Scope & Residence
TAXES CONSOLIDATION ACT
Part 45
Charging and Assessing of Non-Residents (ss. 1032-1043)
Chapter 1
Income tax and corporation tax (ss. 1032-1041)
1032.
Restrictions on certain reliefs.
(1)Except where otherwise provided by this section, an individual not resident in the State shall not be entitled to any of the allowances, deductions, reliefs or reductions under the provisions specified in the Table to section 458.
(2)Where an individual not resident in the State proves to the satisfaction of the Revenue Commissioners that he or she –
(a)is a citizen of Ireland,
(b)is resident outside the State for the sake or on account of his or her health or the health of a member of his or her family resident with him or her or because of some physical infirmity or disease in himself or herself or any such member of his or her family, and that previous to such residence outside the State he or she was resident in the State,
(c)is a citizen, subject or national of another Member State of the European Communities, or of the United Kingdom, or of a country of which the citizens, subjects or nationals are for the time being exempted by an order under section 10 of the Aliens Act, 1935, from any provision of, or of an aliens order under, that Act, or
(d)is a person to whom one of the paragraphs (a) to (e) of the proviso to section 24 of the Finance Act, 1920, applied in respect of the year ending on the 5th day of April, 1935, or any previous year of assessment,
then, subsection (1) shall not apply to that individual, but the amount of any allowance, deduction or other benefit mentioned in that subsection shall, in the case of that individual, be reduced to an amount which bears the same proportion to the total amount of that allowance, deduction or other benefit as the portion of his or her income subject to Irish income tax bears to his or her total income from all sources (including income not subject to Irish income tax).
(3)Notwithstanding subsection (2), where an individual not resident in the State proves to the satisfaction of the Revenue Commissioners that the individual is a resident of another Member State of the European Communities or of the United Kingdom and that the proportion which the portion of the individual’s income subject to Irish income tax bears to the individual’s total income from all sources (including income not subject to Irish income tax) is 75 per cent or greater, subsection (1) or, as the case may be, subsection (2) shall not apply to that individual and he or she shall be entitled to the allowance, deduction or other benefit mentioned in subsection (1).
1033. Entitlement to tax credit in respect of distributions.
Repealed from 6 April 1999
An individual who, having made a claim in that behalf, is by virtue of subsection (2) or (3) of section 1032 entitled to relief in respect of any year of assessment under any of the provisions specified in the Table to section 458 shall be entitled to a tax credit in respect of any distribution received by him or her in that year to the same extent as if he or she were resident in the State, and section 153(1) shall not apply in relation to such an individual.
1034.
Assessment.
A person not resident in the State, whether a citizen of Ireland or not, shall be assessable and chargeable to income tax in the name of any trustee, guardian, or committee of such person, or of any factor, agent, receiver, branch or manager, whether such factor, agent, receiver, branch or manager has the receipt of the profits or gains or not, in the like manner and to the like amount as such non-resident person would be assessed and charged if such person were resident in the State and in the actual receipt of such profits or gains; but, in the case of a partnership, the precedent partner (within the meaning of section 1007) or, if there is no precedent partner, the factor, agent, receiver, branch or manager shall be deemed to be the agent of a non-resident partner.
1035.
Profits from agencies, etc.
Subject to section 1035A, a non-resident person shall be assessable and chargeable to income tax in respect of any profits or gains arising, whether directly or indirectly, through or from any factorship, agency, receivership, branch or management, and shall be so assessable and chargeable in the name of the factor, agent, receiver, branch or manager.
1035A.
Relieving provision to section 1035.
(1)In this section –
‘AIF’ has the same meaning as in section 747G;
‘AIFM’ has the same meaning as in section 747G;
‘authorised agent’ means –
(a)a person acting as an investment business firm, or an authorised member firm –
(i)under an authorisation given by the Central Bank of Ireland under section 10(1) of the Investment Intermediaries Act 1995 or, as the case may be, Regulation 8 of the European Union (Markets in Financial Instruments) Regulations 2017 (S.I. No. 375 of 2017) and not subsequently revoked, or
(ii)under an authorisation, which corresponds to either of the authorisations referred to in subparagraph (i), given by a competent authority in a relevant Member State (within the meaning of section 835I(1)) for the purpose of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 as amended or extended from time to time, and not subsequently revoked and which provides one, or more, investment service through a branch or agency in the State pursuant to the European Union (Markets in Financial Instruments) Regulations 2017,
(b)a credit institution duly authorised by virtue of Directive No. 2000/12/EC of 20 March 2000 which provides investment business services and in so doing does not exceed the terms of its authorisation and that authorisation has not been revoked,
(c)a company –
(i)authorised under any laws of the State that implement the relevant Directives, and
(ii)which carries on a trade which consists of or includes the management of unit trusts, common contractual funds or investment companies, or any combination thereof, each of which is a relevant UCITS,
or
(d)an AIFM authorised –
(i)under any laws of the State which implement the relevant AIFM Directives, or
(ii)under the laws of an EEA state and which manages one, or more than one, AIF through a branch or agency in the State,
and ‘authorisation’ shall be construed accordingly;
‘authorised member firm’ has the meaning assigned to it by section 3 of the Stock Exchange Act 1995;
‘branch or agency’ has the same meaning as in section 4;
‘competent authority’ has the meaning assigned to it by section 2 of the Investment Intermediaries Act 1995;
‘EEA state’ has the same meaning as in section 747B;
‘financial trade’ means a trade exercised in the State by a non-resident person through an authorised agent under and within the terms of the authorised agent’s authorisation;
‘investment business firm’ has the meaning assigned to it by section 2 of the Investment Intermediaries Act 1995;
‘investment business services’ has the meaning assigned to it by section 2 of the Investment Intermediaries Act 1995;
‘relevant AIFM Directives’ has the same meaning as in section 747G;
‘relevant Directives’ means Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS), and any Directive amending that Directive;
‘relevant UCITS’ means an undertaking for collective investment in transferable securities –
(i)to which the relevant Directives apply, and
(ii)which is formed under the laws of any of the Member States of the European Union other than the State.
(2)For the purposes of this section –
(a)an authorised agent, through whom a non-resident person exercises a financial trade in the State, is independent in relation to the non-resident person for a chargeable period if throughout the chargeable period –
(i)the authorised agent does not otherwise act on behalf of the non-resident person,
(ii)the authorised agent, when acting on behalf of the non-resident person, does so in an independent capacity,
(iii)the authorised agent, when acting on behalf of the non-resident person, does so in the ordinary course of the authorised agent’s business, and
(iv)the requirements referred to in subsection (4), in relation to the financial trade, are satisfied,
(b)an authorised agent shall not be regarded as acting in an independent capacity when acting on behalf of a non-resident person unless, having regard to its legal, financial and commercial characteristics, the relationship between them is a relationship between persons carrying on independent businesses that deal with each other at arm’s length, and
(c)references to an amount of profits or gains of a trade, exercised in the State by a non-resident person, to which another person has a beneficial entitlement are references to the amount of profits or gains of the trade to which the other person has, or may acquire, a beneficial entitlement by virtue of –
(i)any interest of the other person (whether or not an interest giving a right to an immediate payment of a share of the profits or gains of the trade) in property in which the whole or any part of the profits or gains of the trade are represented, or
(ii)any interest of the other person in, or other rights in relation to, the non-resident person.
(3)Notwithstanding section 18, a non-resident person shall not be assessable and chargeable to income tax in respect of any profits or gains arising or accruing for a chargeable period to the non-resident person from a financial trade exercised in the State solely through an authorised agent who throughout the chargeable period is independent in relation to the non-resident person.
(4)The requirements of this subsection are satisfied, at any time, in relation to a financial trade exercised in the State by a non-resident person through an authorised agent where at that time –
(a)the aggregate of the amount of the profits or gains of the trade, to which the authorised agent and persons, who are both resident in the State and connected with the authorised agent, have a beneficial entitlement, does not exceed 20 per cent of the amount of the profits or gains of the trade, or
(b)the Revenue Commissioners are satisfied that it is the intention of the authorised agent, that the aggregate of the amount of the profits or gains of the trade, to which the authorised agent and persons who are resident in the State and connected with the authorised agent have beneficial entitlement, does not exceed 20 per cent of the amount of the profits or gains of the trade and that the reasons for the failure to fulfill that intention, at that time, are of a temporary nature.
(5)The Revenue Commissioners may nominate any of their officers to perform any acts and discharge any functions authorised by this section to be performed or discharged by them.
1036.
Control over residents.
Where a non-resident person, not being a citizen of Ireland or an Irish firm or company, or a branch of a non-resident person, carries on business with a resident person, and it appears to the inspector that, owing to the close connection between the resident person and the non-resident person and to the substantial control exercised by the non-resident person over the resident person, the course of business between those persons can be so arranged and is so arranged that the business done by the resident person in pursuance of that person’s connection with the non-resident person produces to the resident person either no profits or less than the ordinary profits which might be expected to arise from that business, then, the non-resident person shall be assessable and chargeable to income tax in the name of the resident person as if the resident person were an agent of the non-resident person.
1037.
Charge on percentage of turnover.
(1)Where it appears to the inspector or on appeal to the Appeal Commissioners that the true amount of the profits or gains of any non-resident person chargeable with income tax in the name of a resident person cannot in any case be readily ascertained, the non-resident person may, if it is thought fit by the inspector or the Appeal Commissioners, be assessed and charged on a percentage of the turnover of the business done by the non-resident person through or with the resident person in whose name the non-resident person is so chargeable, and in such a case the provisions of the Income Tax Acts relating to the delivery of statements by persons acting on behalf of others shall extend so as to require returns to be given by the resident person of the business so done by the non-resident person through or with the resident person in the same manner as statements of profits or gains to be charged are to be delivered by persons acting for incapacitated or non-resident persons.
(2)The amount of the percentage under subsection (1) shall in each case be determined, having regard to the nature of the business, by the inspector by whom the assessment on the percentage basis is made, subject to appeal to the Appeal Commissioners.
(2A)A resident person or a non-resident person aggrieved by an assessment made on that person under subsection (1) may appeal the assessment to the Appeal Commissioners, in accordance with section 949I, within the period of 30 days after the date of the notice of assessment.
(3)[deleted]
1038.
Merchanting profit.
(1)Where a non-resident person is chargeable to income tax in the name of any branch, manager, agent, factor or receiver in respect of any profits or gains arising from the sale of goods or produce manufactured or produced outside the State by the non-resident person, the person in whose name the non-resident person is so chargeable may, if that person thinks fit, apply to the inspector to have the assessment to income tax in respect of those profits or gains made or amended, as the case may be, on the basis of the profits or gains that might reasonably be expected to have been earned or made by –
(a)a merchant, or
(b)where the goods are retailed by or on behalf of the manufacturer or producer, a retailer of the goods sold,
who had bought direct from the manufacturer or producer and, on proving the amount of the profits or gains on that basis to the satisfaction of the inspector, the inspector shall make or amend the assessment accordingly.
(2)A resident person or a non-resident person aggrieved by an assessment or an amended assessment made on that person under subsection (1) may appeal the assessment or amended assessment to the Appeal Commissioners, in accordance with section 949I, within the period of 30 days after the date of the notice of assessment.
1039. Restrictions on chargeability.
(1)Nothing in this Chapter shall render a non-resident person chargeable in the name of –
(a)a broker or general commission agent, or
(b)an agent, not being –
(i)an authorised person carrying on the regular agency of the non-resident person, or
(ii)a person chargeable as if that person were an agent in pursuance of this Chapter,
in respect of profits or gains arising from sales or transactions carried out through such a broker or agent.
(2)The fact that a non-resident person executes sales or carries out transactions with other non-residents in circumstances which would make that person chargeable in pursuance of this Chapter in the name of a resident person shall not of itself make that person chargeable in respect of profits arising from those sales or transactions.
1040. Application of sections 1034 to 1039 for purposes of corporation tax.
Without prejudice to the general application of income tax procedure to corporation tax, the provisions of this Chapter relating to the assessment and charge of income tax on persons not resident in the State, in so far as they are applicable to tax chargeable on a company, shall apply with any necessary modifications in relation to corporation tax chargeable on companies not resident in the State.
1041.
Rents payable to non-residents.
(1)Subject to subsection (1B)(b), section 1034 shall not apply –
(a)tax on profits or gains chargeable to tax under Case V of Schedule D, or
(b)tax on any of the profits or gains chargeable under Case IV of Schedule D which arise under the terms of a lease, but to a person other than the lessor, or which otherwise arise out of any disposition or contract such that if they arose to the person making it they would be chargeable under Case V of Schedule D,
where payment is made (whether in the State or elsewhere) directly to a person whose usual place of abode is outside the State (referred to in this section as the ‘non- resident person’) and where the person making the payment provides the Revenue Commissioners with the information specified in subsection (1A); but section 238 shall apply in relation to the payment as it applies to other payments, being annual payments charged with tax under Schedule D and not payable out of profits or gains brought into charge to tax.
(1A)The following information is specified for the purposes of subsection (1):
(a)the name and address of the non-resident person;
(b)the address of the property in respect of which the payment referred to in subsection (1) is made, including the Eircode in respect of the property;
(c)the unique identification number assigned to the property for the purposes of the Finance (Local Property Tax) Act 2012;
(d)the date the payment referred to in subsection (1) is made to the non-resident person;
(e)the gross amount of the payment referred to in subsection (1);
(f)the amount withheld from the payment referred to in subsection (1) and remitted to the Revenue Commissioners in accordance with section 238.
(1B)
(a)Section 1034 shall not apply to –
(i)tax on profits or gains chargeable to tax under Case V of Schedule D, or
(ii)tax on any of the profits or gains chargeable under Case IV of Schedule D which arise under the terms of the lease, but to a person other than the lessor, or which otherwise arise out of any disposition or contract such that if they arose to the person making it they would be chargeable under Case V of Schedule D,
where the trustee, guardian, committee, attorney, factor, agent, receiver, branch or manager of the non-resident person –
(I)deducts tax in accordance with section 238, and
(II)provides the Revenue Commissioners with the information specified in subsection (1C).
(b)Where paragraph (a) applies –
(i)subsection (1) shall not apply, and
(ii)section 238 shall apply to the trustee, guardian, committee, attorney, factor, agent, receiver, branch or manager of the non-resident person in relation to a payment due to a non-resident person which is made to the trustee, guardian, committee, attorney, factor, agent, receiver, branch or manager of that non-resident person as it applies to other payments, being annual payments charged with tax under Schedule D and not and payable out of profits or gains brought into charge to tax.
(1C)The following information is specified for the purposes of subsection (1B):
(a)the name, address and tax reference number of the non-resident person (being, in the case of an individual, his or her personal public service number (within the meaning of section 262 of the Social Welfare Consolidation Act 2005) and, in the case of a company, the reference number stated on any return of income or notice of assessment issued to the company by the Revenue Commissioners);
(b)the address of the property in respect of which the payment due to the non-resident person is made, including the Eircode in respect of the property;
(c)the unique identification number assigned to the property for the purposes of the Finance (Local Property Tax) Act 2012;
(d)the date the payment is due to the non-resident person in respect of the property;
(e)the gross amount of the payment due in respect of the property;
(f)the amount withheld from the payment due in respect of the property and remitted to the Revenue Commissioners in accordance with section 238.
(2)Where by virtue of subsection (1) or (1B) the tax chargeable for any year of assessment on a person’s profits or gains chargeable to tax under either or both of the Cases referred to in that subsection would but for this subsection be greater than the tax which would be chargeable on such profits or gains but for subsection (1) or (1B) , then, on a claim in that behalf being made, relief shall be given from the excess, whether by repayment or otherwise.
Chapter 2
Capital gains tax (ss. 1042-1043)
1042.
Charging and assessment of persons not resident or ordinarily resident: modification of general rules.
(1)Notwithstanding section 28(2), 31 or 979, any capital gains tax payable in respect of a chargeable gain which on a disposal accrues to a person not resident or ordinarily resident in the State at the time at which the disposal is made may be assessed and charged before the end of the year of assessment in which the chargeable gain accrues, and the tax so assessed and charged shall be payable at or before the expiration of a period of 3 months beginning with the time at which the disposal is made, or at the expiration of a period of 2 months beginning with the date of making the assessment, whichever is the later.
(2)In computing the amount of capital gains tax payable under subsection (1), section 31 shall apply with any necessary modifications as regards the deduction of any allowable losses which accrued to the person mentioned in subsection (1) before the date of making of the assessment mentioned in that subsection.
1043.
Application of sections 1034 and 1035 for purposes of capital gains tax.
Without prejudice to Part 41A, sections 1034 and 1035 shall apply, subject to any necessary modifications, to capital gains tax.