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Chapter III
Retirement Annuities
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Retirement annuities (relief for premiums).
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235.—(1) Where an individual—
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(a) is (or would but for an insufficiency of profits or gains be) chargeable to tax in respect of relevant earnings from any trade, profession, office or employment carried on or held by him, and
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(b) pays a premium or other consideration under an annuity contract for the time being approved by the Revenue Commissioners as being a contract the main benefit secured by which is a life annuity for the individual in his old age (hereafter in this Chapter referred to as a qualifying premium),
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relief from tax may be given in respect of the qualifying premium under section 236.
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(2) Subject to subsection (3), the Revenue Commissioners shall not approve a contract unless it appears to them to satisfy the conditions that it is made by the individual with a person lawfully carrying on in the State the business of granting annuities on human life, and that it does not—
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(a) provide for the payment by that person during the life of the individual of any sum except sums payable by way of annuity to the individual,
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(b) provide for the annuity payable to the individual to commence before he attains the age of sixty or after he attains the age of seventy,
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(c) provide for the payment by that person of any other sums except sums payable by way of annuity to the individual's widow or widower and any sums which, in the event of no annuity becoming payable either to the individual or to a widow or widower, are payable to the individual's personal representatives by way of return of premiums, by way of reasonable interest on premiums or by way of bonuses out of profits,
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(d) provide for the annuity, if any, payable to a widow or widower of the individual to be of a greater annual amount than that paid or payable to the individual, or
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(e) provide for the payment of any annuity otherwise than for the life of the annuitant,
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and that it does include provision securing that no annuity payable under it shall be capable in whole or in part of surrender, commutation or assignment.
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(3) The Revenue Commissioners may, if they think fit, and subject to any conditions they think proper to impose, approve a contract otherwise satisfying the foregoing conditions, notwithstanding that the contract provides for one or more of the following matters:
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(a) for the payment after the individual's death of an annuity to a dependant not the widow or widower of the individual;
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(b) for the payment to the individual of an annuity commencing before he attains the age of sixty, if the annuity is payable on his becoming permanently incapable through infirmity of mind or body of carrying on his own occupation or any occupation of a similar nature for which he is trained or fitted;
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(c) if the individual's occupation is one in which persons customarily retire before attaining the age of sixty, for the annuity to commence before he attains that age (but not before he attains the age of fifty);
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(d) for the annuity payable to any person to continue for a term certain (not exceeding ten years) notwithstanding his death within that term, or for the annuity payable to any person to terminate, or be suspended, on marriage (or remarriage) or in other circumstances;
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(e) in the case of an annuity which is to continue for a term certain, for the annuity to be assignable by will, and in the event of any person dying entitled to it, for it to be assignable by his personal representatives in the distribution of the estate so as to give effect to a testamentary disposition, or to the rights of those entitled on intestacy or to an appropriation of it to a legacy or to a share or interest in the estate.
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(4) The foregoing provisions of this section shall apply in relation to a contribution under a trust scheme approved by the Revenue Commissioners as they apply in relation to a premium under an annuity contract so approved, with the modification that, for the condition as to the person with whom the contract is made, there shall be substituted a condition that the scheme—
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(a) is established under the law of, and administered in, the State,
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(b) is established for the benefit of individuals engaged in or connected with a particular occupation (or one or other of a group of occupations), and for the purpose of providing retirement annuities for them, with or without subsidiary benefits for their families or dependants, and
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(c) is so established under irrevocable trusts by a body of persons comprising or representing the majority of the individuals so engaged in the State,
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and with the necessary adaptations of other references to the contract or the person with whom it is made; and exemption from income tax shall be allowed in respect of income derived from investments or deposits of any fund maintained for the purpose aforesaid under a scheme for the time being approved under this subsection.
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(5) The Revenue Commissioners may at any time, by notice in writing given to the persons by and to whom premiums are payable under any contract for the time being approved under this section or to the trustees or other persons having the management of any scheme so approved, withdraw that approval on such grounds and from such date (including a date before the date of the notice) as may be specified in the notice and where any approval is withdrawn under this section, such assessments as may be appropriate for the purpose of withdrawing any reliefs given under this Chapter consequent upon the approval shall thereupon be made.
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(6) For the purposes of this Chapter a married woman's relevant earnings shall not be treated as her husband's relevant earnings, notwithstanding that her income chargeable to tax is treated as his income.
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(7) Subject to subsection (6), “relevant earnings” in relation to any individual means, for the purposes of this Chapter, any income of his chargeable to tax for the year of assessment in question, being either—
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(a) income arising in respect of remuneration from an office or employment of profit held by him other than a pensionable office or employment,
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(b) income from any property which is attached to or forms part of the emoluments of any such office or employment of profit held by him,
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(c) income which is chargeable under Schedule B or Schedule D and is immediately derived by him from the carrying on or exercise by him of his trade or profession either as an individual or, in the case of a partnership, as a partner personally acting therein, or
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(d) income treated as earned income by virtue of section 2 (2) (c),
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but does not include any remuneration from an investment company of which he is—
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(i) a proprietary director as defined in section 226, or
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(ii) a proprietary employee as defined in that section
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In this subsection “investment company” means a company the income whereof consists mainly of investment income, and “investment income” means, in relation to a company, income which, if the company were an individual, would not be earned income.
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(8) For the purposes of this Chapter, an office or employment is a pensionable office or employment if, and only if, service in it is service to which a sponsored superannuation scheme relates (not being a scheme under which the benefits provided in respect of that service are limited to a lump sum payable on the termination of the service through death before the age of seventy or some lower age or disability before the age of seventy or some lower age); but references to a pensionable office or employment apply whether or not the duties are performed wholly or partly in the State or the holder is chargeable to tax in respect of it.
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Service in an office or employment shall not for the purposes of this definition be treated as service to which a sponsored superannuation scheme relates by reason only of the fact that the holder of the office or employment might (though he does not) participate in the scheme by exercising or refraining from exercising an option open to him by virtue of that service.
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(9) In subsection (8) and in Schedule 5 “sponsored superannuation scheme” means a scheme or arrangement relating to service in particular offices or employments and having for its object or one of its objects to make provision in respect of persons serving therein against future retirement or partial retirement, against future termination of service through death or disability, or against similar matters, being a scheme or arrangement under which any part of the cost of the provision so made is or has been borne otherwise than by those persons by reason of their service (whether it is the cost or part of the cost of the benefits provided, or of paying premiums or other sums in order to provide those benefits, or of administering or instituting the scheme or arrangement); but for this purpose a person shall be treated as bearing by reason of his service the cost of any payment made or agreed to be made in respect of his service, if that payment or the agreement to make it is treated under this Act as increasing his income or would be so treated if he were chargeable to tax under Schedule E in respect of his emoluments from that service.
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(10) Nothing in sections 4 and 6 of the Policies of Assurance Act, 1867, shall be taken to apply to any contract approved under this section.
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