Section 29A Temporary non-residents

(1)(a) In this section-

“intervening year”, in relation to an individual, means any year of assessment falling within the period commencing with the first day of the year of assessment immediately following the year of his or her departure and ending with the last day of the year of assessment immediately preceding the year of his or her return;

“relevant assets”, in relation to an individual, means shares in a company, or rights to acquire shares in a company, being shares or rights which he or she beneficially owned on the last day of the year of his or her departure and the market value of which on that day-

(i) is equal to, or exceeds, 5 per cent of the value of the issued share capital of the company, or

(ii) exceeds €500,000;

“year of departure”, in relation to an individual, means the last year of assessment before the year of return, for which the individual is resident in the State, and references to year of his or her departure shall be construed accordingly;

“year of return”, in relation to an individual, has the meaning assigned to it by subsection (2), and references to year of his or her return shall be construed accordingly.

(b) References in this section to an individual being resident in the State for a year of assessment shall be construed as references to an individual-

(i) who is resident in the State for the year of assessment, and

(ii) who could be taxed in the State for that year in respect of gains on a disposal, on each day of that year, of his or her relevant assets, if such a disposal were made by the individual on that day and gains accrued on the disposal.

(c) References in this section to an individual being not resident in the State for a year of assessment shall be construed as references to an individual who could not be taxed in the State for that year in respect of gains on a disposal in that year, or part of that year, of his or her relevant assets, or part of those assets, if the individual had made such a disposal in that year, or, as the case may be, that part of that year, and gains accrued on the disposal.

(2) This section applies to an individual where-

(a) the individual has relevant assets,

(b) the individual is resident in the State for a year of assessment (in this section referred to as the “year of return”),

(c) the individual was not resident in the State for one or more years of assessment immediately preceding the year of his or her return; but there is a year of assessment before the year of return for which the individual was resident in the State and, at any time during that year, the individual was domiciled in the State, and

(d) there are not more than 5 years of assessment falling between the year of his or her departure and the year of his or her return.

(3) Where an individual to whom this section applies, disposes of his or her relevant assets or any part of them (as the case may be) in one or more intervening years, the individual shall, for the purposes of the Capital Gains Tax Acts, be deemed to have disposed of and immediately reacquired, the relevant assets or that part of them (as the case may be), on the last day of the year of his or her departure, for a consideration equal to their market value on that day.

(3A) Notwithstanding subsection (3), where the market value of the relevant assets on the day they were disposed of is greater or less than the market value of those assets on the last day of the year, referred to in that subsection, that greater or lesser market value shall be substituted for the market value on that last day of the year.

(4) Where by virtue of subsection (3), an individual is chargeable to capital gains tax in respect of a deemed disposal of his or her relevant assets or any part of them (as the case may be), credit shall be allowed against such tax in respect of tax (in this section referred to as “foreign tax”) payable on the subsequent disposal by the individual of those relevant assets or that part of them (as the case may be) under the law of any territory outside the State, the government of which has entered into arrangements having the force of law by virtue of section 826(1), and the amount of such credit-

(a) shall be calculated having regard to the provisions of Schedule 24, and

(b) notwithstanding those provisions, shall not exceed the amount by which capital gains tax payable by the individual would be reduced if the individual had not been deemed to have disposed of relevant assets or that part of them (as the case may be).

(5) Where by virtue of subsection (3) a chargeable gain accrues to an individual, the provisions of Part 41A shall apply in relation to the chargeable gain, as if the year of his or her departure were the year of his or her return.