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23 1971

FINANCE ACT, 1971

PART V

Corporation Profits Tax

Continuance of certain exemptions from corporation profits tax.

45. —The exemptions from corporation profits tax specified in section 33 (1) of the Finance Act, 1929 , shall be given in respect of the period beginning on the 1st day of January, 1971, and ending on the 31st day of December, 1971.

Amendment of section 69 of Finance Act, 1959.

46. —(1) Any reference in section 69 of the Finance Act, 1959 , to an allowance under section 241 of the Income Tax Act, 1967 , shall, in a case in which section 26 (2) of this Act has had effect, be construed as a reference to the allowance as increased under that subsection.

(2) Section 69 of the Finance Act, 1959 , is hereby amended by the insertion in subsection (1) of the following paragraph after paragraph (d);

“(dd) an investment allowance under section 22 of the Finance Act, 1971,”.

(3) Where for any year of assessment—

(a) section 26 (2) of this Act is deemed not to have applied to any machinery or plant, or

(b) an investment allowance in respect of qualifying machinery or plant is withdrawn under section 25 of this Act,

there shall be made for the purposes of corporation profits tax all such additional assessments and adjustments of assessments as may be appropriate.

Amendment of section 14 of Finance Act, 1962.

47. —(1) In relation to interest chargeable for any month commencing on or after the date of the passing of this Act, or part of such a month on corporation profits tax due and payable whether before, on or after such date, section 14 (1) of the Finance Act, 1962 , is hereby amended by the substitution of “.75 per cent.” for “one-half per cent.”.

(2) (a) Section 14 of the Finance Act, 1962 , is hereby further amended—

(i) by the addition to subsection (1) of the following proviso:

“Provided that corporation profits tax charged by any assessment shall, notwithstanding any appeal against such assessment, carry interest at the rate of .75 per cent. for each month or part of a month from the date when, if there were no appeal against the assessment, the tax would become due and payable under section 56 (1) of the Finance Act, 1920, until payment.”;

(ii) by the substitution in subsection (3) of “two months” for “three months”; and

(iii) by the insertion after subsection (3) of the following subsection:

“(3A) (a) Where notice of appeal has been given against an assessment to corporation profits tax and an agreement as to the amount of tax which should be paid notwithstanding the appeal has been reached between the appellant and the inspector or other officer of the Revenue Commissioners concerned under section 31 of the Finance Act, 1964 , and the amount so agreed has been paid within the period referred to in subsection (3), subsection (1) shall not apply to any balance of tax chargeable in accordance with the determination of the appeal if such balance is paid within two months from the determination of the appeal.

(b) Where notice of appeal has been given against an assessment to corporation profits tax and, in the absence of such an agreement as is referred to in paragraph (a), an appellant pays within the period referred to in subsection (3) a sum on account of the tax charged by the assessment under appeal and such sum proves to be not less than 80 per cent. of the amount of tax found to be chargeable by the assessment on the determination of the appeal, subsection (1) shall not apply to any balance of tax chargeable in accordance with the determination if such balance is paid within two months from the date of the determination of the appeal.

(c) In this subsection ‘determination of the appeal’ means a determination by the Appeal Commissioners under section 416 (4) of the Income Tax Act, 1967 (as applied to corporation profits tax by Regulation 6 of the Corporation Profits Tax Regulations, 1967), and includes—

(i) an agreement under section 416 (3) of the Income Tax Act, 1967 (as applied as aforesaid), and

(ii) an assessment becoming final and conclusive by virtue of section 416 (6) of that Act (as applied as aforesaid).”.

(b) Paragraph (a) of this subsection shall not have effect in relation to corporation profits tax charged by any assessment made before the date of the passing of this Act.

(3) Section 65 of the Finance Act, 1965 , shall not apply in relation to assessments to corporation profits tax made on or after the date of the passing of this Act.

Amendment of section 31 of Finance Act, 1964.

48. —In relation to assessments made on or after the date of the passing of this Act, section 31 of the Finance Act, 1964 , is hereby amended—

(a) by the insertion in subsection (1) after “repaid” of “with interest at the rate provided by section 14 (1) of the Finance Act, 1962 , from the date or dates of payment of the amount or amounts giving rise to the overpayment to the date on which the repayment is made”, and

(b) by the addition to subsection (1) of the following proviso:

“Provided that—

(a) interest shall not be payable under this subsection if it amounts to less than £1, and

(b) income tax shall not be deductible on payment of interest under this section and such interest shall not be reckoned in computing profits for purposes of corporation profits tax.”, and

(c) by the insertion after subsection (1) of the following subsection:

“(1 A) Where, in a case in which notice of appeal has been given against an assessment to corporation profits tax and in which there is no agreement of the kind referred to in subsection (1), the appellant pays an amount of tax on account of the tax charged by the assessment under appeal which is in excess of the tax found to be chargeable by the assessment on the determination of the appeal, the provisions of subsection (1) shall apply as if the overpayment of tax had arisen by reason of a payment made in accordance with an agreement of the kind aforesaid.”.

Payment of tax notwithstanding application for rehearing of appeal by Circuit Court.

49. —Notwithstanding that, in the case of an assessment to corporation profits tax made upon a person on or after the date of the passing of the Finance Act, 1971, the person has, pursuant to section 429 of the Income Tax Act, 1967 (as applied to corporation profits tax by section 56 (6) of the Finance Act, 1920), required his appeal to the Appeal Commissioners against the assessment to be reheard by a judge of the Circuit Court, corporation profits tax shall be paid in accordance with the determination of the Appeal Commissioners:

Provided that if the amount of the assessment is altered by the determination of the judge, then—

(a) if too much tax has been paid, the amount or amounts overpaid shall, save where the interest amounts to less than £1, be repaid with interest at the rate provided by section 14 (1) of the Finance Act, 1962 , from the date or dates of payment of the amount or amounts overpaid to the date on which the repayment is made; or

(b) if too little tax has been paid, any balance shall be payable but the provisions of section 14 (3A) of the Finance Act, 1962 , shall apply as if the appeal were an appeal to the Appeal Commissioners and the determination of the appeal by the judge were a determination of the appeal by the Appeal Commissioners.

Interest on corporation profits tax in cases of fraud or neglect.

50. —(1) In this section “neglect” has the same meaning as in section 13 of the Finance (Miscellaneous Provisions) Act, 1968.

(2) Where, for any accounting period ending on or after the date of the passing of this Act, an assessment is made for the purpose of recovering an undercharge to corporation profits tax which is attributable to the fraud or neglect of any person, the amount of the tax undercharged shall carry interest at the rate of .75 per cent. for each month or part of a month from the expiration of one year after the end of that accounting period to the date of payment of the tax undercharged.

(3) Subject to subsection (5), subsections (1) and (3) of section 14 of the Finance Act, 1962 , shall not apply to tax carrying interest under this section.

(4) Subsections (4), (5), (6) and (7) of section 14 of the Finance Act, 1962 , shall apply to interest chargeable under this section as they apply to interest chargeable under the said section 14.

(5) Where an assessment of the kind referred to in subsection (2) is made—

(a) the inspector concerned shall give notice to the person assessed that the tax charged by the assessment will carry interest under this section,

(b) the person assessed may appeal against the assessment on the ground that interest should not be charged under this section and the provisions of the enactments relating to corporation profits tax governing appeals against assessments shall apply and have effect in relation to the appeal as they apply in relation to those appeals with any necessary modifications, and

(c) if, on the appeal, it is determined that the tax charged by the assessment should not carry interest under this section, subsections (1) and (3) of section 14 of the Finance Act, 1962 , shall apply to that tax.