267H Application (Chapter 6)

Summary

This section contains provisions regarding the application of the Chapter. It sets out the conditions under which relief from double taxation applies to interest and royalty payments.

Details

(1) The relief from double taxation applies to interest or royalty payments if the following conditions are met—

• (a) the payment must be made by an Irish resident company or a non-resident company that trades in Ireland through a permanent establishment provided, in the case of such a permanent establishment, that the payment is tax deductible in Ireland under section 81 (case I deduction), or 97 (case V deduction), or Part 8 (charges on income),
• (b) the payment must be for the benefit of-
  • a company resident in another Member State, or
  • a permanent establishment in another Member State of a company of a Member State, and
• the paying and receiving companies are associated companies.

The following payments are not covered—

• (2)(a)(i) interest and royalties paid to a company for a permanent establishment of that company which carries on a trade in the State or in a non EU Member State,
• (2)(a)(ii) interest and royalties paid by a company for the purposes of its permanent establishment situated in a non EU Member State,
• (2)(b) interest on debt-claims, which contain no provision for repayment of the principal amount or where repayment is due more than 50 years after the date of issue.
• (2)(c) so much of any royalties as are not paid at arm’s length.

Relevant Date: Finance Act 2021