653AHA. Sites subject to a relevant contract

(1) In this section—

“lease” has the same meaning as it has in the Capital Gains Tax Acts;

“relevant contract” means a lease, other than a lease or an agreement for lease referred to in section 653Z(1)(c), which—

(a) is evidenced in writing,

(b) was entered into prior to 1 January 2022, and

(c) it is reasonable to consider precludes the owner of the relevant site from carrying out development on or to the site, or part thereof.

(2) Subject to subsections (3) and (5), on the making of a claim by the liable person, so much of any residential zoned land tax arising in relation to a relevant site which is subject to a relevant contract (or where only part of the site is subject to a relevant contract, that part of the relevant site), shall, for the period of that relevant contract, notwithstanding section 653Q(2), not be due and payable.

(3) Where a claim is made in accordance with subsection (2) in respect of part only of a relevant site, the amount of tax due and payable in respect of the relevant site during the period of the relevant contract shall be determined by the following formula:

C = T × (A_part/A_total)

where—

C is the amount of tax due and payable,

T is the total amount of residential zoned land tax that would be due and payable in respect of the site but for this section,

A_part is the area, in square metres, of the part of the site that is not subject to the relevant contract, and

A_total is the total area, in square metres, of the site.

(4) A claim referred to in subsection (2) shall be made in such form and contain such particulars as the Revenue Commissioners may prescribe.

(5) This section only applies if a return referred to in section 653T is delivered to the Revenue Commissioners in respect of each liability date occurring during the term of the relevant contract.

(6) This section shall not apply where the parties to the relevant contract include the owner of the relevant site and a person connected (within the meaning of section 10) with the owner.

(7) This section shall not apply to a relevant site subject to a relevant contract, where it would be reasonable to consider that the relevant contract is not entered into for bona fide commercial reasons and forms part of any arrangement or scheme the main purpose or one of the main purposes of which is the avoidance of a liability to tax.

(8) For the purposes of subsections (2) and (3), where a relevant contract precludes the owner of a relevant site from carrying out development on or to the site, or part thereof, for part only of the term of the contract, the period of that relevant contract shall be deemed to be the period during which such development is precluded under the contract.