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14 January 2010

Exemption from Encashment Tax for "Qualifying Company" within the meaning of Section 110 of the Taxes Consolidation Act, 1997.

Under Schedule 2, Part V of the Taxes Consolidation Act, 1997 the Revenue Commissioners have power to relieve collecting agents of the obligation to deduct income tax at the standard rate on encashment of foreign sourced dividend and interest income payable to Irish residents in circumstances where they deem it appropriate.

Subject to certain conditions, this relief is being given with effect from 1st January 2010 to collecting agents in circumstances where they would otherwise be obliged to deduct tax in respect of such dividends or interest, where the person to whom the payment is made is a "Qualifying Company" within the meaning of Section 110 of the Taxes Consolidation Act, 1997.

The conditions on which the relief is given are:

  1. that the collecting agent is satisfied that the person to whom the payment is made is a "Qualifying Company" within the meaning of Section 110 of the Taxes Consolidation Act, 1997, and
  2. that the collecting agent gives the details required on Statement No. 4 on the annual Foreign Dividends Return which is required to be made under Schedule 2, Part IV of the Taxes Consolidation Act, 1997.

Condition 1

"Qualifying Companies" are required to notify Revenue that they are/intend to be a "Qualifying Company". From 1 January 2010, Revenue will issue an acknowledgement of all such notifications. The collecting agent must obtain, a copy of this acknowledgement from the qualifying company in order to satisfy condition 1 above.  

A Revenue acknowledgement may not be available in the case of section 110 notifications received by Revenue prior to 1 January 2010. In any such case, the qualifying company may obtain such an acknowledgement from:

Financial Services 1
Corporate Business and International Division
Revenue Commissioners
New Stamping Building
Dublin Castle
Dublin 2


Tel (01) 6748016 or (01)6748018