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39 1997

TAXES CONSOLIDATION ACT, 1997

CHAPTER 5

Interest on overdue tax

Interest on overdue income tax and corporation tax.

[ITA67 s550(1), (3), (4) and (5); FA71 s17(2); FA74 s86 and Sch2 PtI; CTA76 s145(3); FA78 s46; FA85 s12; FA97 s146(1) and Sch9 PtI par10(7)]

1080. —(1) (a) Subject to this section and section 1081 , any tax charged by any assessment to income tax or corporation tax shall carry interest at the rate of 1.25 per cent for each month or part of a month from the date when the tax becomes due and payable until payment.

(b) Any tax charged by any assessment to income tax shall, notwithstanding any appeal against such assessment, carry interest at the rate of 1.25 per cent for each month or part of a month from the date when, if there were no appeal against the assessment, the tax would become due and payable under section 960 until payment.

(2) Interest shall not be payable under this section on the tax charged by any assessment unless the total amount of the interest is not less than £1.

(3) The interest payable under this section—

(a) shall be payable without any deduction of income tax and shall not be allowed as a deduction in computing any income, profits or losses for any of the purposes of the Tax Acts, and

(b) shall be deemed to be a debt due to the Minister for Finance for the benefit of the Central Fund and shall be payable to the Revenue Commissioners,

and, subject to subsection (4)

(i) every enactment relating to the recovery of any tax charged by an assessment,

(ii) every rule of court so relating,

(iii) section 81 of the Bankruptcy Act, 1988 , and

(iv) sections 98 and 285 of the Companies Act, 1963 ,

shall apply to the recovery of any amount of interest payable on that tax as if that amount of interest were a part of that tax.

(4) In proceedings instituted by virtue of subsection (3)

(a) a certificate by the Collector-General certifying that a stated amount of interest is due and payable by the person against whom the proceedings were instituted shall be evidence until the contrary is proved that that amount is so due and payable, and

(b) a certificate so certifying and purporting to be signed by the Collector-General may be tendered in evidence without proof and shall be deemed until the contrary is proved to have been signed by the Collector-General.

Effect on interest of reliefs given by discharge or repayment.

[ITA67 s551(1) and (2) (a); CTA76 s147(1) and (2)]

1081. —(1) Subject, in the case of income tax, to subsection (2)

(a) where relief from income tax or corporation tax charged by any assessment referred to in section 1080 (1) is given to any person by a discharge of any of that tax, such adjustment shall be made of the amount payable under that section in relation to the assessment, and such repayment shall be made of any amounts previously paid under that section in relation to the assessment, as are necessary to secure that the total sum, if any, paid or payable under that section in relation to the assessment is the same as it would have been if the tax discharged had never been charged, and

(b) where relief from income tax paid for any year of assessment, or corporation tax paid for any accounting period, is given to any person by repayment, that person shall be entitled to require that the amount repaid shall be treated for the purposes of this subsection to the extent possible as if it were a discharge of the tax charged on that person (whether alone or together with other persons) by any assessment for the same year or, as the case may be, the same accounting period; but the relief shall not be applied to any assessment made after the relief was given and shall not be applied to more than one assessment so as to reduce without extinguishing the amount of tax charged thereby.

(2) No relief, whether by means of discharge or repayment, shall be treated as affecting tax charged by an assessment to income tax unless it is a relief from income tax.

Interest on overdue income tax and corporation tax in cases of fraud or neglect.

[FA71 s20(1) to (4) and (6); FA74 s86 and Sch2 PtI; CTA76 s145(4); FA80 s14(2); FA82 s59]

1082. —(1) In this section, “neglect”, in the case of corporation tax, has the same meaning as in section 919 (5) (a) and, in the case of income tax, has the same meaning as in section 924 (2) (a).

(2) Where for any year of assessment or accounting period an assessment is made for the purpose of recovering an undercharge to income tax or corporation tax, as the case may be, attributable to the fraud or neglect of any person, the amount of the tax undercharged shall carry interest at the rate of 2 per cent for each month or part of a month from the date or dates on which the tax undercharged for that year or accounting period, as the case may be, would have been payable if it had been included in an assessment made—

(a) in the case of income tax, before the 1st day of October in that year, and

(b) in the case of corporation tax, on the expiration of 6 months from the end of that accounting period,

to the date of payment of the tax undercharged.

(3) Subject to subsection (5), section 1080 (1) shall not apply to tax carrying interest under this section.

(4) Subsections (2) to (4) of section 1080 and, in the case of income tax, section 1081 shall apply to interest chargeable under this section as they apply to interest chargeable under section 1080 .

(5) Where an assessment of the kind referred to in subsection (2) is made—

(a) the inspector concerned shall give notice to the person assessed that the tax charged by the assessment will carry interest under this section,

(b) the person assessed may appeal against the assessment on the ground that interest should not be charged under this section, and the provisions of the Tax Acts relating to appeals against assessments shall apply with any necessary modifications in relation to the appeal as they apply in relation to those appeals, and

(c) if on the appeal it is determined that the tax charged by the assessment should not carry interest under this section, section 1080 (1) shall apply to that tax.

Application of sections 1080 to 1082 for capital gains tax purposes.

[CGTA75 s51(1) and Sch4 par2(2)]

1083. —Without prejudice to sections 931 (2) and 976 (2), sections 1080 to 1082 shall, subject to any necessary modifications, apply to capital gains tax.