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Deduction for donations to National Governing Bodies
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21. The Principal Act is amended by the insertion of the following section after section 847A:
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“847AA. (1) In this section—
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‘disability’, in relation to an individual, means a substantial restriction in the capacity of the individual—
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(a) to carry on a profession, business or occupation in the State, or
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(b) to participate in social or cultural life in the State by reason of an enduring physical, sensory, mental health or intellectual impairment;
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‘elite athlete’ means a person that—
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(a) is in receipt of financial support provided by Sport Ireland under the scheme commonly known as the Sport Ireland International Carding Scheme,
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(b) competes at a senior level, and is a participant, in a high performance training programme of a national governing body in respect of which programme the person receives, from Sport Ireland, financial support commonly known as the Sport Ireland High Performance Programme Funding;
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‘Minister’ means the Minister for Tourism, Culture, Arts, Gaeltacht, Sports and Media;
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‘national governing body’ means a body that—
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(a) is Olympic Federation of Ireland, Paralympics Ireland or recognised by Sport Ireland as a national governing body for a sport, and which—
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(i) is listed as a ‘Type B’ or ‘Type C’ organisation, as the case may be, on the register maintained and published by Sport Ireland and known as the Register of Organisations in Compliance with the Governance Code for Sport, and
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(ii) is approved for the purposes of this section by the Minister for Tourism, Culture, Arts, Gaeltacht, Sports and Media,
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(b) has been issued with a tax clearance certificate in accordance with section 1095 and such tax clearance certificate has not been rescinded under subsection (3A) of that section, and
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(c) is an approved body of persons within the meaning of section 235(1);
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‘project’, in relation to a national governing body, means one or more of the following:
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(a) the purchase of sports equipment approved by the Minister as eligible for funding under the fund commonly known as the Community Sports Facilities Fund and that equipment is used for sporting or recreation activities;
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(b) measures to support elite athletes in achieving excellence in competitive sport (within the meaning of section 235(1)(b));
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(c) measures which form part of a programme of a national governing body commonly known as a Women in Sport programme in respect of which programme the body receives, from Sport Ireland, financial support commonly known as the Sport Ireland Women in Sport Programme Funding;
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(d) measures which enable the participation in sport of persons with a disability, which form part of a programme of a national governing body in respect of which programme the body receives, from Sport Ireland, financial support commonly known as the Sport Ireland Core Funding or Sport Ireland Field Sport Funding;
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‘qualifying project’ means a project in respect of which the Minister has given a certificate under subsection (8), which certificate has not been revoked under that subsection;
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‘relevant accounting period’, in relation to a relevant donation made by a company, means the accounting period in which that donation is made by the company;
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‘relevant certificate’, in relation to a relevant donation by a donor who is an individual (other than an individual referred to in subsection (4)(a)(i) or (5)(a)(i), as the case may be), means a certificate which is in such form as the Revenue Commissioners may prescribe and which contains—
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(a) statements to the effect that—
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(i) the donation satisfies the requirements of subsection (2), and
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(ii) the donor has paid or will pay to the Revenue Commissioners income tax of an amount equal to income tax at the standard rate or the higher rate or partly at the standard rate and partly at the higher rate, as the case may be, for the relevant year of assessment on the grossed up amount of the donation, but not being—
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(I) income tax which the donor is entitled to charge against any other person or to deduct, retain or satisfy out of any payment which the donor is liable to make to any other person, or
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(II) appropriate tax within the meaning of Chapter 4 of Part 8,
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(b) a statement specifying how much of the grossed up amount referred to in paragraph (a)(ii) has been or will be liable to income tax at the standard rate and the higher rate for the relevant year of assessment, and
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(c) the identifying number, known as the Personal Public Service Number (PPSN) of the donor;
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‘relevant donation’ means, a donation which satisfies the requirements of subsection (2) and takes the form of a payment by a person of a sum or sums of money amounting to at least €250 to a national governing body which is made—
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(a) where the donor is an individual, in a year of assessment, and
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(b) where the donor is a company, in an accounting period,
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but where an accounting period of a company is less than 12 months the amount of €250 shall be proportionately reduced;
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‘relevant year of assessment’, in relation to a relevant donation made by an individual, means the year of assessment in which that donation is made by the individual;
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‘sports equipment’ means equipment approved by the Minister as eligible for funding under the fund commonly known as the Community Sport Facilities Fund.
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(2) A donation shall satisfy the requirements of this subsection if—
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(a) it is made to the national governing body for the sole purpose of funding a qualifying project,
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(b) it is or will be applied by the national governing body for that purpose,
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(c) apart from this section, it is neither deductible in computing for the purposes of tax the profits or gains of a trade or profession nor an expense of management deductible in computing the total profits of a company,
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(d) it is not a relevant donation to which section 847A or 848A applies,
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(e) it is not subject to a condition as to repayment,
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(f) neither the donor nor any person connected (within the meaning of section 10) with the donor receives, either directly or indirectly, a benefit in consequence of making the donation, including, in particular, a right to membership of the national governing body or a right to use the facilities of that body,
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(g) it is not conditional on or associated with, or part of an arrangement involving, the acquisition of property by the national governing body, otherwise than by way of gift, from the donor or a person connected (within the meaning of section 10) with the donor, and
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(h) in the case of a donation made by an individual, the individual—
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(i) is resident in the State for the relevant year of assessment,
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(ii) except in the case of an individual referred to in subsection (4)(a)(i) or (5)(a)(i), as the case may be, has given a relevant certificate in relation to the donation to the national governing body, and
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(iii) except in the case of an individual referred to in subsection (4)(a)(i) or (5)(a)(i), as the case may be, has paid the tax referred to in such relevant certificate and is not entitled to claim a repayment of that tax or any part of that tax.
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(3) Where it is proved to the satisfaction of the Revenue Commissioners that a person has made a relevant donation, subsection (4), (5) or (6), as the case may be, shall apply.
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(4) (a) Where a relevant donation, other than a relevant donation to which subsection (14) applies, is made by an individual who is not an individual referred to in subsection (5), then the individual shall elect that subparagraph (i) or (ii) shall apply to the donation as follows:
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(i) in a case where the individual elects that this subparagraph shall apply—
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(I) the amount of the donation shall be deducted from or set off against any income of the individual chargeable to income tax for that year of assessment and tax shall, where necessary, be discharged or repaid accordingly, and
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(II) the total income of the individual or, where the individual’s spouse or civil partner is assessed to income tax in accordance with section 1017 or 1031C, the total income of the spouse or civil partner shall be calculated accordingly;
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(ii) in a case where the individual elects that this subparagraph shall apply, then the Tax Acts shall apply in relation to the national governing body to which that donation is made as if—
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(I) the grossed up amount of the donation were an annual payment which was the income of that body received by it under deduction of tax, in the amounts and at the rates specified in the statement referred to in paragraph (b) of the definition in subsection (1) of ‘relevant certificate’, for the relevant year of assessment, and
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(II) the provisions of the Tax Acts which apply in relation to a claim to repayment of tax applied in relation to any claim to repayment of such tax by that body,
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but, if the total amount of the tax referred to in paragraph (b) of the definition in subsection (1) of ‘relevant certificate’ is not paid, the amount of any repayment which would otherwise be made to that body in accordance with this section shall not exceed the amount of tax actually paid by that individual.
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(b) For the purposes of this subsection and in relation to a donation by an individual, references to the grossed up amount are to the amount which after deducting income tax at the standard rate or the higher rate or partly at the standard rate and partly at the higher rate, as the case may be, for the relevant year of assessment leaves the amount of the donation.
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(c) For the purposes of paragraph (a)(i), any such deduction or set-off shall not be taken into account in determining the net relevant earnings (within the meaning of section 787) of the individual or, as the case may be, the individual’s spouse or civil partner for the relevant year of assessment.
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(d) The Revenue Commissioners may make regulations for the purposes of setting down the conditions under which an individual shall make the election referred to in paragraph (a).
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(e) For the purposes of paragraph (a)(i), an individual shall make a claim through such electronic means as the Revenue Commissioners make available, providing—
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(i) full particulars of the relevant donation,
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(ii) a receipt as referred to in subsection (9) and
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(iii) any other relevant information that may reasonably be required by the Revenue Commissioners to determine whether the requirements of this section are met.
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(f) For the purposes of applying the provisions of this subsection, the repayment referred to in paragraph (a)(ii) shall not be made to a national governing body until on or after 1 December in the year following the year in which the relevant donation was made.
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(5) (a) Where a relevant donation, other than a relevant donation to which subsection (14) applies, is made by an individual who is a chargeable person (within the meaning of Part 41A) for the relevant year of assessment, then the individual shall elect that subparagraph (i) or (ii) shall apply to the donation as follows:
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(i) in a case where the individual elects that this subparagraph shall apply—
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(I) the amount of the donation shall be deducted from or set off against any income of the individual chargeable to income tax for that year of assessment and tax shall, where necessary, be discharged or repaid accordingly, and
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(II) the total income of the individual or, where the individual’s spouse or civil partner is assessed to income tax in accordance with section 1017 or 1031C, the total income of the spouse or civil partner shall be calculated accordingly;
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(ii) in a case where the individual elects that this subparagraph shall apply, then the Tax Acts shall apply in relation to the national governing body to which that donation is made as if—
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(I) the grossed up amount of the donation were an annual payment which was the income of that body received by it under deduction of tax, in the amounts and at the rates specified in the statement referred to in paragraph (b) of the definition in subsection (1) of ‘relevant certificate’, for the relevant year of assessment, and
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(II) the provisions of the Tax Acts which apply in relation to a claim to repayment of tax applied in relation to any claim to repayment of such tax by that body,
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but, if the total amount of the tax referred to in paragraph (b) of the definition in subsection (1) of ‘relevant certificate’ is not paid, the amount of any repayment which would otherwise be made to that body in accordance with this section shall not exceed the amount of tax actually paid by that individual.
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(b) For the purposes of this subsection and in relation to a donation by an individual, references to the grossed up amount are to the amount which after deducting income tax at the standard rate or the higher rate or partly at the standard rate and partly at the higher rate, as the case may be, for the relevant year of assessment leaves the amount of the donation.
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(c) For the purposes of paragraph (a)(i), any such deduction or set-off shall not be taken into account in determining the net relevant earnings (within the meaning of section 787) of the individual or, as the case may be, the individual’s spouse or civil partner for the relevant year of assessment.
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(d) The Revenue Commissioners may make regulations for the purposes of setting down the conditions under which an individual shall make the election referred to in paragraph (a).
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(e) For the purposes of paragraph (a)(i), an individual shall make a claim with the return required to be delivered by that individual under Chapter 3 of Part 41A for the relevant year of assessment.
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(f) For the purposes of applying the provisions of this subsection, the repayment referred to in paragraph (a)(ii) shall not be made to an approved body until on or after 1 December in the year following the year in which the relevant donation was made.
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(6) Where a company makes a relevant donation, other than a relevant donation to which subsection (14) applies, then, for the purposes of corporation tax, the amount of that donation shall be treated as—
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(a) a deductible trading expense of a trade carried on by the company in, or
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(b) an expense of management deductible in computing the total profits of the company for,
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the relevant accounting period.
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(7) Where a relevant donation is made by a company, a claim under this section shall be made with the return required to be delivered by it under Chapter 3 of Part 41A for the relevant accounting period.
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(8) (a) The Minister may, on the making of an application by a national governing body, give a certificate to that body stating that a project may be treated as a qualifying project for the purposes of this section.
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(b) An application under this subsection shall be in such form and contain such information as the Minister may direct.
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(c) The Minister may, by notice in writing given to the body, revoke the certificate given in respect of a project under paragraph (a), and the project shall cease to be a qualifying project as respects any donations made to the body after the date of the notice.
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(d) The Minister shall not give a certificate to any national governing body in respect of a project under paragraph (a) if the aggregate cost of the project is, or is estimated to be, in excess of €40,000,000.
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(9) For the purposes of a claim to relief under this section and subject to subsection (14), a national governing body shall, on acceptance of a relevant donation, give to the person making the relevant donation a receipt which shall—
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(a) contain a statement that—
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(i) it is a receipt for the purposes of this section,
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(ii) the body is a national governing body for the purposes of this section,
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(iii) the donation in respect of which the receipt is given is a relevant donation for the purposes of this section, and
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(iv) the relevant donation will be defrayed on a qualifying project,
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(b) show—
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(i) the name and address of the person making the relevant donation,
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(ii) the amount of the relevant donation in both figures and words,
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(iii) the date the relevant donation was made,
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(iv) the full name of the national governing body, and
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(v) the date on which the receipt was issued,
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and
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(c) be signed by a duly authorised official of the national governing body.
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(10) Where relief under this section has been granted in respect of a relevant donation, and—
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(a) that donation has not been used by the national governing body concerned for the purpose of undertaking the qualifying project concerned, or
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(b) which relief is otherwise found not to have been due,
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neither section 235(2) nor 235A(2) shall apply to the amount of that relevant donation.
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(11) The Revenue Commissioners may nominate any of their officers to perform any acts and discharge any functions authorised by this section to be performed or discharged by them.
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(12) Every national governing body, when required to do so by notice in writing from the Minister, shall within the time limited by the notice prepare and deliver to the Minister a return containing particulars of the aggregate amount of relevant donations received by the body in respect of each qualifying project.
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(13) Where any question arises as to whether for the purposes of this section a project is a qualifying project, or a donation is a relevant donation, the Revenue Commissioners may consult with the Minister.
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(14) Relief under this section shall not be given in respect of a relevant donation which is made at any time to a national governing body in respect of a qualifying project if, at that time, the aggregate of the amounts of that relevant donation and all other relevant donations made to the national governing body in respect of the qualifying project at or before that time exceeds €40,000,000.”.
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