Revenue Note for Guidance

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Revenue Note for Guidance

240 Provisions as to tax under section 239

Summary

This section applies certain provisions of the Income Tax Acts to the charge, assessment, collection and recovery of income tax under section 239(10) (that is, in the unusual case of a payment made under deduction of tax at a time which is not in an accounting period of a company).

Details

(1) Apart from subsection (5), this section only applies in a situation where income tax is due under section 239(10).

(2) The provisions of the Income Tax Acts providing for the charging, assessing and collection of income tax are applied for the purposes of the income tax to which the section applies.

(3)(a) Any income tax payable under section 239(10) (without the making of an assessment) shall, for any day or part of a day from the date when it becomes due until payment, carry interest as follows:

  • before 1 August 1978 at a rate of 0.0492 per cent,
  • between 1 August 1978 and 31 March 1998, at a rate of 0.0410 per cent,
  • between 1 April 1998 and 30 June 2009, at a rate of 0.0322 per cent, and
  • on or after 1 July 2009 at a rate of 0.0274 per cent.

(3)(b) Subsections (3) to (5) of section 1080 apply to interest on income tax under section 239(10). These subsections provide that —

  • the interest is to be paid to the Revenue Commissioners without deduction of income tax,
  • the interest is not allowable as a deduction in computing profits,
  • the interest is recoverable as if it were itself income tax, and
  • in court proceedings a certificate from an officer of the Revenue Commissioners regarding the amount of interest due is to be evidence until the contrary is proved.

(4) Where income tax assessed under section 239(10) is not paid on the due date it will not be possible to avoid an interest charge, that is, section 1080(1)(a) will apply to charge interest in accordance with section 1080(1)(c) for each day or part of a day from the date when the tax became due until payment.

(5) Where a loan is made by a close company to a participator, the loan is treated (under section 438) as a net annual payment after deduction of income tax at the standard rate for which tax the company must account to Revenue. If, after the company is assessed to that tax under section 239, the participator repays the loan, the company is entitled to a repayment of the tax. However, the company is not entitled to be repaid any interest it may have paid on that tax.

(6) A person aggrieved by an assessment made under this section may appeal the assessment by notice in writing to the Appeal Commissioners. An appeal must be made within 30 days after the date of the notice of assessment. The Appeal Commissioners will hear and determine an appeal in the manner provided for in Part 40A of the Act.

A person may not appeal if they have not filed a self assessed return and paid the amount due in accordance with their own self assessment (where the person is required to file a return).

Relevant Date: Finance Act 2017