Finance Act 2020

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Acceleration of wear and tear allowances for farm safety equipment

17.(1) The Principal Act is amended—

(a) in Chapter 2 of Part 9, by inserting the following section after section 285C:

“Acceleration of wear and tear allowances for farm safety equipment

285D. (1) In this section—

‘eligible person’ means a person carrying on farming, the profits or gains of which are chargeable to tax in accordance with section 655;

‘farming’ has the same meaning as it has in Part 23, other than in section 664;

‘Minister’ means the Minister for Agriculture, Food and the Marine;

‘qualifying certificate’ means a certificate issued under subsection (4);

‘qualifying equipment’ means equipment of a type specified in column (1) of the table in Part 2 of Schedule 35 meeting the description specified in column (2) of that table opposite the reference to that equipment type in column (1) thereof;

‘qualifying expenditure’, in relation to an item of qualifying equipment, means the amount which, in the reasonable opinion of the Minister, is an appropriate purchase price;

‘relevant tax’, in relation to an eligible person—

(a) where the eligible person is a company, means any corporation tax, and

(b) where the eligible person is not a company, means any contributions paid under the Social Welfare Consolidation Act 2005 , income tax or universal social charge;

‘Rescuing and Restructuring Guidelines’ means the Communication of the Commission on Guidelines on State aid for rescuing and restructuring non-financial undertakings in difficulty¹¹ ;

‘SME’ has the same meaning as it has in Commission Regulation (EU) No. 702/2014 of 25 June 2014¹² ;

‘undertaking’ means the relevant economic unit that would be regarded as an undertaking for the purposes of the Rescuing and Restructuring Guidelines;

‘undertaking in difficulty’ shall be construed in accordance with section 2.2 of the Rescuing and Restructuring Guidelines.

(2) Where a person acquires qualifying equipment, the person may make an application to the Minister for a qualifying certificate in respect of the equipment.

(3) A person making an application to the Minister under subsection (2) shall use the form provided by the Minister for that purpose and shall include the following information in the application:

(a) in respect of each item of qualifying equipment to which the application relates—

(i) a description of the equipment, and

(ii) the purchase price of the equipment;

(b) the name and address of the applicant; and

(c) such other information, specified in the form provided by the Minister, as the Minister considers necessary and appropriate for the purposes of determining—

(i) whether a certificate should be issued under subsection (4), and

(ii) the qualifying expenditure in respect of an item of qualifying equipment.

(4) Where—

(a) a person makes an application to the Minister under subsection (2),

(b) the Minister is satisfied that the equipment concerned is qualifying equipment, and

(c) subsection (5) does not apply in respect of the equipment concerned,

the Minister shall issue a certificate to the person.

(5) This subsection shall apply in respect of qualifying equipment in respect of which an application is made under subsection (2) where the qualifying expenditure for that equipment exceeds an amount determined by the formula—

€5,000,000 - M

where—

M is an amount (which may be nil) equal to the aggregate qualifying expenditure, if any, exclusive of any amount of value-added tax, in respect of which—

(a) a qualifying certificate has been issued prior to the date on which the application was made, in the year in which the application was received, and

(b) a qualifying certificate would be issued, if an appeal of a decision, made prior to the date on which the application was made, in the year in which the application was received, was successful.

(6) A qualifying certificate shall include the following information:

(a) in respect of each item of qualifying equipment to which the certificate relates—

(i) a description, and

(ii) the qualifying expenditure;

(b) a unique, sequential certificate identification number assigned by the Minister;

(c) the name and address of the person to whom the certificate is issued; and

(d) such other information as the Minister or the Revenue Commissioners consider necessary and appropriate.

(7) The Minister shall provide the Revenue Commissioners, by 28 February each year, with the details of all qualifying certificates issued during the preceding year, including, in relation to each such certificate, the information specified in subsection (6).

(8) Where the Minister, following application in that behalf by a person under subsection (2), decides—

(a) not to issue a qualifying certificate, or

(b) to issue a qualifying certificate specifying, as the qualifying expenditure in respect of an item of qualifying equipment to which the certificate relates, an amount which is lower than the amount of the purchase price of the item of equipment specified in the application,

the Minister shall notify the person of that decision.

(9) A notification under subsection (8) shall—

(a) state the reasons for the decision, and

(b) inform the person that—

(i) the person may appeal the decision, by notice in writing (in this section referred to as a ‘notice of appeal’), to the appeals officer (within the meaning of section 667G) within 21 days of the date of the notification,

(ii) the notice of appeal shall specify the grounds for the appeal,

(iii) the decision shall be suspended until—

(I) the decision becomes final under subsection (12), or

(II) the disposal of the appeal under this section.

(10) A notice of appeal shall comply with subsection (9)(b)(i) and (ii) and shall be accompanied by such fee as may be determined by the Minister from time to time and published in such manner as the Minister considers appropriate, including on the internet.

(11) Where the Minister makes a decision referred to in subsection (8), the decision shall be suspended until—

(a) where subsection (12) applies, the decision becomes final under that subsection, or

(b) where subsection (12) does not apply, the disposal of the appeal of that decision under this section.

(12) If, on the expiration of the period of 21 days beginning on the date of a notification under subsection (8), no appeal under this section is made by the person notified under that subsection, the decision to which the notification relates is final.

(13) Subsections (5) to (10) of section 667G shall apply to an appeal under this section as they apply to an appeal under that section.

(14) Subject to subsections (15) and (16), where an eligible person—

(a) incurs, for the purpose of farming by that person, capital expenditure on qualifying equipment on or after 1 January 2021 and on or before 31 December 2023, and

(b) has been issued with a qualifying certificate in respect of that equipment,

then, for any chargeable period a wear and tear allowance is to be made under section 284 in respect of any qualifying expenditure specified in that qualifying certificate, subsection (2) of that section shall apply as if the reference in paragraph (ad) of that subsection to 12.5 per cent were a reference to 50 per cent.

(15) Subsection (14) shall not apply where the eligible person concerned—

(a) is an undertaking in difficulty,

(b) is part of an undertaking part of which is subject to an outstanding recovery order following a previous decision of the Commission of the European Union that declared an aid illegal and incompatible with the internal market, or

(c) is part of an undertaking that is not an SME.

(16) The aggregate amount of relief granted to a person under this section shall not exceed €500,000.

(17) This subsection applies to a person in respect of a chargeable period where the aggregate of the amount of the relief granted to the person in that chargeable period and in previous chargeable periods is greater than €60,000.

(18) Notwithstanding section 851A, where subsection (17) applies to a person in respect of a chargeable period, the Revenue Commissioners may disclose the following information in respect of the year in which the chargeable period ends:

(a) the name of the person;

(b) the sector of activity at NACE group level, within the meaning of Regulation (EC) No. 1893/2006 of the European Parliament and of the Council of 20 December 2006¹³ , as amended by Regulation (EC) No. 295/2008 of the European Parliament and of the Council of 11 March 2008¹⁴ and Regulation (EU) 2019/1243 of the European Parliament and of the Council of 20 June 2019¹⁵ ;

(c) the territorial unit, within the meaning of the NUTS Level 2 classification specified in Annex 1 to Regulation (EC) No. 1059/2003 of the European Parliament and of the Council of 26 May 2003¹⁶ as amended by Regulation (EC) No. 1888/2005 of the European Parliament and of the Council of 26 October 2005¹⁷ , Commission Regulation (EC) No. 105/2007 of 1 February 2007¹⁸ , Regulation (EC) No. 176/2008 of the European Parliament and of the Council of 20 February 2008¹⁹ , Regulation (EC) No. 1137/2008 of the European Parliament and of the Council of 22 October 2008²⁰ , Commission Regulation (EU) No. 31/2011 of 17 January 2011²¹ , Council Regulation (EU) No. 517/2013 of 13 May 2013²² , Commission Regulation (EU) No. 1319/2013 of 9 December 2013²³ , Commission Regulation (EU) No. 868/2014 of 8 August 2014²⁴ , Commission Regulation (EU) No. 2016/2066 of 21 November 2016²⁵ , and Commission Delegated Regulation (EU) 2019/1755 of 8 August 2019²⁶ , in which the person is located; and

(d) the year in which the relief is granted.

(19) For the purposes of subsections (16) and (17), the amount of relief granted to a person in a chargeable period shall be the amount determined by the formula—

R = A - B

where—

R is the amount of the relief granted to the person in the chargeable period,

A is the amount of relevant tax that would be payable by the eligible person for the chargeable period, but for subsection (14), and

B is the amount of relevant tax payable by the eligible person for that chargeable period.”,

(b) in section 667F(1), by substituting “for the purposes of appeals under sections 285D and 667G” for “for the purposes of an appeal under section 667G”, and

(c) by inserting the following Schedule after Schedule 34:

“SCHEDULE 35

Section 285D

PART 1

Definitions

In this Schedule—

‘farm vehicle’ means an agricultural tractor, agricultural self-propelled machine, all-terrain vehicle or utility terrain vehicle;

‘machinery Directive’ means Directive 2006/42/EC of the European Parliament and of the Council of 17 May 2006 on machinery, and amending Directive 95/16/EC (recast) ²⁷ .

PART 2

Qualifying equipment referred to in section 285D

.”.

(2) Subsection (1) shall come into operation on such day as the Minister for Finance may appoint by order.

¹¹ OJ No. C249, 31.7.2014, p. 1

¹² OJ No. L193, 1.7.2014, p. 1

¹³ OJ No. L393, 30.12.2006, p. 1

¹⁴ OJ No. L97, 9.4.2008, p. 13

¹⁵ OJ No. L198, 25.7.2019, p. 241

¹⁶ OJ No. L154, 21.6.2003, p. 1

¹⁷ OJ No. L309, 25.11.2005, p. 1

¹⁸ OJ No. L39, 10.2.2007, p.1

¹⁹ OJ No. L61, 5.3.2008, p.1

²⁰ OJ No. L311, 21.11.2008, p.1

²¹ OJ No. L13, 18.1.2011, p.3

²² OJ No. L158, 10.6.2013, p.1

²³ OJ No. L342, 18.12.2013, p.1

²⁴ OJ No. L241, 13.8.2014, p.1

²⁵ OJ No. L322, 29.11.2016, p. 1

²⁶ OJ No. L270, 24.10.2019, p. 1

²⁷ OJ No. L157, 9.6.2006, p. 24