Finance Act, 1982

Approved profit sharing schemes: appropriated shares.

51.—(1) The provisions of this section apply where, after the 5th day of April, 1982, the trustees of a profit sharing scheme which has been approved of in accordance with Part I of the Third Schedule appropriate shares—

(a) which have previously been acquired by the trustees, and

(b) as to which the conditions in Part II of that Schedule are fulfilled,

to an individual who participates in the scheme.

(2) In this Chapter references to an approved scheme are references to a scheme approved of as mentioned in subsection (1); and in relation to such a scheme—

(a) any reference to a participant is a reference to an individual to whom the trustees of the scheme have appropriated shares; and

(b) subject to section 55 , any reference to a participant's shares is a reference to the shares which have been appropriated to him by the trustees of an approved scheme.

(3) Notwithstanding anything in the Income Tax Acts, a charge to tax shall not be made on any individual in respect of the receipt of a right to receive the beneficial interest in shares passing or to be passed to him by virtue of such an appropriation of shares as is mentioned in subsection (1).

(4) Any reference in this Chapter to the initial market value of any of a participant's shares is a reference to the market value of those shares determined—

(a) except where paragraph (b) applies, on the date on which the shares were appropriated to him; and

(b) if the Revenue Commissioners and the trustees of the scheme agree in writing, on or by reference to such earlier date or dates as may be provided for in the agreement.

(5) Notwithstanding anything in the approved scheme concerned or in the trust instrument or in section 52 , for the purposes of capital gains tax a participant shall be treated as absolutely entitled to his shares as against the trustees.

(6) Where the trustees of an approved scheme acquire any shares as to which the conditions in Part II of the Third Schedule to this Act are fulfilled and, within the period of eighteen months beginning with the date of their acquisition, those shares are appropriated in accordance with the scheme—

(a) section 13 of the Finance Act, 1976 , shall not apply to income consisting of dividends on those shares received by the trustees; and

(b) any gain accruing to the trustees on the appropriation of those shares shall not be a chargeable gain;

and, for the purpose of determining whether any shares are appropriated within that period of eighteen months, shares which were acquired at an earlier time shall be taken to be appropriated before shares of the same class which were acquired at a later time.

(7) The Revenue Commissioners may by notice in writing require any person to furnish to them, within such time as they may direct (but not being less than thirty days), such information as they think necessary for the purposes of their functions under this Chapter, including, in particular, information to enable them—

(a) to determine whether to approve of a scheme or withdraw an approval already given; and

(b) to determine the liability to tax, including capital gains tax, of any participant in an approved scheme.

(8) Schedule 15 of the Income Tax Act, 1967 , is hereby amended by the insertion in column 2 of “Finance Act, 1982, section 51 (7)”.