Tax

Tax

Helen Byrne, Senior Tax Manager at EY Ireland, outlines the relevant compliance dates for August and September. RELEVANT COMPANY DATES 14 October 2018 Dividend withholding tax return filing and payment date (for distributions made in September 2018). 21 October 2018 Due date for payment of preliminary tax for companies with a financial year ended 30 November 2018. If this is paid using ROS, this date is extended to 23 October 2018. Due date for payment of initial instalments of preliminary tax for companies (not “small” companies) with a financial year ended 30 April 2019. If this is paid using ROS, this date is extended to 23 October 2018. 23 October 2018 Last date for filing corporation tax return Form CT1 for companies with a financial year ending on 31 January 2018 if filed using ROS. Due date for any balancing payment in respect of the same accounting period. Loans advanced to participators in a close company in the year ended 31 January 2018 may need to be repaid by 23 October 2018 to avoid the assessment (on the company) of income tax thereon. A concessional three-month filing extension for iXBRL financial statements (not Form CT1) may apply. For 31 October 2017 year ends, this should extend the iXBRL deadline to 23 October 2018. 31 October 2018 Last date for filing third-party payments return Form 46G for companies with a financial year ending on 31 January 2018. Latest date for payment of dividends for the period ended 30 April 2017 to avoid Sections 440 and 441 TCA97 surcharges on investment, rental and professional services income arising in that period (close companies only). Country-by-Country Reporting Notifications relating to the fiscal year ended 31 October 2018 must be made to Revenue no later than 31 October 2018 via ROS (where necessary). 14 November 2018 Dividend withholding tax return filing and payment date (for distributions made in October 2018). 21 November 2018 Due date for payment of preliminary tax for companies with a financial year ended 31 December 2018. If this is paid using ROS, this date is extended to 23 November 2018. Due date for payment of initial instalments of preliminary tax for companies (not “small” companies) with a financial year ended 31 May 2019. If this is paid using ROS, this date is extended to 23 November 2018. 23 November 2018 Last date for filing corporation tax return Form CT1 for companies with a financial year ending on 28 February 2018 if filed using ROS. Due date for any balancing payment in respect of the same accounting period. Loans advanced to participators in a close company in the year ended 28 February 2018 may need to be repaid by 23 November 2018 to avoid the assessment (on the company) of income tax thereon. A concessional three-month filing extension for iXBRL financial statements (not Form CT1) may apply. For 30 November 2017 year ends, this should extend the iXBRL deadline to 23 November 2018. 30 November 2018 Last date for filing third-party payments return Form 46G for companies with a financial year ending on 28 February 2018. Latest date for the payment of dividends for the period ended 31 May 2017 to avoid Sections 440 and 441 TCA97 surcharges on investment, rental and professional services income arising in that period (close companies only). Country-by-Country Reporting Notifications relating to the fiscal year ended 30 November 2018 must be made to Revenue no later than 30 November 2018 via ROS (where necessary). PERSONAL TAXES 31 October 2018 Due date for payment of preliminary income tax (inclusive of the USC) for the tax year 2018 (assuming the ROS ‘pay and file’ 14 November 2018 extension is not availed of). Due date by which self-assessed income tax and capital gains tax returns must be made for the year of assessment 2017 (see 14 November 2018 ROS ‘pay and file’ deadline extension). Due date for payment of any balance of income tax for the tax year 2017, assuming adequate preliminary tax was paid for 2017. Due date for payment and return of €200,000 Domicile Levy for 2017. Latest date for making contributions to a PRSA, an AVC or an RAC for the tax year 2017 (subject to an extension to 14 November 2018 for ROS pay and filers). 14 November 2018 An extension of the income tax ‘pay and file’ date of 31 October 2018 to 14 November 2018 may be availed of if taxpayers submit their payment and file their tax return through ROS. Extended due date for payment of capital acquisitions tax and filing of returns in respect of gifts and inheritances taken in the 12-month period ended 31 August 2018 (if done through ROS, otherwise 31 October 2018).  GENERAL 5 October 2018 Under mandatory reporting rules, promoters of certain transactions may be required to submit quarterly ‘client lists’ in respect of disclosed transactions made available in the relevant quarter. Any quarterly returns for the period to 30 September are due on 5 October. 1 November 2018 Date on which residential property must be held in order to be liable for 2019 Local Property Tax. Note: this article does not take account of any amendments proposed in Budget 2019 or Finance Bill 2018, both of which are expected to be published in October 2018.

Aug 01, 2018
Tax

A summary of some of the recent guidance issued by Revenue and other topical tax matters. One feature of the current Irish tax landscape is an increase in the amount of guidance, often lengthy and detailed in nature, which is issued by Irish Revenue on various matters. The purpose of these releases is to provide practical guidance on Revenue’s interpretation of new tax legislation or, in certain cases, revised guidance in respect of older legislation. This article summarises some of the recent issues from Revenue, as well as other topical tax matters. Business travellers/short-term assignees The taxation of business travellers and foreign employees temporarily assigned to work in Ireland has been the subject of much coverage recently, following the publication of guidance from Revenue on the topic. The guidance covers the taxation of foreign employees who come to Ireland to work for a period of time, often for a small number of days. In certain circumstances, workers employed by a foreign employer and working in Ireland for short periods – from the UK, for example – were protected from double taxation by our tax treaty. However, on the basis of the new guidance, a UK individual spending more than 30 days a year in Ireland will in many cases result in a PAYE withholding obligation for the employer. At a minimum, this will create significant additional administrative requirements on both companies and business travellers/short-term assignees. Companies potentially impacted by the above will need to carefully examine the guidance from Revenue to ascertain whether they could fall into the PAYE net. Unfortunately, this won’t always be clear as a result of the slightly subjective nature of some of the terms in the guidance. In addition, the PAYE modernisation regime – which comes into effect on 1 January 2019 – means time will be of the essence in reporting PAYE, where required, and applying for specific exemptions, where available. Re-grossing of payments that have been missed for PAYE purposes ‘Re-grossing’ is designed to address a situation where an employer makes a payment to an employee or director, but fails to deduct and remit the tax due under the PAYE system. Finance Act 2017 introduced legislative provisions in this regard, with a manual recently issued by Revenue on the topic. Imagine a situation where an employee receives a benefit of €100, which should have been subject to tax through PAYE but wasn’t. When rectifying the matter, should the employer treat the €100 as a gross payment and deduct tax accordingly, or should the €100 be treated as the net amount the employee received, with PAYE applying to the re-grossed amount? In the past, in certain situations, the position to adopt wasn’t clear with the potential for significant variations in the tax liability if Revenue and the employer adopted different positions. The purpose of the new legislation and guidance notes is to remove this ambiguity. Per Revenue’s recently published manual, the circumstances where re-grossing apply are where there is a total non-operation of PAYE by an employer in respect of emoluments paid to an employee (all payments paid gross, for example) or an employer disguises the payment of emoluments – for example, payments from cash sales that are omitted from the employer’s books or records. Broadly speaking, no re-grossing applies where there is innocent error. An example in the Revenue manual refers to an employee who occasionally takes a taxi to work and the employer reimburses the employee for the cost of the taxi. Where Revenue is satisfied that this is an innocent error by the employer, re-grossing should not apply. Historically, re-grossing was not generally required in practice on “normal” benefits-in-kind. Whether these will be accepted going forward as an “innocent error” is unclear. Implications of Finance Act provisions for management buy-outs and similar deals One of the more controversial elements of the 2017 Finance Act was an anti-avoidance provision that impacts transactions where reserves of a target company are ultimately used to pay the vendors of the target. In a typical management buy-out (MBO) situation, a special purpose vehicle (Bidco) might be established by management to acquire the target business from the vendors. A dividend could be paid by the target to the Bidco on closing to enable the payment of the purchase consideration to the vendor by the Bidco. Prior to Finance Act 2017, the sale of the shares in the target would have been subject to capital gains tax (CGT) in the hands of the vendors. Post-Finance Act 2017, the element of the consideration that was sourced from reserves in the target could instead be taxed as a distribution at marginal income tax rates. Guidance on the matter has issued from Revenue, with some limited examples. The guidance confirms that bona fide situations are not caught under the new provisions, although the legislation contains no such “get-out”. The broad thrust of the guidance is that, if the reserves are sourced from the target as part of an arrangement between the vendor and the purchaser, then distribution treatment may apply. The new provisions are potentially far-reaching and could create uncertainty in many “normal” deal situations. It is a point that needs to be considered in transactions that may fall within the remit of the new legislation. EII update Unfortunately, there remains a backlog of cases with Revenue where approval for Employment and Investment Incentive (EII) relief is sought. This appears to be down to a combination of the new EU Block Exemption rules and stretched resources in Revenue. While additional Revenue resources have been allocated to clearing the backlog, in our experience there is still a significant number of old cases awaiting attention. This isn’t ideal, particularly when EII is one of the key non-bank methods available to small business for raising finance. The idea of moving EII to a self-assessment basis has been mooted, which would at least enable relief to be obtained by investors at the outset. So, lots going on and only four months to the next Budget and Finance Bill! Peter is Tax Partner at Grant Thornton.

Jun 01, 2018
Tax

With the UK’s Corporate Criminal Offence legislation now in full force, businesses need to assess their risks before it’s too late. These days, a company’s tax affairs are considered a hot topic – particularly if said company is not seen to be paying its fair share of tax. With the introduction of Corporate Criminal Offence (CCO) legislation, public scrutiny could extend to the actions of those a company employs or contracts within the ordinary course of business. The implications of failing to act could be significant, and the reputational damage alone of a successful conviction could be devastating for a company. CCO is part of the global focus on the prevention of tax evasion and other financial crimes. It is one of a number of measures that were introduced in the Criminal Finances Act 2017 and took effect from September 2017. Aim of the legislation The aim of the legislation is to overcome difficulties in attributing criminal liability to a corporate when its ‘associated persons’ facilitate the evasion of tax. The term ‘associated person’ is widely drawn and includes any person (individual or corporate) who provides services for, and on behalf of, the corporate. This includes – but is not limited to – employees, contractors and agents. The legislation applies to all taxes and all relevant bodies (namely, body corporate or partnership – collectively referred to as ‘corporate’) regardless of their size. There is no de-minimus limit. Penalties Under CCO legislation, it is the corporate that is subject to prosecution. The authorities do not need to attribute the prosecution to a specific individual, and this offence does not alter what is criminal; rather, who is held accountable for the criminal activity. A successful prosecution could lead to: An unlimited fine; Ancillary orders, such as confiscation orders or serious crime prevention orders; Public record of the conviction; and Significant reputational damage. The offences The legislation has created two offences: the UK tax evasion offence (the ‘domestic offence’) and the foreign tax evasion offence (the ‘overseas offence’). These offences are very similar and include three stages: Criminal tax evasion by a taxpayer; The criminal facilitation of the evasion by an ‘associated person’ of the corporate. This would include aiding, abetting, counselling or procuring the fraudulent evasion of tax; and Failure to put in place reasonable procedures to prevent the associated person facilitating the tax evasion. The overseas offence requires a UK nexus; it can only be committed if the corporate is incorporated in the UK, carrying on a business via a permanent establishment in the UK, or the associated person is located in the UK when the evasion of the overseas tax is facilitated. Example A very simplistic example of the type of arrangements the legislation is aiming to catch is as follows: in order to retain the services of a valued contractor, the finance department of a UK corporate agree a change to the payment arrangements whereby 90% of the contactor’s invoiced fees are to be paid to the normal trading account of the contractor, with the remaining 10% paid to a British Virgin Island (BVI) bank account. The contractor carries out the work on behalf of the corporate and payments are made as requested by the contractor. The contractor recognises 90% of invoiced fees, resulting in lower reported profits. The associated person, in this example the employee, must deliberately and dishonestly take action to facilitate the evasion of tax by the taxpayer. If the employee has only accidentally – or even negligently – facilitated the tax evasion, then the offence is not committed. Defence The only defence against this offence is the implementation of reasonable prevention procedures. What is accepted as ‘reasonable’ is likely to develop over time, however HMRC recommend that the following six principles should drive the corporate’s approach: Risk assessment: the risk assessment plays a fundamental role in evidencing that there are reasonable procedures in place. It should be used to highlight areas of potential exposure and identify and prioritise risks; Proportionality of risk-based prevention procedures: the procedures adopted must be proportionate to the risk faced by the corporate. HMRC suggests the ‘opportunity, motive and means’ test; Top-level commitment: this is intended to encourage the involvement of senior management in the creation and implementation of preventative procedures. Communication from the top level of the organisation is key; Due diligence: certain industries already undertake specific due diligence exercises – for example, financial services, legal and accountancy firms. However, this may not be sufficient for the purposes of CCO and may need to be tailored accordingly; Communication (including training): it is necessary to ensure that the procedures are clearly communicated to staff and understood at all levels. Communication and training should be proportionate to the level of risk involved; and Monitoring and review: the nature of risks faced by a corporate will change over time. It is therefore necessary for procedures to be reviewed and modified as appropriate. As can be seen, the legislation is wide-ranging (in particular, innocence of the directors is no defence) and a successful conviction could have significant implications. It is therefore advisable for all corporates to carry out a risk assessment to identify those areas of risk facing their business. The findings can then be used to implement relevant procedures and train staff accordingly. Doing nothing is not an advisable option! Claire McGuigan is Tax Director at BDO Northern Ireland.

Jun 01, 2018
Tax

David Duffy highlights the latest VAT cases and discusses recent VAT developments. IRISH VAT UPDATES Revenue eBriefs 66/18 and 68/18 contain links to Revenue guidance on specific matters. Revenue eBrief 68/18 contains VAT guidance on a number of issues which are principally relevant to the financial services sector. Revenue eBrief 66/18 addresses the VAT treatment of staff secondments. VAT deductibility for life insurance companies The provision of insurance is a VAT-exempt activity and therefore, VAT incurred on costs in respect of the provision of insurance is generally not recoverable (with the exception of insurance services to customers located outside the EU). However, the Revenue guidance acknowledges that a life insurance company typically also generates income from savings and investment products which are written as a life insurance policy, but are similar to, and in competition with, other financial products offered by banks, fund managers etc. The guidance confirms that VAT recovery on costs incurred by a life insurance company relating to these types of products should typically be based on the non-EU financial investments made by the life insurance company in respect of the products. Consequently, VAT should be recoverable on costs that are directly attributable to dealing in non-EU securities, while VAT recovery should be disallowed on costs directly attributable to dealing in EU securities. Where the life insurance company has costs that relate to both its insurance and investment activities, a VAT recovery rate methodology must be formulated using a methodology that correctly reflects how costs are consumed and has due regard for the total supplies of the business. VAT deductibility for the funds industry This guidance note sets out the VAT deductibility rules for regulated Irish funds where the fund is engaged in the execution of trades in financial securities. The guidance does not apply to funds investing in real estate or other non-financial assets.  As with other entities, a fund is entitled to VAT recovery on its costs to the extent it is engaged in the supply of financial services to non-EU counter-parties. However, given that the fund’s level of trading can be very substantial, Revenue set out in this guidance note two methods for calculating the proportion of non-EU activity of a fund. The first is based on the proportion of non-EU investments included in the fund’s net asset value (NAV). Revenue consider this to be generally the most reliable method to correctly reflect the use that the costs incurred are put to. The second method, based on the quantum of non-EU investors in the fund, may only be used if it is a more accurate reflection than the method based on the NAV. Revenue states that whichever method is adopted, it must be applied consistently and any change in methodology should be submitted to Revenue for approval. VAT treatment of personal contract plans In light of the Court of Justice of the European Union (CJEU) judgment in Mercedes Benz Financial Services (C-164/16), Revenue has outlined its position regarding the VAT treatment of personal contract plans (PCP). PCP is a common means of financing assets such as cars, as it generally allows for reduced repayments during the term of the agreement with a larger optional balloon payment due at the end. At the end of the term, the customer has the option to: return the car without paying the balloon payment; pay the balloon amount and take full legal ownership of the car; or trade in the car and enter into a PCP on a new car. The Mercedes Benz judgment had confirmed that a contract of this type should be treated as an upfront supply of goods for VAT purposes by the finance company at the outset of the agreement where the only rational choice for the customer will be to exercise the option to purchase the asset at the end of the agreement.  In this guidance note, Revenue indicates that it is prepared to accept that the requirement to purchase the asset at the end of a PCP contract can be fulfilled by the exercise of either the option to make the balloon payment at the end of the agreement and take ownership of the asset or the option to trade in the asset and enter into a PCP on a new asset. Therefore, where it is clear at the outset of the agreement that the economically rational choice will be to buy the asset or trade it in against a new asset, it can be treated as a supply of goods for VAT purposes. This will need to be considered on a case-by-case basis.  VAT treatment of staff secondments eBrief 66/18 contained guidance on the VAT treatment of staff secondments to companies established in Ireland from related foreign companies. The guidance confirms that in the normal course, staff secondments are subject to VAT at the standard rate. However, Revenue allows an administrative practice where VAT is not chargeable on payments in respect of the seconded staff provided Irish PAYE and PRSI have been correctly operated on those payments. This treatment only applies where staff are seconded from a company not established in Ireland, which is in the same corporate group as the recipient company. In addition, the Irish company to which the employee is seconded must exercise control over the performance of the employee’s duties or the employee must effectively have managerial responsibility for the operation of the Irish company. In addition, the PAYE/PRSI liabilities relating to the payments to the seconded employee must be paid to Revenue in a timely manner. Where the company sending the employee charges the Irish company an amount in excess of the amounts payable to the employee, this excess will be liable to VAT on the reverse charge basis in the hands of the Irish company engaging the employee. EU VAT UPDATES Input VAT recovery and time limits The CJEU judgment in Volkswagen AG (C-533/16) confirmed that where VAT is charged by a supplier to a customer several years after the relevant supply took place, member states cannot deny a VAT refund to that customer solely based on the expiry of a time limit running from the date of the supply. This case concerned Slovakian companies that supplied Volkswagen with moulds for car lights. The suppliers did not charge VAT to Volkswagen as they had incorrectly considered their supplies to be VAT exempt. Subsequently, the suppliers invoiced VAT on the historic supplies for a number of years, collected this VAT from Volkswagen and paid it over to the Slovakian tax authorities. Volkswagen was not established in Slovakia, and therefore submitted an 8th Directive claim for this VAT (a claim for traders not VAT registered or established in a member state they are seeking to recover VAT in). The Slovakian tax authorities had a five-year time limit for VAT recovery from the date of the initial supply and therefore, disallowed Volkswagen’s claim for VAT recovery on invoices relating to supplies that took place more than five years earlier. However, the CJEU found that where a taxpayer has not been invoiced for, and has not paid, the VAT arising on a supply, VAT recovery cannot be denied simply due to a time limit from the date of supply which had expired before the refund claim was submitted. It is worth noting that the judgment in this case was based on a specific fact pattern and businesses that incur foreign VAT should pay close attention to the relevant time limits for submitting refund claims. David Duffy ACA, AITI Chartered Tax Advisor, is a VAT Director at KPMG.

Jun 01, 2018
Tax

Helen Byrne, Senior Tax Manager at EY Ireland, outlines the relevant compliance dates for June and July. Relevant company dates 14 June 2018 Dividend withholding tax return filing and payment date for distributions made in May 2018. 21 June 2018 Due date for payment of preliminary tax for companies with a financial year ended 31 July 2018. If this is paid using ROS, the date is extended to 23 June 2018. Due date for payment of initial instalments of preliminary tax for companies (not “small” companies) with a financial year ended 31 December 2018. If this is paid using ROS, the date is extended to 23 June 2018. 23 June 2018 Last date for filing corporation tax return Form CT1 for companies with a financial year ended 30 September 2017 if filed using ROS. Due date for any balancing payment in respect of the same accounting period. Loans advanced to participators in a close company in the year ended 30 September 2017 may need to be repaid by 23 June 2018 to avoid the assessment on the company of income tax thereon. A concessional three-month filing extension for iXBRL financial statements (not Form CT1) may apply. For 30 June 2017 year ends, this should extend the iXBRL deadline to 23 June 2018. 30 June 2018 Last date for filing third-party payments return Form 46G for companies with a financial year ended 30 September 2017. Latest date for payment of dividends for the period ended 31 December 2016 to avoid Sections 440 and 441 TCA97 surcharges on investment, rental or professional services income arising in that period (close companies only). Country by Country Reporting Notifications relating to the fiscal year ended 30 June 2018 must be made to Revenue no later than 30 June  2018, via ROS (where necessary). 14 July 2018 Dividend withholding tax return filing and payment date for distributions made in June 2018. 21 July 2018 Due date for payment of preliminary tax for companies with a financial year ended 31 August 2018. If this is paid using ROS, the date is extended to 23 July 2018. Due date for payment of initial instalments of preliminary tax for companies (not “small” companies) with a financial year ended 31 January 2019. If this is paid using ROS, the date is extended to 23 July 2018. 23 July 2018 Last date for filing corporation tax return Form CT1 for companies with a financial year ended 31 October 2017 if filed using ROS. Due date for any balancing payment in respect of the same accounting period. Loans advanced to participators in a close company in the year ended 31 October 2017 may need to be repaid by 23 July 2018 to avoid the assessment on the company of income tax thereon. A concessional three-month filing extension for iXBRL financial statements (not Form CT1) may apply. For 31 July 2017 year ends, this should extend the iXBRL deadline to 23 July 2018. 31 July 2018 Last date for filing third-party payments return Form 46G for companies with a financial year ended 31 October 2017. Latest date for payment of dividends for the period ended 31 January 2017 to avoid Sections 440 and 441 TCA97 surcharges on investment, rental or professional services income arising in that period (close companies only). Country by Country Reporting Notifications relating to the fiscal year ended 31 July 2018 must be made to Revenue no later than 31 July 2018, via ROS (where necessary). General 30 June 2018 Deadline for FATCA and CRS reporting obligations for 2017. 6 July 2018 Under mandatory reporting rules, promoters of certain transactions may be required to submit quarterly ‘client lists’ in respect of disclosed transactions made available in the relevant quarter. Any quarterly returns for the period to 30 June are due on 6 July. 30 July 2018 Due date for submission and return of payment of IREF withholding tax in connection with accounting periods ending between 1 July and 31 December 2017.

Jun 01, 2018
Tax

US tax reform is still likely, but there’s work to do on the detail. US tax proposals have run into the sort of roadblock that only the US system can produce, with differences between both the House and Senate having the potential to delay changes. At the time of going to press, it is difficult to predict what compromise will be reached and what elements of the respective reform packages will be dropped. Or indeed, what might be added. From Ireland’s perspective, the general view is that our relatively low tax rate in Europe will continue to make us an attractive location for US groups to do business. It is also worth noting that when you include state and local taxes, the US corporate tax rate will still be double the Irish rate. The biggest danger to Ireland in the immediate aftermath of the US election was the so called “border adjustment tax”, which would heavily penalise Irish companies selling into the US. Due to significant lobbying, this element of the reform package was dropped. However, a potentially lower tax rate for US exporters has emerged in the new proposals. This is probably the key element to look out for as the haggling continues. EU not letting go on various fronts Outside the US, the EU’s drive for changes to the taxation of digital companies continues. In short, the EU would like to see greater direct taxation in the jurisdiction where consumption occurs as opposed to where the product or service originates. To most people, taxation at point of consumption looks like VAT – but not in the eyes of the EU. It is difficult to see how the EU’s digital tax proposals would sit comfortably with the OECD’s BEPS proposals, which place much emphasis on the link between value creation activities and taxable profits. Reconciling this with the EU proposals looks difficult. As the use of tax havens seems to be at the heart of EU concerns, in my view the EU proposals around the digital economy should be put on hold until the OCED BEPS package has been developed properly and tested over a period of time. If concern remains that tax avoidance in the digital context has not been sufficiently addressed, further measures can be considered at that point. The EU hasn’t given up on its tax consolidation plans either, with the CCCTB proposals still very much alive. CCCTB seeks to attribute profits based on sales, employees and assets, which would impact negatively on small countries such as Ireland. Again, it is difficult to see the rationale for CCCTB if the OECD’s BEPS plans are endorsed and implemented by member states. However, the EU hasn’t shown any signs of letting this one drop. The changing pace of much EU tax reform depends on who holds the presidency. With low-tax Bulgaria taking over in January, don’t expect to see much movement on CCCTB in the first half of next year. Ireland’s reputation still strong The Panama papers – and more recently, the Paradise equivalent – have further projected tax planning into the general domain. There is increasing pressure on governments to be seen to be doing their part in tackling tax avoidance. In Ireland, attention moved recently to the so called “Single Malt” structure, which involves an Irish incorporated but Maltese tax resident company. Such a structure is not unique to Ireland, with many developed countries including our nearest neighbour having a clause in their tax treaties that the place of effective management determines tax residence, not the place of incorporation. In theory, as both the Double Irish and Single Malt do not involve the avoidance of Irish tax per se, they shouldn’t be our problem. However, the adverse coverage surrounding the Double Irish structure had an impact on our reputation and the general view is that we made the right call in amending our tax residence rules. Maintaining our reputation was, and is, key. The Finance Minister has said he will look at the revised rules and whether they are sufficiently robust in light of more recent coverage. There are good arguments that no changes are required to our existing rules, which are consistent with other developed countries. Whether the tax rules in certain other jurisdictions are appropriate is a matter for another authority to determine, such as the EU or OCED. Ireland cannot realistically be expected to oversee the tax rules of its treaty partners. In summary, the uncertainty continues. Unfortunately, on many fronts, it doesn’t look like that uncertainty is going to be resolved any time soon.  For businesses operating across borders, accurately predicting tax costs in cash flow projections beyond the immediate period remains precarious. Peter Vale is Tax Partner at Grant Thornton.

Dec 01, 2017