Section 83 lays down the manner in which income tax is to be charged on recipients in respect of dividends and other distributions made by Irish resident companies. The charge will effectively not be changed but the procedure will be under a new Schedule F and they will be charged on the aggregate of the distribution and its tax credit. A non-resident, however, will be charged on the actual distribution only at the excess of any higher rate of tax to which he may be liable over the standard rate and will have to account to the Revenue for income tax on any annual payment made out of the distribution.
SECTION 83.
Question proposed : " That section 83 stand part of the Bill. "
This is an historic departure. The Minister is making a new schedule.
A new schedule, yes. It is necessary to provide the working machinery to deal with this new creature of a tax credit.
I am informed that subparagraph 2 (a) provides that any capital dividends paid by a company after the 27th day of November, 1975, are to be treated as a distribution.
This only applies to a company resident in the State?
Yes.
It is more concerned with individuals than companies: "references to distributions of a company. . ."
Deputy Haughey is right. It is a question of assessing the liability to tax of recipients of distributions.
This is new machinery whereby distributions of companies which are subject to corporation tax will be dealt with by the payee and individually assessed?
Yes.
It provides also for the individual obtaining particulars of how the distribution is arrived at under subsection (5).
It is illustrated with an example in the details circulated.
It involves a claim to be made in certain circumstances by the payee to the Revenue.
If the payee is not liable for tax the payee may apply to the Revenue for a refund. It is a section similar to that of the corporation tax at present where the tax is deducted from dividends before it is paid. The result will be the same.
Question put and agreed to.