On 19 December 2020, the President signed the Finance Bill 2020 into Law, which underpins the Government’s support for the economy in the face of Covid-19 pandemic and the ongoing threat of a no-deal Brexit. The Finance Act 2020 provisions primarily take effect from 1 January 2021, though certain measures took effect from 14 October, the day after the government held its budget, when the specific measures were announced. The Finance Act includes the following provisions:

• The Finance Act gives an amended definition of qualifying relevant person and new rules on loan arrangements and modifies basic rules on transfer pricing for arrangements between qualifying relevant persons. It amends the application of Ireland’s transfer pricing rules to non-trading transactions under Section 835E to give more prescriptive rules regarding the elimination of domestic non-trading transactions involving relevant persons from the application of transfer pricing rules.
• A new COVID Restrictions Support Scheme (CRSS) is introduced by the Act with effect from 13 October 2020 to 31 March 2021 to assist qualifying businesses whose trade has been significantly impacted or temporarily closed as a result of COVID-19 restrictions.
• The Act also provides amendment in the CFC rules by inserting new sections to provide that the potential exclusions from the rules will not apply for CFC resident in jurisdictions included in the EU list of non-cooperative jurisdictions.
• The Act amends the provisions relating to capital allowances on intangible assets and provides that all assets acquired from 14 October 2020 are fully within the scope of balancing charge rules, regardless of when the balancing event may occur, which is meant to ensure consistency with international best practices for similar reliefs.
• Also, the Act provides technically amendments to the anti-hybrid rules to clarify that deductions will not be denied where no economic hybrid mismatch outcome arises.
• To make amendment in the mandatory disclosure (DAC6) of certain transactions.
• According to the Act, the temporarily reduced VAT rate announced for the hospitality and tourism sector from 13.5% to 9% with effect from 1 November 2020 until December 2021. This will apply to catering and restaurant services, tourist accommodation, cinemas, theatres, museums, historic houses, open farms, amusement parks, certain printed matter and hairdressing.