Chapter 3

Income Tax

4 .— As respects the year of assessment 2009 and subsequent years of assessment, section 15 of the Principal Act is amended—

(a) by substituting “€27,400” for “€26,400” (inserted by the Finance Act 2008 ) in subsection (3), and

(b) by substituting the following Table for the Table (as so inserted) to that section:

“TABLE

PART 1

PART 2

PART 3

”.

5 .— As respects the year of assessment 2009 and subsequent years of assessment, section 122 of the Principal Act is amended in the definition of the “ specified rate ” in subsection (1)(a)—

(a) by substituting “5 per cent” for “5.5 per cent” (inserted by the Finance Act 2008 ) in both places where it occurs, and

(b) by substituting “12.5 per cent” for “13 per cent” (inserted by the Finance Act 2008 ).

6 .— (1) Section 121 of the Principal Act is amended—

(a) in subsection (1) in the definition of “business mileage for a year of assessment” by substituting “whole kilometres” for “whole miles”,

(b) in subsection (3)—

(i) by deleting paragraph (c) for the year of assessment 2009 and subsequent years,

(ii) by inserting the following after paragraph (c):

“(d) This subsection is subject to subsection (4B) for years of assessment 2009 and subsequent years.”,

(c) in subsection (4)—

(i) in paragraph (a) by substituting “24,000 kilometres” for “15,000 miles”,

(ii) in paragraph (c)(i)—

(I) by substituting “24,000” for “15,000” in each place where it occurs, and

(II) by substituting the following for the Table to that subsection—

“TABLE

”,

(iii) by inserting the following after paragraph (c):

“(d) This subsection is subject to subsection (4B) for years of assessment 2009 and subsequent years.”,

(d) by deleting subsection (4A) for the year of assessment 2009 and subsequent years,

(e) by inserting the following after subsection (4A):

“(4B) (a) Where a new car is provided for the first time for the year of assessment 2009 or any subsequent year, the cash equivalent of the benefit shall be an amount determined by the formula:

Original market value [html] A

where—

A is a percentage, based on vehicle categories and business mileage, determined in accordance with column (3), (4) or (5), as the case may be, of Table A to this subsection.

(b) In Table A to this subsection, any percentage shown in column (3), (4) or (5), as the case may be, shall be the percentage applicable to any business mileage for a year of assessment which—

(i) exceeds the lower limit (if any) shown in column (1), and

(ii) does not exceed the upper limit (if any) shown in column (2),

opposite the mention of that percentage in column (3), (4) or (5), as the case may be.

(c) Any reference in this section to a vehicle in any of the vehicle Categories A to G as set out in the first column of Table B to this subsection is a reference to a vehicle whose CO ₂ emissions, confirmed by reference to the relevant EC type approval certificate or EC certificate of conformity, are set out in the corresponding entry in the second column of Table B to this subsection.

TABLE A

TABLE B

”,

(f) in subsection (5)—

(i) in subparagraph (ii) by substituting “8,000 kilometres” for “5,000 miles”, and

(ii) by deleting subparagraph (aa) for the year of assessment 2009 and subsequent years,

and

(g) in subsection (6)—

(i) in paragraph (b) by substituting “by deducting 8,000 from the total number of kilometres travelled” for “by deducting 5,000 from the total number of miles travelled”, and

(ii) by deleting paragraph (bb) for the year of assessment 2009 and subsequent years.

(2) This section comes into operation on such day or days as the Minister for Finance may by order or orders appoint and different days may be appointed for different purposes or different provisions.

7 .— (1) Chapter 3 of Part 5 of the Principal Act is amended—

(a) in section 118 by inserting the following after subsection (5F):

“(5G) (a) Subject to paragraph (c) of this subsection, subsection (1) shall not apply to expense of up to €1,000 incurred by the body corporate in, or in connection with, the provision for a director or employee of a bicycle or bicycle safety equipment, where—

(i) the bicycle and bicycle safety equipment provided is unused and not second-hand,

(ii) the director or employee uses the bicycle or bicycle safety equipment, or the bicycle and the bicycle safety equipment, as the case may be, mainly for qualifying journeys, and

(iii) bicycles or bicycle safety equipment, or bicycles and bicycle safety equipment, as the case may be, are made available generally to directors and employees of the body corporate.

(b) In this subsection—

‘ bicycle ’ means a pedal cycle;

‘ bicycle safety equipment ’ includes—

(i) bicycle bells and bulb horns,

(ii) bicycle helmets that conform to European product safety standard CEN/EN 1078,

(iii) bicycle lights, including dynamo packs,

(iv) bicycle reflectors and reflective clothing, and

(v) such other safety equipment as the Revenue Commissioners may allow;

‘ normal place of work ’ means the place where the director or employee normally performs the duties of his or her office or employment;

‘ pedal cycle ’ means—

(i) a bicycle or tricycle which is intended or adapted for propulsion solely by the physical exertions of a person or persons seated thereon, or

(ii) a pedelec,

but does not include a moped or a scooter;

‘ pedelec ’ means a bicycle or tricycle which is equipped with an auxiliary electric motor having a maximum continuous rated power of 0.25 kilowatts, of which output is progressively reduced and finally cut off as the vehicle reaches a speed of 25 kilometres per hour, or sooner if the cyclist stops pedalling;

‘ qualifying journey ’, in relation to a director or employee, means the whole or part of a journey—

(i) between the director’s or employee’s home and normal place of work, or

(ii) between the director’s or employee’s normal place of work and another place of work, where the director or employee is travelling in the performance of the duties of his or her office or employment.

(c) A director or employee shall not, by virtue of this subsection, be relieved from a charge to income tax under subsection (1) more than once in any period of 5 consecutive years of assessment, commencing with the year of assessment in which the director or employee concerned is first provided with a bicycle or bicycle safety equipment.”,

(b) in section 118B—

(i) in subsection (1) in the definition of “ salary sacrifice agreement ” by substituting “‘salary sacrifice arrangement’ ” for “salary sacrifice agreement”,

(ii) in subsection (2)—

(I) in paragraph (a)(i) by deleting “and” and in paragraph (a)(ii) by substituting “section 510(4), and” for “section 510(4),”, and

(II) by inserting the following after paragraph (a)(ii):

“(iii) a bicycle or bicycle safety equipment provided to a director or employee and which is exempt from a charge to tax by virtue of section 118(5G),”,

and

(iii) in subsection (5) by substituting “salary sacrifice arrangement” for “salary sacrifice agreement”.

(2) This section applies in respect of expense incurred on or after 1 January 2009.

8 .— As respects the year of assessment 2009 and subsequent years of assessment, section 469 of the Principal Act is amended—

(a) in subsection (1)—

(i) by inserting the following definition before the definition of “ educational psychologist ”:

“ ‘ appropriate percentage ’, in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year;”,

and

(ii) by inserting the following definition before the definition of “ speech and language therapist ”:

“ ‘ specified amount ’, in relation to a year of assessment, means the amount of expenditure which qualifies for income tax relief in accordance with this section;”,

and

(b) by substituting the following for subsection (2):

“(2) Subject to this section, where an individual for a year of assessment proves that in the year of assessment he or she defrayed health expenses incurred for the provision of health care, the income tax to be charged on the individual, other than in accordance with section 16(2) for that year of assessment shall be reduced by the lesser of—

(a) the amount equal to the appropriate percentage of the specified amount, and

(b) the amount which reduces that income tax to nil,

but, where an individual proves that he or she defrayed health expenses incurred for the provision of health care in the nature of maintenance or treatment in a nursing home, the individual shall be entitled for the purpose of ascertaining the amount of the income on which he or she is to be charged to income tax, to have a deduction made from his or her total income of the amount proved to have been so defrayed.”.

9 .— (1) The Principal Act is amended—

(a) in paragraph 5(1) of Schedule 11—

(i) by deleting “or” where it occurs immediately before clause (d) and by substituting “paragraph 4, or” for “paragraph 4,” in clause (d), and

(ii) by inserting the following after clause (d):

“(e) where a person fails to provide information requested by the Revenue Commissioners under section 510(7) or information which is required to be delivered under section 510(8),”,

and

(b) in paragraph 3(1) of Schedule 12—

(i) by deleting “or” in clause (a) and by inserting “or” at the end of clause (b), and

(ii) by inserting the following after clause (b):

“(c) where a person fails to provide information requested by the Revenue Commissioners under paragraph 3(4) or information which is required to be delivered under paragraph 3(5),”.

(2) Subsection (1) applies as on and from the date of passing of this Act.

10 .— (1) Section 128 of the Principal Act is amended—

(a) by substituting the following for subsection (6):

“(6) (a) Subject to subsection (7), a person shall, in the case of a right granted by reason of the person’s office or employment, be chargeable to tax under this section in respect of a gain realised by another person—

(i) if the right was granted to that other person,

(ii) if the other person acquired the right otherwise than by or under an assignment made by means of a bargain at arm’s length,

(iii) if the 2 persons are connected persons at the time when the gain is realised, or

(iv) if the person benefits directly or indirectly from the exercise, assignment or release of the right by the other person;

but in a case within subparagraphs (ii), (iii), or (iv), the gain realised shall be treated as reduced by the amount of any gain realised by a previous holder on an assignment of the right.

(b) For the purposes of this subsection, a gain realised by another person shall include a gain realised on the exercise of a right by the person in respect of whose office or employment the right was granted, where that person exercises the right as nominee or bare trustee of the other person, or otherwise on behalf of the other person.”,

(b) in subsection (7) by substituting “subparagraph (ii) or (iii) of subsection (6)(a)” for “subsection (6)(b)”, and

(c) by substituting the following for subsection (8):

“(8) (a) Where a right (referred to in this subsection as the ‘original right’) is assigned or released and the whole or part of the consideration for the assignment or release consists of or comprises another right (referred to in this subsection as the ‘new right’) the new right shall not be treated as consideration for the assignment or release; but this section shall apply in relation to the new right as it applies in relation to the original right and as if the consideration for its acquisition did not include the value of the original right but did include the amount or value of the consideration given for the grant of the original right in so far as that has not been offset by any valuable consideration for the assignment or release other than the consideration consisting of the new right.

(b) The operation of paragraph (a) shall not prevent a charge arising under this section on a gain realised by the exercise of the original right.”.

(2) This section applies as on and from 20 November 2008.

11 .— Schedule 29 to the Principal Act is amended in column 3—

(a) by inserting the following before “section 238(3)”:

“section 128C(15)

section 128D(8)

section128E(9)”,

and

(b) by inserting the following before “section 904”:

“section 896A”.

12 .— (1) Chapter 5 of Part 5 of the Principal Act is amended by inserting the following after section 128C:

“Tax treatment of directors of companies and employees who acquire restricted shares.

128D.— (1) In this section—

‘ director ’ and ‘ employee ’ have the meanings, respectively, given to them by section 770(1);

‘ employer ’ means the company in which the director or employee holds his or her office or employment;

‘ market value ’ shall be construed in accordance with section 548;

‘ restricted shares ’ shall be construed in accordance with subsection (3);

‘ shares ’ includes stock;

‘ specified period ’ has the same meaning as in subsection (3)(a).

(2) Subject to subsection (7), this section applies where—

(a) a director or employee acquires shares (including shares acquired on the exercise of a right to which section 128 applies) in a company as a director or employee of that company or of another company,

(b) the shares are shares in the company in which the director or employee holds his or her office or employment or in a company which has control (within the meaning of section 432) of that company, and

(c) at the time of acquisition, the shares are restricted shares.

(3) For the purposes of this section, shares are restricted shares if—

(a) there is a written contract or agreement in place under the terms of which there is a restriction on the freedom of the director or employee by whom the shares are held to assign, charge, pledge as security for a loan or other debt, transfer, or otherwise dispose of the shares for a period of not less than one year (in this section referred to as the ‘ specified period ’),

(b) the contract or agreement is in place for bona fide commercial purposes and does not form part of a scheme or arrangement of which the main purpose or one of the main purposes is the avoidance of tax,

(c) the shares cannot be assigned, charged, pledged as security for a loan or other debt, transferred, or otherwise disposed of in any circumstances during the specified period, other than—

(i) on the death of the director or employee, or

(ii) as a consequence of the director or employee agreeing to—

(I) accept an offer for the shares (in this clause referred to as the ‘original shares’) if the acceptance or agreement would result in a new holding (within the meaning of section 584) being equated with the original shares for the purposes of capital gains tax,

(II) a transaction affecting the shares or such of the shares as are of a particular class if the transaction would be entered into pursuant to a compromise, arrangement or scheme applicable to or affecting all the ordinary share capital of the company in question or, as the case may be, all the shares of the same class as the shares acquired by the director or employee, or

(III) accept an offer of cash, with or without other assets, for the shares if the offer forms part of a general offer made to holders of shares of the same class as the shares acquired by the director or employee or of shares in the same company and made in the first instance on a condition such that if it is satisfied the person making the offer will have control (within the meaning of section 432) of that company,

and

(d) during the specified period, the shares are held in a trust established by the employer for the benefit of employees and directors, or held under such other arrangements as the Revenue Commissioners may allow.

(4) Where this section applies—

(a) any charge to income tax under Schedule E (and computed in accordance with section 112 or 128, as the case may be), or under Schedule D, on the acquisition of the shares, shall be reduced by an amount determined by the formula—

A x B

A x 100

where—

Ais the amount of the income tax charge under Schedule E or Schedule D, as the case may be, and

B is—

(i) where the specified period is one year, 10,

(ii) where the specified period is 2 years, 20,

(iii) where the specified period is 3 years, 30,

(iv) where the specified period is 4 years, 40,

(v) where the specified period is 5 years, 50,

(vi) where the specified period is more than 5 years, 60,

(b) the charge to income tax referred to in paragraph (a) shall be computed by reference to the market value of the shares at the date of acquisition but without regard to the restriction on the freedom of the director or employee by whom the shares are held to assign, charge, pledge as security for a loan or other debt, transfer, or otherwise dispose of the shares.

(5) Where a charge to income tax under Schedule E or Schedule D on the acquisition of shares by a director or employee is reduced in accordance with subsection (4), and—

(a) the restriction on the freedom of the director or employee to assign, charge, pledge as security for a loan or other debt, transfer, or otherwise dispose of the shares acquired by him or her is subsequently removed or varied, or

(b) the shares are disposed of in any of the circumstances mentioned in subparagraphs (i) and (ii) of subsection (3)(c) before the specified period expires,

then, notwithstanding any limitation in the Income Taxes Acts on the time within which assessments may be made, the income tax charge on the acquisition of the shares shall be adjusted to take account of the actual period during which there was a restriction on the freedom of the director or employee to assign, charge, pledge as security for a loan or other debt, transfer or otherwise dispose of the shares. The adjustment of liability to tax as may be necessary for the purposes of this subsection shall be made at any time, whether by means of an assessment, an additional assessment or otherwise.

(6) Where this section applies and a charge to income tax on the acquisition of shares by a director or employee is, for the purposes of section 552, to be treated as forming part of the consideration given by the director or employee for the acquisition of the shares, then the amount of the income tax charge to be so treated shall be the amount as reduced in accordance with subsection (4), together with any additional amount charged as a consequence of an adjustment made in accordance with subsection (5).

(7) This section does not apply to shares acquired by a director or employee under the terms of a scheme approved of by the Revenue Commissioners under Schedule 11, 12, 12A or 12C.

(8) Where in any year—

(a) a person awards restricted shares to a director or employee, or

(b) an event that comes within paragraph (a) or (b) of subsection (5) occurs in relation to restricted shares awarded,

then the person shall deliver to the Revenue Commissioners on or before 31 March in the year of assessment following the year in which the award was made or the event occurred, as the case may be, particulars of the award or the event, as the case may be.

(9) For the purposes of subsection (8), a person shall be deemed to award restricted shares to a director or employee where the director or employee acquires the restricted shares on the exercise of a right to which section 128 applies, and the right was granted to the director or employee by the person.

Tax treatment of directors of companies and employees who acquire forfeitable shares.

128E.— (1) In this section—

‘ director ’ and ‘ employee ’ have the meanings, respectively, given to them by section 770(1);

‘ market value ’ shall be construed in accordance with section 548;

‘ forfeitable shares ’ shall be construed in accordance with subsection (3);

‘ shares ’ includes stock.

(2) This section applies where—

(a) a director or employee acquires shares (including shares acquired on the exercise of a right to which section 128 applies) in a company as a director or employee of that company or of another company, and

(b) at the time of acquisition, the shares are forfeitable shares.

(3) Subject to subsection (4), for the purposes of this section, shares are forfeitable shares if—

(a) there is a written contract or agreement in place under the terms of which—

(i) there will be a forfeiture of the shares, if certain circumstances arise or do not arise,

(ii) as a result of the forfeiture, the director or employee will cease to have any beneficial interest in the shares, and

(iii) the director or employee will not be entitled to receive, directly or indirectly, consideration in money or money’s worth in respect of the shares on their forfeiture in excess of the consideration given by the director or the employee for the acquisition of the shares,

and,

(b) the contract or agreement is in place for bona fide commercial purposes and does not form part of a scheme or arrangement of which the main purpose or one of the main purposes is the avoidance of tax.

(4) Shares shall not be forfeitable shares by reason only that the shares are unpaid or partly paid shares which may be forfeited for non-payment of calls.

(5) Where this section applies, any charge to income tax under Schedule E (and computed in accordance with section 112 or 128, as the case may be), or under Schedule D, on the acquisition of the shares, shall be computed by reference to the market value of the shares at the date of acquisition but without regard to provision in a contract or agreement referred to in subsection (3) for the forfeiture of the shares.

(6) If under the terms of a contract or agreement referred to in subsection (3) the shares are forfeited, then—

(a) the director or employee shall, for income tax purposes, be treated, for the year of assessment in which the shares were acquired, as if he or she did not acquire the shares, and

(b) such adjustment shall be made by repayment or otherwise as the case may require, on receipt of a claim from the director or employee, which shall be made within 4 years from the end of the year of assessment in which the shares are forfeited.

(7) Subsection (6) applies notwithstanding any limitation in section 865(4) on the time within which a claim for a repayment of tax is required to be made. Section 865(6) does not prevent the Revenue Commissioners from repaying an amount of tax as a consequence of any adjustment made in accordance with subsection (6).

(8) Notwithstanding section 546(2), where subsection (6) of this section applies, the amount of a loss accruing on the forfeiture of the shares shall not exceed the amount of consideration given by the director or employee for the acquisition of the shares less any amount received by the director or employee on the forfeiture of the shares.

(9) Where in any year—

(a) a person awards forfeitable shares to a director or employee, or

(b) shares awarded to a director or employee are forfeited,

then the person shall deliver to the Revenue Commissioners on or before 31 March in the year of assessment following the year in which the award was made or the shares were forfeited, as the case may be, particulars of the award or the forfeiture, as the case may be.”.

(2) This section applies as on and from 20 November 2008 in respect of shares acquired on or after that date.

13 .— (1) The Principal Act is amended by inserting the following after section 825A:

“825B.— (1) In this section—

‘ associated company ’, in relation to a relevant employer, means a company which is that employer’s associated company within the meaning of section 432 and which is incorporated or resident in a country or jurisdiction which is not a party to the EEA agreement, but with the government of which arrangements are for the time being in force by virtue of section 826(1);

‘ EEA agreement ’ means the Agreement on the European Economic Area signed at Oporto on 2 May 1992, as adjusted by the Protocol signed at Brussels on 17 March 1993;

‘ emoluments ’ has the same meaning as in Chapter 4 of Part 42;

‘ relevant emoluments ’, in relation to a tax year, means emoluments that are—

(a) paid by a relevant employer or an associated company of that relevant employer to a relevant employee, and

(b) within the charge to tax under Schedule E and to which Chapter 4 of Part 42 has been applied,

for that tax year;

‘ relevant employee ’ means an individual who, for a tax year—

(a) is resident in the State for tax purposes, and

(b) is not domiciled in the State,

and who, prior to becoming resident in the State for tax purposes—

(i) was a resident of, and resident in, a country or jurisdiction that is not a party to the EEA Agreement but with the government of which arrangements are for the time being in force by virtue of section 826(1),

(ii) was employed in that country or jurisdiction by the same relevant employer referred to in subsection (2) or by an associated company of that relevant employer, and

(iii) had exercised the greater part of his or her employment in that country or jurisdiction;

‘ relevant employer ’ means a company that is incorporated, and is resident, in a country or jurisdiction that is not a party to the EEA Agreement but with the government of which arrangements are for the time being in force by virtue of section 826(1);

‘ Revenue officer ’ means an officer of the Revenue Commissioners;

‘ tax year ’ means a year of assessment.

(2) Where a relevant employee—

(a) becomes resident in the State for tax purposes,

(b) is required by his or her relevant employer to exercise the duties of his or her employment in the State,

(c) exercises those duties in the State on behalf of the relevant employer or on behalf of an associated company of the relevant employer for a period of at least 3 years, and

(d) while so exercising those duties, continues to be paid relevant emoluments from abroad by his or her relevant employer or associated company,

then after the end of any tax year in respect of which relevant emoluments are paid, the relevant employee may apply to the Revenue Commissioners to have the tax due on the relevant emoluments computed for the tax year on the full amount of the greater of—

(i) the relevant emoluments earned and received in or remitted—

(I) either directly or indirectly,

(II) through any property imported,

(III) through any money or value received on credit or on account,

to the State in that tax year, and

(ii) an amount equal to €100,000 plus 50 per cent of the relevant emoluments in excess of €100,000,

and any tax deducted from the relevant emoluments in excess of the tax due as so computed shall be repaid on foot of a claim from the relevant employee.

(3) Section 72 shall, with any necessary modification, apply to this section.

(4) For the purposes of this section, where deductions under Chapter 4 of Part 42 are made from relevant emoluments, such deductions shall be deemed to be an amount of the relevant emoluments received in or remitted to the State for the year of assessment to which such deductions refer.

(5) (a) If relevant emoluments are remitted to the State in a tax year after the tax year in which they were earned, and the individual has received a repayment under subsection (2) of any tax originally deducted from those emoluments, the individual shall be liable to income tax on those emoluments from the date on which the tax was originally deducted.

(b) In a case in which paragraph (a) applies, section 924(2)(b) shall apply in the case of assessments or additional first assessments in respect of the emoluments referred to in paragraph (a) subject to a substitution of a reference to the end of the tax year in which the emoluments were received for the reference to the end of the tax year in which the emoluments were remitted.

(6) Where a relevant employee—

(a) has claimed a repayment of tax under subsection (2), and

(b) fails to comply with the 3 year limit contained in subsection (2)(c),

then that employee shall, whether or not requested to do so by a Revenue officer and within 2 months of that failure, repay to the Revenue Commissioners the tax repaid under subsection (2).

(7) If a Revenue officer is not satisfied with the information provided by a relevant employee making a claim under subsection (2), the officer may refuse the claim.”.

(2) This section shall apply for the year of assessment 2009 and subsequent years.

14 .— As respects the year of assessment 2009 and subsequent years of assessment, section 244 of the Principal Act is amended—

(a) in subsection (2), by substituting the following for paragraph (a):

“(a) In this subsection ‘appropriate percentage’, in relation to a year of assessment, means—

(i) where relievable interest is determined by reference to paragraph (i) or (ii) of the definition of ‘relievable interest’, 15 per cent for that year,

(ii) where relievable interest is determined by reference to paragraph (iii) or (iv) of the definition of ‘relievable interest’:

(I) 25 per cent for the first and second years of assessment for which there is an entitlement to relief under this section,

(II) 22.5 per cent for the third, fourth and fifth years of assessment for which there is an entitlement to relief under this section, and

(III) a percentage equal to the standard rate of tax for the sixth and seventh years of assessment for which there is an entitlement to relief under this section.”,

(b) in subsection (1)(c) and (3)(a) by substituting “paragraph” for “subparagraph” in each place where it occurs.

15 .— Section 819 of the Principal Act is amended by substituting the following for subsection (4):

“(4) For the purposes of this section—

(a) as respects the year of assessment 2008 and previous years of assessment, an individual shall be deemed to be present in the State for a day if the individual is present in the State at the end of the day, and

(b) as respects the year of assessment 2009 and subsequent years of assessment, an individual shall be deemed to be present in the State for a day if the individual is present in the State at any time during that day.”.

16 .— (1) Part 30 of the Principal Act is amended—

(a) in section 787O(1) by substituting the following for the definition of “B” in the formula in paragraph (b) of the definition of “ personal fund threshold ” and “ standard fund threshold ”:

“B is—

(i) the earnings adjustment factor which may be designated in writing by the Minister for Finance in December of the year of assessment preceding the relevant year, a note of which shall be published as soon as practicable in the Iris Oifigiúil, or

(ii) where no earnings adjustment factor is designated by the Minister for Finance, 1;”,

and

(b) in section 790A—

(i) by substituting the following for subsection (2):

“(2) For a year of assessment (in this subsection referred to as the ‘relevant year’) after the year of assessment 2006 the earnings limit shall be an amount equivalent to the amount determined by the formula—

A [html] B

where—

A is the earnings limit for the year of assessment immediately preceding the relevant year, and

B is—

(i) the earnings adjustment factor which may be designated in writing by the Minister for Finance in December of the year of assessment preceding the relevant year, a note of which shall be published as soon as practicable in the Iris Oifigiúil, or

(ii) where no earnings adjustment factor is designated by the Minister for Finance, 1.”,

and

(ii) by inserting the following after subsection (2):

“(3) Notwithstanding subsection (2), for the purposes of subsection (1) the earnings limit for the year of assessment 2009 shall be €150,000.”.

(2) (a) Subject to paragraphs (b) and (c), subsection (1) has effect as on and from 1 January 2009.

(b) Paragraph (a) of subsection (1) is deemed to have effect as on and from 7 December 2005.

(c) Paragraph (b)(i) of subsection (1) is deemed to have effect as on and from 1 January 2006.