Finance Act, 1977

Assessment of farming profits for 1977-78.

12.—The Finance Act, 1974 , is hereby amended—

(a) by the substitution for subsections (1), (2), (3) and (4) of section 21, of the following subsections:

“(1) Where, for the year 1977-78, an individual, other than an individual to whom section 16 applies, is, by virtue of section 15, chargeable to tax in respect of profits or gains from farming, he shall be charged to tax for that year in accordance with the provisions of this section and, subject to section 21A, not by reference to the provisions of section 58 (1) of the Income Tax Act, 1967 .

(2) Where an individual is to be charged to tax in accordance with the provisions of this section, he shall be charged under Case I of Schedule D on an amount determined by the formula—

(V×65)−R−W

where

V is the rateable valuation of the farm land occupied by him for the year 1977-78,

R is the amount of rates payable by him for that year in respect of the farm land so occupied, and

W is the total amount of emoluments payable by him for that year to persons, employed as permanent employees for the purpose of working the said land, in respect of such work.

(3) In charging profits or gains in accordance with the provisions of this section, no deduction under any of the provisions of the Income Tax Acts shall be made from the amount determined under subsection (2).

(4) For the purposes of this section—

(a) a person shall be regarded as a permanent employee of an individual if that individual—

(i) is registered as an employer under the Income Tax (Employments) Regulations, 1960 (S.I. No. 28 of 1960),

(ii) has, in relation to all emoluments paid by him during the year 1977-78 to the said person, complied with the provisions of the said Regulations, and

(iii) has, in respect of that person, paid employment contributions (within the meaning of the Social Welfare Act, 1952 ) for the period or periods during which the said person was employed by him in that year, and

(b) emoluments payable by an individual to a person connected with the said individual shall be taken into account for the purpose of the formula in subsection (2) only in so far as the emoluments are paid to that person in cash.”, and

(b) by the insertion, after section 21, of the following section:

Appeals against assessments under section 21.

“21A.—(1) An individual aggrieved by an assessment made upon him under section 21 shall be entitled to appeal against that assessment on the grounds that he elects to be charged to tax for the year 1977-78 in respect of his profits or gains from farming on an amount—

(a) determined in accordance with the provisions of section 58 (1) of the Income Tax Act, 1967 , or

(b) equal to the full amount of those profits or gains for that year:

Provided that, in the case of an individual who elects to be charged to tax in accordance with paragraph (b) and who, for the year 1976-77, has been charged to tax in respect of his profits or gains from farming, section 11 of the Finance Act, 1967, and section 26 of the Finance Act, 1971 , shall not apply for the year 1977-78, in relation to any qualifying machinery or plant (within the meaning of those sections) provided for use for the purposes of farming in the interval between the basis period (within the meaning of Part XV of the Income Tax Act, 1967 ) for the year 1976-77 and the basis period (within the meaning aforesaid) for the year 1977-78.

(2) Where an individual appeals and elects as provided for in subsection (1), all such amendments of the assessment shall be made as will ensure that he is charged to tax in accordance with such election.”.