Revenue Note for Guidance

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Revenue Note for Guidance

Section 8 Facts and circumstances affecting duty to be set forth in instruments, etc.

Summary

This section puts the onus on a person to bring to the attention of the Revenue Commissioners all the facts and circumstances affecting the liability of an instrument to stamp duty.

Details

Facts and circumstances to be disclosed

(1) All relevant facts and circumstances relating to the liability of the instrument to stamp duty must be stated in the instrument itself.

(2) However, it is acknowledged that it will not always be practicable for the instrument to contain all relevant facts and circumstances. In such cases it is permissible to set out any facts or circumstances, not set out in the instrument, in an accompanying statement2. This statement is not required to be delivered to the Revenue Commissioners where the instrument is stamped under the e-stamping system. The Revenue Commissioners may request whatever information they require to determine the liability of the instrument to duty. In addition, the Revenue Commissioners may determine the form in which that information is to be given.

Evidence in relation to the chargeability of an instrument to duty must be retained by an accountable person for audit purposes for 6 years from the date of stamping of the instrument under the e-stamping system should the Revenue Commissioners wish to examine it.

Penalties for non-disclosure

(3) Penalties incurred before 24 December 2008 are payable in cases where all the relevant facts and circumstances are not fully and truly set out either in the instrument or in an accompanying statement and fraud or negligence3 is involved. The persons liable to pay such penalties are the parties to the instrument or the persons who prepared them. In a case of fraud or negligence, the penalty is €1,265 plus the amount of duty underpaid. This amount is in addition to the requirement to pay the balance of the duty owed on the instrument. For penalties incurred on or after 24 December 2008, where the penalty is incurred by the parties to the instrument see section 134A(2)(a) and where the penalty is incurred by the parties who prepared the instrument see subsection (4A) below.

Presumption of negligence

Negligence is presumed in —

  • (4) situations where it comes to the notice of the parties, or would have come to their notice if they had taken reasonable care, that incorrect information had been provided unless the Revenue Commissioners have been informed of the error without unreasonable delay;
  • (5) cases involving voluntary dispositions inter vivos in certain circumstances; Where a transfer or lease of property is made by way of a full or partial gift, stamp duty is chargeable by reference to the market value of the property (sections 30 and 54). However, it is not always apparent from the instrument that the transfer is by way of gift e.g. where some consideration is paid. All parties to an instrument are obliged to ensure that the Revenue Commissioners are aware from the stamp duty return delivered under the e-stamping system that the transfer is by way of gift and the market value must also be set out in the return. If the parties to the instrument fail to provide this information they are regarded as having acted deliberately for the purposes of section 134A(2)(a) until the contrary is proven

(4A) In relation to the preparation of instruments, any person, who on or after 24 December 2008, being employed or concerned in the preparation of any instrument, prepares such instrument where all the relevant facts and circumstances, of which the person is aware, are not fully and truly set out either in the instrument or in an accompanying statement, will incur a penalty of €3,000.

2Instruments should be drafted on the basis of normal drafting conventions and practices. Any information which is not covered by those conventions and practices but which is relevant to the liability of the instrument to stamp duty should be set out in the accompanying statement.

3The concept of negligence is potentially very wide-ranging and ultimately in any given case the courts will decide the matter on the facts. In deciding whether actions constitute negligence the Revenue Commissioners will consider how a court might view those actions.

Relevant Date: Finance Act 2014