Revenue Note for Guidance
This section provides special measures to deal with the common situation where distributions are made through intermediaries such as nominees and custodians. DWT does not apply to distributions made through one or more qualifying intermediaries for the benefit of persons beneficially entitled to the distributions who are non-liable persons.
To be a qualifying intermediary, an intermediary must —
In addition, the intermediary must —
An authorisation of a person as a qualifying intermediary expires after 7 years subject to renewal of the, or the entering into of a new, qualifying intermediary agreement.
Under a qualifying intermediary agreement, an intermediary must undertake to accept, retain and make available for inspection, all declarations of exemption and notifications made to the intermediary in connection with the DWT scheme. The intermediary must also undertake to exercise a duty of care in relation to the veracity of such declarations and notifications, to operate the DWT scheme (including the making of returns to Revenue) correctly and efficiently, to provide to Revenue an auditor’s report on the intermediary’s compliance with the agreement for its first year of operation and further such reports on request by Revenue, and to allow for the verification of such compliance by Revenue in any manner considered necessary by Revenue. The agreement may also require the provision of a bond or guarantee by the intermediary to protect the Exchequer against fraud or negligence in the operation of the agreement and the DWT scheme.
Provision is also made for the maintenance by Revenue of a list of qualifying intermediaries which can be made available to any person, and for the revocation of an authorisation of a person as a qualifying intermediary.
(1) DWT does not apply where an Irish resident company makes a relevant distribution through one or more than one qualifying intermediary for the benefit of a person who is beneficially entitled to the distribution and is a non-liable person in relation to the distribution. This rule is, however, subject to section 172F(6) which provides that the company must apply DWT to a distribution made to a qualifying intermediary unless it has been notified by the qualifying intermediary that the distribution is to be received by the qualifying intermediary for the benefit of a person in its Exempt Fund.
(2) A number of conditions must be satisfied if a person is to be a qualifying intermediary. The person must first of all be an intermediary, that is, a person whose trade consists of or includes the receipt, on behalf of other persons, of relevant distributions from Irish resident companies or of amounts or other assets representing such distributions from other qualifying intermediaries. In addition, the person must be resident for tax purposes in the EU or in a tax treaty country, must enter into a qualifying intermediary agreement with Revenue, and must be authorised by Revenue as a qualifying intermediary.
(3) A qualifying intermediary agreement is an agreement entered into between Revenue and an intermediary under which the intermediary undertakes certain obligations, namely —
(3A) Revenue may examine, or take extracts from or copies of, any declarations, certificates or notifications made available to it under subsection (3)(b).
Revenue are restricted as to whom they may authorise as a qualifying intermediary. Revenue may only authorise as a qualifying intermediary —
(5) Revenue are required to maintain a list of qualifying intermediaries whose authorisation as a qualifying intermediary has not been revoked. Notwithstanding their confidentiality and secrecy obligations, Revenue may make available to any person the name and address of any qualifying intermediary.
(6) Revenue are empowered to revoke a person’s authorisation as a qualifying intermediary where Revenue is satisfied that the person has failed to comply with the qualifying intermediary agreement or the DWT scheme in general or that the person is otherwise unsuitable to be a qualifying intermediary. Notice of a revocation must be served in writing by registered post, and the revocation takes effect from the date specified in the notice.
(7) Notice of a revocation of an authorisation as a qualifying intermediary must be published in Iris Oifigiúil.
(8) Without prejudice to subsection (6) which allows Revenue to revoke an intermediary’s authorisation as a qualifying intermediary in certain circumstances, such an authorisation ceases to have effect after 7 years. This, however, does not prevent Revenue and the intermediary from agreeing to renew the qualifying intermediary agreement or to enter into a further such agreement. Nor does it to prevent a further authorisation by Revenue of the intermediary as a qualifying intermediary for the purposes of the DWT scheme
Relevant Date: Finance Act 2021