Finance Act 2003

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Amendment of section 12B (special scheme for means of transport supplied by taxable dealers) of Principal Act.

120.—Section 12B of the Principal Act is amended—

(a) in subsection (10), by deleting “and” at the end of paragraph (a), by substituting “of that motor vehicle to that person, and” for “of that motor vehicle to that person.” in paragraph (b) and by inserting the following after paragraph (b):

“(c) a supply by a taxable dealer of a means of transport being a motor vehicle as defined in section 12(3)(b) which has been declared for registration in accordance with section 131 of the Finance Act 1992 on that dealer's own behalf, unless it can be shown to the satisfaction of the Revenue Commissioners that, on the basis of the use to which that means of transport has been put by that taxable dealer, the provisions of subsection (11)(b) should not apply to that supply.”,

and

(b) by inserting the following after subsection (10):

“(11)(a) Where a means of transport which is a motor vehicle as defined in section 12(3)(b) is declared for registration to the Revenue Commissioners in accordance with section 131 of the Finance Act 1992 by a taxable dealer on that dealer's own behalf and on which deductibility in accordance with section 12 has been claimed by that dealer, then that means of transport shall be treated for the purposes of this Act as if it were removed from stock-in-trade and such removal is deemed to be a supply of that means of transport by that taxable dealer for the purposes of section 3(1)(e).

(b) At the time when a taxable dealer supplies to another person a means of transport which is deemed to have been supplied in accordance with paragraph (a), then that means of transport is deemed to be re-acquired by that dealer as stock-in-trade and, notwithstanding subsection (2), the taxable dealer is entitled to deduct residual tax referred to in subsection (1) and in that case for the purposes of the formula in subsection (4) the residual tax is calculated as if ‘A’ were equal to the total of—

(i) the amount on which tax was chargeable on the supply of that means of transport to the dealer,

(ii) the tax which was chargeable on the supply referred to at subparagraph (i), and

(iii) the vehicle registration tax accounted for by that dealer in respect of the registration of that means of transport,

and, apart from the cases provided for in paragraph (c), the amount referred to in subparagraph (i) is the amount on which tax was chargeable on the supply of that means of transport in accordance with section 3(1)(e).

(c) Where a taxable dealer declares a means of transport for registration in the circumstances described in paragraph (a) but does not claim deductibility in accordance with section 12 in respect of that means of transport, then paragraph (b) applies when that dealer supplies that means of transport to another person.”.