Revenue eBrief No. 202/18

27 November 2018

Competent Authority Agreement between Ireland and Malta

A new Tax and Duty Manual Part 35-01-10 has been created which sets out a Competent Authority Agreement entered into by the Irish and Maltese Competent Authorities under Article 24 (Mutual Agreement Procedure) of the Ireland-Malta Double Taxation Convention.

Revenue, as Competent Authority with respect to the Convention between Ireland and Malta for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income (‘Double Taxation Convention’), has signed a Competent Authority Agreement with the Maltese Competent Authority.

The Competent Authorities have agreed that, in relation to the structure outlined in the Competent Authority Agreement, the Double Taxation Convention’s deeming of a company – incorporated in Ireland but managed and controlled in Malta – to be resident in Malta only, does not serve the purposes of the Double Taxation Convention and is not “for those purposes”.

Accordingly, under Section 23A of the Taxes Consolidation Act 1997, such an Irish-incorporated company will be resident in Ireland and the relevant payments to it will come within the charge to Irish corporation tax.

This Competent Authority Agreement will have effect for taxable periods beginning on or after the expiration of a period of six months from the later of the dates on which the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting enters into force for Ireland and Malta.