Interest
14/01/1991
Query
The calculation of interest on an overpayment of corporation tax as a result of aCT being set back from a later accounting period : date from which interest is to be calculated.
Decision
Interest is to be calculated from the date on which the ACT was paid rather then the date of payment of the corporation tax.
Corporation Tax
Section 160, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:CTF353.1
07/11/1991
Query
Would interest payable by a qualified company within the meaning of S.446 TCA 1997 on borrowings from group companies in non-treaty countries be treated as a distribution under S.130(2)(d)(iv) TCA 1997?
Decision
Interest would not be treated as a distribution under S.130(2)(d)(iv) TCA 1997 subject to the following conditions: a) the interest is charged at a commercial rate; b) the interest would otherwise be recognised (apart from the afore-mentioned section) as an expense to be set against income of the trade; c) the funds borrowed are used solely for qualifying activities certified by the Minister for Finance under Section 446 TCA 1997; d) an application for this treatment must be made in letter form to the Revenue Commissioners, Direct Taxes: Incentives Branch, Dublin Castle, Dublin 2. [Note: Following the amendment to Section 452 TCA 1997 by Section 87 FA 2001 this precedent is no longer required for interest payments after 6 April 2001.]
Corporation Tax
Section 130, Taxes Consolidation Act, 1997
Origin: Direct Taxes International and Administration
File ref:5049/97
25/08/1992
Query
Is interest earned on short term deposits, income from the sale of goods.
Decision
Disallowed. See file number 1223/91
Corporation Tax
Section 443, Taxes Consolidation Act, 1997
Origin: Direct Taxes International and Administration
File ref:9997/99
16/12/1992
Query
Whether interest payable on borrowings between companies carrying on relevant trading operations within the meaning of S.445 or 446 TCA 1997 may be paid without deduction of tax.
Decision
Yes, provided that the following conditions are satisfied: a) the loan is in a foreign currency; b) the making of the loan is covered by the terms of the certificate of the lending company i.e. it's licensed trading operations include lending to other IFSC/Shannon companies (in this connection, the lender should provide written confirmation that this is the case and that it will remain so throughout the period of the loan); c) the loan is applied by the borrower for the purpose of it's own licensed trading operations; d) authorisations are granted on a case by case basis. Applications for exemption should be made in letter form to the Revenue Commissioners, Direct Taxes: Incentives Branch, Dublin Castle, Dublin 2.
Income Tax
Section 246, Taxes Consolidation Act, 1997
Origin: Direct Taxes International and Administration
File ref:5047/97
28/11/1996
Query
(1) Interest relating to the late payment of sales proceeds qualifies even where it is inter-group companies; (2) Whether interest on inter-company balances arising from the transfer of sale proceeds from one company to another for financing qualifies.
Decision
(1) Yes. (2) No.
Corporation Tax
Section 443, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:319.1996(1)