Tax Appeals Commission determination 147TACD2023 regarding CGT, 2023

• Administrative Decision Number: 147TACD2023
• Date: 11 September 2023
• Subject Matter: CGT
• Respondent: THE REVENUE COMMISSIONERS

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147TACD2023

Between

Appellant

and

THE REVENUE COMMISSIONERS

Respondent

Determination

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Contents

Introduction ........................................................................................................................... 3

Background ........................................................................................................................... 3

Preliminary issue ................................................................................................................... 4

Appellant ........................................................................................................................... 5

Respondent ....................................................................................................................... 5

Analysis ................................................................................................................................ 7

Finding and Commentary ...................................................................................................... 8

Documentation presented to the Commission ....................................................................... 9

Witness Evidence – The Appellant ...................................................................................... 11

Submissions ....................................................................................................................... 14

Appellant ......................................................................................................................... 14

Respondent ..................................................................................................................... 16

Material Facts ..................................................................................................................... 21

Analysis .............................................................................................................................. 22

Determination ..................................................................................................................... 24

Appendix 1 – Legislation ..................................................................................................... 26

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Introduction

1. This matter comes before the Tax Appeals Commission (hereinafter “the Commission”)

as an appeal against a Notice of Assessment to Capital Gains Tax (“CGT”) raised by the

Revenue Commissioners (hereinafter “the Respondent”) in respect of the tax year 2013.

The Respondent issued its Notice of Assessment on 21st March 2019.

2. The amount of CGT in dispute is €38,319. The Appellant makes his appeal in accordance

with the provisions of section 945 Taxes Consolidation Act 1997 (“TCA 1997”).

3. The hearing took place in person on 27th March 2023. The Appellant was represented by

his solicitor and his tax agent. The Respondent was represented by Counsel, its solicitor

and two members of its staff.

Background

4. The Appellant submitted his 2012 Income Tax Return (“Form 11”) in a timely manner.

Included within that return was details of a CGT transaction which the Appellant deemed

was referable to that year. The recorded CGT transaction detailed gross consideration

received of €134,375 and a chargeable gain of “nil”.

5. On 28th September 2016, the Respondent issued the Appellant with an audit notification

letter. The letter advised that the Respondent was auditing the Appellant’s Income Tax,

CGT and Value Added Taxation returns for the period 1st January 2012 to 31st December

2014.

6. During the course of the audit, the Appellant advised the Respondent that the he had

leased lands and the underlying leases on those lands contained options (“the options”)

for the Appellant to purchase the leased lands. The options provided on the expiration of

the leases, the Appellant could buy the lands for an agreed consideration of £91,000

(ninety one thousand Irish pounds).

7. In response to queries raised on the options, the Respondent received a letter from the

Appellant’s agent on 21st December 2016. Attached to that correspondence was a letter

from the Lessor’s solicitor dated 15th December 2016. That letter stated following the

death of the Lessor the Appellant had instigated Circuit Court proceedings against the

deceased’s personal representatives seeking compensation to buy out the options on the

leased lands.

8. As an agreement was reached between the Appellant and the deceased’s personal

representatives, the matter did not go before the Court. The agreement provided in return