Ireland tax guide reviews mandatory disclosure regime

Irish Revenue on October 22 incorporated into its tax manual guidelines on the mandatory disclosure regime, setting out guidance notes regarding the required reporting of certain transactions that are undertaken with the intent to generate a tax advantage.

The requirement to report under the regime primarily falls on the promoter of such transactions, although the “user” may have a duty to disclose in certain circumstances, such as if the scheme is devised in-house (i.e., without an outside promoter) or the promoter is either outside the country or asserts legal professional privilege to avoid disclosure.

The disclosure requirement generally applies when the transaction is expected to generate a tax advantage, that tax advantage is the main benefit of the transaction, and the transaction falls within certain classes of transactions specified in the legislation.

With the goal of shutting down transactions that are deemed aggressive to be tax avoidance schemes, the disclosure regime is intended to give the government early information about how the tax schemes work and who is using them. Upon disclosure, the government may, if it deems appropriate, move to close down the schemes through legislative action or challenge them through anti-avoidance provisions.

In addition to reviewing what transactions have to be disclosed and who has to disclose them, the guidelines further cover when and how to make disclosures, the information to include, and the penalties for failure to comply.

Be the first to comment

Leave a Reply

Your email address will not be published.