Case reference

Tax head

Legislation

Case stated requested

Matter under determination

22TACD2021
(related case 24TACD2021)

Income tax

section 954 TCA 1997
section 922 TCA 1997
section 1094 TCA 1997

Unknown

This appeal concerned assessments for income tax for the years 2011 and 2012. The Appellant, a jointly assessed taxpayer, contended that the trading partnership in which his spouse was a partner had ceased to trade in 2011 as the partners had availed of maternity benefit and job seekers benefit during the assessment years. The Appeal Commissioner found that the Appellant failed to demonstrate that the spouse was not a partner in the business for the years in question and the assessments were determined to stand. The Appellant was also not entitled to separate treatment from his spouse for the relevant years due to the absence of a valid election.

23TACD2021

Income tax

section 959C TCA 1997
section 959Z TCA 1997
section 1094 TCA 1997

Unknown

This appeal concerned assessments for income tax for the years 2013 and 2014. In the absence of submission of returns for the periods, the Respondents raised the assessments by reference to the VAT returns submitted for the relevant periods. The Appellant sought to have the assessments displaced on submission of returns reflecting his earnings during the periods. The Appeal Commissioner provided for an adjustment to the amounts under assessment on the basis that on the balance of probabilities, overheads not reflected in the VAT returns would amount to at least 10 percent of turnover.

25TCAD2021

VAT

section 111 VATCA 2010

Unknown

This appeal concerned VAT assessments for years 2011, 2012 and part of 2013. The Appellant, a trading partnership, cancelled its VAT registration during 2011 as it had ceased to trade. On the basis that it could not be considered self-evident from the fact that the partners had availed of maternity benefit and job seekers benefit that the trade had ceased, the Appellant was determined to have failed to discharge the onus of proof, and the VAT assessments were considered to stand.

26TACD2021

Income tax

Unknown

This appeal concerns a Balancing Statement (P21) for the year 2015. A Tax Credit Certificate issued to the Appellant for 2015, including tax credits and increased rate bands for maintenance paid, despite the Appellant notifying Revenue of the death of his former spouse. Revenue issued a 2015 Balancing Statement in 2016 showing an underpayment of €454. Following a direction to provide a Statement of Case, Revenue issued an updated 2015 Balancing Statement in 2020 showing an overpayment of €540 due to a revision to the Appellant’s personal tax credits to include a widowed persons credit. The Appeal Commissioner determined the Statement of Liability showing an overpayment of tax to be correct.

27TACD2021

Stamp duty

section 31 SDCA 1997
section 31A SDCA 1997

Yes

This appeal concerns an assessment to stamp duty on a transfer of a hotel to the Appellant from investors of a tax scheme, which allowed investors to avail of tax allowances following their investment in the scheme facilitating the hotel development. The scheme included an option agreement under which the investors could require the Appellant to re-purchase the hotel from them. The investors assigned their interest in the option to the bank under a mortgage agreement. Following the assignment to the bank, the investors exercised the option agreement. However, the Appellant argued that the hotel transferred under an oral agreement.
The Appeal Commissioner in their analysis of the relevant documents, considered that the option agreement had been absolutely assigned to the bank, and so the notice to exercise the option was invalid. Despite this finding, the Appeal Commissioner considered that as the Appellant was a party to the investor’s facility agreement, acting as guarantor, and owing to a number of clauses within the agreement, the facilities agreement, option agreement and the mortgage were inextricably linked and the payment of €12 million in consideration was in pursuance of an agreement to re-purchase the hotel such that section 31A SDCA applied. The Appeal Commissioner considered that given the consideration was identical in all material aspects to that envisioned under the option agreement, the payment was made in pursuance of an agreement that pre-existed the oral agreement.

28TACD2021

Capital gains tax

section 949I TCA 1997
section 27 Finance (Tax Appeals) Act 2015
section 955 TCA 1997
section 957 TCA 1997

Unknown

This appeal is a preliminary appeal relating to an appeal against a CGT assessment on the sale of property in June 2006. The Appellant had understood that her former spouse was responsible for filing the CGT. In this case the return contained an omission of the 2006 disposal. The Appeal Commissioner determined that in such circumstances, the return could not be considered to contain a full and true disclosure of the facts in accordance with section 955(2). The Appeal Commissioner also considered the entitlement of the Appellant to rely on the time limit as an additional ground of appeal in the substantive appeal but found the statutory requirements of section 957 was not met.

29TACD2021

Employment Investment Incentive

section 494 TCA 1997
Article 21, EU Commission Regulation No. 651/214

Unknown

This appeal concerns a refusal by the Respondent to certify the Appellant company as a ‘qualifying company’ for the purpose of the Employment Investment Incentive (EII) Scheme. The Respondents refused the relief on the grounds that the original business plan did not foresee the need to raise additional risk finance to that already raised, as required under Article 21 paragraph 6(b) of the General Block Exemption Regulation (GBER). The Appeal Commissioner determined that the refusal to grant relief for a 2017 investment in a new share issue should not stand on the basis that the possibility of follow-on risk finance after the initial investment was foreseen in the original business plan and therefore, the conditions of Article 21 paragraph 6(b) GBER were met.

30TACD2021

Capital gains tax

section 955 TCA 1997
section 956(1)(c) TCA 1997
section 956(2)(a) TCA 1997
section 552(1)(b) TCA 1997
section 886(4) TCA 1997

Yes

This appeal concerned an amended assessment to CGT for the tax year 2011, which was issued in June 2018. The Appellant disposed of properties to a company in which he was the sole shareholder. The Appeal Commissioner considered whether the Appellant was entitled to a deduction for enhancement expenditure incurred in 2008/09, whether the Appellant made a full and true disclosure in his 2011tax return and whether the Respondent was entitled to make an amended assessment in 2018. The Appeal Commissioner determined that the Appellant was not obliged to maintain documents to support the enhancement expenditure claim beyond 6 years as per section 866 TCA 1997 and therefore his 2011 tax return was a full and true disclosure, and the Respondent was out of time in making the amended assessment in 2018.

31TACD2021

Income tax – Artists’ exemption

section 195 TCA 1997
Arts Council and the Minister for Culture, Heritage and the Gaeltacht guidelines

Unknown

The Appeal Commissioner determined that the Appellant was not entitled to the artists’ exemption in relation to a non-fiction work, termed as an autobiography. The Appeal Commissioner considered the book not to satisfy the criteria in paragraph 7(2)(b) of the guidelines as it was not an autobiography, nor could it be said to satisfy the criteria in paragraph 7(2)(c) as the Appellant had not demonstrated that the book relates to a function of the Heritage Council.

32TACD2021

PAYE

section 81 TCA 1997
section 112 TCA 1997
section 114 TCA 1997
section 117 TCA 1997
section 118 TCA 1997

Unknown

This appeal concerned a Notice of Estimation of Amounts due for PAYE/PRSI/USC during the years 2013, 2014 and 2015 for the Appellant company’s travel and subsistence expense claims which the Respondents considered not to be ‘wholly and exclusively laid out or expended for the purpose of the trade or profession’. The Appeals Commissioner determined that vouched expenses relating to ‘Pre-Sales’ activities were deductible from the directors’ emoluments as these expenses were incurred in the performance of their duties in accordance with section 114.

33TACD2021

Customs – Binding tariff classification

Council Regulation (EEC) No. 2658/87 of 23 July 1987
Commission implementing Regulation EU 2016/1821 of 6 October 2017 amending Annex I to Council Regulation (EEC) No 2568/87
CN heading 9018
CN heading 3004
CN heading 3922

No

This appeal concerned a Binding Tariff Classification (BTI) issued for an antimicrobial Basin Liner System. The Respondent’s classified the product under a Combined Nomenclature (CN) heading which carried an import duty rate of 6.5 percent on the basis that the equipment was not a medical devise. The Appellant appealed the BTI seeking classification under a CN heading which carries a zero percent rate of import duty on the basis that the Basin Liner System was a medical devise preventing the spread of disease and cross-contamination when bathing a patient. The evidence of a Professor of Microbiology supported the Appellants claims. The Appeal Commissioner considered that while the Basin Liner System was not clearly for medical use, it was materially different from a standard washbasin, for tariff classification purposes. CN heading 9018 was determined to be the appropriate classification, applying a zero percent rate of import duty to the product.

34TACD2021

VAT & Income tax

section 111 VATCA 2010
section 113 VATCA 2010
section 382 TCA 1997
section 924 TCA 1997

No

The Appellant claimed that payments received from a company during the period 2008 to 2012 were made under a profit-sharing joint venture agreement and were not subject to VAT while the Respondents contended that the payments related to consulting and training services provided by the Appellant, which were subject to VAT. The Appellant also claimed the joint venture to be a continuation of his sole tradership from which losses were available for offset under section 382 TCA 1997. The Appeal Commissioner determined the evidence provided in support of the Appellant’s claim that a joint venture existed was insufficient and accordingly the payments were considered to have been received in exchange for services and that VAT should have been charged and returned on the supply of taxable services. The losses arising from the sole trade were determined not to be available for offset against the income arising from the provision of services under section 382(1), as the trades were not the same. The Appellant had also sold machinery to the company that he provided consultancy services to and charged VAT on the invoice but had not returned the VAT on the basis that he was taxed on a payments received basis and the invoice had not been discharged. The Appeal Commissioner determined that the VAT assessment for the machinery sold stood on a proportional basis in respect of sums recovered from High Court proceedings in respect of the invoice.

35TACD2021

VAT

section 2 VATCA 2010
section 3 VATCA 2010
section 24 VATCA 2010
section 34 VATCA 2010
section 59(2) VATCA 2010
section 29(1) VATCA 2010
section 19(1) VATCA 2010

Unknown

This appeal concerned the imposition of VAT on the purchase of a yacht by a company which was subsequently sold to a director of the company. The company sought to reverse views expressed in an Unprompted Disclosure in relation to the purchase of the yacht and contended that no Irish VAT was payable on the boat acquisition under section 29(1)(c) VATCA 2010 as the yacht was never dispatched or transported on acquisition. The yacht was purchased from a UK supplier and treated as a zero-rated sale. The company’s VAT registration number was quoted on the invoice but an indication that the supply was an intra-Community acquisition was not included. In analysis of European case law the Appeal Commissioner determined the ultimate destination of the yacht to have been either France, Portugal, or Ireland. On the basis that the company’s VAT registration number was quoted on the invoice and that VAT had not been paid in another jurisdiction, the supply was considered an intra-Community acquisition and the place of supply was Ireland and the assessment to VAT was determined to stand.

36TACD2021

VRT

section 146 Finance Act 2001
section 130 Finance Act 1992

Unknown

Despite the Respondent’s website showing reduced a CO2 emission rate for a similar vehicle, the Appeal Commissioner determined the most reliable evidence of the correct rate of CO2 was the original registration document for the vehicle. The Appeal Commissioner detailed that the Appellant is required to discharge the burden of proof and demonstrate that the reduced CO2 emission rate applies.

37TACD2021

Income tax

section 983 TCA 1997

Unknown

The Appellant, a proprietary director and 99 percent shareholder of a company that was liquidated, appealed assessments to income tax for the years of assessment 2010, 2011. Despite the Respondents failing to attend the creditors meeting organised by the liquidator, the Appeal Commissioner determined the assessments, withdrawing the tax credited to the Appellant, to be correct as per 997A TCA 1997.