784A Approved retirement fund.
(1) (a) In this section—
“approved retirement fund” means a fund which is managed by a qualifying fund manager and which complies with the conditions of section 784B;
“qualifying fund manager” means—
(a) a person who is a holder of a licence granted under section 9 of the Central Bank Act, 1971,
(b) a building society within the meaning of section 256,
(c) a trustee savings bank within the meaning of the Trustee Savings Banks Act, 1989,
(d) ACC Bank plc,
(e) ICC Bank plc,
(f) ICC Investment Bank Limited,
(g) the Post Office Savings Bank,
(h) a credit union within the meaning of the Credit Union Act, 1997,
(i) a collective investment undertaking within the meaning of section 172A,
(j) a person lawfully carrying on in the State the business of granting annuities on human life,
(k) a person—
(i) which is an authorised member firm of the Irish Stock Exchange, within the meaning of the Stock Exchange Act, 1995, or a member firm (which carries on a trade in the State through a branch or agency) of a stock exchange of any other Member State of the European Communities, and
(ii) which has sent to the Revenue Commissioners a notification of its name and address and of its intention to act as a qualifying fund manager,
(l) such other person as the Minister for Finance may by order approve of for the purposes of this section;
“tax reference number”, in relation to an individual, has the meaning assigned to it by section 885 in relation to a specified person within the meaning of that section.
(b) For the purposes of this Chapter, references to an approved retirement fund shall be construed as a reference to assets in an approved retirement fund which are managed for an individual by a qualifying fund manager and which are beneficially owned by the individual.
(2) The beneficial owner of assets in an approved retirement fund shall, subject to the provisions of the Income Tax Acts and the Capital Gains Tax Acts, be chargeable to income tax or capital gains tax, as the case may be, in respect of any income, profits or gains arising in respect of those assets or any chargeable gains on disposals of such assets.
(3) (a) A qualifying fund manager shall maintain a record (in this section and in section 784B referred to as “the income and gains account”) of the aggregate—
(i) of all income, profits and gains arising in respect of an approved retirement fund, and
(ii) of all gains and losses on disposal of investments made by the qualifying fund manager in relation to the approved retirement fund,
reduced by the aggregate of all distributions made in respect of the approved retirement fund.
(b) In calculating at any time the residue of the assets transferred to an approved retirement fund (in this section and in section 784B referred to as “the residue”) by the person lawfully carrying on in the State the business of granting annuities on human life—
(i) distributions made at or before that time shall be treated as made primarily out of the income and gains account,
(ii) in so far as the distributions made from the fund exceed the aggregate of the balance on the income and gains account, they shall be treated as made out of the residue,
and, where assets in an approved retirement fund are transferred to another approved retirement fund, the residue in relation to those assets shall be calculated as if the assets had at all times been held in the approved retirement fund to which those assets had originally been transferred.
(c) Any reference in this section to a distribution in relation to an approved retirement fund shall be construed as including any payment or transfer of assets out of the fund or any assignment of assets out of the fund, including a payment, transfer or assignment to the individual beneficially entitled to the assets, other than a payment, transfer or assignment to another approved retirement fund the beneficial owner of the assets in which is the individual who is beneficially entitled to the assets in the first-mentioned approved retirement fund, whether or not the payment, transfer or assignment is made to the said individual.
(4) Within 3 months after the end of a year of assessment, a qualifying fund manager shall provide a statement for that year of assessment to each individual, on whose behalf an approved retirement fund was managed at any time during that year of—
(a) the income, profits or gains and the chargeable gains and allowable losses, as may be appropriate, in respect of the assets held in the approved retirement fund at any time during that year,
(b) the tax, if any, deducted from such income, profits or gains,
(c) the income and gains account in relation to the fund, and
(d) the residue including, in particular, any distributions made out of the residue in the year of assessment.
(5) The amount or value of any distribution out of the residue of an approved retirement fund other than a distribution to which subsection (7)(a) applies shall be treated as income of the individual beneficially entitled to the assets of the fund and shall be chargeable to income tax under Case IV of Schedule D for the year of assessment in which the said distribution is made.
(6) Subject to subsection (7), where the distribution referred to in subsection (5) occurs following the death of the individual, who was prior to death beneficially entitled to the assets of the approved retirement fund—
(a) the amount or value of the said distribution shall be treated as the income of the said individual for the year of assessment in which that individual dies, and
(b) the qualifying fund manager shall be liable to pay to the Collector-General income tax at the higher rate on the value of such distribution; the qualifying fund manager may deduct an amount on account of such tax and the person beneficially entitled to the residue of the approved retirement fund, including the personal representatives of the deceased individual, shall allow such deduction; but, where there are no such funds or insufficient funds available out of which the qualifying fund manager may satisfy the tax required to be deducted, the amount of such tax shall be a debt due to the qualifying fund manager from the estate of the deceased individual.
(7) (a) This subsection shall apply to the extent that the distribution, made following the death of the individual beneficially entitled to the assets in the approved retirement fund, is made to—
(i) another such fund (hereafter in this subsection referred to as “the second-mentioned fund”) the beneficial owner of the assets in which is the spouse of the said individual, or
(ii) to or for the sole benefit of any child of the individual who has not, at the date of the individual’s death, attained the age of 21 years.
(b) Where the beneficial owner of the assets in the second-mentioned fund dies, subsection (6) shall apply as regards any distributions out of the residue of that approved retirement fund following that spouse’s death as if the reference to the higher rate were a reference to a rate of 25 per cent.
(c) Where, in accordance with paragraph (b), the qualifying fund manager is required to account for tax at a rate of 25 per cent, the amount so charged to tax shall not, notwithstanding any provisions of the Income Tax Acts, be treated as income for any other purposes of those Acts.