Finance Act, 1995

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Amendment of provisions relating to the taxation of certain benefits payable under Social Welfare Acts.

10.—(1) Section 15 of the Finance Act, 1992 , is hereby amended, as respects the year of assessment 1995-96 and subsequent years of assessment, by the substitution of the following subsection for subsection (2):

“(2) All amounts falling to be paid on foot of the benefits to which this section applies (other than amounts so payable in respect of a qualified child within the meaning of section 2 (3) (a) of the Social Welfare (Consolidation) Act, 1993 ) shall be deemed—

(a) to be profits or gains arising or accruing from an employment and, accordingly—

(i) tax under Schedule E shall be charged on every person, to whom any such benefit is payable, in respect of all amounts falling to be paid on foot of such benefits, and

(ii) the tax so chargeable shall be computed under section 110 (1) (inserted by the Finance Act, 1991 ) of the Income Tax Act, 1967 ,

and

(b) to be emoluments to which the provisions of Chapter IV of Part V of the Income Tax Act, 1967 , are applied by section 125 of that Act:

Provided that—

(I) the first £10 of the aggregate of the amounts of unemployment benefit payable to a person in respect of one or more days of unemployment comprised in any income tax week (other than an amount so payable in respect of a qualified child within the meaning as aforesaid) shall be disregarded for all the purposes of the Income Tax Acts, and

(II) for the purposes of this proviso, ‘income tax week’ means one of the successive periods of 7 days in a year of assessment beginning on the 1st day of that year, or on any 7th day after that day, the last day of a year of assessment (or the last 2 days of a year of assessment ending in a leap year) being taken as included in the last income tax week of that year of assessment.”.

(2) Section 10 of the Finance Act, 1994 , shall apply and have effect, as respects the year of assessment 1995-96, as if—

(a) in subsection (1), the definitions of “day of unemployment” and “period of interruption of employment” were deleted, and

(b) the following subsection were substituted for subsection (2):

“(2) Notwithstanding the provisions of section 15 (as amended by the Finance Act, 1995) of the Finance Act, 1992 , and the Finance Act, 1992 (Commencement of Section 15) (Unemployment Benefit and Pay-Related Benefit) Order, 1994 (S.L No. 19 of 1994), the said section 15 shall not apply or have effect, as respects the year of assessment 1995-96, in relation to unemployment benefit paid or payable to a person employed in short-time employment.”.