Corporation Tax Act, 1976

Foreign life assurance funds.

42.—(1) Corporation tax under Case III of Schedule D on income arising from securities and possessions in any place outside the State which form part of the investments of the foreign life assurance fund of an assurance company shall be computed on the full amount of the actual sums received in the State from remittances payable in the State, or from property imported, or from money or value arising from property not imported, or from money or value so received on credit or on account in respect of such remittances, property, money or value brought into the State without any deduction or abatement.

(2) Where—

(a) any securities issued by the Minister for Finance with a condition in the terms specified in section 464 of the Income Tax Act, 1967 (issue of securities with exemption from tax), or

(b) any stocks or other securities to which section 474 (exemption of certain securities from tax) of the said Act applies and which are issued with either or both of the conditions specified in subsection (2) of that section,

for the time being form part of the investments of the foreign life assurance fund of an assurance company, the income arising from any of those stocks or securities, if applied for the purposes of that fund or reinvested so as to form part of that fund, shall not be liable to tax.

(3) Where the Revenue Commissioners are satisfied that any income arising from the investments of the foreign life assurance fund of an assurance company has been remitted to the State and invested, as part of the investments of that fund, in any stocks or securities issued as aforesaid, that income shall not be liable to tax and any tax paid thereon shall, if necessary, be repaid to the company on the making of a claim.

(4) Where income from the investments of the foreign life assurance fund of an assurance company has been relieved from tax in pursuance of the provisions of this section a corresponding reduction shall be made—

(a) in the relief granted under section 33 in respect of expenses of management, and

(b) in any amount on which the company is chargeable to tax by virtue of section 39—

(i) in respect of general annuity business, or

(ii) in respect of pension business,

in so far as the investment income relieved is referable to general annuity business or pension business as the case may be.

(5) In this section “foreign life assurance fund”—

(a) means any fund representing the amount of the liability of an assurance company in respect of its life business with policy holders and annuitants residing outside the State whose proposals were made to, or whose annuity contracts were granted by, the company at or through a branch or agency outside the State, and

(b) where such a fund is not kept separately from the life assurance fund of the company, means such part of the life assurance fund as represents the liability of the company under such policies and annuity contracts, such liability being estimated in the same manner as it is estimated for the purposes of the periodical returns of the company.

(6) While agreements mentioned in Part I of Schedule 6 to the Income Tax Act, 1967 , remain in force, subsection (5) shall have effect as if after “State” in each place where it occurs, there were inserted “, Northern Ireland and Great Britain”.

(7) Where an assurance company having its head office in the State carries on business in Northern Ireland or Great Britain and under provisions of the law therein corresponding with section 41 exemption from corporation tax is allowable in respect of income from investments and deposits referable to pension business, this section shall have effect in relation to the income so exempt in Northern Ireland and Great Britain with the omission of subsection (6).

(8) Where this section has effect in relation to income arising from investments of any part of an assurance company's life assurance fund, it shall have the like effect in relation to chargeable gains accruing from the disposal of any such investments, and losses so accruing shall not be allowable losses.