Irish Investment Fund Tax Registration And Filing Obligations - Are You Compliant?

Author:Mr Andrew Quinn, William Fogarty, Lynn Cramer, Barry McGrath, Peter Stapleton, Paul Dobbyn, Stephen Carty and Elaine Keane
Profession:Maples and Calder
 
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Irish regulated investment funds ("Investment Undertakings") benefit from Ireland's very favourable funds tax regime. This regime effectively provides that no Irish tax is levied on the profits or gains of Investment Undertakings and non-Irish residents are not taxed in Ireland on a sale of units or distributions from the fund.

However, notwithstanding that Investment Undertakings may not be subject to any charge to tax in Ireland, it is important to note that tax filing requirements still arise for such funds and it is important to consider these filing requirements and compliance obligations when establishing the fund as failure to comply can lead to interest and penalties. The filing requirements and the related services offered by Maples are described below.

  1. Registration for Tax

    Investment Undertakings:

    must register for investment undertaking tax; and may also be required to register for: (a) Pay As You Earn ("PAYE" – Irish payroll taxes); and (b) Value Added Tax ("VAT"). Investment Undertaking Tax

    Every Investment Undertaking is required to register for investment undertaking tax within 30 days of commencing business (i.e. within 30 days of authorisation of the Investment Undertaking by the Central Bank of Ireland). This involves filing a registration form with the Irish Revenue Commissioners ("Irish Revenue"). Once the Investment Undertaking has been registered, it will receive a tax reference number.

    PAYE

    Where a corporate Investment Undertaking is making payments of directors fees (whether those directors are Irish resident or not) Irish payroll taxes will generally need to be operated on those fees (unless a Revenue "exclusion order" applies). Irish directorship fees are automatically subject to Irish payroll taxes and the Investment Undertaking will need to register with Irish Revenue for PAYE in order to operate the correct withholding.

    Where the directors of the Investment Undertaking are partners in Irish law firms or accounting firms, an exclusion order providing that no PAYE need be withheld may be sought from Irish Revenue, on the basis that the partnership will account for the income tax. However, before such an order can be obtained, Irish Revenue require the Investment Undertaking to register for PAYE.

    VAT

    Where an Investment Undertaking is receiving taxable services from abroad (such as legal or audit services), the Investment Undertaking will be required to self-account for Irish VAT on those...

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