With effect from 1 January 2010, subject to certain conditions (set out below), the Irish Revenue Commissioners (Revenue) have confirmed that collecting agents will no longer be under an obligation to deduct income tax at the standard rate (currently 20 per cent.) on encashment of foreign sourced dividend and interest income, where the person to whom the payment is made is a “qualifying company” within the meaning of section 110 of the Taxes Consolidation Act 1997 (as amended) (TCA) (Section 110).
The conditions on which the relief is given are:
- that the collecting agent is satisfied that the person to whom the payment is made is a qualifying company; and
- that the collecting agent gives the details required on Statement No. 4 on the annual Foreign Dividends Return which is required to be made under Schedule 2, Part IV of the TCA.
In accordance with the provisions of Section 110, qualifying companies are required to notify Revenue in the prescribed form that they are or intend to be a qualifying company. From 1 January 2010, Revenue will issue an acknowledgement of all such notifications. In order to satisfy condition (i) above, a collecting agent must obtain a copy of such an acknowledgment from the qualifying company. For Section 110 notifications received by Revenue prior to 1 January 2010, the qualifying company may obtain an acknowledgement from the Corporate Business and International Division of Revenue.