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Finance Act, 1999

Amendment of Chaper 7 (other reliefs and exemptions) of Part 19 of Principal Act.

90.—(1) Part 19 of the Principal Act is hereby amended in Chapter 7—

(a) in section 613—

(i) in subsection (4)(a) by the substitution for “No chargeable gain” of “Subject to subsection (5), no chargeable gain”, and

(ii) by the insertion after subsection (4) of the following subsections:

“(5) Subsection (4)(a) shall not apply—

(a) to the disposal of an interest in settled property, other than such a disposal treated under subsection (4)(b) as made in consideration of obtaining the settled property, if at the time of the disposal the trustees are neither resident nor ordinarily resident in the State,

(b) if the settlement falls within subsection (6), or

(c) the property comprised in the settlement is or includes property that is derived directly or indirectly from a settlement falling within subsection (6).

(6) (a) In this subsection ‘arrangements’ means arrangements having the force of law by virtue of section 826 (as extended to capital gains tax by section 828).

(b) A settlement falls within this subsection if there has been a time when the trustees of the settlement—

(i) were neither resident nor ordinarily resident in the State, or

(ii) fell to be regarded for the purposes of any arrangements as resident in a territory outside the State.”,

and

(b) by the insertion after section 613 of the following section:

“Supplementary provisions.

613A.—(1) Subject to this section, subsection (2) shall apply where—

(a) section 579B applies as regards the trustees of a settlement,

(b) after the relevant time (within the meaning of that section) a person disposes of an interest created by or arising under the settlement and the circumstances are such that subsection (4)(a) of section 613 does not apply by virtue of subsection (5)(a) of that section, and

(c) the interest was created for the benefit of the person making the disposal or that person otherwise acquired it, before the relevant time.

(2) For the purposes of calculating any chargeable gain accruing on the disposal of the interest, the person disposing of it shall be treated as having—

(a) disposed of it immediately before the relevant time, and

(b) immediately reacquired it,

at its market value at that time.

(3) Subsection (2) shall not apply if section 579E applied as regards the trustees in circumstances where the time concerned (within the meaning of that section) fell before the time when the interest was created for the benefit of the person disposing of it or when the person otherwise acquired it.

(4) Subsection (6) applies where—

(a) section 579B applies as regards the trustees of a settlement,

(b) after the relevant time (within the meaning of that section) a person disposes of an interest created by or arising under the settlement and the circumstances are such that subsection (4)(a) of section 613 does not apply by virtue of subsection (5)(a) of that section,

(c) the interest was created for the person's benefit, or the person otherwise acquired it, before the relevant time, and

(d) section 579E applied as regards the trustees in circumstances where the time concerned (within the meaning of that section) fell in the relevant period.

(5) The relevant period is the period which—

(a) begins when the interest was created for the benefit of the person disposing of it or when the person otherwise acquired it, and

(b) ends with the relevant time.

(6) For the purposes of calculating any chargeable gain accruing on the disposal of the interest, the person disposing of it shall be treated as having—

(a) disposed of it immediately before the time determined in accordance with subsection (7), and

(b) immediately reacquired it,

at its market value at that time.

(7) The time mentioned in subsection (6) is—

(a) where there is only one such time, the time concerned, or

(b) where there is more than one time concerned, because section 579E applied more than once, the earliest time concerned.

(8) Where subsection (2) applies, subsection (6) shall not apply.”.

(2) This section shall apply as respects the disposal on or after the 11th day of February, 1999, of an interest created by or arising under a settlement.