This section deals with the returns of material interest in offshore funds. What is the position on this matter?
SECTION 41.
Question proposed: "That section 41 stand part of the Bill".
The section proposes that investments in foreign investment funds will be subject to the same reporting requirements as investments in foreign deposit accounts and foreign life assurance polices. Investments in foreign funds were previously subject to reporting requirements, but these were removed in 1993 when the 3 per cent levy on collective funds was abolished. The new reporting requirements will mean that persons who invest in a foreign fund or who act as intermediaries in such investment, will, as in the case of foreign deposit accounts and life policies, be required to notify Revenue of certain details with regard to the investment. Required reporting of investments abroad helps to ensure greater tax compliance and to deter evasion where funds can, since the abolition of exchange controls, move abroad without restriction.
Is it the intention that intermediaries and those who invest their client's money in offshore funds will have to make a return? Is it a reporting requirement regarding foreign bank accounts and such like?
The person investing or an intermediary investing on behalf——
Has it been found that there has been abuse of that?
We are trying to avoid that in advance.
It would not have been possible until very recently.
Before the abolition of exchange controls those constraints were there in a different form. The reporting requirement was not needed because the exchange controls would have effectively got that information.
Does the acquisition of material interest come into being, not in its retrospective but its prospective effect, from 1 June 1995?
Yes.
Question put and agreed to.
Section 42 agreed to.