PART 18C

Domicile Levy

531AA Interpretation (Part 18C).

(1) In this Part—

“close company” has the meaning assigned to it by section 430;

“discretionary trust” means any disposition whereby, or by virtue or in consequence of which, property is held on trust to apply, or with a power to apply, the income or capital or part of the income or capital of the property for the benefit of any person or persons or of any one or more of a number or of a class of persons whether at the discretion of trustees or any other person and notwithstanding that there may be a power to accumulate all or any part of the income and for the purposes of this definition “disposition” includes any disposition whether by deed or otherwise and any covenant, agreement or arrangement whether effected with or without writing;

“domicile levy” has the meaning assigned to it by section 531AB;

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“final decision” means a decision against which no appeal lies or against which an appeal lies within a period which has expired without an appeal having been brought;

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“foundation” means any legal entity, wherever established, to which an individual disposes of, or transfers, property, irrespective of—

(a) how that entity is described in the place of establishment, and

(b) the name by which that entity is called in the place of establishment;

^[10]>“holding company” and “subsidiary” have the same meanings as in section 155 of the Companies Act 1963^<[10][10]>“holding company” has the same meaning as in section 8 of the Companies Act 2014^<[10];

“Irish property”, in relation to an individual and a valuation date, means all property, situate in the State, to which the individual is beneficially entitled in possession on the valuation date, but does not include—

(a) shares in a company which exists wholly or mainly for the purpose of carrying on a trade or trades,

(b) shares in a holding company which derive the greater part of their value from subsidiaries which wholly or mainly carry on a trade or trades;

“liability to income tax”, in relation to an individual and a tax year, means the amount of income tax due and payable by the individual for the tax year in accordance with the Tax Acts ^[8]>and in respect of which a final decision has been made^<[8];

“market value”, in relation to property, means the price which such property would fetch if sold on the open market on the valuation date in such manner and subject to such conditions as might reasonably be calculated to obtain for the vendor the best price for the property;

“minor child” means a child who has not attained the age of 18 years and is not and has not been ^[2]>married^<[2][2]>married or is not and has not been a civil partner^<[2];

“property” includes rights and interests of every description;

“relevant individual”, in relation to a tax year, means an individual—

(a) who is domiciled in^[6]>, and is a citizen of,^<[6] the State in the tax year,

(b) whose world-wide income for the tax year is more than €1,000,000,

(c) whose liability to income tax in the State for the tax year is less than €200,000, and

(d) the market value of whose Irish property on the valuation date in the tax year is in excess of €5,000,000;

“return” means such a return as is referred to in section 531AF;

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“subsidiary” has the same meaning as in section 7 of the Companies Act 2014;

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“tax year” means a year of assessment for income tax purposes;

“world-wide income”, in relation to an individual, means the individual’s income, without regard to any amount deductible from or deductible in computing total income, from all sources as estimated in accordance with the Tax Acts and as if any provision of those Acts providing for any income, profits or gains to be exempt from income tax or to be disregarded or not reckoned for the purposes of income tax or of those Acts were never enacted, and—

(a) without regard to any deduction—

(i) in respect of double rent allowance under section 324(2), 333(2), 345(3) or 354(3),

(ii) under section 372AP, in computing the amount of a surplus or deficiency in respect of rent from any premises,

(iii) under section 372AU, in computing the amount of a surplus or deficiency in respect of rent from any premises,

(iv) under section 847A, in respect of a relevant donation (within the meaning of that section),

(v) under section 848A, in respect of a relevant donation (within the meaning of that section),

and

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(b) having regard to a deduction for—

(i) any payment to which section 1025 applies made by an individual pursuant to a maintenance arrangement (within the meaning of that section) relating to the marriage for the benefit of the other party to the marriage, unless section 1026 applies in respect of such payment, or

(ii) a payment of a similar nature to a payment referred to in subparagraph (i) pursuant to a maintenance arrangement (within the meaning of section 1025) relating to the marriage for the benefit of the other party to the marriage which attracts substantially the same tax treatment as such a payment,

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(b) having regard to a deduction for—

(i) any payment to which section 1025 applies made by an individual pursuant to a maintenance arrangement (within the meaning of that section) relating to the marriage for the benefit of the other party to the marriage, unless section 1026 applies in respect of such payment,

(ii) a payment of a similar nature to a payment referred to in subparagraph (i) pursuant to a maintenance arrangement (within the meaning of section 1025) relating to the marriage for the benefit of the other party to the marriage which attracts substantially the same tax treatment as such a payment,

(iii) any payment to which section 1031J applies made by an individual pursuant to a maintenance arrangement (within the meaning of that section) relating to the civil partnership for the benefit of the other party to the civil partnership, unless section 1031K applies in respect of such payment,

(iv) a payment of a similar nature to a payment referred to in subparagraph (iii), pursuant to an order of a court under the law of another territory that, had it been made by a court in the State, would be a maintenance arrangement (within the meaning of section 1031J), relating to the civil partnership for the benefit of the other party to the civil partnership which attracts substantially the same tax treatment as such a payment, or

(v) any payment to which section 1031Q applies made by an individual pursuant to a maintenance arrangement (within the meaning of that section) where a relationship between cohabitants ends,

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determined on the basis that the individual, if not otherwise resident in the State for the year, was resident in the State for the tax year;

“valuation date”, in relation to a tax year, means 31 December in that year.

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(1A) For the purposes of the definition of ‘world-wide income’ in subsection (1), an individual’s income means the income of an individual before deducting capital allowances and losses.

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(2) Subject to subsection (3), for the purposes of the definition of “Irish property” in subsection (1), an individual shall be deemed to be beneficially entitled in possession on the valuation date to—

(a) all property situate in the State which the individual has transferred ^[4]>to his or her spouse or minor children,^<[4][4]>to his or her spouse, civil partner or minor children, or to the minor children of his or her civil partner,^<[4] for less than market value, on or after 18 February 2010,

(b) all property situate in the State which the individual has disposed of, or transferred, to a discretionary trust, for less than market value, on or after 18 February 2010, and

(c) all property situate in the State which the individual has disposed of, or transferred, to a foundation, for less than market value, on or after 18 February 2010.

(3) (a) Subsection (2)(a) shall not apply to a maintenance arrangement (within the meaning of ^[5]>section 1025^<[5][5]>section 1025, 1031J or 1031Q^<[5]).

(b) Subsection (2)(b) and (c) shall not apply to a discretionary trust or a foundation, as the case may be, which is shown, to the satisfaction of the Revenue Commissioners, to have been created exclusively—

(i) for purposes which, in accordance with the law of the State, are charitable, or

(ii) for the benefit of one or more named individuals and for the reason that such individual, or all such individuals, is or are, because of age or improvidence, or of physical, mental or legal incapacity, incapable of managing that individual’s or those individuals’ affairs.

(4) For the purposes of this Part, where the whole or the greater part of the market value of any share in a company incorporated outside the State that would be a close company if it were incorporated in the State is attributable, directly or indirectly, to property situate in the State, that share shall be deemed to be property situate in the State.

(5) In estimating the market value of any property for the purposes of this Part, no deduction shall be made from the market value for any debts or encumbrances.

(6) References in this Part to the Revenue Commissioners shall be construed as including references to any of their officers.