Chapter VI

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

36. —For the purposes of the Tax Acts and the Capital Gains Tax Act, 1975 , unless the contrary intention appears—

(a) references in any of those Acts to a child (including references to a son or a daughter) include references to—

(i) a stepchild, and

(ii) a child adopted—

(I) under the Adoption Acts, 1952 to 1976, or

(II) under an adoption law, other than the Adoption Acts, 1952 to 1976, being an adoption that has, in the place where the law applies, substantially the same effect as an adoption under the Adoption Acts, 1952 to 1976, has in the State,

and

(b) the relationship between a child referred to in paragraph (a) (ii) and any other person, or between other persons, that would exist if such child had been born to his adopter or adopters in lawful wedlock, shall be deemed to exist between such child and that other person, or between those other persons, and the relationship of any such child and any person that existed prior to his being so adopted shall be deemed to have ceased,

and “adopted child” shall be construed in accordance with this section.

37. —For the purpose of continuing, in respect of the period from the 1st day of April, 1977, to the 1st day of April, 1979, the capital allowances provided for by the sections specified in the Table to this section, the said sections (which were inserted by the Corporation Tax Act, 1976 ) shall have effect as if each reference therein to the 1st day of April, 1977, were a reference to the 1st day of April, 1979.

TABLE

Section 251 , Income Tax Act, 1967

Section 254 , Income Tax Act, 1967

Section 264 , Income Tax Act, 1967

Section 265 , Income Tax Act, 1967

Section 22 , Finance Act, 1971

Section 26 , Finance Act, 1971 .

38. — Section 8 (1) of the Finance Act, 1973 , is hereby amended by the substitution of “the 1st day of April, 1979” for “the 1st day of April, 1977” (inserted by the Finance Act, 1975 ), and the said section 8 (1), as so amended, is set out in the Table to this section.

TABLE

8.—(1) Section 246 of the Income Tax Act, 1967 , shall not apply to any expenditure incurred on or after the 24th day of July, 1973, and before the 1st day of April, 1979, on the purchase of a new ship.

39. —(1) (a) 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 a person is chargeable to income tax or corporation tax under Case III of Schedule D on income which is a dividend in respect of which the person is entitled to a tax credit under Article 11 (2) (b) of the Convention, the income so chargeable shall include the amount of the tax credit.

(b) In this subsection “dividend” means a dividend within the meaning of Article 11 (4) of the Convention paid on or after the 6th day of April, 1976.

(2) (a) Where—

(i) a person is, for the year of assessment 1976-77, chargeable to income tax under Case III of Schedule D in respect of income arising in the United Kingdom (hereinafter referred to as “the said income”), and

(ii) the tax chargeable for the said year of assessment is computed on the full amount of the said income arising within the year preceding the year of assessment, and

(iii) he is chargeable to United Kingdom income tax for that year of assessment in respect of the said income computed on the full amount of that income arising within that year,

relief shall, subject to the provisions of paragraph (b), be granted from income tax charged in the assessment for the year 1976-77 in respect of the said United Kingdom income tax.

(b) The relief granted under paragraph (a) shall be of the same amount, and subject to the same limitations, as if it were a credit allowable under arrangements having the force of law by virtue of section 361 of the Income Tax Act, 1967 , in respect of the United Kingdom income tax which would have been charged on the said income included in the assessment if that income had arisen in the year 1976-77:

Provided that the relief shall not exceed the amount of United Kingdom income tax referred to in paragraph (a) (iii).

(c) Paragraphs (a) and (b)—

(i) shall apply in relation to income tax on salaries, wages and other similar remuneration to which Article 15 of the Convention applies subject to the modification that references to 1976-77 shall be construed as references to 1977-78, and

(ii) shall not apply in relation to remuneration or pensions to which Article 18 of the Convention applies.

(3) For the purpose of giving effect to the Convention the Tax Acts shall, for any year for which the Convention is in force, have effect subject to the modifications set out in paragraph 1 of Part III of Schedule 6 to the Income Tax Act, 1967 .

(4) (a) In applying section 33 of the Corporation Tax Act, 1976 , in the case of a society registered under the enactments for the time being in force in the United Kingdom corresponding to the Friendly Societies Acts, 1896 to 1953, only expenses of management attributable to the life business referable to contracts of assurance made on or after the 6th day of April, 1976, shall be taken into account.

(b) In applying section 43 (3) of the Corporation Tax Act, 1976 , in the case of a society referred to in paragraph (a), there shall be excluded from the liabilities of which B in the said section 43 (3) is the average any liabilities to policy holders arising from contracts made before the 6th day of April, 1976:

Provided that this paragraph shall not affect the proportion by reference to which relief under section 33 of the Corporation Tax Act, 1976 , in respect of expenses of management is to be computed by virtue of section 47 (2) of the said Act.

(c) This subsection shall be construed as one with Part III of the Corporation Tax Act, 1976 .

(5) In this section and in section 54—

“the Convention” means the Convention between the Government of Ireland and the Government of the United Kingdom for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and capital gains, and the Protocol amending the Convention, both of which are set out in the Schedule to the Double Taxation Relief (Taxes on Income and Capital Gains) (United Kingdom) Order, 1976 (S.I. No. 319 of 1976);

“the former Agreements” mean the Agreements set out in—

(a) the Fifth Schedule to the Finance Act, 1949 ,

(b) Part I of Schedule 6 to the Income Tax Act, 1967 ,

(c) the Second Schedule to the Finance Act, 1973 , and

(d) the Double Taxation Relief (Taxes on Income) (United Kingdom) Order, 1975 (S.I. No. 143 of 1975),

and the Protocol set out in the Fourth Schedule to the Finance Act, 1973 .

40. —(1) Notwithstanding the proviso to section 31 (1) of the Corporation Tax Act, 1976 , any arrangements entered into by the Revenue Commissioners and any building society as respects the year of assessment 1975-76, in so far as they provide for payment of an amount representing income tax calculated in part at the standard rate and in part at a reduced rate, may, with any necessary modifications, be continued for the two years of assessment immediately following for the purpose of determining, in relation to that building society, the amount representing income tax which is referred to in paragraph (a) of the said section 31 (1), and that section shall have effect in relation to any arrangements so continued for the said two years.

(2) The reference to the standard rate in paragraph (i) of the proviso to subsection (3) of the said section 31 shall, in relation to the year 1976-77, be construed as a reference to the standard rate of tax increased by 10 per cent. of that rate.

41. —(1) Section 171 of the Corporation Tax Act, 1976 , is hereby amended by the insertion after “Tax Acts” of “(other than in sections 3, 8 and 151)”.

(2) This section shall have and be deemed to have had effect as on and from the 6th day of April, 1976.

42. —With effect for all relevant financial years from the beginning of the financial year 1974 onwards—

(a) the enactments specified in paragraphs 1, 2 and 5 of Part IV of the First Schedule are herby amended as specified in that Part, and

(b) the other enactments specified in that Part are hereby amended for corporation tax, as so specified,

and paragraph 50 of Part I of the Second Schedule to the Corporation Tax Act, 1976 , shall apply to the amendments so specified as it applies to the amendments referred to in that paragraph.

43. —The provisions of Part V of the First Schedule shall have effect for the purpose of amending sections 31 and 31A of and the Third and Fifth Schedules to the Finance Act, 1975 and section 12 of the Finance Act, 1976 .