Finance Act, 1988

Amendment of Chapter III (Payments in Respect of Professional Services by Certain Persons) of Part I of Finance Act, 1987.

8.Chapter III of Part I of the Finance Act, 1987 , is hereby amended—

(a) in section 13 (1), by—

(i) the insertion of the following definitions:

“‘authorised insurer’ has the same meaning as in section 145 of the Income Tax Act, 1967 ;

‘contract of insurance’ means a contract between an authorised insurer and a subscriber in respect of such insurance as is referred to in section 145 (2) of the Income Tax Act, 1967 ;

‘member’ means, in relation to a contract of insurance, a person who is named in the relevant policy of insurance and who has been accepted for insurance by an authorised insurer;

‘practitioner’ has the same meaning as in section 12 of the Finance Act, 1967 ;

‘relevant medical expenses’ means expenses incurred in respect of professional services provided by a practitioner, being expenses that are or may become the subject of a claim for their reimbursement or discharge in whole or in part under a contract of insurance but not including any such expenses that—

(a) under the terms of the contract of insurance, may (except in the case of certain expenses that, in the opinion of the authorised insurer concerned, are unusually large) be the subject of a claim for their discharge or reimbursement only—

(i) after the expiry of a stated period of 12 months in which the expenses are incurred, and

(ii) to the extent that the aggregate of the expenses and any other expenses incurred in the said period exceeds a stated amount,

or

(b) are incurred in respect of professional services provided by a practitioner outside the State;

‘subscriber’ means, in relation to a contract of insurance, a person (other than an authorised insurer) who is a party to the contract and in whose name the relevant policy of insurance is registered;”,

(ii) the substitution in paragraph (f) of the definition of “professional services” of “An Foras Áiseanna Saothair” for “An Chomhairle Oiliúna”, and

(iii) the substitution of the following definition for the definition of “relevant payment”:

“‘relevant payment’ means—

(a) a payment made on or after the 6th day of June, 1987, in respect of professional services whether or not such services are provided to the accountable person making the payment, and

(b) a payment made on or after the 6th day of June, 1988—

(i) by an accountable person mentioned in paragraph (u), (v), (w) or (x) (inserted by the Finance Act, 1988) of section 14 (1) of the Finance Act, 1987 , in respect of professional services whether or not such services are provided to the accountable person, or

(ii) by an authorised insurer to a practitioner in accordance with the provisions of section 14A (inserted by the Finance Act, 1988), or otherwise, in the discharge of a claim in respect of relevant medical expenses under a contract of insurance,

but excludes—

(I) emoluments within the scope of Chapter IV of Part V of the Income Tax Act, 1967 , to which that Chapter applies, and

(II) payments under a construction contract within the meaning of section 17 of the Finance Act, 1970 , from which tax has been deducted in accordance with the provisions of subsection (2) of that section, or would have been so deducted but for the provisions of subsection (8) of that section;”,

(b) in section 14 (1), by—

(i) the substitution of the following paragraph for paragraph (m):

“(m) An Foras Áiseanna Saothair,”, and

(ii) the deletion of “or” in paragraph (s) and the insertion of the following paragraphs after paragraph (t):

“(u) CERT,

(v) Eolas — The Irish Science and Technology Agency,

(w) An Bord Fuinnimh Núicléigh,

(x) a voluntary public or joint board hospital to which grants are paid by the Minister for Health in the year 1988-89 or any subsequent year of assessment, or

(y) an authorised insurer.”,

(c) by the insertion of the following section after section 14:

“14A.—Subject to section 15 (1) (inserted by the Finance Act, 1988), where under a contract of insurance a claim is made to an authorised insurer in respect of relevant medical expenses, the insurer shall discharge the claim by making payment to the extent of the amount of the benefit, if any, due under the contract, to the practitioner who provided the professional services to the subscriber or member concerned to which the relevant medical expenses relate and the subscriber or member, as the case may be, shall be acquitted and discharged of such amount as is represented by the payment as if the subscriber or member had made such payment.”, and

(d) in section 15 by the substitution of the following subsections for subsection (1):

“(1) An accountable person making a relevant payment shall deduct from the amount of the payment the appropriate tax in relation to the payment. The specified person to whom the amount is payable shall allow such deduction upon receipt of the residue of the payment, and

(a) the accountable person making the deduction, and

(b) if the accountable person is an authorised insurer, any subscriber or member on whose behalf the accountable person is making the relevant payment,

shall be acquitted and discharged of such amount as is represented by the deduction, as if that amount had actually been paid.

(1A) Where—

(a) in accordance with the provisions of section 14A (inserted by the Finance Act, 1988), a relevant payment has been made to a practitioner by an authorised insurer, and

(b) in accordance with the provisions of subsection (1), the practitioner has allowed a deduction of appropriate tax in respect of that payment and a subscriber or member has been acquitted and discharged of so much money as is represented by the deduction,

the practitioner shall, if any amount in respect of the relevant medical expenses to which the relevant payment relates has been paid by the subscriber or member, pay to the subscriber or member, as the case may be, an amount equal to the amount by which the aggregate of the amount paid by the subscriber or member and the amount of the relevant payment exceeds the relevant medical expenses.

(1B) (a) The Minister for Finance may make such regulations as he considers necessary or expedient for the purpose of giving full effect to this Chapter in so far as it relates to amendments made thereto by the Finance Act, 1988, and, in particular, but without prejudice to the generality of the foregoing, regulations under this subsection may—

(i) specify the circumstances and the manner in which a payment (other than a relevant payment) may be made or claimed in respect of relevant medical expenses, and

(ii) provide for the indemnification of an individual against claims in respect of relevant medical expenses, or any other claims arising out of acts done or omitted to be done by the individual in pursuance of this Chapter or regulations made under this subsection in so far as it relates or they relate to the amendments aforesaid.

(b) Every regulation made under this subsection shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the regulation is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.”.