Taxes Consolidation Act, 1997 (Number 39 of 1997)
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541A Treatment of debts on a change in currency.
(1) Where on any day a debt (to which section 541 does not apply by virtue of subsection (6) of that section) owed to a person in a currency other than [4]>Irish currency<[4][4]>the currency of the State<[4], becomes a debt in [4]>Irish currency<[4][4]>the currency of the State<[4] as a result of the currency of a State being substituted by another currency, which other currency also on that day becomes [4]>Irish currency<[4][4]>the currency of the State<[4], then, subject to subsection (2), that debt shall be deemed, for the purposes of the Capital Gains Tax Acts, on the day preceding that day, to be disposed of by the person and immediately reacquired by the person at its market value.
(2) [2]>Notwithstanding any other provision of the Capital Gains Tax Acts<[2][2]>Subject to subsection (4) and notwithstanding any other provision of the Capital Gains Tax Acts<[2], where in respect of a debt a chargeable gain accrues to a person by virtue of subsection (1), that chargeable gain shall be assessed and charged as if it were a chargeable gain which accrued to the person at the time of the disposal of the debt and shall not be assessed and charged otherwise.
(3) For the purposes of subsection (2), in relation to a debt owed to a person, the satisfaction of the debt or part of the debt shall be treated as a disposal of the debt or of that part at the time when the debt or that part is satisfied.
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(4) (a) In this subsection—
“assurance company” has the meaning assigned to it in section 706;
“life business fund” has the meaning assigned to it in section 719;
“special investment fund” has the meaning assigned to it in section 723;
“special investment scheme” has the meaning assigned to it in section 737;
“undertaking for collective investment” has the meaning assigned to it in section 738.
(b) Where the person referred to in subsection (1) is a company and either—
(i) the company is an assurance company and the debt referred to in that subsection is an asset of the company’s life business fund, or
(ii) the company is an undertaking for collective investment and the debt referred to in that subsection is an asset of the undertaking,
subsection (1) shall not apply and where the day (in this paragraph referred to as “the deemed disposal day”) on which, but for this paragraph, the debt would be deemed to be disposed of and reacquired in accordance with subsection (1), is not the day on which an accounting period of the company ends—
(I) in case of an assurance company, section 719(2) shall apply in respect of the debt as if, for this purpose only, the deemed disposal day was the day on which an accounting period of the company ends and the chargeable gain or allowable loss thereby accruing shall be included in the net amount (within the meaning of section 720) in respect of the accounting period in which the deemed disposal day falls, and
(II) in case of an undertaking for collective investment, section 738(4)(a) shall apply in respect of the debt as if, for this purpose only, the deemed disposal day was the day on which an accounting period of the company ends and the chargeable gain or allowable loss thereby accruing shall be included in the net amount (within the meaning of section 738(4)(b)) in respect of the accounting period in which the deemed disposal day falls.
(c) Where the person referred to in subsection (1) is an undertaking for collective investment and is not a company, subsection (2) shall not apply but the chargeable gain or allowable loss which accrues to the undertaking by virtue of subsection (1) shall be treated as accruing to the undertaking by virtue of paragraph (a) of section 738(4) and the provisions of that section shall apply accordingly.
(d) Subsection (2) shall not apply to a debt which is—
(i) an asset of a special investment fund of an assurance company, or
(ii) an asset which is subject to any trust created pursuant to a special investment scheme.
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Substituted by FA99 s87(1)(a). This section shall be deemed to have applied as on and from the 31st day of December, 1998.
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Inserted by FA99 s87(1)(b). This section shall be deemed to have applied as on and from the 31st day of December, 1998.