Select view:

Taxes Consolidation Act, 1997 (Number 39 of 1997)

198 Certain interest not to be chargeable.

[FA95 s40]

[3]>

[1]>(1)<[1]Notwithstanding any other provision of the Income Tax Acts but without prejudice to any charge under the Corporation Tax Acts on the profits of such person, a person not ordinarily resident in the State shall not be chargeable to income tax in respect of interest paid by a company in the course of carrying on relevant trading operations within the meaning of section 445 or 446.

<[3]

[3]>

(1) (a) In this subsection—

[21]>

arrangements” means arrangements having the force of law by virtue of [12]>section 826<[12][13]>[12]>section 826(1)(a)<[12]<[13][13]>section 826(1)<[13];

<[21]

[21]>

arrangements” means arrangements having the force of law by virtue of section 826(1) or arrangements made with the government of a territory which on completion of the procedures set out in section 826(1) will have the force of law;

<[21]

relevant territory” means—

(i) a Member State of the European Communities other than the State, [18]>or<[18] [22]>or<[22]

(ii) not being such a Member State, a territory with the government of which arrangements [19]>have been made;<[19][19]>have been [23]>made, or<[23]<[19][23]>made;<[23]

[24]>

[20]>

(iii) not being a territory referred to in subparagraph (i) or (ii), a territory with the government of which arrangements have been made which on completion of the procedures set out in section 826(1) will have the force of law;

<[20]

<[24]

tax”, in relation to a relevant territory, means any tax imposed in that territory which corresponds to [4]>corporation tax<[4][4]>income tax or corporation tax, as is appropriate,<[4] in the State.

(b) For the purposes of this subsection, a [5]>company<[5][5]>person<[5] shall be regarded as being a resident of a relevant territory if—

(i) in a case where the relevant territory is a territory with the government of which arrangements have been made [25]>and have effect in accordance with the provisions of those arrangements<[25], the [5]>company<[5][5]>person<[5] is regarded as being a resident of that territory under those arrangements, and

(ii) in any other case, the [5]>company<[5][5]>person<[5] is by virtue of the law of the relevant territory resident for the purposes of tax in that territory.

(c) Notwithstanding any other provision of the Income Tax Acts but without prejudice to any charge under the Corporation Tax Acts on the profits of such a person—

(i) a company not resident in the State or a person not ordinarily resident in the State shall not be chargeable to income tax in respect of interest paid by—

(I) a company in the course of carrying on relevant trading operations (within the meaning of section 445 or 446), or

(II) a specified collective investment undertaking (within the meaning of section 734),

[6]>and<[6]

[26]>

(ii) a company shall not be chargeable to income tax in respect of interest paid by a relevant person (within the meaning of section 246) in the ordinary course of a trade or business carried on by that person if the company—

(I) is not resident in the State, and

(II) is regarded for the purposes of this subsection as being a resident of a [7]>relevant territory.<[7][7]>relevant territory,<[7]

<[26]

<[3]

[26]>

(ii) a company shall not be chargeable to income tax in respect of interest paid by a relevant person (within the meaning of section 246) in the ordinary course of a trade or business carried on by that person—

(I) if the company is not resident in the State but is regarded for the purposes of this subsection as being a resident of a relevant territory which imposes a tax that generally applies to interest receivable in that territory by companies from sources outside that territory, or

(II) where the interest—

(A) is exempted from the charge to income tax under arrangements made with the government of a territory outside the State having the force of law under the procedures set out in section 826(1), or

(B) would be exempted from the charge to income tax if arrangements made, on or before the date of payment of the interest, with the government of a territory outside the State, that do not have the force of law under the procedures set out in section 826(1), had the force of law when the interest was paid,

<[26]

[9]>

[7]>

and

<[7]

<[9]

[14]>

[8]>

(iii) a person shall not be chargeable to income tax in respect of interest paid by a company if—

(I) the person is not resident in the State, and

(II) the person is regarded for the purposes of this subsection as being a resident of a relevant territory,

and the interest is interest to which section 64(2) applies.

<[8]

<[14]

[27]>

[14]>

(iii) a person shall not be chargeable to income tax in respect of interest payable by a company if the person is not a resident of the State and is regarded as being a resident of a relevant territory for the purpose of this subsection, and the interest is interest to which section 64(2) applies [15]>, an interest payment to which section 246A applies<[15] or interest paid in respect of an asset covered security within the meaning of section 2 of the Asset Covered Securities Act, 2001.

<[14]

<[27]

[27]>

(iii) a person shall not be chargeable to income tax in respect of interest paid by a company—

(I) if the person is not a resident of the State and is regarded as being a resident of a relevant territory for the purposes of this subsection, or

(II) [29]>if<[29] the person is a company controlled in accordance with section 172D(3)(b)(ii), or a company the principal class of shares of which are shares to which section 172D(3)(b)(iii) applies, and the interest is interest to which section 64(2) applies, an interest payment to which section 246A applies or interest paid in respect of an asset covered security within the meaning of section 3 of the Asset Covered Securities Act 2001,

<[27]

[11]>

(iv) a person shall not be chargeable to income tax in respect of interest paid by a qualifying company (within the meaning of section 110) if the person is not a resident of the State and is regarded as being a resident of a relevant territory for the purposes of this subsection, and the interest is paid out of the [16]>assets of the qualifying company<[16][16]>assets of the qualifying company, and<[16].

<[11]

[17]>

(v) a person shall not be chargeable to income tax in respect of discounts arising on securities issued by a relevant person (within the meaning of section 246) in the ordinary course of a trade or business carried on by that person if the first mentioned person is not a resident of the State and is regarded as being a resident of a relevant territory for the purposes of this subsection.

<[17]

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[1]>

(2) In relation to interest paid in respect of a relevant security (within the meaning of section 246), subsection (1) shall apply—

[2]>

(a) as if there were deleted from subsection (2) of section 445 “, and any certificate so given shall, unless it is revoked under subsection (4), (5) or (6), remain in force until the 31st day of December, 2005”, and

(b) as if there were deleted from subsection (2) of section 446 “, and any certificate so given shall, unless it is revoked under subsection (4), (5) or (6), remain in force until the 31st day of December, 2005”.

<[2]

<[1]

[2]>

(a) as if in section 445 the following subsection were substituted for subsection (2) of that section:

“(2) Subject to subsections (7) and (8), the Minister may give a certificate certifying that such trading operations of a qualified company as are specified in the certificate are, with effect from a date specified in the certificate, relevant trading operations for the purpose of this section.”,

and

(b) as if in section 446 the following subsection were substituted for subsection (2) of that section:

“(2) Subject to subsections (7) and (9), the Minister may give a certificate certifying that such trading operations of a company as are specified in the certificate are, with effect from a date specified in the certificate, relevant trading operations for the purpose of this section.”.

<[2]

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(2) Where a company would not be chargeable to income tax in respect of interest paid in respect of a ‘relevant security’ (within the meaning of section 246) in accordance with this section but for the fact that—

(a) sections 445 and 446 have been deleted, and

(b) those sections referred to time limits in respect of certificates to which each section related,

then, notwithstanding those deletions and time limits, the company shall not be so chargeable and the other provisions of this section shall apply with any modifications necessary to give effect to this subsection.

<[28]

[1]

[+] [+]

Inserted and Renumbered by FA98 s54.

[2]

[-] [+]

Substituted by FA99 s85(a).

[3]

[-] [+]

Substituted by FA00 s34(1). This section shall apply as respects interest paid in the year of assessment 2000-2001 and subsequent years of assessment.

[4]

[-] [+]

Substituted by FA01 s36(1)(a). This section shall apply as respects interest paid on or after the date of 30 March 2001

[5]

[-] [+] [-] [+] [-] [+]

Substituted by FA01 s36(1)(b). This section shall apply as respects interest paid on or after the date of 30 March 2001

[6]

[-]

Deleted by FA01 s36(1)(c). This section shall apply as respects interest paid on or after the date of 30 March 2001

[7]

[-] [+] [+]

Substituted by FA01 s36(1)(d). This section shall apply as respects interest paid on or after the date of 30 March 2001

[8]

[+]

Inserted by FA01 s36(1)(e). This section shall apply as respects interest paid on or after the date of 30 March 2001

[9]

[-]

Deleted by FA03 s48(3)(a). Applies as respects interest paid on or after 6 February 2003.

[11]

[+]

Inserted by FA03 s48(3)(c). Applies as respects interest paid on or after 6 February 2003.

[12]

[-] [+]

Substituted by FA04 sched3(1)(g). This section shall have effect as on and from 25 March 2004

[13]

[-] [+]

Substituted by FA07 sched2(1)(g). Has effect as on and from 2 April 2007

[14]

[-] [+]

Substituted by ACSA01 sched2(1). With effect from 22 March 2002 per SI 94 of 2002.

[15]

[+]

Inserted by F(No.2)A08 s25(1)(a). Applies as respects interest paid or discounts arising on or after 1 January 2009.

[16]

[-] [+]

Substituted by F(No.2)A08 s25(1)(b). Applies as respects interest paid or discounts arising on or after 1 January 2009.

[17]

[+]

Inserted by F(No.2)A08 s25(1)(c). Applies as respects interest paid or discounts arising on or after 1 January 2009.

[18]

[-]

Deleted by F(No.2)A08 s33(d)(i). This section is deemed to have come into force and takes effect as on and from 1 January 2009.

[19]

[-] [+]

Substituted by F(No.2)A08 s33(d)(i). This section is deemed to have come into force and takes effect as on and from 1 January 2009.

[20]

[+]

Inserted by F(No.2)A08 s33(d)(ii). This section is deemed to have come into force and takes effect as on and from 1 January 2009.

[21]

[-] [+]

Substituted by FA10 s40(1)(a). Has effect as on and from 3 April 2010.

[22]

[+]

Inserted by FA10 s40(1)(b)(i). Has effect as on and from 3 April 2010.

[23]

[-] [+]

Substituted by FA10 s40(1)(b)(ii). Has effect as on and from 3 April 2010.

[24]

[-]

Deleted by FA10 s40(1)(b)(iii). Has effect as on and from 3 April 2010.

[25]

[+]

Inserted by FA10 s40(1)(c). Has effect as on and from 3 April 2010.

[26]

[-] [+]

Substituted by FA10 s40(1)(d). Has effect as on and from 3 April 2010.

[27]

[-] [+]

Substituted by FA12 s39(1). Shall apply to interest paid on or after 31 March 2012.

[28]

[-] [+]

Substituted by FA12 sched1(8).

[29]

[+]

Inserted by FA13 sched2(1)(d). Has effect on and from 27 March 2013.