617A Transfers arising from certain mergers under Companies Act 2014

Summary

This section confirms that where a company transfers all its assets and liabilities to its 100 per cent parent as a consequence of a merger by absorption, as provided for in Chapter 3 of Part 9 and Chapter 16 of Part 17 of the Companies Act 2014, it shall not be treated as giving rise to a disposal by the parent of the share capital it holds in the company.

Section 633D of the Taxes Consolidation Act 1997 was introduced in 2012 to ensure cross-border mergers do not give rise to chargeable gains, in line with Article 7 of Council Directive 2009/133/EC (the Mergers Directive); however domestic mergers were not provided for in Irish law until the introduction of the Companies Act 2014. The purpose of section 617A is to confirm that domestic mergers by absorption similarly are not treated as involving a disposal by the parent company.

Relevant Date: Finance Act 2021