Finance Act, 1996

Amendment of section 14 (special portfolio investment accounts) of Finance Act, 1993.

37.—(1) Section 14 of the Finance Act, 1993 , is hereby amended—

(a) in subsection (1) in the definition of “designated broker” by the insertion after “the Irish Stock Exchange” of “or is a member firm (which carries on a trade in the State through a branch or agency) of a stock exchange of any other Member State of the European Union”, and

(b) in subsection (4) by the insertion after paragraph (b) of the following paragraph:

“(bb) (i) Where in a year of assessment (hereafter in this paragraph referred to as ‘the first year of assessment’) securities which are assets of a special portfolio investment account are disposed of and in the immediately following year of assessment interest becoming payable in respect of the securities is receivable by the special portfolio investment account, then, for the purposes of computing the relevant income or gains for the first year of assessment, the price paid by the designated broker for the securities shall be treated as reduced by the appropriate amount in respect of the interest:

Provided that where for a year of assessment the provisions of this paragraph apply so as to reduce the price paid for securities, the amount by which the price paid for the securities is reduced shall be treated as a loss arising, in the immediately following year of assessment, from the disposal of the securities.

(ii) In this paragraph—

‘the appropriate amount in respect of the interest’ means the appropriate amount in respect of the interest which would be determined in accordance with Schedule 11 to the Income Tax Act, 1967 , if the designated broker were the first buyer and the designated broker carried on a trade to which section 368 (1) of that Act applies:

Provided that in so determining the appropriate amount in respect of the interest in accordance with the said Schedule 11, paragraph 3 (4) of that Schedule shall apply as if there were deleted ‘in the opinion of the Appeal Commissioners’;

‘securities’ has the same meaning as in subsection (1) of section 29 of the Finance Act, 1984 .”.

(2) This section shall apply and have effect as respects a disposal on or after the 28th day of March, 1996.