Covenants
28/02/1990
Query
(1)Whether covenants can be made to two or more individuals. (2)Whether references to "a person who is an individual" excludes companies.
Decision
(1)Covenants can be made to two or more individuals. (2)References to a "person who is an individual" excludes companies.
Income Tax
Section 792, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT903000
06/01/1992
Query
Whether payment made before date of deed of covenant is an effective disposition of income for the purposes of section 792
Decision
No; the payment is not made by virtue or in consequence of the disposition
Income Tax
Section 792, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT922015
02/03/1993
Query
Whether deed of covenant for period which exceeds or may exceed 6 years, where payments made for period less than 6 years; whether UK case law relevant in deciding if covenant for a sufficient period
Decision
The fact that payments under deed are made for less than 6 years does not render the deed ineffective; UK case law is relevant, although the wording is different.
Income Tax
Section 791, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT932009
28/10/1993
Query
whether a covenant made in consideration of child minding services, where the parties are cohabiting is an effective disposition of income
Decision
No; the payment is not pure income profit in the hands of the recipient
Income Tax
Section 791, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT932022
09/02/1995
Query
Whether the 5% restriction, which applied in relation to covenants from parent to child, applied in the case of a covenant from a natural /biological parent to his/her child who had been given up for adoption.
Decision
The 5 % restriction did apply in these circumstances.The adopted child remained the "child" of the natural parent for the purposes of covenant relief.
Income Tax
Section 792, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT952503
19/05/1995
Query
Whether a covenant to a college or university should be capable of lasting 4 years.
Decision
A covenant to a college or university should be capable of lasting four years
Income Tax
Section 792, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT952528
09/06/1995
Query
Whether pensions payable to former partners are paid for valuable and sufficent consideration
Decision
In the circumstances of the case, it was held that section 792 did not apply to such pensions because they were paid for valuable and sufficent consideration. Neither did section 242 apply to such covenants
Income Tax
Section 792, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT952003
19/06/1995
Query
Whether a person suffering from chronic back pain is considered to be permanently incapacitated for the purposes of covenant relief.
Decision
A person suffering from chronic back pain will be considered to be permanently incapacitated for the purposes of covenant relief if there is evidence to show the person is in fact incapacitated and that the condition is permanent.
Income Tax
Section 792, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT952544
10/06/1996
Query
In calculating 5% of a covenantor's total income for the purposes of the covenant relief, whether income which qualifies for foreign earnings deduction under section 823 TCA 1997 is included in total income.
Decision
Income which qualifies for foreign earnings deduction is excluded from total income of the covenantor for the purposes of calculating the 5% restriction for covenant relief.
Income Tax
Section 792, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT962508