Case I
19/04/1994
Query
Are legal fees incurred in connection with the ownership of a business property deductible in arriving at trading profits?
Decision
The allowability of legal expenditure will depend on whether it is attributable to Revenue or Capital. This matter has been considered in a number of tax cases and the main findings appear to be that legal expenses incurred in acquiring a capital asset are treated as capital expenditure, yet expenditure incurred in protecting the title to a capital asset, when it has been acquired, may be deductible revenue expenditure. The case of Southern v Borax Consolidated Ltd. 23 TC 597 is relevant.
Income Tax
Section 81, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT943501
25/05/1994
Query
Whether the special sellers prize paid by the national lottery to lotto agents who sell wnning lotto tickets is taxable.
Decision
Such prizes are taxable under Schedule D case 1
Income Tax
Section 18, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:GD94027
18/01/1995
Query
If a trader, who offers a "free gift" to a customer who purchases certain items, entitled to a deduction for the cost of the "free gift" or is the cost disallowed under Section 840? e.g. a trader starts a sales promotion whereby the purchaser of a washing machine wil receive a radio to the value of £20.
Decision
It appears that in these circumstances the contract between the customer and the trader involves both the washing machine and the radio. In effect the radio is not a "free gift" and as such would not come within the provisions of Section 840. It is the Revenue view that the cost of each radio is allowable in computing the profits of the trade.
Income Tax
Section 81, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT943520
15/08/1995
Query
Are payment received from the Department of agriculture in respect of the grubbing-up of orchards chargeable Case I.
Decision
No. These appear to be capital in nature and would be chargeable under the Capital Gains Tax rules
Income Tax
Section 65, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT953511
10/10/1995
Query
Are payments made under the Emergency Aid Grant, paid by an Bord Iascaigh Mhara to compensate fishermen for poor earnings during adverse weather conditions, taxable receipts liable to Income Tax.
Decision
Yes
Income Tax
Section 65, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT953549
06/11/1995
Query
Does a transfer of stock at a grossly inflated price come within the provisions of Section 89(2)(a)?
Decision
No. In order for a transaction to come within this provision the purchaser must be entitled to deduct the cost in computing his/her trading profits. Where the value at which stock is transferred does not come within the realms of being a bona fide transaction the purchaser would not be entitled to a deduction for such cost.
Income Tax
Section 89, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT953552
24/04/1996
Query
Whether payments made to foster parents in Ireland under German Rehabilitation Programmes to board/accommodate German youths are chargeable to tax under Schedule D Case 1
Decision
Where the foster parents are not employees of the German paying authorities, the payments are chargeable to tax under Schedule D Case I
Income Tax
Section 18, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT952520