PART XXXII

Government and Other Public Loans

463. —The accumulated interest payable in respect of any savings certificate issued by the Minister for Finance under which the purchaser, by virtue of an immediate payment of a specified sum, becomes entitled after a specified period to receive a larger sum consisting of the said sum originally paid and accumulated interest thereon, shall not be liable to tax so long as the amount of such certificates held by the person who is for the time being the holder of the certificate does not exceed the amount which that person is for the time being authorised to hold under regulations made by the Minister for Finance.

464. —Any security which the Minister for Finance has power to issue for the purpose of raising any money or loan, may be issued with a condition that neither the capital of nor the interest on such security shall be liable to tax so long as it is shown in the manner to be prescribed by the Minister for Finance that such security is in the beneficial ownership of a person or persons who is or are not ordinarily resident in the State, and every security issued (whether before or after the passing of this Act) with such condition shall be exempt from tax accordingly.

465. —The excess of the amount received on the redemption of a unit of non-interest-bearing securities issued by the Minister for Finance under section 4 of the Central Fund Act, 1965 , over the amount which was paid for the unit on its issue shall, save where the excess falls to be taken into account in computing for the purposes of taxation the profits of a trade, be exempt from income tax (including sur-tax).

466. —(1) The Minister for Finance may direct that any securities already issued or hereafter to be issued under his authority shall be deemed to have been, or shall be, issued subject to the condition that the interest thereon shall be paid without deduction of tax.

(2) The interest on all securities issued, or deemed to have been issued, subject to the condition aforesaid shall be paid without deduction of tax, but all such interest shall be chargeable under Case III of Schedule D and, where any funds under the control of any court or public department are invested in any such securities, the person in whose name the securities are invested shall be the person so chargeable in respect of the interest thereon.

(3) Where interest on any security is paid under this section without deduction of tax, every person by whom such interest is paid, and every person who receives such interest on behalf of a registered or inscribed holder of the security, and also every person who has acted as an intermediary in the purchase of the security, shall, on being so required by the Revenue Commissioners, furnish to them—

(a) the name and address of the person to whom such interest has been paid, or on whose behalf such interest has been received, and the amount of the interest so paid or received, or (as the case may require)

(b) the person on whose behalf such security was purchased and the amount of such security.

467. —(1) Any debentures, debenture stock or other forms of security issued after the 2nd day of July, 1964, by a company to which this section applies shall be deemed to be securities issued under the authority of the Minister for Finance within the meaning of section 466 and that section shall apply accordingly.

(2) Notwithstanding anything contained in this Act, in computing for the purposes of assessment under Case I of Schedule D the amount of the profits or gains of a company to which this section applies, for any period for which accounts are made up, there shall be allowed as a deduction the amount of the interest on debentures, debenture stock or other forms of security which, by direction of the Minister for Finance given under section 466 as applied by this section, is paid by the company without deduction of tax for such period.

(3) The companies to which this section applies are Aer Lingus, Teoranta, Aer Rianta, Teoranta, and Aerlínte Éireann, Teoranta.

468. —(1) Debentures, debenture stock, certificates of charge and other securities issued by The Agricultural Credit Corporation, Limited, shall be deemed to be securities issued under the authority of the Minister for Finance within the meaning of section 466 and that section shall apply accordingly.

(2) Notwithstanding anything contained in section 61 (l), 433, 434 or 456, in computing for the purposes of assessment under Schedule D the amount of the profits or gains of The Agricultural Credit Corporation, Limited, for any period for which accounts are made up there shall be allowed as a deduction the amount of the interest on debentures, debenture stock, certificates of charge and other securities which, by direction of the Minister for Finance given under section 466, as applied by this section, is paid without deduction of tax for such period.

(3) Debentures, debenture stock and certificates of charge issued by The Agricultural Credit Corporation, Limited, shall not be liable to tax so long as it is shown in manner to be prescribed by the Minister for Finance that they are in the beneficial ownership of persons who are neither domiciled nor ordinarily resident in the State.

469. —(1) In this section—

“the Act” means the Government Loans (Conversion) Act, 1951 ;

“Government loan”, “new loan”, “the redemption date” and

“stockholder” have the same meanings respectively as they have in the Act.

(2) Where a holding, or part of a holding, of stock of a Government loan is converted under the Act and the stockholder is a person who is carrying on a trade which consists wholly or partly in dealing in securities, the stockholder shall, if he gives notice in writing to the inspector, not later than the end of the year of assessment next following the year of assessment in which the redemption date falls, that he desires to be so treated, be treated for the purposes of this Act as having changed his investment on the redemption date, but if he gives no such notice, he shall be for those purposes treated, both then and thereafter, as not having changed his investment, and in that case the produce of any subsequent realisation of the whole or any part of the holding of the new loan (which holding shall, for the purpose of this provision, be deemed to include any stock issued by way of bonus in respect of the conversion) together with any additional consideration, or the appropriate part of any additional consideration, received by him in connection with the conversion, shall be treated as the produce of the realisation of the whole or the appropriate part of the original holding.

470. —Securities issued (whether before or after the commencement of this Act) outside the State by a local authority in the State for the purpose of raising any money which they are authorised to borrow, if issued under the authority of the Minister for Finance, shall not be liable to tax, except where they are held by persons domiciled in the State or ordinarily resident in the State.

“Local authority” in this section includes any public body which is recognised as a local authority for the purposes of this section by the Minister for Local Government.

471. —(1) Any stock or other forms of security issued after the 13th day of July, 1954, by the Electricity Supply Board or by Córas Iompair Éireann shall be deemed to be securities issued under the authority of the Minister for Finance within the meaning of section 466 and that section shall apply accordingly.

(2) Notwithstanding anything contained in section 61 (l), 433, 434 or 456, in computing for the purposes of assessment under Schedule D the amount of the profits or gains of the Electricity Supply Board, or of Córas Iompair Éireann, as the case may be, for any period for which accounts are made up, there shall be allowed as a deduction the amount of the interest on stock or other forms of security which, by direction of the Minister for Finance given under section 466, as applied by this section, is paid by the Electricity Supply Board or by Córas Iompair Éireann, as the case may be, without deduction of tax for such period.

472. —(1) Any stock under section 87 of the Local Government Act, 1946 , issued after the 13th day of July, 1955, shall be deemed to be securities issued under the authority of the Minister for Finance within the meaning of section 466 and that section shall apply accordingly.

(2) (a) Sections 106, 433 and 434 shall not apply to interest (in this subsection referred to as the said interest) which, by direction of the Minister for Finance given under section 466, as applied by this section, is paid without deduction of tax.

(b) Where paragraph (a) applies in relation to a local authority, the total tax payable by the local authority, by deduction or otherwise, for any year of assessment shall not exceed a sum to be ascertained by first computing the total tax which, but for this section, would have been payable by the local authority, by deduction or otherwise, for that year and then deducting therefrom a sum equal to tax on the amount of the said interest paid for that year by the local authority.

473. —(1) Any stock or other forms of security issued after the 18th day of July, 1957, by Bord na Móna shall be deemed to be securities issued under the authority of the Minister for Finance within the meaning of section 466 and that section shall apply accordingly.

(2) Notwithstanding anything contained in this Act, Bord na Móna shall be entitled to have the amount of income tax which, but for this section, it would be liable ultimately to bear for any year of assessment reduced by a sum representing income tax on the amount of the interest on stock or other forms of security which, by direction of the Minister for Finance given under section 466, as applied by this section, is paid by Bord na Móna without deduction of tax in that year of assessment.

474. —(1) This section applies to any stock or other security on which interest is payable without deduction of income tax by virtue of a direction given by the Minister for Finance in pursuance of section 467, 471, 472 or 473.

(2) Any stock or other security to which this section applies may be issued with either or both of the following conditions:

(a) that neither the capital of nor the interest on the stock or other security shall be liable to tax so long as it is shown in the manner directed by the Minister for Finance that the stock or other security is in the beneficial ownership of persons who are neither domiciled nor ordinarily resident in the State,

(b) that the interest on the stock or other security shall not be liable to income tax so long as it is shown in the manner directed by the Minister for Finance that the stock or other security is in the beneficial ownership of persons who, though domiciled in the State, are not ordinarily resident therein,

and, as respects every such stock or other security issued as aforesaid, exemption from tax shall be granted accordingly.

475. —(1) Where any funding bonds are issued to a creditor in respect of any liability to pay interest on a debt to which this section applies, the issue of those bonds shall be treated for all the purposes of this Act as if it were the payment of an amount of the said interest equal to the value of the said bonds at the time of the issue thereof, and the redemption of the said bonds shall not be treated for any of the said purposes as payment of the said interest or any part thereof.

(2) This section applies to all debts owing by any government, public authority, or public institution whatsoever or wheresoever and to all debts owing by any body corporate whatsoever or wheresoever.

(3) In this section “funding bonds” includes all bonds, stocks, shares, securities, and certificates of indebtedness.