26 July 2019
Department of Finance publishes Feedback Statement on ATAD anti-hybrid rules
A Feedback Statement on the proposed implementation of the anti-hybrid rules under the Anti-Tax Avoidance Directive (ATAD) was published by the Department of Finance this week. It seeks views from stakeholders on some of the technical aspects of the anti-hybrid rules, prior to the publication of Finance Bill 2019. The consultation period will run until Friday, 6 September but the Department of Finance is encouraging stakeholders to provide their feedback on the rules at the earliest opportunity. The Institute will be responding to the Feedback Statement. Members who would like to contribute to the submission can contact Anne Gunnell at email@example.com or Clare McGuinness firstname.lastname@example.org
Read the Feedback Statement - https://assets.gov.ie/19455/ae52861db68e41f09f8aead64d0111db.pdf
Read a Department of Finance press release - https://www.gov.ie/en/consultation/1a5496-department-of-finance-launches-feedback-statement-on-atad-anti-hybri/
New Revenue Manual published on CFC rules
Revenue has published a Manual on Controlled Foreign Company (CFC) rules. The Manual provides an overview of the rules and their operation. It also includes information on the meaning of ‘control’ and ‘associated companies’, how a CFC charge can arise and the relevant exemptions and reliefs. The Institute provided feedback on the contents of the Manual, including suggested examples on how the rules apply in practice, at the TALC BEPS sub-committee.
Read the eBrief - https://www.revenue.ie/en/tax-professionals/ebrief/2019/no-1412019.aspx
Revenue issues note on used vehicles purchased in the UK
Revenue has issued a reminder that a “V5 certificate” is a mandatory requirement when importing a used vehicle from the UK. The V5 certificate is the vehicle registration document issued by the Driver Vehicle Licencing Agency (DVLA). Failure to produce a V5 certificate will lead to the re-registration of the vehicle being refused. Revenue will, however, accept Certificates of Permanent Export where they are available.
When purchasing a vehicle in the UK, the seller must give the buyer parts 1-8 of the V5 certificate, as these are the parts required for re-registration in the State. The DVLA in the UK has issued instructions to both private sellers and dealers in this regard.
New chapters in Revenue’s VAT Manual
Revenue’s VAT Manual has been updated to include some new chapters:
VAT Deductibility for Holding Companies - https://www.revenue.ie/en/tax-professionals/tdm/value-added-tax/part03-taxable-transactions-goods-ica-services/Financial-Services/vat-deductibility-for-holding-companies.pdf
VAT and Electronic Publications (New Guidance) - https://www.revenue.ie/en/tax-professionals/tdm/value-added-tax/part03-taxable-transactions-goods-ica-services/Services/electronic-publications.pdf
Exemption for Certain Activities in the Public Interest - https://www.revenue.ie/en/tax-professionals/tdm/value-added-tax/part03-taxable-transactions-goods-ica-services/Financial-Services/exemption-for-certain-activities-in-the-public-interest.pdf
Transitional Measures Applying to Legacy Leases - https://www.revenue.ie/en/tax-professionals/tdm/value-added-tax/part11-immovable-goods/transitional-measures-applying-to-legacy-leases.pdf
Transitional Properties – freehold or freehold equivalent interests held prior to 1 July 2008 - https://www.revenue.ie/en/tax-professionals/tdm/value-added-tax/part11-immovable-goods/transitional-measures/transitional-properties-freehold-or-freehold-equivalent-interests.pdf
The Institute’s VAT committee provides feedback on developments to the VAT Manual at the TALC Indirect Taxes sub-committee. A number of issues the Institute raised in our submission (http://taxinstitute.ie/Portals/0/Tax Policy/Revenue Practice and Representations/ITI comments on draft guidance - VAT Deductibility and Holding Company 28 June 2019 FINAL.pdf) on VAT deductibility for holding companies have been reflected in the new chapter on this topic.
Revenue has also updated some chapters in the VAT Manual to improve readability and to remove obsolete content. These chapters relate to the supply of garden sheds and pre-fabricated structures, hire purchase transactions and printing and printed materials.
Read the eBrief - https://www.revenue.ie/en/tax-professionals/ebrief/2019/no-1432019.aspx
Updates to Revenue Manuals
A number of Revenue Manuals have been updated over the last week:
- Earned Income Tax Credit (https://www.revenue.ie/en/tax-professionals/ebrief/2019/no-1442019.aspx)now includes an example of an individual who is employed by his or her spouse (and qualifies for the Earned Income Credit). See Example 3 in Section 2.
- Rent-a-Room Relief (https://www.revenue.ie/en/tax-professionals/ebrief/2019/no-1472019.aspx) has been updated to reflect amendments introduced in Finance Act 2018. These amendments provide for a minimum rental period of 28 consecutive days to qualify for the relief, subject to certain exceptions.
- Deductibility of Loan Interest in Computing Rental Income (https://www.revenue.ie/en/tax-professionals/ebrief/2019/no-1452019.aspx) has been updated to reflect the restoration of 100% interest deduction from 1 January 2019 for interest on loans used to purchase, improve or repair a rented residential property.
- Remittance Basis of Assessment (https://www.revenue.ie/en/tax-professionals/ebrief/2019/no-1462019.aspx) includes further clarification regarding section 825B TCA 1997 (repayment of tax where earnings not remitted). Section 825B applied for the tax years 2009 to 2012. However, individuals who were first entitled to the relief in 2011 could claim the relief up to the 2015 tax year.
- Filing and Paying Stamp Duty on Instruments (https://www.revenue.ie/en/tax-professionals/ebrief/2019/no-1422019.aspx) includes bank account details for the payment of Stamp Duty by Electronic Fund Transfer (EFT). The bank account name has been updated to "Stamp Duty CG's 2". See Section 6 of the Manual.
Updated European Union Customs Data Model now available
A new version of the European Union Customs Data Model (EUCDM) web-publication is now available. It reflects all of the recent changes in the customs legislation affecting data requirements and includes the provisions for the low value consignment dataset. The EUCDM sets out the legal provisions of the Union Customs Code Delegated Act and the Union Customs Code Implementing Act in a reader-friendly and structured manner.
Pilot project launched on VAT cross-border rulings
A pilot project has been set up to allow taxable persons to obtain advance rulings on the VAT treatment of complex cross-border transactions. At present, Belgium, Denmark, Ireland, Estonia, Spain, France, Italy, Cyprus, Latvia, Lithuania, Malta, Hungary, Netherlands, Portugal, Slovenia, Finland, Sweden and the United Kingdom are participating in this pilot project. An information note on the procedure for requesting such a ruling is available on the European Commission website.
Commission publishes statistics on APAs and MAPs
Under the EU Arbitration Convention, the European Commission receives information from Member States annually on pending Mutual Agreement Procedures (MAPs) and on Advance Pricing Agreements (APAs). The Commission has published an overview of these statistics for 2018.
The statistics on MAPs relate to MAPs between EU Member States and outline:
- Outstanding MAPs at the end of each year
- Reasons why cases are pending two years after initiation
- Reasons for rejection either by the reporting Member State or the other Member State
- Time from the date of submission of the MAP request under the Convention to the date on which a case is initiated
The statistics on APAs include both EU and non-EU APA and include:
- Total number of APAs in force at the end of the year
- Number of APAs granted in the year
- Number of APAs rejected in the year
- Number of APAs where the taxpayer withdrew its request in the year
- Average time in months to negotiate bilateral or multilateral APAs
OECD releases latest results on preferential regimes
On 19 July 2019, the Inclusive Framework on BEPS approved the latest results of reviews of jurisdictions' domestic laws, conducted by the OECD Forum on Harmful Tax Practices (FHTP). The reviews covered preferential tax regimes and the substantial activities standard for “no or only nominal tax jurisdictions”. The FHTP reviewed the domestic laws of the 12 “no or only nominal tax jurisdictions” and considered 56 preferential tax regimes.