Taxes Consolidation Act, 1997
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Taxation of certain foreign currencies. [FA93 s47(1) and (2)] |
80.—(1) In this section— | |
“relevant liability”, in relation to an accounting period, means relevant principal— | ||
(a) denominated in a currency other than the currency of the State, and | ||
(b) the interest in respect of which— | ||
(i) is to be treated as a distribution for the purposes of the Corporation Tax Acts, and | ||
(ii) is computed on the basis of a rate which, at any time in that accounting period, exceeds 80 per cent of the specified rate at that time; | ||
“relevant principal” means an amount of money advanced to a borrower by a company, the ordinary trading activities of which include the lending of money, where— | ||
(a) the consideration given by the borrower for that amount is a security within subparagraph (ii), (iii)(I) or (v) of section 130 (2)(d), and | ||
(b) interest or any other distribution is paid out of the assets of the borrower in respect of that security; | ||
“specified rate” means— | ||
(a) the rate known as the 3 month Dublin Interbank Offered Rate, a record of which is maintained by the Central Bank of Ireland, or | ||
(b) where such a record was not maintained, the rate known as the Interbank market 3 month fixed rate as published in the statistical appendices of the bulletins and annual reports of the Central Bank of Ireland. | ||
(2) Notwithstanding any other provision of the Tax Acts or the Capital Gains Tax Acts, a profit or loss from any foreign exchange transaction, being a profit or loss which arises in an accounting period— | ||
(a) in connection with relevant principal which, in relation to the accounting period, is a relevant liability, and | ||
(b) to a company which, in relation to that relevant liability, is the borrower, | ||
shall for the purposes of those Acts be deemed to be a profit or gain or a loss, as the case may be, of the trade carried on by the borrower in the course of which trade the relevant liability is used. |