Finance Act 2003

Administrative changes.

146.—(1) The Principal Act is amended—

(a) by substituting the following for section 25:

Penalty.

25.—(1) Any person who contravenes or fails to comply with any requirement under section 21(e) is liable to a penalty of—

(a) €1,265, or

(b) twice the amount of tax payable in respect of the taxable inheritance to which the return relates,

whichever is the lesser.

(2) Where a person fails to comply with a requirement to deliver a return under section 21(e), by reason of fraud or neglect by that person, that person shall be liable to a penalty of—

(a) €1,265, and

(b) the amount, or in the case of fraud twice the amount, of the difference specified in subsection (3).

(3) The difference referred to in subsection (2)(b) is the difference between—

(a) the amount of tax paid by that person in respect of the taxable inheritance to which the return relates, and

(b) the amount of tax which would have been payable if the return had been delivered by that person and the return had been correct.”,

(b) by inserting the following after section 45:

“Obligation to retain certain records.

45A.—(1) In this section—

‘records’ includes books, accounts, documents, and any other data maintained manually or by any electronic, photographic or other process, relating to—

(a) property, of any description, which under or in consequence of any disposition, a person becomes beneficially entitled in possession to, otherwise than for full consideration in money or money's worth paid by that person,

(b) liabilities, costs and expenses properly payable out of that property,

(c) consideration given in good faith, in money or money's worth, paid by a person for that property,

(d) a relief or an exemption claimed under any provision of this Act, and

(e) the valuation, on the valuation date or other date, as the case may be, of property the subject of the disposition.

(2) Every person who is an accountable person shall retain, or cause to be retained on his or her behalf, records of the type referred to in subsection (1) as are required to enable—

(i) a true return, additional return or statement to be made for the purposes of this Act, or

(ii) a claim to a relief or an exemption under any provision of this Act to be substantiated.

(3) Records required to be retained by virtue of this section shall be retained—

(a) in written form in an official language of the State, or

(b) subject to section 887 (2) of the Taxes Consolidation Act 1997 , by means of any electronic, photographic or other process.

(4) Records retained for the purposes of subsections (2) and (3) shall be retained by the person required to retain the records—

(a) where the requirements of section 21(e) or section 46(2), requiring the preparation and delivery of a return on or before the date specified in each of those provisions, are met, for the period of 6 years commencing on the valuation date of the gift or inheritance, or

(b) notwithstanding paragraph (a), where an accountable person fails to comply with the requirements of the provisions referred to in paragraph (a) in the manner so specified, or, where any person is required to deliver a return, additional return or statement under this Act other than the provisions referred to in paragraph (a), for the period of 6 years commencing on the date that the return, additional return or statement is received by the Commissioners.

(5) Any person who fails to comply with subsection (2), (3) or (4) in respect of the retention of any records relating to a gift or inheritance is liable to a penalty of €1,520; but a penalty shall not be imposed under this section on any person who is not liable to tax in respect of that gift or inheritance.”,

(c) by inserting the following after section 46:

“Expression of doubt.

46A.—(1) Where an accountable person is in doubt as to the correct application of law to, or the treatment for tax purposes of, any matter to be included in a return or additional return to be delivered by such person under this Act, then that person may deliver the return or additional return to the best of that person's belief but that person shall draw the Commissioners' attention to the matter in question in the return or additional return by specifying the doubt and, if that person does so, that person shall be treated as making a full and true disclosure with regard to that matter.

(2) Subject to subsection (3), where a return or additional return, which includes an expression of doubt as to the correct application of law to, or the treatment for tax purposes of, any matter contained in the return or additional return, is delivered by an accountable person to the Commissioners in accordance with this section, then section 51(2) does not apply to any additional liability arising from a notification to that person by the Commissioners of the correct application of the law to, or the treatment for tax purposes of, the matter contained in the return or additional return the subject of the expression of doubt, on condition that such additional liability is accounted for and remitted to the Commissioners within 30 days of the date on which that notification is issued.

(3) Subsection (2) does not apply where the Commissioners do not accept as genuine an expression of doubt as to the correct application of law to, or the treatment for tax purposes of, any matter contained in the return or additional return and an expression of doubt shall not be accepted as genuine where the Commissioners are of the opinion that the person was acting with a view to the evasion or avoidance of tax.

(4) Where the Commissioners do not accept an expression of doubt as genuine they shall notify the accountable person accordingly within the period of 30 days after the date that the expression of doubt is received by the Commissioners, and the accountable person shall account for any tax, which was not correctly accounted for in the return or additional return referred to in subsection (1) and section 51(2) applies accordingly.

(5) An accountable person who is aggrieved by a decision of the Commissioners that that person's expression of doubt is not genuine may, by giving notice in writing to the Commissioners within the period of 30 days after the notification of the said decision, require the matter to be referred to the Appeal Commissioners.”,

and

(d) in section 58—

(i) by inserting the following after subsection (1):

“(1A) Where a person fails to comply with a requirement to deliver a return or additional return under subsection (2), (6) or (8) of section 46, by reason of fraud or neglect by that person, that person is liable to a penalty of—

(a) €2,535, and

(b) the amount, or in the case of fraud twice the amount, of the difference specified in subsection (5A).”,

and

(ii) by inserting the following after subsection (5):

“(5A) The difference referred to in paragraph (b) of subsection (1A) is the difference between—

(a) the amount of tax paid by that person in respect of the taxable gift or taxable inheritance to which the return or additional return relates, and

(b) the amount of tax which would have been payable if the return or additional return had been delivered by that person and that return or additional return had been correct.”.

(2) This section shall come into effect on such day or days as the Minister for Finance may by order or orders, either generally or with reference to any particular purpose or provision, appoint and different days may be so appointed for different purposes or different provisions.