811C Transactions to avoid liability to tax

(1)(a) In this section and section 811D—

“the Acts” means—

(i) the Tax Acts,

(ii) the Capital Gains Tax Acts,

(iii) the Value-Added Tax Consolidation Act 2010, and the enactments amending or extending that Act,

(iv) the Capital Acquisitions Tax Consolidation Act 2003, and the enactments amending or extending that Act,

(v) the Stamp Duties Consolidation Act 1999, and the enactments amending or extending that Act, and

(vi) Part 18D,

and any instruments made thereunder;

“assessment” includes any assessment to tax made under any provision of the Acts including any amended assessment, correcting assessment and any estimate or estimation;

“business” means any trade, profession or vocation;

“Revenue officer” means an officer of the Revenue Commissioners;

“tax” means any tax, duty, levy or charge which in accordance with the Acts is placed under the care and management of the Revenue Commissioners and any interest or other amount payable pursuant to the Acts;

“tax advantage” means—

(i) a reduction, avoidance or deferral of any charge or assessment to tax, including any potential or prospective charge or assessment, or

(ii) a refund of or a payment of an amount of tax, or an increase in an amount of tax, refundable or otherwise payable to a person, including any potential or prospective amount so refundable or payable,

arising out of or by reason of a transaction, including a transaction where another transaction would not have been undertaken or arranged to achieve the results, or any part of the results, achieved or intended to be achieved by the transaction;

“tax avoidance transaction” has the meaning assigned to it by subsection (2);

“transaction” means—

(i) any transaction, action, course of action, course of conduct, scheme, plan or proposal,

(ii) any agreement, arrangement, understanding, promise or undertaking, whether express or implied and whether or not enforceable or intended to be enforceable by legal proceedings, and

(iii) any series of or combination of the circumstances referred to in paragraphs (i) and (ii),

whether entered into or arranged by one person or by 2 or more persons—

(I) whether acting in concert or not,

(II) whether or not entered into or arranged wholly or partly outside the State, or

(III) whether or not entered into or arranged as part of a larger transaction or in conjunction with any other transaction or transactions.

(b) This section and section 811D shall apply notwithstanding any other provision of the Acts.

(2) (a) Subject to paragraph (b), for the purposes of this section a transaction shall be a ‘tax avoidance transaction’ if having regard to the following matters—

(i) the form of that transaction,

(ii) the substance of that transaction,

(iii) the substance of any other transaction or transactions which that transaction may reasonably be regarded as being directly or indirectly related to or connected with, and

(iv) the final outcome of that transaction and any combination of those other transactions which are so related or connected,

and having regard to any one or more of the following matters—

(I) the results of the transaction,

(II) its use as a means of achieving those results,

(III) any other means by which the results or any part of the results could have been achieved,

it would be reasonable to consider that—

(A)the transaction gives rise to, or but for this section would give rise to, a tax advantage, and

(B)the transaction was not undertaken or arranged primarily for purposes other than to give rise to a tax advantage.

(b) For the purpose of this section, a transaction shall not be a tax avoidance transaction if, having regard to the matters set out in paragraph (a)—

(i) notwithstanding that the purpose or purposes of the transaction could have been achieved by some other transaction which would have given rise to a greater amount of tax being payable by the person, the transaction—

(I) was undertaken or arranged by a person with a view, directly or indirectly, to the realisation of profits in the course of the business activities of a business carried on by the person, and

(II) was not undertaken or arranged primarily to give rise to a tax advantage,

or

(ii) the transaction was undertaken or arranged for the purpose of obtaining the benefit of any relief, allowance or other abatement provided by any provision of the Acts and the transaction did not result directly or indirectly in a misuse of the provision or an abuse of the provision having regard to the purposes for which it was provided.

(3) A person shall not be entitled to any tax advantage arising out of or by reason of a tax avoidance transaction to which this section applies.

(4) (a) Where a person submits any return, declaration, statement or account or makes any claim which purports to obtain the benefit of a tax advantage arising out of or by reason of a tax avoidance transaction, a Revenue officer may at any time deny or withdraw the tax advantage.

(b) Without prejudice to the generality of paragraph (a), it shall be a lawful exercise of the powers conferred by that paragraph to do one or more of the following acts, and accordingly that paragraph shall be read as permitting, for the purposes of that paragraph, a Revenue officer to do each of the following acts, namely to—

(i) make or amend an assessment,

(ii) allow or disallow in whole or in part any credit, deduction or other amount which is relevant in computing tax payable, or any part of such credit, deduction or other amount,

(iii) allocate or deny any credit, deduction, loss, abatement, relief, allowance, exemption, income or other amount, or any part thereof,

(iv) recharacterise, for tax purposes, the nature of any payment or other amount.

(c) In paragraph (b) a reference to the doing of an act includes a reference to the making of an adjustment.

(d) Where any adjustment is made or act is done to deny or withdraw a tax advantage, relief shall be afforded from any double taxation which would, or would but for this paragraph, arise by virtue of any such adjustment made or act done pursuant to this subsection.

(5) (a) For the purposes of this subsection, ‘alternative assessment’ means an assessment—

(i) not being an assessment made pursuant to subsection (4), and

(ii) the effect of which is to withdraw or deny, in whole or in part, any tax advantage.

(b) Where a Revenue officer makes or amends an assessment to withdraw or deny a tax advantage pursuant to this section, it shall be lawful for a Revenue officer to make or have made or to amend or have amended an alternative assessment.

(c) No appeal shall lie against an assessment made pursuant to this section or an alternative assessment on the grounds that a Revenue officer has made or amended an assessment pursuant to this section, or an alternative assessment, as the case may be.

(d) Where an assessment is made pursuant to this section and an alternative assessment is made, then only one such assessment shall, by agreement with the person on whom the assessment and the alternative assessment were made or by way of determination on appeal, as the case may be, become final and conclusive.

(6) Except as provided for in section 811D(4)(a)(i), this section and section 811D shall be read as enabling the doing of, and nothing in the Acts, in particular a provision stipulating a time limit, shall be read as preventing a Revenue officer from doing, each of the following, namely:

(a) making any enquiry;

(b) taking any action;

(c) making or amending an assessment;

(d) collecting or recovering any amount of tax;

at any time in connection with this section or section 811D.

(7) Where a tax advantage is withdrawn from or denied to 2 or more persons pursuant to this section, any obligation on the Revenue Commissioners to maintain secrecy or any other restriction on the disclosure of information by the Revenue Commissioners shall not apply with respect to the making of any adjustment, the performance of any other acts or the discharge of any functions authorised by this section to be made, performed or discharged by a Revenue officer or to the making of any adjustment, the performance of any other acts or the discharge of any functions (including any act or function in relation to an appeal ^[2]>made under Part 40^<[2][2]>made to the Appeal Commissioners^<[2]) which is directly or indirectly related to the adjustment, acts or functions so authorised.

(8) A transaction shall not be a tax avoidance transaction for the purposes of this section if it was commenced on or before 23 October 2014.