FINANCE ACT, 1958 (1958_act_25) | IE

ISB Act 1958-07-29

Schedule 1 FINANCE ACT, 1958 Open official source

FIRST SCHEDULE. Retirement Annuities (Adjustments Of Limit On Qualifying Premiums).

Retirement Annuities (Adjustments Of Limit On Qualifying Premiums).

Section 41.

Part I. Holders of Pensionable Office or Employment.

Part I.

Holders of Pensionable Office or Employment.

1. Subject to the following paragraphs, in the case of an individual who is the holder of a pensionable office or employment, the proviso to subsection (1) of section 41 of this Act shall have effect with the substitution for the references to five hundred pounds of references to five hundred pounds less one-tenth of his pensionable emoluments for the year of assessment.

2. Where an individual is the holder of a pensionable office or employment during part only of the year of assessment, then—

(a) paragraph 1 of this Schedule shall not apply if the condition in paragraph (a) of subsection (1) of section 40 of this Act is not satisfied at any time during that part of the year; but

(b) if the condition is satisfied at such a time and is also satisfied at a time during the remainder of the year, paragraph 1 of this Schedule shall apply but for one-tenth there shall be substituted therein such less proportion as may be just.

3. For the purposes of this Part of this Schedule, an individual's pensionable emoluments for any year of assessment shall be taken to be the amount, estimated in accordance with the provisions applicable to Schedule E, of any income of his for the year (but not including in the case of a married man income of his wife), being either—

(a) income arising in respect of remuneration from any pensionable office or employment, or

(b) income from any property which is attached to or forms part of the emoluments of any pensionable office or employment.

Part II. Persons born in or before 1917.

Part II.

Persons born in or before 1917.

4. Subject to paragraph 5 of this Schedule, in the case of an individual born at a time specified in the first column of the Table set out below, the proviso to subsection (1) of section 41 of this Act and Part I of this Schedule shall have effect with the substitution for the references to five hundred pounds and to the fraction one-tenth of references respectively to such sum and to such percentage as are specified for his case in the second and third columns of the Table.

TABLE.

Year of birth.

Sum.

Percentage.

1916 or 1917

£550

11 per cent.

1914 or 1915

£600

12 per cent.

1912 or 1913

£650

13 per cent.

1910 or 1911

£700

14 per cent.

1909 or any earlier year

£750

15 per cent.

5. (1) This Part of this Schedule shall not apply in relation to any year of assessment in which the individual, in respect of his past services in any office or employment formerly held by him (not being one in which he served part-time only), either—

(a) receives any income in respect of a pension payable under or in pursuance of a sponsored superannuation scheme or otherwise purchased or provided for him by another person, or

(b) has a right under a sponsored superannuation scheme to a pension which is not presently payable, whether because it is suspended or because it is to become payable only at a future time or on the happening of some contingency (but not including a right dependant also on service in an office or employment for the time being held by him).

(2) In this paragraph, “pension” includes any superannuation or other allowance or deferred pay.

ISB Act 1958-07-29

Schedule 2 FINANCE ACT, 1958 Open official source

SECOND SCHEDULE. Provisions As To Relief From Income Tax (Including Sur-Tax) And Corporation Profits Tax By Way Of Credit In Respect Of Foreign Tax.

Provisions As To Relief From Income Tax (Including Sur-Tax) And Corporation Profits Tax By Way Of Credit In Respect Of Foreign Tax.

Section 44.

Interpretation.

1. (1) In this Schedule, except where the context otherwise requires—

“arrangements” means arrangements for the time being in force by virtue of section 44 of this Act or of section 12 of the Finance Act, 1950 (No. 18 of 1950), or of section 14 of the Finance Act, 1955 (No. 13 of 1955);

“income tax” includes sur-tax;

“income”, in relation to corporation profits tax, means profits;

“total income” means total income from all sources as estimated in accordance with the provisions of the Income Tax Acts;

“the Irish taxes” means income tax (including sur-tax) and corporation profits tax;

“foreign tax” means, in relation to any territory in regard to which arrangements have the force of law, any tax chargeable under the laws of that territory for which credit may be allowed under the arrangements.

(2) Any reference in this Schedule to foreign tax shall be construed, in relation to credit to be allowed under any arrangements, as a reference only to tax chargeable under the laws of the territory in regard to which the arrangements are made.

General.

2. (1) Subject to the provisions of this Schedule, where, under the arrangements, credit is to be allowed against any of the Irish taxes chargeable in respect of any income, the amount of the Irish taxes so chargeable shall be reduced by the amount of the credit.

(2) The credit to be allowed shall be first applied in reducing the amount of any corporation profits tax chargeable in respect of the income and, so far as it cannot be so applied, in reducing the income tax chargeable in respect thereof.

(3) Nothing in this paragraph authorises the allowance of credit against any Irish tax against which credit is not allowable under the arrangements.

Requirements as to incorporation and residence.

3. (1) Credit shall not be allowed against corporation profits tax unless the company in respect of whose income the corporation profits tax is chargeable is incorporated by or under the laws of the State.

(2) Credit shall not be allowed against income tax for any year of assessment unless the person in respect of whose income the tax is chargeable is resident in the State for that year.

Limit on total credit—corporation profits tax.

4. The amount of the credit to be allowed against corporation profits tax for foreign tax in respect of any income shall not exceed the corporation profits tax attributable to that income.

Limit on total credit—income tax.

5. (1) The amount of the credit to be allowed against income tax for foreign tax in respect of any income shall not exceed the sum which would be produced by computing the amount of that income in accordance with the Income Tax Acts, and then charging it to income tax for the year of assessment for which the credit is to be allowed, but at the following rate, that is to say—

(a) in the case of a person whose income is chargeable to income tax but not to sur-tax, a rate ascertained by dividing the income tax payable by that person for that year by the amount of the total income of that person for that year;

(b) in the case of a person whose income is chargeable to sur-tax, the sum of the following rates—

(i) the rate which would have been the appropriate rate in his case if his income had been chargeable to income tax but not to sur-tax, and

(ii) the rate ascertained by dividing the sur-tax payable by him for that year by the amount of his total income for that year

Provided that where, under the arrangements, credit is not to be allowed against sur-tax for the year, the rate shall be calculated in all cases as in the case of persons whose incomes are chargeable to income tax but not to sur-tax, and where, under the arrangements, credit is not to be allowed except against surtax for the year, the rate shall be that ascertained by dividing the sur-tax payable by the person in question for the year by the amount of his total income for the year.

(2) For the purpose of determining the said rate, the tax payable by any person for any year shall be computed without regard to any relief in respect of life assurance premiums and without any reduction thereof for any credit allowed or to be allowed under any arrangements having effect by virtue of section 44 of this Act, but shall be deemed to be reduced by any tax which, otherwise than under Rule 20 of the General Rules, the person in question is entitled to charge against any other person, and the total income of any person shall be deemed to be reduced by the amount of any income the income tax upon which that person is entitled to charge as aforesaid.

(3) Where credit for foreign tax falls to be allowed in respect of any income and any relief would, but for the provisions of this subparagraph, fall to be allowed in respect of that income under section 3 of the Finance Act, 1941 (No. 14 of 1941), the said relief shall not be allowed.

6. Without prejudice to the provisions of the last preceding paragraph, the total credit to be allowed to a person against income tax for any year of assessment shall not exceed the total income tax payable by the person in question for that year of assessment, less any tax which, otherwise than under Rule 20 of the General Rules, that person is entitled to charge against any other person.

Effect on computation of income of allowance of credit.

7. (1) Subject to the provisions of this paragraph, where credit for foreign tax falls to be allowed against any of the Irish taxes in respect of any income, no deduction for foreign tax (whether in respect of that or any other income) shall be made in computing the amount of that income for the purposes of corporation profits tax.

(2) Where the income includes a dividend and, under the arrangements, foreign tax not chargeable directly or by deduction in respect of the dividend is to be taken into account in considering whether any, and if so what, credit is to be allowed against the Irish taxes in respect of the dividend, the amount of the income shall for the purposes of corporation profits tax, be treated as increased by the amount of the foreign tax not so chargeable which falls to be taken into account in computing the amount of the credit.

(3) Notwithstanding anything in the preceding provisions of this paragraph, where part of the foreign tax in respect of the income (including any foreign tax which, under subparagraph (2) of this paragraph, falls to be treated as increasing the amount of the income) cannot be allowed as a credit against any of the Irish taxes, the amount of the income shall be treated for the purposes of corporation profits tax as reduced by that part of that foreign tax.

8. (1) Where credit for foreign tax falls to be allowed against any of the Irish taxes in respect of any income, the following provisions of this paragraph shall have effect as respects the computation, for the purposes of income tax, of the amount of that income.

(2) Where the income tax payable depends on the amount received in the State, the said amount shall be treated as increased by the amount of the credit allowable against income tax.

(3) Where the last preceding subparagraph does not apply—

(a) no deduction shall be made for foreign tax (whether in respect of the same or any other income), and

(b) where the income includes a dividend and under the arrangements foreign tax not chargeable directly or by deduction in respect of the dividend is to be taken into account in considering whether any, and if so what, credit is to be allowed against the Irish taxes in respect of the dividend, the amount of the income shall be treated as increased by the amount of the foreign tax not so chargeable which falls to be taken into account in computing the amount of the credit, but

(c) notwithstanding anything in the preceding provisions of this subparagraph, where any part of the foreign tax in respect of the income (including any foreign tax which, under clause (b) of this subparagraph, falls to be treated as increasing the amount of the income) either falls to be allowed as a credit against corporation profits tax, or cannot be allowed as a credit against any of the Irish taxes, the amount of the income shall be treated for the purposes of income tax as reduced by that part of that foreign tax.

(4) In relation to the computation of the total income of a person for the purpose of determining the rate mentioned in paragraph 5 of this Schedule, the preceding provisions of this paragraph shall have effect subject to the following modifications

(a) for the reference in subparagraph (2) to the amount of the credit allowable against income tax, there shall be substituted a reference to the amount of the foreign tax in respect of the income (in the case of a dividend foreign tax not chargeable directly or by deduction in respect of the dividend being left out of account), and

(b) clauses (b) and (c) of subparagraph (3) shall not apply,

and subject to those modifications shall have effect in relation to all income in the case of which credit falls to be allowed for foreign, tax under any arrangements.

Special provisions as to dividends.

9. Where, in the case of any dividend, foreign tax not chargeable directly or by deduction in respect of the dividend is, under the arrangements, to be taken into account in considering whether any, and if so what, credit is to be allowed against the Irish taxes in respect of the dividend, the foreign tax not so chargeable which is to be taken into account shall be that borne by the body corporate paying the dividend upon the relevant profits in so far as it is properly attributable to the proportion of the relevant profits which is represented by the dividend.

The relevant profits are

(a) if the dividend is paid for a specified period, the profits of that period;

(b) if the dividend is not paid for a specified period, but is paid out of specified profits, those profits;

(c) if the dividend is paid neither for a specified period nor out of specified profits, the profits of the last period for which accounts of the body corporate were made up which ended before the dividend became payable

Provided that if, in a case falling under subparagraph (a) or subparagraph (c) of this paragraph, the total dividend exceeds the profits available for distribution of the period mentioned in the said subparagraph (a) or the said subparagraph (c), as the case may be, the relevant profits shall be the profits of that period plus so much of the profits available for distribution of preceding periods (other than profits previously distributed or previously treated as relevant for the purposes of this paragraph) as is equal to the excess; and for the purposes of this proviso the profits of the most recent preceding period shall first be taken into account, then the profits of the next most recent preceding period, and so on.

10. Where—

(a) the arrangements provide, in relation to dividends of some classes, but not in relation to dividends of other classes, that foreign tax not chargeable directly or by deduction in respect of dividends is to be taken into account in considering whether any, and if so what, credit is to be allowed against the Irish taxes, in respect of the dividends, and

(b) a dividend is paid which is not of a class in relation to which the arrangements so provide,

then, if the dividend is paid to a company which controls, directly or indirectly, not less than one half of the voting power in the company paying the dividend, credit shall be allowed as if the dividend were a dividend of a class in relation to which the arrangements so provide.

Miscellaneous.

11. Credit shall not be allowed under the arrangements against the Irish taxes chargeable in respect of any income of any person if the person in question elects that credit shall not be allowed in respect of that income.

12. Where, under the arrangements, relief may be given either in the State or in the territory in regard to which the arrangements are made in respect of any income and it appears that the assessment to income tax or to corporation profits tax made in respect of the income is not made in respect of the full amount thereof or is incorrect having regard to the credit, if any, which falls to be given under the arrangements, any such additional assessments may be made as are necessary to ensure that the total amount of the income is assessed and the proper credit, if any, is given in respect thereof, and where the income is entrusted to any person in the State for payment, any such additional assessment to income tax may be made on the recipient of the income under Case VI of Schedule D.

13. (1) Subject to paragraph 14 of this Schedule, any claim for an allowance by way of credit for foreign tax in respect of any income shall be made in writing to the inspector of taxes not later than six years from the end of the relevant year of assessment, and, if the inspector objects to any such claim, it shall be heard and determined by the Special Commissioners as if it were an appeal to them against an assessment to income tax and the provisions of the Income Tax Acts relating to the re-hearing of an appeal or the statement of a case for the opinion of the High Court on a point of law, shall, with the necessary modifications, apply accordingly.

(2) In this paragraph “the relevant year of assessment” means, in relation to credit for foreign tax in respect of any income, the year of assessment for which that income falls to be charged to income tax or would fall so to be charged if any income tax were chargeable in respect thereof.

14. Where the amount of any credit given under the arrangements is rendered excessive or insufficient by reason of any adjustment of the amount of any tax payable either in the State or in the territory in regard to which the arrangements are made, nothing in the Income Tax Acts or in the enactments relating to corporation profits tax limiting the time for the making of assessments or claims for relief shall apply to any assessment or claim to which the adjustment gives rise, being an assessment or claim made not later than six years from the time when all such assessments, adjustments and other determinations have been made, as are material in determining whether any, and if so what, credit falls to be given.

ISB Act 1958-07-29

Schedule 3 FINANCE ACT, 1958 Open official source

THIRD SCHEDULE. Dividends Regarded as Paid out of Profits Accumulated Before Given Date.

Dividends Regarded as Paid out of Profits Accumulated Before Given Date.

Section 51.

1. (1) Subject to the provisions of the next following paragraph, a dividend shall be regarded for the purposes of section 51 of this Act and of this Schedule as paid wholly out of profits accumulated before a given date (hereafter in this Schedule referred to as the relevant date)—

(a) if it is declared for a period falling wholly before the relevant date,

(b) if there are no profits of the company arising in the period beginning with the relevant date and ending with the date on which the dividend is payable, or

(c) if, out of such profits of the company as arose in the said period beginning with the relevant date, no part is, having regard to paragraph 3 of this Schedule, available for payment of the dividend.

(2) Subject as aforesaid, where, out of such profits of the company as arose in the said period beginning with the relevant date, some part is, having regard to paragraph 3 of this Schedule, available for payment of the dividend but the total amount distributed in payment of the net dividend on all the shares of the class in question exceeds the said part of the profits, the dividend shall be regarded for the said purposes as paid out of profits accumulated before the relevant date to an extent which is the same as the proportion which the excess bears to the said total amount.

(3) For the purposes of this Schedule a dividend which is declared for a period falling partly before the relevant date, and partly after, shall be regarded as consisting of two dividends respectively declared for the two parts of the period and of amounts proportionate to those parts.

2. (1) Notwithstanding the provisions of the foregoing paragraph, a dividend shall not be regarded as paid to any extent out of profits accumulated before the relevant date—

(a) if it became payable within one year from that date, and

(b) if in the opinion of the Special Commissioners the annual rate of dividend on the shares in question in the said year—

(i) is not substantially greater than the annual rate of dividend on those shares in the period of three years ending on the relevant date, or

(ii) in a case where the shares in question were acquired in the ordinary course of a business of arranging public issues and placings of shares, represents a yield on the cost to the person receiving the dividend which is not substantially greater than the yield obtainable by investing in comparable shares the prices of which are quoted on stock exchanges in the State.

(2) For the purposes of clause (b) of the foregoing subparagraph the Special Commissioners shall have regard to all dividends paid on the shares in the respective periods, to any share-issue made in those periods to holders of the shares and, in a case under subclause (i) of the said clause (b) where the shares were not in existence three years before the relevant date, to the dividends paid on, and any share-issue made to holders of, any shares surrendered in exchange for the first-mentioned shares or in right of which the first-mentioned shares were acquired, and shall take such averages and make such adjustments as may appear to them to be required for a fair comparison.

3. (1) The part of the profits of the company arising in the period beginning on the relevant date and ending on the date on which a dividend is payable which is available for payment of the dividend shall be determined as follows.

(2) There shall be deducted from the said profits such amount, whether fixed or proportionate to the amount of the profits, as in the opinion of the Special Commissioners ought justly and reasonably to be treated as set aside for payment of dividends on any other class of shares in the company, having regard to the respective rights attaching to the shares and on the assumption that the total amount available for distribution by way of net dividend on all the shares in the company over any period will be proportionately greater or less than the profits of the company arising in the period beginning on the relevant date and ending on the date on which the dividend mentioned in the foregoing subparagraph is payable, according as the first-mentioned period is longer or shorter than the second-mentioned period.

(3) In a case where, in the period beginning on the relevant date and ending on the date on which the dividend is payable, no previous dividend became payable on the shares of the class in question, the whole of the profits of the company arising in the period, less any deduction to be made under the last foregoing subparagraph, shall be regarded as available for payment of the dividend.

(4) If any previous dividend became payable in the said period on the same shares, there shall be determined in accordance with the foregoing paragraphs the extent, if any, to which that previous dividend is to be regarded as paid out of profits accumulated before the relevant date, and the profits of the company arising in the said period, less any deduction to be made as aforesaid, shall be regarded as primarily available for payment of the net amount of that previous dividend so far as it is not regarded as paid out of profits accumulated before the relevant date and only such balance, if any, as remains shall be regarded as available for payment of the later dividend.

(5) Where under subparagraph (2) of this paragraph it falls to the Special Commissioners to determine what should be set aside for payment of dividends on shares of any class, and dividends on shares of that class have been treated under this Schedule as paid to any extent out of profits accumulated before the relevant date, the Special Commissioners may take that fact into account and reduce the amount to be so set aside accordingly.

4. (1) For the purposes of this Schedule the profits of a company arising in a given period shall be determined as follows.

(2) The said profits shall be the income of the company for the period diminished by—

(a) the income tax actually borne by the company for any year of assessment in the said period (including any sur-tax borne by the company under section 21 of the Finance Act, 1922, and the First Schedule to that Act), and

(b) the corporation profits tax payable by the company for any accounting period in the said period

Provided that where relief has been afforded to the company under section 12 of the Finance Act, 1950 (No. 18 of 1950), section 14 of the Finance Act, 1955 (No. 13 of 1955) or section 44 of this Act, references in this subparagraph to tax actually borne or to tax payable shall be construed as references to the tax which would have been borne or payable if that relief had not been given.

(3) In ascertaining for the purposes of this paragraph the amount of income tax and corporation profits tax by which the income of the company for the period is to be diminished, any tax on the amount to be deducted under clause (d) of subparagraph (3) of paragraph 5 of this Schedule shall be left out of account.

5. (1) For the purposes of this Schedule the income of the company for a given period shall be determined as follows.

(2) There shall be computed the aggregate amount—

(a) of any profits or gains arising in the period from any trade carried on by the company computed in accordance with the provisions applicable to Case I of Schedule D, and

(b) of any income for any year of assessment in the period (computed in accordance with the provisions of the Income Tax Acts) other than profits or gains arising from any such trade.

(3) There shall be deducted from the said aggregate amount the sum of the following amounts, that is to say—

(a) any loss sustained by the company in the period in any such trade (computed in the same manner as profits or gains under the provisions applicable to Case I of Schedule D),

(b) any allowances in respect of any such trade under Rule 6 of the Rules applicable to Cases I and II of Schedule D, subsection (3) of section 5 or section 6 of the Finance Act, 1946 (No. 15 of 1946), Part V of the Finance Act, 1956 (No. 22 of 1956), Part IV of the Finance (Miscellaneous Provisions) Act, 1956 (No. 47 of 1956), or Part V of the Finance Act, 1957 (No. 20 of 1957), for any year of assessment in the period,

(c) any payments made by the company in any year of assessment in the period to which Rule 19 or Rule 21 of the General Rules applies, other than payments which are deductible in computing the profits or gains or losses of a trade carried on by it, and

(d) if the company is not engaged in carrying on such a trade as is mentioned in subsection (1) of section 51 of this Act and has received in a year of assessment in the period a dividend (being a dividend which, on or after the 19th day of June, 1958, the company became entitled to receive) which, if the company had been engaged in such a trade, would have been required by the said subsection (1) to be brought into account to any extent as mentioned therein, such amount as would, after deduction of income tax at the rate authorised to be deducted by Rule 20 of the General Rules, be equal to the amount which would have been so required to be brought into account,

and the balance shall be the income of the company for the period.

6. Any reference in paragraph 4 or 5 of this Schedule to an amount for a year of assessment in the period in question shall be taken as a reference to the full amount for any year of assessment falling wholly within the period and a proportionate part of the amount (on a time basis) for any year of assessment falling partly within that period, and the reference therein to corporation profits tax payable for any accounting period in the said period shall be construed in a corresponding manner.

ISB Act 1958-07-29

Schedule 4 FINANCE ACT, 1958 Open official source

FOURTH SCHEDULE. Enactments Repealed.

Enactments Repealed.

Section 66.

Session and Chapter or Number and Year

Short Title

Extent of Repeal

Date of Repeal

(1)

(2)

(3)

(4)

8 & 9 Geo. 5, c. 40

Income Tax Act, 1918.

In paragraph (c) of subsection (1) of section 103, the words “living with her husband, or a married woman whose husband is not accountable for the payment of any tax charged on her,”; section 171; subsections (5) and (6) of section 220; in section 237, the words “married woman,”; Rule 8 of the Rules applicable to Schedule B; Rule 16 of the General Rules.

The 6th day of April, 1958.

10 & 11 Geo. 5, c. 18

Finance Act, 1920.

Section 25.

The 6th day of April, 1958.

No. 14 of 1942.

Finance Act, 1942.

Section 22.

The 1st day of April, 1958.

No. 35 of 1945.

Finance (Miscellaneous Provisions) Act, 1945.

Section 2.

The 1st day of April, 1958.

No. 15 of 1951.

Finance Act, 1951.

Subsection (4) of section 4.

The 6th day of April, 1958.

FINANCE ACT, 1958

Statutory Text (4 Articles)

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