Finance Act, 1982

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Reduction of corporation tax in relation to interest on certain loans to farmers.

28.—(1) In this section—

“participating bank” means the Bank of Ireland or Allied Irish Banks Limited;

“qualifying farmer” means a farmer who has been accepted as eligible for inclusion in the specified scheme;

“relevant accounting period” means an accounting period or part of an accounting period falling within the period from the 1st day of April, 1982, to the 31st day of March, 1986;

“relief from interest”, in relation to a relevant accounting period of a participating bank, means the amount by which B exceeds A where—

A is the amount of interest paid by qualifying farmers to that bank during that period in respect of loans the rate of interest on which falls to be reduced under the specified scheme, and

B is the amount of interest which would have fallen to be paid by those farmers to that bank during the said period in respect of the said loans if that interest had not been reduced under the specified scheme;

“the specified scheme” means the scheme known as the Reduced Interest Scheme for Farmers in Severe Financial Difficulty introduced by the Minister for Agriculture on the 1st day of April, 1982, in association with certain banks and The Agricultural Credit Corporation Limited.

(2) Subject to subsection (3), where a participating bank claims and proves that relief from interest was allowed by it during a relevant accounting period, the corporation tax payable by that bank for the accounting period which coincides with or includes the relevant accounting period shall be reduced by an amount determined by the formula

where—

C is the amount of the relief from interest allowed by the participating bank during the relevant accounting period, and

D is the amount of corporation tax which, under sections 1 (1) and 6 (3) of the Corporation Tax Act, 1976 , would be chargeable for the accounting period which coincides with or includes the relevant accounting period on an amount of profits equal to C.

(3) (a) A reduction, under subsection (2), of corporation tax pay able by a participating bank shall be made in respect only of relief from interest which has been certified by the Minister for Agriculture to be relief from interest allowed in accordance with the conditions and regulations of the specified scheme.

(b) If any relief from interest (hereafter in this paragraph referred to as “disallowed relief”) allowed by a participating bank has been certified by the Minister for Agriculture to be relief from interest allowed in accordance with the conditions and regulations of the specified scheme and is subsequently certified by the Minister for Agriculture to be relief from interest which did not fall to be allowed in accordance with those conditions and regulations, the participating bank shall not be entitled in respect of the disallowed relief to any reduction under subsection (2) of corporation tax payable by it and, if any such reduction has been made in respect of any such disallowed relief, there shall be made such additional assessments or adjustments of assessments as may be required to recover that reduction.