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8 1976

CAPITAL ACQUISITIONS TAX ACT, 1976

PART IX

Exemptions

Exemption of small gifts.

53. —(1) The first £250 of the total taxable value of all taxable gifts taken by a donee from any one disponer in any relevant period shall be exempt from tax and shall not be taken into account in computing tax.

(2) In the case of a gift which becomes an inheritance by reason of its being taken under a disposition where the date of the disposition is within two years prior to the death of the disponer, the same relief shall be granted in respect thereof under subsection (1) as if it were a gift.

(3) The first £250 of the total aggregable value of all aggregable gifts (within the meaning of paragraph 1 of Part I of the Second Schedule) which are taken by the donee from any one disponer in any relevant period shall not be taken into account in computing tax.

(4) In this section, “relevant period” means the period commencing on the 28th day of February, 1969, and ending on the 31st day of December, 1969, and thereafter the period of twelve months ending on the 31st day of December in each year.

Provisions relating to charities, etc.

54. —(1) Any benefit taken by a person for public or charitable purposes shall, for the purposes of sections 5 (1) and 11 (1), be deemed to be taken beneficially by a person who is other than a donee or successor referred to in Table I, II or III of Part II of the Second Schedule.

(2) A gift or an inheritance which is taken for public or charitable purposes shall, to the extent that the Commissioners are satisfied that it has been or will be applied to public or charitable purposes in the State or Northern Ireland, be exempt from tax and shall not be taken into account in computing tax.

(3) Save as provided in section 56 (4), a gift or inheritance which a person takes on becoming entitled to any benefit on the application to public or charitable purposes of property (including moneys provided by the Oireachtas or a local authority) held for such purposes shall be exempt from tax and shall not be taken into account in computing tax.

Exemption of certain objects.

55. —(1) This section applies to the following objects, that is to say, any pictures, prints, books, manuscripts, works of art, jewellery, scientific collections or other things not held for the purposes of trading—

(a) which, on a claim being made to the Commissioners, appear to them to be of national, scientific, historic or artistic interest;

(b) which are kept permanently in the State except for such temporary absences outside the State as are approved by the Commissioners; and

(c) in respect of which reasonable facilities for viewing are allowed to members of the public or to recognised bodies or to associations of persons.

(2) (a) Any object to which this section applies and which, at the date of the gift or at the date of inheritance, and at the valuation date, is comprised in a gift or an inheritance taken by a person shall be exempt from tax in relation to that gift or inheritance, and the value thereof shall not be taken into account in computing tax on any gift or inheritance taken by that person from the same disponer unless the exemption ceases to apply under the provisions of subsection (3) or (4).

(b) The provisions of section 19 (6) shall apply, for the purposes of this subsection, as they apply in relation to agricultural property.

(3) If an object exempted from tax by virtue of subsection (2) is sold within six years after the valuation date, and before such object forms part of the property comprised in a subsequent gift or inheritance, the exemption referred to in subsection (2) shall cease to apply to such object:

Provided that, if the sale of such object is a sale by private treaty to the National Gallery of Ireland, the National Museum of Science and Art or any other similar national institution, any university in the State, a local authority or the Friends of the National Collections of Ireland, the exemption referred to in subsection (2) shall continue to apply.

(4) The exemption referred to in subsection (2) shall cease to apply to an object, if at any time after the valuation date, and before such object again forms part of the property comprised in a gift or an inheritance, there has been a breach, by the donee or successor, of any condition specified in subsection (1) (b) or (c).

Payments relating to retirement, etc.

56. —(1) Subject to the provisions of subsection (2), any payment to an employee or former employee by, or out of funds provided by, his employer or any other person, bona fide by way of retirement benefit, redundancy payment or pension shall not be a gift or an inheritance.

(2) Subsection (1) shall not have effect in relation to a payment referred to in that subsection, and any such payment shall be deemed to be a gift or an inheritance where—

(a) (i) the employee is a relative of the employer or other disponer; or

(ii) the employer is a private company within the meaning of section 16 (2), and of which private company the employee is deemed to have control within the meaning of that section:

(b) the payment is not made under a scheme (relating to superannuation, retirement or redundancy) approved by the Commissioners under the Income Tax Acts; and

(c) the Commissioners decide that in the circumstances of the case the payment is excessive.

(3) The Commissioners shall serve on an accountable person a notice in writing of their decision referred to in subsection (2) and the accountable person concerned may appeal against such decision and section 52 shall apply with any necessary modifications in relation to such appeal as it applies in relation to an appeal against an assessment of tax.

(4) Any benefit taken by a person other than the person in respect of whose service the benefit arises, under the provisions of any superannuation fund, or under any superannuation scheme, established solely or mainly for persons employed in a profession, trade, undertaking or employment, and their dependants, shall (whether or not any person had a right enforceable at law to the benefit) be deemed to be a gift or an inheritance, as the case may be, derived under a disposition made by the person in respect of whose service the benefit arises and not by any other person.

(5) In this section—

superannuation scheme” includes any arrangement in connection with employment for the provision of a benefit on or in connection with the retirement or death of an employee;

employment” includes employment as a director of a body corporate and cognate words shall be construed accordingly.

Exemption of certain securities.

57. —(1) In this section—

security” means any security, stock, share, debenture, debenture stock, certificate of charge or other form of security issued, whether before or after the passing of this Act, and which by virtue of any enactment or by virtue of the exercise of any power conferred by any enactment is exempt from taxation when in the beneficial ownership of a person neither domiciled nor ordinarily resident in the State;

unit trust scheme” means a unit trust scheme registered in the register established by the Unit Trusts Act, 1972 , whose deed expressing the trusts of the scheme restricts the property subject to those trusts to securities.

(2) Any security, or units (within the meaning of the Unit Trusts Act, 1972 ) of a unit trust scheme, comprised in a gift or an inheritance shall be exempt from tax (and shall not be taken into account in computing tax on any gift or inheritance taken by the donee or successor from the same disponer) if and only if—

(a) the security or units was or were comprised in the gift or inheritance—

(i) at the date of the gift or at the date of the inheritance; and

(ii) at the valuation date; and

(b) the donee or successor is at the date of the gift or at the date of the inheritance neither domiciled nor ordinarily resident in the State and the provisions of section 19 (6) shall apply, for the purposes of this subsection, as they apply in relation to agricultural property:

Provided that if a security or units or any part thereof comprised—

(a) in a gift; or

(b) in a gift which becomes an inheritance by reason that it was taken under a disposition where the date of the disposition was within two years prior to the death of the disponer,

is within one year after the valuation date sold or exchanged, or is converted (otherwise than into another security or other units respectively, which, during that period of one year, are not sold or exchanged), the donee or successor shall be deemed to have taken from the disponer a gift or an inheritance, as the case may be, consisting of a sum equal to the market value at the valuation date of the security or units or of the part thereof that has been sold, exchanged or converted.

(3) For the purposes of sections 6 (1) (c) and 12 (1) (b), the sum referred to in the proviso to subsection (2) shall be deemed to be situate in the State at the date of the gift or at the date of the inheritance, as the case may be, if the security or units (or the part thereof) so sold, exchanged or converted had at that date been situate in the State and not otherwise.

Exemption of certain receipts.

58. —(1) The following shall not be gifts or inheritances—

(a) the receipt by a person of any sum bona fide by way of compensation or damages for any wrong or injury suffered by him in his person, property, reputation or means of livelihood;

(b) the receipt by a person of any sum bona fide by way of compensation or damages for any wrong or injury resulting in the death of any other person;

(c) the receipt by a person of any sum bona fide by way of winnings from betting (including pool betting) or from any lottery, sweepstake or game with prizes;

(d) any benefit arising out of—

(i) the payment to the Official Assignee in Bankruptcy of money which has been provided by, or which represents property provided by, friends of a bankrupt; or

(ii) a remission or abatement of debts by the creditors of a bankrupt,

to enable the bankrupt to fulfil an offer of composition after bankruptcy in accordance with the provisions of section 149 of the Irish Bankrupt and Insolvent Act, 1857; and

(e) any benefit arising out of—

(i) the payment to the Official Assignee in Bankruptcy of money which has been provided by, or which represents property provided by, friends of an arranging debtor; or

(ii) a remission or abatement of debts by the creditors of an arranging debtor,

to enable the debtor to carry out the terms of a proposal made by him under section 345 of the Irish Bankrupt and Insolvent Act, 1857, which has been accepted by his creditors and approved and confirmed by the High Court.

(2) Notwithstanding anything contained in this Act, the receipt in the lifetime of the disponer of money or money's worth—

(a) by—

(i) the spouse or child of the disponer; or

(ii) a person in relation to whom the disponer stands in loco parentis,

for support, maintenance or education; or

(b) by a person who is in relation to the disponer a dependent relative under section 142 of the Income Tax Act, 1967 , for support or maintenance,

shall not be a gift or an inheritance, where the provision of such support, maintenance or education, or such support or maintenance—

(i) is such as would be part of the normal expenditure of a person in the circumstances of the disponer, and

(ii) is reasonable having regard to the financial circumstances of the disponer.

Exemption where disposition was made by the donee or successor.

59. —(1) Tax shall not be chargeable upon a gift or an inheritance taken by the donee or successor under a disposition made by himself.

(2) Where, at the date of the gift, two companies are associated in the manner described in subsection (3), a gift taken by one of them under a disposition made by the other shall be deemed to be a gift to which subsection (1) applies.

(3) For the purposes of subsection (2), two companies shall be regarded as associated if—

(a) one company would be beneficially entitled to not less than 90 per cent. of any assets of the other company available for distribution to the owners of its shares and entitlements of the kind referred to in section 34 (1) on a winding up; or

(b) a third company would be beneficially entitled to not less than 90 per cent. of any assets of each of them available as in paragraph (a).

(4) In this section, “company” means a body corporate (wherever incorporated), other than a private company within the meaning of section 16 (2).