Finance Act, 1978
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Tax credit in respect of distributions. |
28.—(1) In relation to distributions made on or after the 6th day of April, 1978, the provisions of the Corporation Tax Act, 1976 , specified in subsection (2) shall have effect as if the standard rate for the year 1978-79 and subsequent years of assessment were 30 per cent. | ||||
(2) The provisions referred to in subsection (1) are the following: | |||||
(a) sections 64 (2), 66 (2), 67, 82 (2), 82 (7), 83 (4), 88 (2), 167 (2) and 178, | |||||
(b) in subparagraph (ii) (as amended by the Finance Act, 1977 ) of section 66 (3) (b), the expression “income tax at the standard rate”, | |||||
(c) in subparagraph (iii) (inserted by the Finance Act, 1977 ) of the said section 66 (3) (b), the expression “standard rate per cent.” in each place where it occurs, and | |||||
(d) in section 79 (6), the definition of A in paragraph (b). | |||||
(3) Subsection (5) of section 45 of the Corporation Tax Act, 1976 , is hereby amended by the substitution for the words from “but the restriction” to the end of the subsection of “but the amount of the tax credit which may be so set off shall not exceed an amount determined by the formula | |||||
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where— | |||||
A is the portion of the income from investments which is chargeable to corporation tax by virtue of section 43 (3), or, as the case may be, the portion, determined in accordance with subsection (4), of the income from investments which is included in computing the total amount of the profits of the company arising from its general annuity business, and | |||||
B is the aggregate of the payments, the income tax on which, having regard to subsection (3) or (4), as the case may be, the company is entitled to set off against corporation tax by virtue of a claim under section 8 (3).”, | |||||
and the subsection, as so amended, is set out in the Table to this subsection. | |||||
TABLE | |||||
(5) Where an overseas life assurance company receives a distribution in respect of which it is entitled to a tax credit the company may claim to have that credit set off against any corporation tax assessed on the company under section 43 or 44 for the accounting period in which the distribution is received, but the amount of the tax credit which may be so set off shall not exceed an amount determined by the formula | |||||
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where— | |||||
A is the portion of the income from investments which is chargeable to corporation tax by virtue of section 43 (3), or, as the case may be, the portion, determined in accordance with subsection (4), of the income from investments which is included in computing the total amount of the profits of the company arising from its general annuity business, and | |||||
B is the aggregate of the payments, the income tax on which, having regard to subsection (3) or (4), as the case may be, the company is entitled to set off against corporation tax by virtue of a claim under section 8 (3). | |||||
(4) Section 64 (3) (c) (ii) of the Corporation Tax Act, 1976 , is hereby amended by the addition of the following proviso: | |||||
“Provided that the tax credit in respect of a distribution to which subparagraph (i) applies shall not exceed the amount which would be the amount of the tax credit in respect of the distribution if that tax credit were determined in accordance with the provisions of section 88 (2).”. | |||||
(5)
Section 79
(6) of the
Corporation Tax Act, 1976
, is hereby amended by the substitution in paragraph (b) for “determined by the formula | |||||
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and the said paragraph (b), as so amended, is set out in the Table to this subsection. | |||||
TABLE | |||||
(b) where the company distributes, on or after the 27th day of November, 1975, its assets amongst its members or proprietors on the winding up or dissolution of the company the company shall be assessed to income tax for the year of assessment in which the winding up or dissolution occurs at the standard rate under Case IV of Schedule D on an amount the income tax on which at the standard rate for that year is equal to an amount determined by the formula | |||||
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where— | |||||
A is the standard rate per cent. for the year of assessment in which the winding up or dissolution occurs, and | |||||
D is the amount by which the total value of the assets distributed to the members or proprietors on the winding up or dissolution exceeds the amount of the paid up share capital of the company. | |||||
(6) Section 178 (1) of the Corporation Tax Act, 1976 , is hereby amended by the substitution in the definition of A of “of assessment in which the dividend is paid” for “1976-77” and the said definition, as so amended, is set out in the Table to this subsection. | |||||
TABLE | |||||
A is the standard rate per cent. for the year of assessment in which the dividend is paid, | |||||
(7) (a) This subsection applies to a distribution that is made by a company on or after the 6th day of April, 1978, and to which section 64 of the Corporation Tax Act, 1976 , applies. | |||||
(b) The reference to certain tax credits in the definition of B in subsection (2) of the said section 64 shall, in relation to distributions to which the said section 64 applies and which— | |||||
(i) were received by a company that makes a distribution to which this subsection applies, and | |||||
(ii) were made before the date aforesaid, be construed as a reference to thirty-nine-forty-ninths of those tax credits. |
” of “the income tax on which at the standard rate for that year is equal to an amount determined by the formula