Ireland: Revenue assessment in the absence of a return

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On 19 June 2017, the Irish Revenue published the Tax and Duty Manual Part 41A-05-02 that has been amended in paragraph 1 in relation to the pursuit of outstanding returns and in paragraph 4 in relation to appeal provisions.

According to this manual, where a taxpayer has failed to submit a Form 11, CG1 or CT1, as appropriate, section 959O of the TCA 1997 provides that penalties under section 1052 and 1054 may arise. In addition, a surcharge under section 1084 may apply (refer to Part 47-06-01 of the Tax and Duty Manual). Notwithstanding the provisions of sections 1052, 1054 and 1084, outstanding returns are pursued under the Return Non Filer Programme and, where appropriate, prosecution is considered under section 1078.

Furthermore, where a taxpayer has not filed a return (be that a Form 11, CG1 or CT1), then a Revenue Officer may, under section 959AC, make a Revenue Assessment on that person for the amount of tax, which in the best of the officer’s judgment, is due.

Ireland amends Capital Acquisitions Tax manual

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On 12 June 2017, Irish Revenue has published the amended Capital Acquisitions Tax manual that dealing with business relief Part 12 to incorporate material from Tax Briefing No. 33 (September 1998) in relation to the treatment of debts attributable to assets that are not used for the purposes of the business concerned.

Ireland: Interaction of PAYE and Self Assessment Procedures

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On 12 June 2017, Irish Revenue published the amended Part 42-04-13 of the Income Tax, Capital Gains Tax and Corporation Tax Manual. The amendments reflect the changes to the income thresholds which are applied in determining whether an individual with sources of PAYE and non-PAYE income is a chargeable person for self-assessment purposes.

The changes, which apply for the tax year 2016 and subsequent years are as follows:

  • The income threshold in section 959B(1)(a) of the TCA 1997 has been increased from €3,174 to €5,000.
  • The gross income threshold has been reduced from €50,000 to €30,000.

Ireland: Charges on income for corporation tax purposes

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On 12 June 2017, Irish Revenue published Tax and Duty Manual Part 08-02-01 dealing with charges on income for Corporation Tax purposes has been updated. The principal updates are in relation to interest as a charge on income under section 247 Taxes Consolidation Act 1997. In particular, the revised manual contains information on the anti-avoidance provisions that apply in respect of section 247 and related exclusions.

The updated manual also addresses the availability of relief under section 247 where shares are acquired pursuant to a court-approved scheme of arrangement effected in accordance with Chapter 1 of Part 9 of the Companies Act 2014.

Netherlands signs Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS

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The Netherlands signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (“Multilateral Instrument” or “MLI”) on 7th June 2017. About 70 Ministers and other high-level representatives participated in the signing ceremony at Paris. Eight other countries and jurisdictions have expressed their intention to sign the MLI and more countries are expected to sign by the end of this year.

The Convention enables all signatories, inter alia, to meet treaty-related minimum standards that were agreed as part of the Final BEPS package, including the minimum standard for the prevention of treaty abuse under Action 6. The MLI provisions will generally take effect concerning to withholding taxes on the 1st  day of the calendar year following the last date on which the MLI enters into force for each of the two Contracting Jurisdictions and six months as of this date with respect to all other covered taxes.


Ireland: New Tax-Geared Penalties for Non-Submission of Returns

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On 12 June 2017, Irish Revenue published the manual Tax-Geared Penalties for Non-Submission of Returns, that provides guidance as to the application of tax-geared penalties under section 1077E TCA 1997 in circumstances where the taxpayer has failed to deliver a return on or before the specified return date as set out under Chapter 3 Part 41A TCA 1997.

Ireland: New tax treatment of certain dividends

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On 12 June 2017, Irish Revenue published Tax and Duty Manual Part 02-02-03a that deals with the tax treatment of certain foreign dividends paid out of trading profits, which in accordance with section 21B Taxes Consolidation Act 1997, may be chargeable to corporation tax at the standard rate of 12.5% rather that at 25%.