Finance Act, 1982
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Business entertainment expenses. |
20.—(1) In respect of any expenses incurred on or after the 26th day of March, 1982, in providing business entertainment, no sum shall be— | |
(a) deducted in computing the amount of profits or gains chargeable to tax under Schedule D, or | ||
(b) included in computing any expenses of management in respect of which a deduction may be claimed under section 15 or 33 of the Corporation Tax Act, 1976 , or | ||
(c) allowed under Rule 3 of Schedule 2 to the Income Tax Act, 1967 . | ||
(2) (a) Where any asset is used or is provided for use, wholly or partly, for the purpose of providing business entertainment, no allowance under any of the specified provisions shall be made for the year 1982-83 or any subsequent year of assessment or for any accounting period of a company which ends on or after the 6th day of April, 1982, in respect of the use of the asset or the expenditure incurred in the provision of the asset to the extent that it is used or is to be used for the said business entertainment. | ||
(b) In this subsection “the specified provisions” means section 241 , Chapter III of Part XIV, Chapters I and III of Part XV and Chapters II and V of Part XVI of the Income Tax Act, 1967 , and section 22 of the Finance Act, 1971 . | ||
(3) The expenses to which subsection (1) applies include, in the case of any person, any sum paid by him to, or on behalf of, or placed by him at the disposal of, a member of his staff for the purpose of defraying expenses incurred or to be incurred by him in providing business entertainment. | ||
(4) For the purposes of this section “business entertainment” means entertainment (including the provision of accommodation, food and drink or any other form of hospitality in any circumstances whatsoever) provided directly or indirectly, by— | ||
(a) any person (hereinafter referred to as “the first-mentioned person”), or | ||
(b) any person who is a member of the first-mentioned person's staff, or | ||
(c) any person providing or performing any service for the first-mentioned person, the entertainment being entertainment that is provided in the course of, or is incidental to, the provision or performance of the service, | ||
in connection with a trade, carried on by the first-mentioned person but does not include anything provided by him for bona fide members of his staff unless its provision for them is incidental to its provision also for others. | ||
(5) This section shall apply in relation to the provision of a gift as it applies in relation to the provision of entertainment. | ||
(6) In this section— | ||
a reference to expenses incurred in, or to the use of an asset for, providing entertainment includes a reference to expenses incurred in, or to the use of an asset for, providing anything incidental thereto; | ||
a reference to a trade includes a reference to a business, profession or employment; | ||
a reference to the members of a person's staff is a reference to persons employed by that person, directors of a company or persons engaged in the management thereof being for this purpose deemed to be persons employed by it. | ||
(7) (a) The provisions of section 24 (1A) of the Finance Act, 1973 , shall not apply or have effect in respect of any expenses incurred on or after the 26th day of March, 1982. | ||
(b) The provisions of section 24 of the Finance Act, 1973 (apart from the provisions of subsection (1A)) shall not apply or have effect for the year 1982-83 or any subsequent year of assessment or for any accounting period of a company which ends on or after the 6th day of April, 1982. | ||
(8) (a) Where, by reason of the provision or performance of a service, an amount is paid or payable to a person referred to in subsection (4) (c), so much of the amount as is equal to the cost of any business entertainment that is provided in the course of, or is incidental to the provision or performance of, the service shall be deemed to be incurred in providing business entertainment. | ||
(b) The cost of any business entertainment shall be determined by the inspector according to the best of his knowledge and judgment. | ||
(c) A determination made under paragraph (b) may be amended by the Appeal Commissioners or by the Circuit Court on the hearing, or the rehearing, of an appeal against any deduction (including a case where no deduction is granted) granted on the basis of the determination. |