Revenue Note for Guidance

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Revenue Note for Guidance

216F Exemption of certain profits arising from production, maintenance and repair of certain musical instruments

Summary

This section provides for an exemption of up to €20,000 from income tax, for certain profits from the production, maintenance and repair of certain musical instruments. The exemption is available to individuals who are chargeable to tax in respect of profits arising from the production, maintenance and repair of the following: early Irish harps, Irish lever harps and uilleann pipes.

Details

Definitions

(1)“Commission Regulation (EU) 2023/2831” means Commission Regulation (EU) 2023/2831 of 13 December 2023 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid;

“early Irish harp” means a harp instrument which is —

  1. traditionally referred to in the Irish language as “cruit” or “cláirseach” by reason of its characteristics and shape,
  2. traditionally played with the left hand above the right and with the fingernails,
  3. strung with 29 or 30 metal strings, that emerge through eyelets set in a solid soundboard which has been hollowed out from behind, which are held in place along the harmonic curve by the tuning and bridge pins, without a semitone lever system, and
  4. traditionally associated with a relevant musical practice;

“Irish lever harp” means a harp instrument which —

  1. is traditionally referred to in the Irish language as “cruit” or “cláirseach” by reason of its characteristics and shape,
  2. is traditionally played with the right hand above the left and with the tips or pads of the fingers,
  3. does not have pedals of any kind,
  4. is generally strung with not less than 34 but not more than 36 strings,
  5. has levers on its strings which can raise the note of a string by a semitone, and
  6. is traditionally associated with a relevant musical practice;

“relevant activities” means the production, maintenance or repair of relevant musical instruments;

“relevant musical instrument” means an early Irish harp, an Irish lever harp or uilleann pipes;

“relevant musical practice” means—

  1. the practice of uilleann piping, as inscribed by the United Nations Educational, Scientific and Cultural Organization on the Representative List of the Intangible Cultural Heritage of Humanity pursuant to Decision of the Intergovernmental Committee: 12.COM 11.B.16 of 7 December 2017, or
  2. the practice of Irish harping, as inscribed by the United Nations Educational, Scientific and Cultural Organization on the Representative List of the Intangible Cultural Heritage of Humanity pursuant to Decision of the Intergovernmental Committee:14.COM 10.B.18 of 12 December 2019;

“relevant period” means the years of assessment 2023, 2024 and 2025;

“relevant person” means—

  1. in the case of early Irish harps and Irish lever harps, Harp Foundation Ireland Company Limited by Guarantee, a private company incorporated in the State with registration number 614434,
  2. in the case of uilleann pipes, Na Píobairí Uilleann Cuideachta Faoi Theorainn Ráthaíochta, a private company incorporated in the State with registration number 242874, or
  3. such other person with appropriate experience in relation to relevant musical instruments and relevant musical practice as the Minister for Tourism, Culture, Arts, Gaeltacht, Sport and Media may designate in writing for the purposes of this section;

“relevant profit” means profits or gains from relevant activities;

“uilleann pipes” means a set of bagpipes which —

  1. has air supplied by a bellows that is operated by the elbow, and
  2. is traditionally associated with a relevant musical practice.

Exemption

(2)This section applies to an individual who has, in the relevant period (2023 - 2025), relevant profits (profits arising from the production, maintenance or repair of Irish harps and/or uilleann pipes) chargeable to income tax under Schedule D.

(3)An individual to whom this section applies is entitled, on making a claim on their income tax return, to have relevant profits of up to €20,000 disregarded for the purposes of the Income Tax Acts in a year of assessment. This section does not exempt the income from PRSI and USC, which are chargeable in the usual manner. The relief provided by this section may be given by repayment or otherwise.

(4)Where an individual is in receipt of relevant profits, the provisions of part 41A (self-assessment) relating to the requirement to file returns apply to that individual —

  • as if no exemption were available under this section,
  • as if they were a chargeable person, even if they would not otherwise be a chargeable person,
  • as if no notice under s959N had been issued, even where such a notice has been issued.

Where an individual is in receipt of relevant profits, the requirement to keep records imposed by section 886 and the requirements imposed by the Tax Acts to produce them for inspection apply as if no profits had been exempted by this section.

(5) Where an individual carries on a trade which includes relevant activities and other activities then, for the purposes of this section, the profits of that trade shall be apportioned on a just and reasonable basis. The exemption may be claimed in respect of the relevant profits only. The manufacture of musical instruments other than Irish harps or uilleann pipes as defined in the section is not a relevant activity.

(6)Where any question arises as to whether an instrument is a relevant musical instrument for the purposes of this section, the Revenue Commissioners may consult with a relevant person.

(7)(a)This relief is a form of State Aid and is available only where it complies with the “De Minimis” requirement for state aid set out in Commission Regulation (EU) 2023/2831 of 13 December 2023 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union.

A single undertaking may not receive more than €300,000 in State Aid (from all sources) in any three-year period, and relief provided by this section will be available only where it does not cause this limit to be exceeded.

7(b)An individual who avails of relief under this section shall be liable to pay any income tax in excess of this limit.

7(c) An individual who avails of this relief shall provide information on request to the Revenue Commissioners for the purposes of ensuring that they are compliant with Commission Regulation (EU) 2023/2831.

An individual who avails of this relief shall retain such records as are required to ensure that they are compliant with Commission Regulation (EU) 2023/2831.

7(d) The Revenue Commissioners may share information about the amount of relief claimed by an individual with any board established by statute, any other public or local authority or any other agency of the State where required in order to ensure compliance with the limits on State Aid imposed by Commission Regulation (EU) 2023/2831.

The Revenue Commissioners may provide to the European Commission any information requested by the European Commission under Article 6 of Commission Regulation (EU) 2023/2831.

Relevant Date: Finance Act 2024