Select view:

Taxes Consolidation Act, 1997 (Number 39 of 1997)

[1]>

396D. Accelerated loss relief for certain accounting periods

(1) In this section—

the Acts” has the same meaning as it has in section 1095;

estimated non-relevant trading loss”, in relation to a specified accounting period, means a non-relevant trading loss incurred or expected to be incurred, based on the best estimate that may reasonably be made, by a company in a specified accounting period;

estimated relevant trading loss”, in relation to a specified accounting period, means a relevant trading loss incurred or expected to be incurred, based on the best estimate that may reasonably be made, by a company in a specified accounting period;

excess claim” means the amount by which the amount, referred to in this definition as ‘A’, exceeds the amount referred to in this definition as ‘B’:

(a) A, being the amount of tax repaid to a company for the preceding accounting period as computed in accordance with an interim claim made under this section, and

(b) B, being the amount of tax that would have been repaid to a company for the preceding accounting period if that amount had been computed in accordance with a true and correct interim claim based on 50 per cent of the amount of the non-relevant trading loss or 50 per cent of the amount of the relevant trading loss, as the case may be, incurred in the specified accounting period and not on 50 per cent of the estimated non-relevant trading loss or 50 per cent of the estimated relevant trading loss, as the case may be;

interim claim”, in relation to a specified accounting period, has the meaning assigned to it in subsection (2);

non-relevant trading loss” means a loss incurred by a company carrying on a trade to which section 396(2) applies and which is not a relevant trading loss;

preceding accounting period”, in relation to a company, means the accounting period that is equal in length to, and that immediately precedes, a specified accounting period for which a company has an estimated non-relevant trading loss or an estimated relevant trading loss, as the case may be;

relevant trading loss” has the same meaning as it has in section 396A;

return” has the same meaning as it has in section 959A;

specified accounting period” means any accounting period of a company carrying on a trade which includes some or all of the period commencing on 1 March 2020 and ending on 31 December 2020;

specified return date for the accounting period” has the same meaning as it has in section 959A;

specified return date for the preceding accounting period” has the same meaning as is assigned by section 959A to the definition of the expression, ‘specified return date for the accounting period’, but subject to the modification that the reference in that definition to ‘accounting period’ shall be construed as a reference to ‘preceding accounting period’;

tax compliant company” means a company which has complied with all obligations imposed on the company by the Acts in relation to—

(a) the payment or remittance of taxes, interest or penalties required to be paid or remitted under the Acts, and

(b) the delivery of any returns to be made under the Acts;

tax repaid”, in relation to an excess claim, means—

(a) any amount of tax that has been repaid to the company by the Revenue Commissioners, and

(b) any amount of tax that would have been repaid to the company in respect of the excess claim but for the offset of that tax against any other liability of the company in accordance with section 960H.

(2) Where, for a specified accounting period, a company has an estimated non-relevant trading loss or an estimated relevant trading loss, as the case may be, the company may, subject to this section, make a claim (referred to in this section as an ‘interim claim’) for such relief as would be available to the company in respect of the preceding accounting period under section 396(2), 396A(3) or 396B, as the case may be, in respect of 50 per cent of the estimated non-relevant trading loss or 50 per cent of the estimated relevant trading loss, as the case may be, and an interim claim made under this subsection shall be treated—

(a) as if it were a claim under section 396(2), 396A(3) or 396B, as the case may be, and

(b) as if—

(i) in the case of an estimated non-relevant trading loss, the loss is incurred in a trade, and

(ii) in the case of an estimated relevant trading loss, it is a relevant trading loss that has been incurred,

and sections 396, 396A and 396B shall apply to an interim claim with any other necessary modifications to give effect to this subsection.

(3) (a) Subject to paragraph (b), an interim claim under this section may be made by a company on or after the commencement of section 11 of the Financial Provisions (Covid-19) (No. 2) Act 2020, but—

(i) not earlier than the end of the period of 4 months from the beginning of the specified accounting period, and

(ii) not later than the end of the period of 5 months from the end of the specified accounting period.

(b) Where the specified accounting period is less than 4 months, the company may make an interim claim under this section after the end of the specified accounting period but not later than the end of the period of 5 months from the end of the specified accounting period.

(4) (a) Where, subsequent to making an interim claim under subsection (2), it comes to the company’s notice that 50 per cent of the amount of its estimated non-relevant trading loss or 50 per cent of the amount of its estimated relevant trading loss, as the case may be, is greater than the amount in respect of which the interim claim has been made, the company may, subject to this section, increase the amount in respect of which an interim claim is made under subsection (2).

(b) Where it comes to the company’s notice that 50 per cent of the amount of its estimated non-relevant trading loss or 50 per cent of the amount of its estimated relevant trading loss, as the case may be, is less than the amount in respect of which an interim claim has been made under subsection (2)

(i) the difference between—

(I) the amount in respect of which an interim claim has been made under subsection (2), and

(II) 50 per cent of the amount of the estimated non-relevant trading loss or 50 per cent of the amount of the estimated relevant trading loss, as the case may be,

is, for the purposes of subparagraph (ii), referred to as the ‘excess amount’, and

(ii) the company shall, without unreasonable delay, amend the amount in respect of which the interim claim has been made under subsection (2) so as to reduce the amount claimed by the excess amount.

(5) (a) Where a company makes an interim claim under this section in respect of 50 per cent of an estimated non-relevant trading loss or 50 per cent of an estimated relevant trading loss, as the case may be, the company shall—

(i) maintain and have available such records as may reasonably be required for the purposes of determining whether such losses have been computed in a reasonable manner and to the best of the company’s knowledge and belief, and

(ii) not later than the specified return date for the accounting period in which the estimated non-relevant trading loss or the estimated relevant trading loss, as the case may be, is incurred, make such amendment to the amount of relief claimed by the company as is necessary to ensure that the amount of the claim does not exceed the amount of the non-relevant trading loss or the relevant trading loss, as the case may be, incurred by the company in the specified accounting period which is, under section 396, 396A or 396B, as the case may be, available in respect of the preceding accounting period.

(b) The requirement in paragraph (a)(ii) to make an amendment shall apply notwithstanding section 396(9), 396A(5) or 396B(6), as the case may be, but shall not prevent a company from making a notice of amendment under section 959V.

(6) Subsection (2) shall not apply unless the company which makes an interim claim under this section—

(a) makes a declaration that the company has incurred or may reasonably expect to incur an estimated non-relevant trading loss or an estimated relevant trading loss, as the case may be, in the specified accounting period, and

(b) is a tax compliant company.

(7) Where a company makes an interim claim under this section which gives rise to an excess claim—

(a) then, subject to paragraph (b), tax repaid to the company in respect of the excess claim shall carry interest as determined in accordance with section 1080(2)(c) as if a reference to the date when the tax became due and payable were a reference to the date the tax was repaid by the Revenue Commissioners or offset in accordance with section 960H, as the case may be,

(b) where the interim claim was made neither deliberately nor carelessly (within the meaning of section 1077E) and the company, without unreasonable delay upon it coming to the company’s notice that the claim is overstated, reduces the claim by such amount as is necessary to ensure that it is no longer overstated, tax repaid in respect of the excess claim shall carry interest as determined in accordance with section 1080(2)(c) as if a reference to the date when the tax became due and payable were a reference to the date the claim was reduced.

(8) A claim under this section shall be made in such form and contain such particulars as the Revenue Commissioners may prescribe.

<[1]

[1]

[+]

Inserted by the Financial Provisions (Covid-19) (No. 2) Act 2020 s11.