Finance Act, 1977
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Provisions in relation to Convention for reciprocal avoidance of double taxation in the State and the United Kingdom of income and capital gains. |
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 . |