Interaction of section 997A and debt warehousing

Nov 09, 2020

Revenue confirmed via the TALC forum that a credit for tax deducted from the emoluments of a proprietary director will not be available, where the company has warehoused its PAYE tax debt. Revenue will not consider tax to be paid for the purposes of section 997A TCA 1997 when the tax is warehoused, accordingly a credit will not be available to the director in calculating their 2020 income tax liability.

Information provided by Revenue:

“Section 997A(3) TCA is not being disapplied, which means that if the tax on the director’s salary has not been paid under PAYE because it has been warehoused, the director cannot take credit for it.  The tax is not considered to be remitted when warehoused for the purpose of section 997A(4) TCA.

However, if the director is herself/himself availing of income tax/preliminary tax warehousing under the new section 1080B TCA, all liabilities including the unpaid Schedule E liabilities can be warehoused.”