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Distributions to certain non-residents.
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28.—(1) The Principal Act is hereby amended by the substitution of the following section for section 153:
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“153.—(1) In this section—
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‘non-resident person’, in relation to a distribution, means the person beneficially entitled to the distribution, being—
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(a) a person, other than a company, who—
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(i) is neither resident nor ordinarily resident in the State, and
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(ii) is, by virtue of the law of a relevant territory, resident for the purposes of tax in the relevant territory,
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or
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(b) a company which is not resident in the State and—
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(i) is under the control, whether directly or indirectly, of a person or persons who, by virtue of the law of a relevant territory, is or are resident for the purposes of tax in such a relevant territory and who is or are, as the case may be, not under the control, whether directly or indirectly, of a person who is, or persons who are, not so resident, or
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(ii) the principal class of the shares of—
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(I) the company, or
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(II) another company of which the company is a 75 per cent subsidiary,
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is substantially and regularly traded on one or more than one recognised stock exchange in a relevant territory or territories or on such other stock exchange as may be approved of by the Minister for Finance for the purposes of this section;
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‘relevant territory’ means—
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(a) a Member State of the European Communities other than the State, or
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(b) not being such a Member State, a territory with the government of which arrangements having the force of law by virtue of section 826 have been made;
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‘tax’, in relation to a relevant territory, means any tax imposed in that territory which corresponds to income tax or corporation tax in the State.
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(2) For the purposes of paragraph (b)(i) of the definition of ‘non-resident person’ in subsection (1), ‘control’ shall be construed in accordance with subsections (2) to (6) of section 432 as if in subsection (6) of that section for ‘5 or fewer participators’ there were substituted—
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(a) in so far as the first mention of ‘control’ in that paragraph is concerned, ‘persons who, by virtue of the law of a relevant territory (within the meaning assigned by section 153), are resident for the purposes of tax in such a relevant territory (within that meaning)’, and
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(b) in so far as the second mention of ‘control’ in that paragraph is concerned, ‘persons who are not resident for the purposes of tax in a relevant territory (within that meaning)’.
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(3) For the purposes of paragraph (b)(ii)(II) of the definition of ‘non-resident person’ in subsection (1), sections 412 to 418 shall apply as those sections would apply for the purposes of Chapter 5 of Part 12 if subparagraph (iii) of section 411(1)(c) were deleted.
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(4) Where for any year of assessment the income of a person who for that year of assessment is a non-resident person includes an amount in respect of a distribution made by a company resident in the State—
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(a) income tax shall not be chargeable in respect of that distribution, and
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(b) the amount or value of the distribution shall be treated for the purposes of sections 237 and 238 as not brought into charge to income tax.
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(5) Where, by virtue of section 831(5), Chapter 8A of Part 6 (other than section 172K) does not apply to a distribution made to a parent company (within the meaning of section 831) which is not resident in the State by its subsidiary (within the meaning of that section) which is a company resident in the State—
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(a) income tax shall not be chargeable in respect of that distribution, and
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(b) the amount or value of the distribution shall be treated for the purposes of sections 237 and 238 as not brought into charge to income tax.”.
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(2) Section 712(1) of the Principal Act is hereby amended by the substitution of “Section 129 and subsections (4) and (5) of section 153” for “Sections 129 and 153(1)”.
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(3) Section 1033 (which relates to entitlement to tax credit in respect of distributions) of the Principal Act is hereby repealed.
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(4) This section shall apply as respects distributions made on or after the 6th day of April, 1999.
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