Finance Act 2011
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Chapter 5 Corporation Tax | ||
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Amendment of section 486C (relief from tax for certain start-up companies) of Principal Act. |
34.— (1) Section 486C of the Principal Act is amended— | |
(a) in subsection (1)(a) by inserting the following definition before the definition of “Commission Regulation (EC) No. 1998/2006”: | ||
“ ‘associated company’ shall be construed in accordance with section 432;”, | ||
(b) in subsection (1)(a) by inserting the following definitions after the definition of “EEA State”: | ||
“ ‘Employer Job (PRSI) Incentive Scheme’ means the scheme provided for in the Social Welfare (Employers’ Pay-Related Social Insurance Exemption Scheme) Regulations 2010 ( S.I. No. 294 of 2010 ); | ||
‘Employers’ Pay-Related Social Insurance’ means the contribution specified in section 13 (2)(d) of the Social Welfare Consolidation Act 2005 ;”, | ||
(c) in subsection (1)(a) by inserting the following definition after the definition of “relevant corporation tax”: | ||
“ ‘relevant limit’ means, subject to subsection (6), €5,000;”, | ||
(d) in subsection (1)(a) by inserting the following definitions after the definition of “relevant period”: | ||
“ ‘specified contribution’, in relation to an employee or director of a company, means, subject to paragraph (c), the lesser of— | ||
(i) the amount of Employers’ Pay-Related Social Insurance paid by the company in an accounting period in respect of that employee or director, or which would have been so paid if relief under the Employer Job (PRSI) Incentive Scheme did not apply, and | ||
(ii) the relevant limit; | ||
‘total contribution’ means the lesser of — | ||
(i) the aggregate amount of specified contributions of a company for an accounting period, and | ||
(ii) the lower relevant maximum amount specified in subsection (5);”, | ||
(e) in subsection (1) by inserting the following after paragraph (b): | ||
“(c) In computing a specified contribution for an accounting period of a company which sets up and commences a qualifying trade in 2011, an amount of Employers’ Pay-Related Social Insurance paid by the company, or which would have been so paid if relief under the Employer Job (PRSI) Incentive Scheme did not apply, within one month after the end of the accounting period may be treated as Employers’ Pay-Related Social Insurance paid by the company in that accounting period and, where such an amount is so treated, it shall not be taken into account in computing a specified contribution for any subsequent accounting period.”, | ||
(f) in subsection (2)(a)— | ||
(i) by substituting “, 2010 or 2011” for “or 2010”, | ||
(ii) in subparagraph (iv) by deleting “or”, and | ||
(iii) in subparagraph (v) by substituting “apply, or” for “apply.”, | ||
(g) in subsection (2)(a) by inserting the following after subparagraph (v): | ||
“(vi) the activities of which, if carried on by an associated company of the new company, would form part of a trade carried on by that associated company.”, | ||
(h) in subsection (4)(a)— | ||
(i) by inserting “the aggregate of” after “then”, and | ||
(ii) by substituting the following for “shall be reduced to nil”: | ||
“shall be reduced by the lesser of— | ||
(I) that aggregate, and | ||
(II) the total contribution for the accounting period”, | ||
(iii) in subsection (4)(b) by substituting the following for “shall be reduced to an amount determined by the following formula:”: | ||
“shall be reduced to the greater of— | ||
(i) that aggregate as reduced by the total contribution for the accounting period, and | ||
(ii) an amount determined by the following formula:”, | ||
and | ||
(i) by substituting the following for subsection (6): | ||
“(6) For an accounting period of less than 12 months— | ||
(a) the relevant limit, and | ||
(b) the relevant maximum amounts specified in subsection (5), | ||
shall be proportionately reduced.”. | ||
(2) Subsection (1) has effect in relation to accounting periods beginning on or after 1 January 2011. |