Finance Act, 2001

Employee share ownership trusts — deceased beneficiaries.

13.—The Principal Act is amended—

(a) in section 519—

(i) in subsection (5)(a)—

(I) by the substitution in subparagraph (iv) of “the trust deed,” for “the trust deed, and”, and

(II) by the insertion after subparagraph (iv) of the following:

“(iva) the payment of any sum or the transfer of securities to the personal representatives of a deceased beneficiary under the terms of the trust deed, and”,

(ii) by the substitution of the following for subsection (7A):

“(7A) Where the trustees of a trust to which this section applies sell securities on the open market, any gain accruing to such trustees shall not be a chargeable gain if, and to the extent that, the proceeds of such sale are used—

(a) to repay monies borrowed by those trustees,

(b) to pay interest on such borrowings, or

(c) to pay a sum to the personal representatives of a deceased beneficiary.”,

(iii) by the insertion of the following after subsection (8):

“(8A) Where the trustees of a trust to which this section applies transfer securities to the personal representatives of a deceased beneficiary, any gain accruing to the trustees on that transfer shall not be a chargeable gain.

(8B) The payment of any sum as is referred to in subsection (7A)(c) or the transfer of any securities to which subsection (8A) applies shall, notwithstanding any other provision of the Income Tax Acts, be exempt from income tax.”,

(iv) in subsection (9)—

(I) by the substitution for “subsections (1) to (8)” of “subsections (1) to (8B)”,

(II) by the substitution in paragraph (c) of “Schedule 11,” for “Schedule 11, or”, and

(III) by the insertion after paragraph (c) of the following:

“(ca) the payment of any sum or the transfer of securities to the personal representatives of a deceased beneficiary of the trust, or”,

and

(v) by the insertion of the following after subsection (9):

“(10) For the purposes of this section—

‘deceased beneficiary’ means a person who on the date of such person's death—

(a) would have been eligible to have shares appropriated to him or her, had such shares been available for appropriation, under a scheme approved of by the Revenue Commissioners under Schedule 11 and for which approval has not been withdrawn, and

(b) was a beneficiary under the terms of a trust deed of an employee share ownership trust approved of by the Revenue Commissioners under Schedule 12 and for which approval has not been withdrawn and which trust deed contained provision for the transfer of securities to the trustees of the scheme referred to in paragraph (a) and for the payment of sums and for the transfer of securities to the personal representatives of deceased beneficiaries.”,

and

(b) in Schedule 12—

(i) by the insertion in subparagraph (2) of paragraph 12, of the following after clause (d):

“(da) to pay any sum or to transfer securities to the personal representatives of deceased persons who were beneficiaries under the terms of the trust deed;”,

and

(ii) by the insertion, in subparagraph (3) of paragraph 13, of the following after clause (d):

“(da) the payment of any sum to the personal representatives of a deceased person who was a beneficiary under the terms of the trust deed;”.