Stapled Stock Arrangements DWT

This article is written as a reminder to practitioners of the reporting requirements of certain resident companies in relation to Dividend Withholding Tax.

Some Irish resident companies have arrangements with associated non-resident companies whereby the shareholders can elect to take distributions either from the resident or the non-resident company. Such arrangements are referred to as ‘stapled stock arrangements’.

Section 172L TCA 1997 provides for the reporting of distributions made under stapled stock arrangements Where under a stapled stock arrangement a non-resident company makes distributions in any month, Section 172L requires the resident company to make a return to Revenue within 14 days of the end of the month showing:

• The name and tax reference number of the resident company
• The name and address of the non-resident company which made the distributions
• The name and address of each person to whom a distribution was made in the month concerned
• The date the distribution was made to that person, and
• The amount of that distribution

In general the return must be made in an electronic format approved by Revenue. In certain circumstances the return may be made in writing in a form prescribed or authorised for that purpose by Revenue. It must also be accompanied by a declaration made by the company, on the prescribed or authorised form, to the effect that the return is correct and complete.