Revenue Note for Guidance

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Revenue Note for Guidance

526 Credit for appropriate tax borne

Summary

This section enables a specified person (individual or company) to have appropriate tax set off against that person’s tax liability.

A specified person who is within the charge to income tax may set-off the tax deducted during a year of assessment against his/her income tax liability for that year. In the case of a specified person who is liable to corporation tax, the set-off is made against the corporation tax liability of the accounting period in which the relevant payment is made.

In either case, where the appropriate tax for the period exceeds the liability the excess may be refunded.

Details

(1) A specified person, who is chargeable to corporation tax, and who has suffered appropriate tax on relevant payments taken into account in computing profits or gains of an accounting period, may (subject to the limitation that appropriate tax may only be refunded once) claim to have the appropriate tax (as arrived at in accordance with subsection (4)) set off against the corporation tax chargeable for that accounting period. Where the appropriate tax is greater than the corporation tax liability, the excess is to be refunded.

(2) A specified person, who is within the charge to income tax, and who has suffered appropriate tax in a basis period for a year of assessment, may (subject to the limitation that an amount of appropriate tax may only be refunded once) claim to have the appropriate tax, set off against his/her income tax chargeable for that year of assessment.

(3) A specified person must provide the following information to the Revenue Commissioners when making a claim for set off or a refund of appropriate tax in respect of each amount of appropriate tax included in the claim where requested to do so by the Revenue Commissioners;

  1. the relevant payment notification reference number, and,
  2. where the claim is made by a partner in a partnership, a statement showing the apportionment that applies to the relevant payment and appropriate tax in respect of that partner.

(4) The amount, which may be set off or repaid under this section, is limited to the amount included in the appropriate payment notifications and not already repaid under any of the provisions of this Chapter.

(5) References to income tax chargeable and to corporation tax chargeable should be interpreted in accordance with section 959A.

Relevant Date: Finance Act 2021