Taxes Consolidation Act, 1997 (Number 39 of 1997)
261 Taxation of relevant interest, etc.
[FA 86 s35(1)(a) to (cc); FA93 s15(1)(b); FA94 s12(1)(a)]
Notwithstanding anything in the Tax Acts—
(a) no part of any interest paid by a building society in respect of any shares in the society shall be treated for the purposes of the Corporation Tax Acts as a distribution of the society or as franked investment income of any company resident in the State;
(b) except where otherwise provided for in section 267, no repayment of appropriate tax in respect of any relevant interest shall be made to any person receiving or entitled to the payment of the relevant interest who is not a company within the charge to corporation tax in respect of the payment;
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(c) (i) the amount of any payment of relevant interest shall be regarded as income chargeable to tax under Case IV of Schedule D and under no other Case or Schedule and shall be taken into account in computing the total income of the person entitled to that amount, but, in relation to such a person (being an individual)—
(I) except for the purposes of a claim to repayment under section 267(3), the specified amount within the meaning of section 187 or 188, and
(II)the part of taxable income on which he or she is charged to income tax at the standard rate,
shall, as respects the year of assessment for which he or she is to be charged to income tax in respect of the relevant interest, be increased by the amount of that payment, and
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(c) (i) the amount of any payment of relevant interest shall be regarded as income chargeable to tax under Case IV of Schedule D, and under no other Case or Schedule, and shall be taken into account in computing the total income of the person entitled to that amount, but, in relation to such a [8]>person (being an individual)<[8][8]>person (other than a company)<[8]—
(I) except for the purposes of a claim to repayment under section 267(3), the specified amount within the meaning of [2]>section 187 or 188<[2][2]>section 188<[2] shall, as respects the year of assessment for which he or she is to be charged to income tax in respect of the relevant interest, be increased by the amount of that payment,
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(II) the part of taxable income on which he or she is charged to income tax at the standard rate for that year shall be increased by the part of such relevant interest which comes within [2]>paragraph (b) or the definition<[2][2]>paragraph (b) of the definition<[2] of “appropriate tax” in section 256(1), and
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(II) where the taxable income of that person includes relevant interest which comes within paragraph (b) of the definition of “appropriate tax” in section 256(1)[5]>of the Principal Act<[5], the part of taxable income, equal to that relevant interest, shall be chargeable to tax at the rate at which tax was deducted from that relevant interest.
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(II) where the taxable income of that person includes relevant interest, the part of taxable income equal to that relevant interest shall be chargeable to tax at the rate at which tax was deducted from that relevant interest,
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(III) as respects any part of relevant interest which comes within paragraph (c) of the definition of “appropriate tax” in section 256(1), the person shall be chargeable to tax at the rate at which tax was deducted from that relevant interest,
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and
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(ii) where the specified amount is so increased, references in [3]>sections 187 and 188<[3][3]>section 188<[3] to—
(I) income tax payable shall be construed as references to the income tax payable after credit is given by virtue of [9]>section 59<[9][9]>paragraph (d)<[9] for appropriate tax deducted from the payment of relevant interest, and
(II) a sum equal to twice the specified amount shall be construed as references to a sum equal to the aggregate of—
(A) twice the specified amount (before it is so increased), and
(B) the amount of the payment of relevant interest;
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(d) section 59 shall apply as if a reference to appropriate tax deductible by virtue of this Chapter were contained in paragraph (a) of that section.
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(d) where relevant interest is to be taken into account in computing the total income of a person (other than a company) for any year of assessment, then, for the purpose of charging that total income to tax at the rate or rates of tax charged for that year of assessment, the following provisions shall apply—
(i) the relevant interest shall be regarded as income chargeable to tax under Case IV of Schedule D and shall be charged accordingly, and
(ii) in determining the amount of tax payable on that relevant interest, credit shall be given for the appropriate tax deducted from the relevant interest and the amount of the credit shall be the amount of such appropriate tax.
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Substituted by F(No.2)A08 s26(1)(b). Applies for the year of assessment 2009 and subsequent years of assessment.
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Substituted by F(No.2)A13 s23(1)(b)(i). Applies to interest or dividends (within the meaning of Part 8) paid on or after 1 January 2014.
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Deleted by F(No.2)A13 s23(1)(b)(ii). Applies to interest or dividends (within the meaning of Part 8) paid on or after 1 January 2014.