Finance Act, 2001

Amendment of section 85 (exemption of specified collective investment undertakings) of Finance Act, 1989.

224.—(1) Section 85 of the Finance Act, 1989 , is amended by the substitution of the following for subsections (1) and (2):

“(1) In this section—

‘investment undertaking’ has the meaning assigned to it by section 739B of the Taxes Consolidation Act, 1997 ;

‘specified collective investment undertaking’ has the meaning assigned to it by section 734 of the Taxes Consolidation Act, 1997 ;

‘unit’, in relation to an investment undertaking, has the meaning assigned to it by section 739B of the Taxes Consolidation Act, 1997 ;

‘unit’, in relation to a specified collective investment undertaking, has the meaning assigned to it by section 734 of the Taxes Consolidation Act, 1997 .

(2) Where any unit of an investment undertaking or of a specified collective investment undertaking is comprised in a gift or an inheritance, then such unit—

(a) shall be exempt from tax, and

(b) shall not be taken into account in computing tax on any gift or inheritance taken by the donee or successor,

if, but only if, it is shown to the satisfaction of the Commissioners that—

(i) the unit is comprised in the gift or inheritance—

(I) at the date of the gift or at the date of the inheritance, and

(II) at the valuation date,

(ii) at the date of the disposition, the disponer is neither domiciled nor ordinarily resident in the State, and

(iii) at the date of the gift or at the date of the inheritance, the donee or successor is neither domiciled nor ordinarily resident in the State.”.

(2) In relation to any unit of an investment undertaking comprised in a gift or an inheritance, section 85(2)(ii) (inserted by subsection (1)) of the Finance Act, 1989 , shall, notwithstanding that the disponer was domiciled or ordinarily resident in the State at the date of the disposition, be treated as satisfied where—

(a) the proper law of the disposition was not the law of the State at the date of the disposition, and

(b) the unit came into the beneficial ownership of the disponer or became subject to the disposition prior to 15 February 2001.

(3) This section shall have effect in relation to units of an investment undertaking comprised in a gift or an inheritance where the date of the gift or the date of the inheritance is on or after 1 April 2000.

(4) This section shall have effect in relation to units of a specified collective investment undertaking comprised in a gift or an inheritance where the date of the gift or the date of the inheritance is on or after 15 February 2001 and the units—

(a) come into the beneficial ownership of the disponer on or after 15 February 2001, or

(b) become subject to the disposition on or after that date without having been previously in the beneficial ownership of the disponer.