Revenue has announced in eBrief 11/10 that they are prepared to examine claims for repayment of tax where it is claimed that a repayment would have been due had the remittance basis of assessment applied rather then the arising basis in respect of a taxpayers UK sourced income and capital gains. However, claims for repayment of tax will be examined on a case by case basis and subject to the statutory four year time limit for claiming tax refunds.

Under the provisions of section 18 Finance Act (FA) 2008, the remittance basis of assessment applies in respect of UK sourced income (except UK employment income attributable to duties of employment performed in Ireland) since 1 January 2008. Prior to section 18 FA 2008, section 73 TCA 1997 precluded the remittance basis of assessment in respect of UK sourced income. Section 42 Finance (No.2) Act 2008 also extended the remittance basis of assessment to chargeable gains arising in the UK as and from 20 November 2008.

Section 18 FA 2008 and section 42 F(No.2)A 2008, do not have retrospective effect. However, arising from a recent tax appeal case, Revenue will consider claims that a repayment of tax would have been due had the remittance basis of assessment applied for a relevant year of assessment in respect of UK sourced income or/or chargeable gains.

Further details are set out in eBrief 11/10 which is available here.