Temporary Solidarity Contribution (TSC)
The TSC applies to surplus profits of energy companies with activities in:
- the extraction, mining or refining of petroleum, natural gas or coal
- or
- the manufacture of coke products.
The TSC will apply to the taxable profits in the calendar years 2022 and 2023. The TSC is allowed as a deduction in calculating the amount of Corporation Tax due.
The relevant legislation is contained in the Energy (Windfall Gains in the Energy Sector) (Temporary Solidarity Contribution) Act 2023. This legislation inserts Part 24B into the Taxes Consolidation Act 1997.
How is the TSC calculated?
The TSC will apply if the taxable profits for 2022 and, or 2023 exceed the average taxable profits for 2018 to 2021 by 20%. The amount of TSC due is calculated using the following formula: (A – (B x 1.2)) x 0.75, where:
- (A) is the taxable profits for 2022 and, or 2023
- and
- (B) is the average taxable profits for 2018 to 2021.
Note
The definition of taxable profits used for the purposes of the TSC calculation is provided for in Part 24B of the Taxes Consolidation Act, 1997.
Registering for the TSC
Energy companies must register for the TSC with Revenue on, or before, 30 August 2023. To register for the TSC, energy companies must complete Form TSC1 and submit it through MyEnquiries in Revenue Online Service (ROS).
Where a company becomes an energy company during 2023, the company must register on, or before, 30 August 2024.
Pay and file
Energy companies must complete and file a return (Form TSC2) for 2022 on, or before, 23 September 2023. Returns in respect of 2023 (Form TSC2) must be completed and filed on, or before, 23 September 2024.
The return due must be submitted through MyEnquiries in ROS. The TSC is due and payable at the same time the return is filed and the payment must be made through ROS.
Please see Tax and Duty Manual Part 24B-01-01 for further information and guidance on the operation of the TSC.
Note
The Energy (Windfall Gains In the Energy Sector) (Temporary Solidarity Contribution) Act 2023 transposes Council Regulation (EU) 2022/1854 of 6 October 2022 on an emergency intervention to address high energy prices.