Chapter VI

Income Tax, Sur-Tax, Corporation Profits Tax, Corporation Tax and Capital Gains Tax

24. — Sections 31 and 37 of the Finance Act, 1973 , are hereby amended—

(a) by the substitution of “to which this section applies” for—

(i) “set forth in the Second Schedule” in the said section 31, and

(ii) “set forth in the Second Schedule to this Act” in the said section 37;

(b) by the substitution of “1976” for “1975”; and

(c) by the addition thereto of the following subsection—

“(2) This section applies to the Agreement, set forth in the Second Schedule, as extended by the Agreement set forth in the Schedule to the Double Taxation Relief (Taxes on Income) (United Kingdom) Order, 1975.”,

and the said sections 31 and 37, as so amended, are set out in the Table to this section.

TABLE

31.—(1) Subject to the provisions of sections 76 and 77 of the Income Tax Act, 1967 , as modified by Part III of Schedule 6 to that Act, where income tax is chargeable under Case III of Schedule D in respect of income which is a dividend, within the meaning of Article 1 of the Agreement to which this section applies being a dividend paid on or after the 6th day of April, 1973, and not later than the 5th day of April, 1976, the income so chargeable to income tax shall include the amount of the tax credit for the payment of which provision is made in the said Article 1.

(2) This section applies to the Agreement, set forth in the Second Schedule, as extended by the Agreement set forth in the Schedule to the Double Taxation Relief (Taxes on Income) (United Kingdom) Order, 1975.

37.—(1) Where profits chargeable to corporation profits tax under section 52 of the Finance Act, 1920, include a dividend, within the meaning of Article 1 of the Agreement to which this section applies, being a dividend paid on or after the 6th day of April, 1973, and not later than the 5th day of April, 1976, the profits so chargeable shall include the amount of any tax credit appropriate to the dividend for the payment of which provision is made in the said Article 1.

(2) This section applies to the Agreement, set forth in the Second Schedule, as extended by the Agreement set forth in the Schedule to the Double Taxation Relief (Taxes on Income) (United Kingdom) Order, 1975.

25. —Payments by the Minister for Labour under the Employment Premium Act, 1975 , whether made before or after the commencement of this Part, shall be disregarded for all the purposes of the Tax Acts and the enactments relating to corporation profits tax.

26. —(1) The Finance Act, 1975 , is hereby amended—

(a) in section 31—

(i) by the substitution in subsection (1) in the definition of “accounting period” of “1976” for “1975”,

(ii) by the insertion in subsection (1) after the definition of “company” of:

“‘period of account’ has the meaning assigned to it by paragraph 6 (1) of the Third Schedule;” and

(iii) by the addition thereto of the following subsections:

“(7) (a) Where a company has acquired or disposed of trading stock otherwise than in the normal conduct of the trade in question, the company shall be treated, for the purposes of this section and the Third Schedule, as having, at the beginning or end of the relevant period of account, trading stock of such value as appears to the inspector (or, on appeal, to the Appeal Commissioners) to be reasonable and just having regard to all the circumstances of the case.

(b) Where the value of a company's trading stock at the beginning of a period of account is not calculated on the basis used for the calculation of the value of the trading stock at the end of that period, the value of the trading stock at the beginning of that period shall, for the purposes of this section and the Third Schedule, be treated as being what it would have been if it had been calculated on that basis.

(8) In any case where a company is entitled by virtue of this section to a deduction which has effect for an accounting period which ends on a date in the period from the 6th day of April, 1975, to the 5th day of April, 1976, the value of its trading stock at the beginning of the period of account immediately following the period of account the end of which coincides with the end of that accounting period or which is current at the end of that accounting period shall, for all the purposes of the Income Tax Acts and of the enactments relating to corporation profits tax, other than this section, be treated as reduced by the amount of the said deduction.”;

(b) by the insertion after the said section 31 of the following section:

“31A—(1) In this section—

‘accounting period’, in relation to a company, means an accounting period determined in accordance with the provisions of section 9 of the Corporation Tax Act, 1976 , which ends on a date in the period from the 6th day of April, 1975, to the 5th day of April, 1976;

‘trade’ means a trade which is carried on in the State and which during an accounting period consists wholly or mainly of any of the following classes of trading operations—

(a) the manufacture of goods,

(b) the carrying out of construction operations within the meaning of section 17 of the Finance Act, 1970 ,

(c) farming, or

(d) the sale of machinery or plant (excluding vehicles suitable for the conveyance by road of persons) or goods to a person engaged in a trade consisting wholly or mainly of trading operations of a class specified in paragraph (a), (b) or (c) for use for the purposes of that trade;

‘trading income’, in relation to any trade, means the income from the trade computed in accordance with the rules applicable to Case I of Schedule D before any set-off or reduction of income by virtue of section 16 or 18 of the Corporation Tax Act, 1976 , and before any deduction or addition by virtue of section 14 of that Act;

‘trading stock’, in relation to any trade, has the same meaning as in section 62 of the Income Tax Act, 1967 , and in determining the value of a company's trading stock at any time for the purposes of a deduction under this section, to the extent that, at or before that time, any payments on account have been received by the company in respect of any trading stock, the value of that stock shall be reduced accordingly.

(2) Subject to the following provisions of this section, if—

(a) a company which is resident in the State carries on in an accounting period a trade in respect of which it is within the charge to corporation tax under Case I of Schedule D, and

(b) the value of the company's trading stock at the end of the accounting period (in this section referred to as its ‘closing stock value’) exceeds the value of its trading stock at the beginning of the accounting period (in this section referred to as its ‘opening stock value’),

the company shall, in the computation for the purposes of corporation tax of its trading income, be entitled to a deduction under this section by reference to the amount of that excess as if the deduction were a trading expense incurred in the accounting period; and in the following provisions of this section the amount of that excess is referred to as the company's ‘increase in stock value’.

(3) The Fifth Schedule shall have effect for the purpose of supplementing this section.

(4) (a) In any case where a company is entitled to a deduction under this section, that deduction shall be an amount equal to its increase in stock value in an accounting period less 20 per cent. of its trading income for that period:

Provided that—

(i) in no case shall the amount of the deduction as so computed exceed the amount of the company's trading income for that period, and

(ii) the company's trading income to be taken into account in computing a deduction shall be that income before any deduction is made under this section or the Fifth Schedule.

(b) There shall be made such reductions of assessments or repayments of tax as may in any case be required in order to give effect to this section.

(5) A company shall not be entitled to a deduction by virtue of this section in computing its trading income for an accounting period unless it makes a claim for the deduction before—

(a) the date on which the assessment for the accounting period becomes final and conclusive, or

(b) the expiry of the period of six months beginning with the date of the passing of the Finance Act, 1976,

whichever is the later.

(6) (a) Where a company has acquired or disposed of trading stock otherwise than in the normal conduct of the trade in question, the company shall be treated, for the purposes of this section and the Fifth Schedule, as having, at the beginning or end of the relevant period of account, trading stock of such value as appears to the inspector (or, on appeal, to the Appeal Commissioners) to be reasonable and just having regard to all the circumstances of the case.

(b) Where the value of a company's trading stock at the beginning of a period of account is not calculated on the basis used for the calculation of the value of the trading stock at the end of that period, the value of the trading stock at the beginning of that period shall, for the purposes of this section and the Fifth Schedule, be treated as what it would have been if it had been calculated on that basis.

(7) Where a company is entitled by virtue of this section to a deduction for any accounting period the value of its trading stock at the beginning of the period of account immediately following the period of account the end of which coincides with the end of that accounting period or which is current at the end of that accounting period shall for all the purposes of the Tax Acts, other than this section, be treated as reduced by the amount of the said deduction.” and

(c) by the insertion of the following Schedule:

“FIFTH SCHEDULE

INCREASE IN STOCK VALUES: SUPPLEMENTARY PROVISIONS

1. (1) In any case where a company's accounting period does not coincide with a period of account or with two or more consecutive periods of account the company's increase in stock value in the accounting period shall be determined for the purposes of section 31A not in accordance with subsection (2) of that section but by reference to a period (in this Schedule referred to as the reference period) determined in accordance with this paragraph.

(2) In any case where the beginning of a company's accounting period does not coincide with the beginning of a period of account, the reference period shall begin at the beginning of the period of account which is current at the beginning of the company's accounting period.

(3) In any case where the end of a company's accounting period does not coincide with the end of a period of account, the reference period shall end at the end of the period of account which is current at the end of the company's accounting period.

(4) In any case where subparagraph (2) does not apply, the reference period shall begin at the beginning of the company's accounting period and, in any case where subparagraph (3) does not apply, the reference period shall end at the end of the company's accounting period.

2. (1) In any case where paragraph 1 (1) applies, a company's increase in stock value in the accounting period shall be determined for the purposes of section 31A by the formula

where—

A is the number of months in the company's accounting period;

C is the value of the company's trading stock at the end of the reference period;

O is the value of the company's trading stock at the beginning of the reference period; and

N is the number of months in the reference period.

(2) In any case where a company's increase in stock value in an accounting period falls to be determined in accordance with subparagraph (1), then, in section 31A and in the following provisions of this Schedule, any reference to the company's closing stock value shall be construed as a reference to the value of the company's trading stock at the end of the reference period.

3. (1) The provisions of this paragraph shall have effect for the purposes of section 31A and the preceding provisions of this Schedule in any case where—

(a) there are two companies one of which is engaged in a trade consisting wholly or mainly of the manufacture of goods (in this paragraph referred to as the transferor company) and the other of which (in this paragraph referred to as the transferee company) acquires those goods as trading stock; and

(b) the acquisition occurs during an accounting period of the transferee company or, if paragraph 1 (1) applies in relation to that company, during a reference period; and

(c) the acquisition referred to in paragraph (a) results in a reduction in the trading stock held by the transferor company and a corresponding increase in the trading stock held by the transferee company; and

(d) the business of the transferee company consists wholly or mainly of the sale of goods manufactured by the transferor company; and

(e) the transferee company is not entitled to a deduction under section 31A otherwise than by virtue of this paragraph.

(2) If a claim for relief under section 31A is made by the transferor company, then that company and the transferee company, if it has the same accounting period as the transferor company, shall be treated as one company for the purpose of determining the aggregate amount of the deductions to which they are entitled under section 31A:

Provided that if paragraph 1 (1) applies in relation to the transferor company, the transferee company shall not be treated as falling within this subparagraph unless paragraph 1 (1) also applies in relation to the transferee company and both the transferee company and the transferor company have the same reference period.

(3) For the purpose specified in subparagraph (2), any reference in section 31A or in the preceding provisions of this Schedule to the value of a company's trading stock at any time or to its trading income for any period shall be construed as a reference to the aggregate of the values of trading stocks at that time or, as the case may be, the aggregate of the trading incomes for that period, of the companies which, for that purpose, are treated as one by virtue of that subparagraph.

(4) Where the aggregate amount of the deductions to which the transferor company and the transferee company are entitled under section 31A has been determined in accordance with subparagraphs (2) and (3), that amount shall be apportioned between them so that the deduction to which one of them is so entitled bears to the deduction to which the other is so entitled the same proportion as the closing stock value of that one of them bears to the closing stock value of the other.

(5) The provisions of this paragraph shall apply only where one of the two companies referred to in subparagraph (1) (a) holds throughout the relevant accounting period or reference period either in its own name or in that of a nominee all of the ordinary shares in the other company referred to in the said subparagraph or where some other company holds throughout the relevant accounting period or reference period either in its own name or in that of a nominee all of the ordinary shares in each of the two companies referred to in the said subparagraph.

(6) For the purposes of computing the aggregate amount of the deductions to which the transferor company and the transferee company treated as one by virtue of subparagraph (2) are entitled under section 31A pursuant to this paragraph and the apportionment of that amount between them, the transferee company shall be regarded as carrying on a trade.

4. (1) A company shall not be entitled to a deduction under section 31A for an accounting period if that accounting period ends by virtue of the company—

(a) ceasing to carry on a trade; or

(b) ceasing to be resident in the State; or

(c) ceasing to be within the charge to corporation tax under Case I of Schedule D.

(2) In any case where a company's increase in stock value in an accounting period falls to be determined in accordance with paragraph 2 (1), subparagraph (1) shall have effect as if the reference therein to the company's accounting period were a reference to any of the accounting periods comprised in the company's reference period.

5. (1) Subject to the following provisions of this paragraph, where a company claims a deduction under section 31A and, immediately before the beginning of an accounting period, the company was not carrying on the trade to which the claim relates, then, unless—

(a) the company acquired the initial trading stock of that trade on a sale or transfer from another person on that person's ceasing to carry on that trade, and

(b) the stock so acquired is, or is included in, the company's trading stock as valued at the beginning of the accounting period,

the company shall be treated for the purposes of section 31A and the preceding provisions of this Schedule as having at the beginning of the accounting period trading stock of such value as appears to the inspector to be reasonable and just.

(2) In determining, for the purposes specified in subparagraph (1), the value of trading stock to be attributed to a company at the beginning of the accounting period, the inspector shall have regard to all the relevant circumstances of the case and, in particular—

(a) to movements during the company's accounting period in the costs of items of a kind comprised in the company's trading stock during that period; and

(b) to changes during that period in the volume of the trade in question carried on by the company.

(3) The Appeal Commissioners dealing with an appeal from the decision of an inspector on a claim in a case where, in accordance with subparagraph (1), the inspector has attributed to a company at the beginning of an accounting period trading stock of a particular value shall, in hearing and determining the appeal, in so far as it relates to the value of the trading stock to be so attributed, determine such value as appears to them to be reasonable and just, having regard to those factors to which the inspector is required to have regard by virtue of subparagraph (2).

(4) In any case where paragraph 1 (1) applies to a company's accounting period, for any reference in subparagraphs (1) to (3) to that accounting period there shall be substituted a reference to the reference period.

6. (1) In this Schedule ‘trade’, ‘trading income’, and ‘trading stock’ have the same meanings, respectively, as in section 31A.

(2) In any case where a company's accounting period or reference period consists of a number of complete months and a fraction of a month, any reference in the preceding provisions of this Schedule to the number of months in the period shall be construed as including that fraction of a month (and in any case where any such period is less than one month any such reference shall be construed as a reference to that fraction of a month of which the period consists).”,

and the said definition of “accounting period”, as so amended by subsection (1) (a) (i), is set out in the Table to this subsection.

TABLE

“accounting period”, in relation to a company, means an accounting period determined in accordance with the provisions of section 54 of the Finance Act, 1920, which ends on a date in the period from the 6th day of April, 1973, to the 5th day of April, 1976.

(2) A company shall not be entitled to a deduction by virtue of subsection (1) (a) in respect of an assessment unless it makes a claim before—

(a) the date on which the assessment becomes final and conclusive,

or

(b) the expiry of the period of six months beginning with the date of the passing of this Act,

whichever is the later.

27. — Section 54 of the Corporation Tax Act, 1976 , is hereby amended by the addition of the following subsection:

“(4) (a) ‘Goods’ in this section shall not include goods sold to the agency whether or not the goods are exported out of the State.

(b) ‘The agency’ in paragraph (a) means the Minister for Agriculture and Fisheries when exercising or performing any power or function conferred on him by Regulation 3 of the European Communities (Common Agricultural Policy) (Market Intervention) Regulations, 1973 , and any other person when exercising or performing any corresponding power or function in any member state of the European Economic Community.”.

28. —(1) In this section—

“approved bank” means any bank approved of for the purposes of this section by the Minister for Finance;

“housing loan” means a loan granted on or after the 1st day of July, 1975, by an approved bank, or a subsidiary thereof, to an individual resident in the State for the sole purpose of the purchase by that individual of a dwelling-house in the State for occupation by him as his only or main residence;

“the approved rate” means the rate of interest approved from time to time by the Minister for Finance for the purposes of this section;

“subsidiary”, in relation to an approved bank, means a company (within the meaning of the Companies Act, 1963 ) which is, or if every such bank were a company (within the meaning aforesaid) would be, a subsidiary (within the meaning of the said Companies Act, 1963 ) of any such bank.

(2) This section applies to interest on housing loans received on or after the 1st day of July, 1975, by an approved bank, or a subsidiary thereof, being interest which has been charged at the approved rate.

(3) Section 52 of the Finance Act, 1920, shall not apply to interest to which this section applies.

(4) Section 79 (3) of the Corporation Tax Act, 1976 , is hereby amended by the insertion, after paragraph (c), of the following paragraph:

“(cc) interest to which section 28 of the Finance Act, 1976, applies, and, for this purpose, that interest shall, without any deduction therefrom, be regarded as part of the income of the company for the relevant accounting period.”.

29. —Interest payable under section 18 of the Wealth Tax Act, 1975 , or section 41 of the Capital Acquisitions Tax Act, 1976 , shall not be allowed in computing any income, profits or losses for any of the purposes of the Tax Acts or of any of the enactments relating to corporation profits tax.

30. —(1) In this section—

“assessment to tax” means an assessment to tax made on or after the passing of this Act;

“determination of the appeal” has the same meaning as in section 550 (2A) (c) of the Income Tax Act, 1967 ;

“the specified amount of tax” means, in a case where notice of appeal against an assessment to tax has been given—

(a) the amount of tax specified in the notice in accordance with the provisions of subsection (2), or

(b) where no amount of tax is so specified, or where the amount of tax specified exceeds the tax assessed, the tax assessed;

“tax” means income tax, sur-tax, corporation profits tax, corporation tax or capital gains tax, as may be appropriate;

“the tax assessed” means the amount of tax charged by the assessment or, in a case where the tax is payable in two instalments, the amount of each instalment.

(2) Whenever an appeal is made against an assessment to tax, the appellant shall, in the notice of appeal, specify—

(a) the grounds of the appeal, and

(b) the amount of tax in the assessment or, where the tax is payable in two instalments, the amount of each instalment, which, in his opinion, is likely to become payable on or after the determination of the appeal,

but this subsection shall not preclude the Appeal Commissioners from allowing the appellant, on the hearing of the appeal, to go into any ground of appeal which was not specified in the notice of appeal and the omission of which from such notice was, in the opinion of the Appeal Commissioners, not wilful or unreasonable.

(3) In any case where notice of appeal has been given against an assessment to tax—

(a) the specified amount of tax shall, notwithstanding the appeal, be collected, paid and carry interest in all respects as if it were tax charged by an assessment in respect of which no appeal was pending and section 550 (other than subsection (2A)) of the Income Tax Act, 1967 , shall apply accordingly, and

(b) on the determination of the appeal, any balance of tax chargeable in accordance with the determination shall be payable, or any tax overpaid shall be repaid.

(4) Where an overpayment of tax is to be repaid under subsection (3), the overpayment shall carry interest at the rate or rates in force by virtue of section 550 (1) of the Income Tax Act, 1967 , for the period from the date or dates of the payment of the amount or amounts giving rise to the overpayment, as the case may require, to the date on which the repayment is made:

Provided that—

(a) interest shall not be payable under this subsection if it amounts to less than £1, and

(b) income tax shall not be deductible on payment of interest under this subsection and such interest shall not be reckoned in computing income for the purposes of the Tax Acts.

(5) Where the specified amount of tax is paid not later than two months from the date on which it becomes due and payable and that amount is not less than the lesser of the two following amounts—

(a) the tax assessed, and

(b) 80 per cent. of the amount of tax found to be chargeable by the assessment on the determination of the appeal,

interest shall not be payable on any balance of tax if such balance is paid within two months from the date of the determination:

Provided that in a case where the tax found to be chargeable by the assessment is payable in two instalments, this subsection shall apply in relation to each specified amount of tax as if the reference to the amount of tax found to be chargeable by the assessment on the determination of the appeal, were a reference to the amount of the said tax which is payable in the relevant instalment.

(6) Where—

(a) the amount of tax referred to in subsection (5) (b) falls to be computed and the income in respect of which the tax is chargeable consists of or includes income from any source or sources which is to be computed on the basis of the actual amounts receivable in the year of assessment, or where any deductions allowable on account of any annual sums paid out of profits or gains of a person are to be allowed as deductions in respect of the year in which they are payable, and

(b) the appeal is made before the end of the year of assessment to which the assessment relates,

the said amount shall, if the person assessed so elects at the time of determination of the appeal, be computed as if—

(i) the amount of the income from each of the said sources were equivalent to the amount of the income received from that source in the year immediately preceding the year of assessment, and

(ii) the amount of deductions so allowable were an amount equivalent to the amount of those deductions in the year immediately preceding the year of assessment.

(7) Section 416 (1) of the Income Tax Act, 1967 , shall have effect as if for “twenty-one days” there were substituted “thirty days”.

(8) Sections 417 and 419 of the Income Tax Act, 1967 , shall not apply to any assessment to tax.

31. —(1) Sections 25 to 29 of the Finance Act, 1973 , shall have effect, in relation to expenditure incurred on the provision or hiring of a vehicle to which those sections apply, as if for “£2,500”, in each place where it occurs in those sections, there were substituted “£3,500”.

(2) The reference in subsection (1) to expenditure incurred on the provision or hiring of a vehicle does not include—

(a) as respects the said sections 25 to 27, a reference to expenditure incurred on or before the 28th day of January, 1976, or incurred within twelve months after that day under a contract entered into before that day, and

(b) as respects subsections (2) and (3) of the said section 28 and the said section 29, a reference to expenditure under a contract entered into on or before the said 28th day of January, 1976.

32. —(1) In this section—

“qualifying expenditure” means the amount of expenditure incurred in relation to a vehicle (within the meaning of section 30 of the Finance Act, 1973 ), being expenditure which, but for the provisions of this section—

(a) would be allowable as a deduction—

(i) in the computation of the profits or gains chargeable to tax under Schedule D of the trade, profession or business in the course of which the vehicle is used, or

(ii) in the computation of the profits or gains chargeable to tax under Schedule E from an office or employment in the performance of the duties of which the vehicle is used,

or

(b) would be taken into account for the purposes of a claim in respect of expenses of management under section 15 of the Corporation Tax Act, 1976 , or that section as applied by section 33 of that Act;

“relevant cost”, in relation to a vehicle provided for the purposes of a trade, profession, business, office or employment, means—

(a) in a case where the vehicle is purchased by the person providing it, the actual cost to that person of providing the vehicle, or

(b) in a case where the vehicle is not purchased by the person providing it, the retail price of the vehicle at the time it was first provided for use by that person.

(2) Where, for any year of assessment or accounting period, a deduction is claimed by any person in respect of qualifying expenditure and that expenditure is incurred—

(a) in respect of a vehicle the relevant cost of which exceeds £3,500, and

(b) in respect of a period subsequent to the 28th day of January, 1976,

the amount of the deduction to be allowed in respect of that qualifying expenditure shall be reduced—

(i) by one-third of the amount by which the relevant cost of the vehicle exceeds £3,500, or

(ii) where that person so elects, by an amount which bears to the amount of the qualifying expenditure the same proportion as the excess of the relevant cost of the vehicle over £3,500 bears to the relevant cost of the vehicle:

Provided that, in a case where paragraph (i) applies and the period in respect of which the qualifying expenditure is incurred is part only of a year, the amount by which the deduction is to be reduced for that period by virtue of the said paragraph (i), shall be reduced in the proportion which that part of the year bears to a year.

33. —(1) In this section—

“society” means a society registered under the Industrial and Provident Societies Acts, 1893 to 1971, which is an agricultural society or a fishery society within the meaning of section 220 of the Income Tax Act, 1967 ;

“period of account” has the meaning assigned to it by section 155 (5) of the Corporation Tax Act, 1976 ;

“wear and tear allowance” means an allowance under section 241 of the Income Tax Act, 1967 ;

“initial allowance” means an allowance under Chapter I, Part XV of the Income Tax Act, 1967 ;

“investment allowance” means an allowance under section 22 of the Finance Act, 1971 .

(2) In the case of a trade carried on by a society no transaction on or after the 6th day of April, 1976, shall be regarded as an exempted transaction for the purposes of section 220 of the Income Tax Act, 1967 .

(3) Where a society comes within the charge to corporation tax in respect of a trade before the 6th day of April, 1976, an accounting period of the society shall end for purposes of corporation tax on the 5th day of April, 1976.

(4) Where a society carrying on a trade incurred before the 6th day of April, 1976, capital expenditure on the provision of machinery or plant for the purposes of the trade and that expenditure was either—

(a) qualifying expenditure within the meaning of section 11 of the Finance Act, 1967, or

(b) expenditure on qualifying machinery or plant within the meaning of section 26 of the Finance Act, 1971 ,

an allowance equal to the specified amount of that capital expenditure may at the election of the society be made in taxing the trade of the society for the accounting period which commences on the 6th day of April, 1976, as if it were an allowance on account of the wear and tear of the machinery or plant in that accounting period, and where such an election is made, the amount of the capital expenditure on the provision of the machinery or plant still unallowed as at the time of any subsequent event shall for the purposes of Chapter II of Part XVI of the Income Tax Act, 1967 , be deemed to be nil.

(5) For the purposes of subsection (4) the specified amount of the capital expenditure means the amount of that capital expenditure together with any investment allowance in respect of that expenditure after deducting from the aggregate amount thereof—

(a) the amount, as diminished by section 220 (5) of the Income Tax Act, 1967 , of any investment allowance made to the society in respect of that expenditure;

(b) the aggregate amount, as diminished by the said section 220 (5), of the wear and tear allowances and initial allowances, made to the society in respect of that expenditure for all chargeable periods before the accounting period commencing on the 6th day of April, 1976;

(c) the aggregate of the amounts by which the wear and tear allowances in respect of that expenditure would have been diminished by the said section 220 (5) if the only wear and tear allowances for those chargeable periods in respect of that expenditure were the amounts which would have been made if a proper claim had been duly made by the society for each chargeable period without regard to section 11 of the Finance Act, 1967, or section 26 of the Finance Act, 1971 .

(6) Where—

(a) a society comes within the charge to corporation tax in respect of a trade,

(b) the society was within the charge to income tax for the year 1975-76 in respect of the trade, and

(c) a period of account of the society commences before the 6th day of April, 1976, and ends on or after that date,

the income from the trade for the period of account shall be computed (in accordance with the provisions applicable to Case I of Schedule D) without regard to the provisions of section 220 (3) of the Income Tax Act, 1967 , and the income as so computed shall be apportioned to the part of the period of account falling before the 6th day of April, 1976, and the part falling after that date, and for the purposes of subsections (3) and (4) of section 220 of the Income Tax Act, 1967 , and section 70 (5) of the Finance Act, 1963, each such part shall be deemed to be a period of account and the income from the trade for that part shall be the amount apportioned to it under the provisions of this section.

(7) Any apportionment to different periods under this section shall be made on a time basis according to the respective lengths of those periods.

34. —(1) In this section—

“an authorised officer” means an inspector or other officer of the Revenue Commissioners authorised by them to exercise the powers conferred by this section;

“trade” means any trade or business (other than banking business within the meaning of the Central Bank Act, 1971 ).

(2) An authorised officer may at all reasonable times enter any premises or place where any trade is carried on or anything is done in connection with the trade and—

(a) may require the owner or manager of the premises or place or any person on the premises or in that place who is employed by the person carrying on the trade to produce any books, records, accounts or other documents relating to the trade and may remove and retain any such books, records, accounts or other documents for such period as may be reasonable for their examination,

(b) may examine any such books, records, accounts or other documents and may take copies of or extracts from the books, records, accounts or other documents,

(c) may examine any property listed in any balance sheets, stock sheets or other such statements,

(d) may require the owner or manager of the premises or place or any person on the premises or in that place, who is employed by the person carrying on the trade, to give to the inspector or authorised officer all reasonable assistance.

(3) A person shall not wilfully obstruct or delay an authorised officer in the exercise of his powers under this section.

(4) A person who contravenes subsection (3) or does not comply with a requirement of an authorised officer under this section shall be liable to a penalty of £500.

(5) When exercising any powers conferred by this section, an authorised officer shall, if so requested by any person affected, produce to that person a certificate of the Revenue Commissioners stating that he is authorised to exercise the powers so conferred.