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Here you can access summary of the key current tax developments in Ireland, the UK and internationally as reported by Chartered Accountants Ireland

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FA06 Commencement Orders

The Minister for Finance has signed orders giving effect to the sections in Finance Act 2006 which modify and/or phase out tax reliefs for certain property schemes.

The schemes affected by the commencement orders are:

  • Urban Renewal scheme
  • Rural Renewal scheme
  • Town Renewal Scheme
  • Relief for hotels and holiday cottages
  • Relief for third-level educational buildings
  • Relief for park-and-ride facilities and associated developments
  • Relief for multi-storey car parks.

as modified by FA06 ss25 onwards. The relevant sections were subject to Commencement orders because EU approval was required to ensure conformity with EU State Aid rules.

Provision had been made for additional regulations in relation to s27 (Holiday Accommodation) s30 (Urban Renewal and Living over the Shop) s31 (Rural Renewal) and s33 (Town Renewal) regarding commercial developments. This was to ensure that any additional conditions required for State Aid purposes could be accommodated. It is understood that further regulations of this type are not envisaged.

The commencement orders are reproduced at 2.01 below.

Two further developments (sic) should be noted here. Revenue eBrief 26/2006 contains clarification of aspects of the extension to 31 July 2008 of the termination date for certain schemes.

One of the conditions for availing of the extended termination date of 31 July 2008 for some of the property incentive schemes is that a binding contract in writing, under which expenditure on the construction or refurbishment of a building or structure is incurred, must be in place for the particular building or structure on or before 31 July 2006. The following buildings/schemes are affected:

  • Hotels (‘accelerated’ allowances only)
  • Holiday Camps (‘accelerated’ allowances only)
  • Registered Holiday Cottages
  • Urban Renewal (commercial and industrial buildings)
  • Rural Renewal (commercial and industrial buildings)
  • Town Renewal (commercial and industrial buildings)

The note also offers guidance as to what is meant by “self-construction” and “parties to the contract”, and is reproduced in full at 2.02. This eBrief was further expanded upon to clarify situations arising where no third party contractors are involved, and this is carried at 2.03 below.