891GA Disclosure of certain information for the purposes of administrative cooperation in the field of taxation

Summary

This section allows the Revenue Commissioners to supplement the information which is required to be automatically exchanged under Council Directive 2011/16/EU, as amended by Council Directive (EU) 2015/2376 of 8 December 2015 (known as DAC 3) as regards mandatory automatic exchange of information in the field of taxation.

DAC 3 provides for the automatic exchange of information relating to advance cross-border rulings and advance pricing arrangements between Member States and to the European Commission.

Details

(1) The section provides for the disclosure by the competent authority of certain information connected with or supplementing the information required to be exchanged under the Regulations. The Regulations are the European Union (Administrative Cooperation in the Field of Taxation) Regulations 2012, which transposed Council Directive 2011/16/EU into Irish law.

Definitions

(2) “advance cross-border ruling” is defined by reference to the Directive, as amended. In the Directive, as amended, advance cross-border ruling is defined as:

“any agreement, communication, or any other instrument or action with similar effects, including one issued, amended or renewed in the context of a tax audit, and which meets the following conditions:

1. is issued, amended or renewed by, or on behalf of, the government or the tax authority of a Member State, or the Member State’s territorial or administrative subdivisions, including local authorities, irrespective of whether it is effectively used;
2. is issued, amended or renewed, to a particular person or a group of persons, and upon which that person or a group of persons is entitled to rely;
3. concerns the interpretation or application of a legal or administrative provision concerning the administration or enforcement of national laws relating to taxes of the Member State, or the Member State’s territorial or administrative subdivisions, including local authorities;
4. relates to a cross-border transaction or to the question of whether or not activities carried on by a person in another jurisdiction create a permanent establishment; and
5. is made in advance of the transactions or of the activities in another jurisdiction potentially creating a permanent establishment or in advance of the filing of a tax return covering the period in which the transaction or series of transactions or activities took place.

The cross-border transaction may involve, but is not restricted to, the making of investments, the provision of goods, services, finance or the use of tangible or intangible assets and does not have to directly involve the person receiving the advance cross-border ruling”

“advance pricing arrangement” is also defined by reference to the Directive, as amended. In the Directive, as amended, advance pricing arrangement is defined as:

“any agreement, communication or any other instrument or action with similar effects, including one issued, amended or renewed in the context of a tax audit, and which meets the following conditions:

1. is issued, amended or renewed by, or on behalf of, the government or the tax authority of one or more Member States, including any territorial or administrative subdivision thereof, including local authorities, irrespective of whether it is effectively used;
2. is issued, amended or renewed, to a particular person or a group of persons and upon which that person or a group of persons is entitled to rely; and
3. determines in advance of cross-border transactions between associated enterprises, an appropriate set of criteria for the determination of the transfer pricing for those transactions or determines the attribution of profits to a permanent establishment.

Enterprises are associated enterprises where one enterprise participates directly or indirectly in the management, control or capital of another enterprise or the same persons participate directly or indirectly in the management, control or capital of the enterprises. Transfer prices are the prices at which an enterprise transfers physical goods and intangible property or provides services to associated enterprises, and “transfer pricing” is to be construed accordingly”.

“competent authority” means the Revenue Commissioners acting as competent authority for the purpose of the Directive.

“Directive” means Council Directive 2011/16/EU of 15 February 2011on administrative cooperation in the field of taxation and repealing Directive 77/799/EEC, as amended by Council Directive 2014/107/EU of 9 December 2014 and Council Directive (EU) 2015/2376 of 8 December 2015.

“exchange information” means the information described in Article 8a of the Directive that is required to be communicated by the competent authority under the Regulations.

“Regulations” means the European Union (Administrative Cooperation in the Field of Taxation) Regulations 2012.

“relevant instrument” means an advance cross-border ruling or an advance pricing arrangement.

(3) The competent authority may, when exchanging information in respect of relevant instrument, also provide the following additional information:

• The reference, if any, of the relevant instrument;
• Information identifying any other relevant instrument related to or connected with the one being exchanged;
• In respect of a person to whom the relevant instrument relates that person’s main business activity, annual turnover and annual profits or losses;
• In respect of an advance pricing arrangement an explanation of why more than one transfer pricing methodology is used, if relevant; and
• Any other information included on the standard form adopted by the European Commission for the purpose of exchanging information under the Directive.

(4) The competent authority may delegate to any of its officers any of the functions to be performed by the competent authority under this section.

Relevant Date: Finance Act 2019