body established by or under statute:

Provided that this section shall not apply in any case where the income from an office or employment—

(a) is chargeable to tax in accordance with the provisions of section 76 (3) of the Income Tax Act, 1967 , or

(b) (i) is subject to the provisions of Part III of Schedule 6 to the Income Tax Act, 1967 , or

(ii) would be so subject, if the employment were deemed to be property situated where the employment is exercised, or

(c) is income to which section 153 applies.

(4) Nothwithstanding anything contained in the Acts, the income, profits or gains from an office or employment shall, for the purposes of this section, be deemed not to include any amounts paid in respect of expenses incurred wholly, exclusively and necessarily in the performance of the duties of the office or employment.

Non-residents.

155. Section 153 of the Income Tax Act, 1967 , is hereby amended—

(a) in subsection (2) by the substitution of the following paragraph for paragraph (c):

“(c) that he is a citizen, subject or national of another Member State of the European Union or of a country of which the citizens, subjects or nationals are for the time being exempted by an order under section 10 of the Aliens Act, 1935 , from any provision of, or of an aliens order under, that Act, or”,

and

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

“(3) Notwithstanding subsection (2), where an individual who is not resident in the State proves to the satisfaction of the Revenue Commissioners that the individual is a resident of another Member State of the European Union and that the proportion which the portion of the individual's income which is subject to Irish tax bears to the individual's total income from all sources (including income which is not subject to Irish tax) is three-fourths or greater, subsection (1) or, as the case may be, subsection (2) shall not apply to that individual and he or she shall be entitled to the allowance, deduction or other benefit mentioned in subsection (1).”.

Appeals.

156. —(1) An individual who is aggrieved by the decision of an authorised officer on any question arising under those provisions of this Chapter which require an individual to satisfy an authorised officer on such a question may, by notice in writing to that effect given to the authorised officer within two months from the date on which notice of the decision is given to the individual, make an application to have the question heard and determined by the Appeal Commissioners.

(2) Where an application is made under subsection (1), the Appeal Commissioners shall hear and determine the question concerned in like manner as an appeal made to them against an assessment and all the provisions of the Acts relating to such an appeal (including the provisions relating to the rehearing of an appeal and to the statement of a case for the opinion of the High Court on a point of law) shall apply accordingly with any necessary modifications.

Repeals.

157. —(1) Sections 76 (4), 199 and 206 of the Income Tax Act, 1967 , and section 4 of the Finance Act, 1987 , are hereby repealed.

(2) Where the Revenue Commissioners are satisfied that the repeal of section 76 (4) of the Income Tax Act, 1967 , would give rise to hardship in the case of income derived in the manner mentioned in the said section 76 (4), they may, for the year 1994-95 and for that year of assessment only, grant such relief as in their opinion is just.

Commencement ( Chapter I ).

158. —(1) Subject to subsection (2), this Chapter shall apply as respects the year 1994-95 and subsequent years of assessment.

(2) Where in any case an individual—

(a) was resident in the State for the year of assessment 1991-92 but not resident in the State for the years of assessment 1992-93 and 1993-94, or

(b) was resident in the State for the year of assessment 1992-93 but not resident in the State for the year of assessment 1993-94, or

(c) was resident in the State for the year of assessment 1993-94 and would not, but for section 150 , be resident in the State in the year of assessment 1994-95, or

(d) left the State in the years of assessment 1992-93 or 1993-94 for the purpose of commencing a period of ordinary residence outside the State and did not recommence ordinary residence in the State prior to the end of the year of assessment 1993-94,

section 150 and section 157 , in so far as it relates to the repeal of section 4 of the Finance Act, 1987 , shall apply as respects the year 1995-96 and subsequent years of assessment in that case.