739T Deduction from consideration on the disposal of certain units

Summary

On the happening of an IREF taxable event to which the IREF is not party (e.g. the sale of the units) withholding tax under this section, rather than IREF withholding tax, applies.

Details

(1)(a) This section is relevant for IREF taxable events to which the IREF is not party and on which IREF withholding tax under section 739P could not be operated.

(1)(b) This section will only apply if the proceeds for the sale of the units exceed €500,000. Multiple disposals to the same person will be treated as a single disposal, as will disposals to persons who are acting in concert or who are connected persons.

(2) On the payment of any consideration for an IREF taxable event to which this section applies, 20% of the gross proceeds must be deducted and the person disposing of the units will treat the purchaser as having paid the full proceeds upon receipt of proof that the 20% tax was paid over to the Revenue Commissioners..

(3) Within 30 days of the IREF taxable event, the person who withheld the tax must pay that tax and deliver the following information to Revenue:

• the name and tax reference number of the IREF
• the name, address, TIN and unit holding of the unit holder from whom the units were purchased
• the date on which the IREF taxable event happened,
• the consideration for the sale
• the amount of withholding tax deducted.

Where tax due under this section is not paid over to Revenue, it may be assessed on the purchaser.

(4) Tax withheld under this section shall be treated as a payment on account in respect of the person who disposed of the units.

(5) Withholding tax deducted under this section may be repaid pursuant to a claim for relief under a double tax agreement. The residual charge to tax, under section 739O(2)(c) will be at the rate application under that double tax agreement.

(6) Claims for repayment of this withholding tax must be made in a return of income, under Part 41A.

Relevant Date: Finance Act 2021