Following member requests we have been in discussions with Revenue on these issues to ensure a double charge to USC does not arise.

USC on Balancing Charge

Revenue has confirmed that the USC should not apply on balancing charges arising on the disposal of assets upon which capital allowances were claimed under Schedule D, Case V. This is on the basis that no deduction is allowed in the calculation of the USC in respect of Case V capital allowances and, accordingly, no USC liability should arise when a Case V balancing charge is taxable. A Revenue eBrief is expected on this.

USC/Income Levy and Deeds of Covenants

Revenue also confirmed that the income levy and USC should not apply to the covenant income of the covenantee on the basis that the covenator is not entitled to deduct the covenant income in the calculation of his/her Income Levy/USC liability. Revenue is investigating any amendments required to ROS to allow for this. If there are instances where the incorrect treatment has been applied they should be raised directly with the local tax district.