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Chapter 3
Income Tax, Corporation Tax and Capital Gains Tax
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Amendment of Part 16 (income tax relief for investment in corporate trades — business expansion scheme and seed capital scheme) of Principal Act.
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16.—Part 16 of the Principal Act is amended—
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(a) in section 489—
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(i) by inserting the following after subsection (4):
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“(4A) Notwithstanding any other provision of this section, where—
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(a) (i) in accordance with section 508 relief is due in respect of an amount subscribed as nominee for a qualifying individual by the managers of a designated fund,
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(ii) the amount so subscribed was subscribed to the designated fund in the period beginning on 1 January 2002 and ending on 31 January 2002, and
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(iii) the eligible shares in respect of which the amount is subscribed by the managers of the designated fund are issued on or before 31 December 2002,
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or
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(b) eligible shares are issued by a qualifying company to a qualifying individual in the period beginning on 1 January 2002 and ending on 31 January 2002,
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the qualifying individual may elect by notice in writing to the inspector to have the relief due given as a deduction from his or her total income for the year of assessment 2001 instead of (as provided for in subsection (3)) as a deduction from his or her total income for the year of assessment 2002.”,
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(ii) in paragraphs (a) and (b) of subsection (5), by substituting “6 years” for “5 years”, and
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(iii) in subsection (15), by substituting “31 December 2003” for “31 December 2001”,
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(b) (i) in section 490(3)(a), by inserting “or (4A)” after “section 489(4)”, and
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(ii) in subsections (3)(b) and (4)(b) of section 490, by substituting “2003” for “2001”,
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and
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(c) in section 491—
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(i) by substituting the following for paragraph (a) of subsection (2):
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“(a) Subject to this section, where a company raises any amount through the issue of eligible shares on or after 1 January 2002 (in this section referred to as ‘the relevant issue’), relief shall not be given in respect of the excess of the amount so raised over the amount determined by the formula—
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A — B
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where—
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A is—
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(i) in the case of a company which, or whose qualifying subsidiary, raises the amount by virtue of section 496(2)(a)(iv)(II), €127,000,
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(ii) in the case where the money raised was used, is being used or is intended to be used solely for qualifying trading operations referred to in section 496(2)(a)(ix) carried on or to be carried on by the company or its qualifying subsidiary, €1,270,000, or
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(iii) in any other case, €750,000,
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and
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B is the lesser of—
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(i) the appropriate amount represented by A in the formula, and
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(ii) an amount equal to the aggregate of all amounts raised by the company through the issue of eligible shares at any time before the relevant issue.”,
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and
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(ii) by substituting the following for paragraph (a) of subsection (3):
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“(a) Where, on or after 1 January 2002, a company raises any amount through a relevant issue and that company is associated (within the meaning of this section) with one or more other companies, then, as respects that company, relief shall not be given in respect of the excess of the amount so raised over the amount determined by the formula—
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A — B
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where—
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A is—
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(i) in the case of a company which, or whose qualifying subsidiary, raises the amount by virtue of section 496(2)(a)(iv)(II), €127,000,
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(ii) in the case where the money raised was used, is being used or is intended to be used solely for qualifying trading operations referred to in section 496(2)(a)(ix) carried on or to be carried on by the company or its qualifying subsidiary, €1,270,000, or
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(iii) in any other case, €750,000,
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and
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B is the lesser of—
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(i) the appropriate amount represented by A in the formula, and
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(ii) the aggregate of all amounts raised through the issue of eligible shares at any time before or on the date of the relevant issue by all of the companies (including that company) which are associated within the meaning of this section.”.
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