Section 21A Higher rate of corporation tax


Finance Act 1999 section 73.

(1) In this section-

“construction operations” means operations of any of the descriptions referred to in the definition of

“construction operations” in section 530(1), other than operations referred to in paragraph (f) of that definition;

“dealing in or developing land” shall be construed in accordance with Chapter 1 of Part 22;

“excepted operations” means any one or more of the following operations or activities-

(a) dealing in or developing land, other than such part of that operation or activity as consists of-

(i) construction operations, or

(ii) dealing by a company in land which, in relation to the company, is qualifying land.

(b)(i) working scheduled minerals, mineral compounds or mineral substances (within the meaning of section 2 of the Minerals Development Act 1940), or

(ii) working minerals (other than those specified in subparagraph (i)) other than so much of working such minerals as is manufacturing,


(c) petroleum activities;

“excepted trade” means a trade consisting only of trading operations or activities which are excepted operations or, in the case of a trade consisting partly of excepted operations and partly of other operations or activities, the part of the trade consisting only of excepted operations which is treated as a separate trade by virtue of subsection (2);

exempt development” means a development within Class 1 of Part 1 of the Second Schedule to the Local Government Planning and Development Regulations, 1994 (S.I. No. 86 of 1994), which complies with the conditions and limitations specified in column 2 of that Part which relate to that Class;

“land” includes foreshore and land covered with water, and “dry land” means land not permanently covered by water;

“minerals” means all substances (other than the agricultural surface of the ground and other than turf or peat) in, on or under land, whether obtainable by underground or by surface working, and includes all mines, whether or not they are already opened or in work, and also includes the cubic space occupied or formerly occupied by minerals;

“petroleum” has the same meaning as in section 2(1) of the Petroleum and Other Minerals Development Act, 1960;

“petroleum activities” means any one or more of the following activities-

(a) petroleum exploration activities,

(b) petroleum extraction activities, and

(c) the acquisition, enjoyment or exploitation of petroleum rights;

“petroleum exploration activities” means activities carried on in searching for deposits of petroleum, in testing or appraising such deposits or in winning access to such deposits for the purposes of such searching, testing or appraising;

“petroleum extraction activities” means activities carried on in-

(a) winning petroleum from any land, including searching in that land and winning access to such petroleum,

(b) transporting as far as dry land petroleum so won from a place not on dry land, or

(c) effecting the initial treatment and storage of petroleum so won from any land;

“petroleum rights” means rights to petroleum to be extracted or to interests in, or to the benefit of, petroleum;

qualifying land”, in relation to a company, means land which is disposed of at any time by the company, being land-

(a) on which a building or structure had been constructed by or for the company before that time, and

(b) which had been developed by or for the company to such an extent that it could reasonably be expected at that time that no further development (within the meaning of section 639) of the land would be carried out in the period of 20 years beginning at that time (other than a development which is not material and which is intended to facilitate the occupation of, and the use or enjoyment of, the building or structure for the purposes for which it was constructed) and for those purposes a development of land on which a building or buildings had been constructed shall not be material if it consists of one or both of the following-

(i) an exempt development, and

(ii) a development, not being an exempt development, if the total floor area of the building or buildings on the land after such development is not greater than 120 per cent of the total floor area of the building or buildings on the land calculated without regard to that development;

“working”, in relation to minerals, includes digging, searching for, mining, getting, raising, taking, carrying away and treating minerals and the sale or other disposal of minerals.

(2) For the purposes of this section, where a trade consists partly of excepted operations and partly of other operations or activities, the part of the trade consisting of excepted operations and the part of the trade consisting of other operations or activities shall each be treated as a separate trade, and there shall be apportioned to each such part such proportion of the total amount receivable from sales made and services rendered in the course of the trade, and of expenses incurred in the course of the trade, as is just and reasonable.

(3)(a) Notwithstanding section 21, but subject to subsection (4) and section 21B, corporation tax shall be charged on the profits of companies, in so far as those profits consist of income chargeable to corporation tax under Case III, IV or V of Schedule D or of income of an excepted trade, at the rate of 25 per cent for the financial year 2000 and subsequent financial years.

(b) For the purposes of paragraph (a), the profits of a company for an accounting period shall be treated as consisting of income of an excepted trade to the extent of the income of the trade for the accounting period after deducting from the amount of that income the amount of charges on income paid in the accounting period wholly and exclusively for the purposes of that trade.

(4) This section shall not apply to the profits of a company for any accounting period to the extent that those profits consist of income which arises in the course of any of the following trades—

(a) non-life insurance,

(b) reinsurance, and

(c) life business, in so far as the income is attributable to shareholders of the company.