Finance Act 2005

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“Interest on overdue income tax, corporation tax and capital gains tax.

1080.—(1) In this section—

‘chargeable period’ has the same meaning as in section 321(2);

‘chargeable person’ has the same meaning as in section 950(1);

‘period of delay’, in relation to any tax due and payable, means the period during which that tax remains unpaid;

‘Table’ means the Table to subsection (2);

‘tax’ means income tax, corporation tax or capital gains tax, as appropriate;

‘relevant period’, in relation to a period of delay which falls into more than one of the periods specified in column (1) of the Table, means any part of the period of delay which falls into, or is the same as, a period specified in that column.

(2) (a) Subject to this section and section 1081—

(i) as respects tax due and payable for a chargeable period beginning before 1 January 2005, any tax charged by any assessment to tax shall carry interest from the date when the tax becomes due and payable until payment, and

(ii) as respects tax due and payable for a chargeable period beginning on or after 1 January 2005, any tax due and payable by a chargeable person for a chargeable period shall carry interest from the date when the tax becomes due and payable until payment,

and the amount of that interest shall be determined in accordance with paragraph (c).

(b) Subject to this section and section 1081, any tax charged by any assessment to income tax shall, notwithstanding any appeal against such assessment, carry interest from the date when, if there were no appeal against the assessment, the tax would become due and payable under section 960 until payment, and the amount of that interest shall be determined in accordance with paragraph (c).

(c) The interest to be carried by the tax referred to in paragraph (a) or (b), as the case may be, shall be—

(i) where one of the periods specified in column (1) of the Table includes or is the same as the period of delay, the amount determined by the formula—

T × D × P

where—

T is the tax due and payable which remains unpaid,

D is the number of days (including part of a day) forming the period of delay, and

P is the appropriate percentage in column (2) of the Table opposite the period specified in column (1) of the Table within which the period of delay falls or which is the same as the period of delay,

and

(ii) where a continuous period formed by 2 or more of the periods specified in column (1) of the Table, but not (as in subparagraph (i)) only one such period, includes or is the same as the period of delay, the aggregate of the amounts due in respect of each relevant period which forms part of the period of delay, and the amount due in respect of each such relevant period shall be determined by the formula—

T × D × P

where—

T is the tax due and payable which remains unpaid,

D is the number of days (including part of a day) forming the relevant period, and

P is the appropriate percentage in column (2) of the Table opposite the period specified in column (1) of the Table into which the relevant period falls or which is the same as the relevant period.

TABLE

From 1 August 1971 to 30 April 1975

From 1 May 1975 to 31 July 1978

From 1 August 1978 to 31 March 1998

From 1 April 1998 to 31 March 2005

(3) The interest payable under this section—

(a) shall be payable without deduction of income tax and shall not be allowed as a deduction in computing any income, profits or losses for any of the purposes of the Tax Acts, and

(b) shall be deemed to be a debt due to the Minister for Finance for the benefit of the Central Fund and shall be payable to the Revenue Commissioners.

(4) Subject to subsection (5)—

(a) every enactment relating to the recovery of tax,

(b) every rule of court so relating,

(c) section 81 of the Bankruptcy Act 1988 , and

(d) sections 98 and 285 of the Companies Act 1963 ,

shall apply to the recovery of any amount of interest payable on that tax as if that amount of interest were a part of that tax.

(5) In proceedings instituted by virtue of subsection (4)—

(a) a certificate signed by an officer of the Revenue Commissioners certifying that a stated amount of interest is due and payable by the person against whom the proceedings were instituted shall be evidence until the contrary is proven that that amount is so due and payable, and

(b) a certificate so certifying and purporting to be signed as specified in this subsection may be tendered in evidence without proof and shall be deemed until the contrary is proved to have been signed by an officer of the Revenue Commissioners.

Effect on interest of reliefs given by discharge or repayment.

1081.—(1) Subject to subsection (2)—

(a) where for any year of assessment or accounting period, as the case may be, relief from any tax referred to in section 1080(2) is given to any person by a discharge of any of that tax, such adjustment shall be made of the amount of interest payable under that section in relation to that tax, and such repayment shall be made of any amounts of interest previously paid under that section in relation to that tax, as are necessary to secure that the total sum, if any, paid or payable under that section in relation to that tax is the same as it would have been if the tax discharged had never been due and payable, and

(b) where relief from tax paid for any year of assessment or accounting period, as the case may be, is given to any person by repayment, that person shall be entitled to require that the amount repaid shall be treated for the purposes of this subsection to the extent possible as if it were a discharge of the tax charged on that person (whether alone or together with other persons) by any assessment for the same year or period; but the relief shall not be applied to any assessment made after the relief was given and shall not be applied to more than one assessment so as to reduce without extinguishing the amount of tax charged thereby.

(2) No relief, whether by discharge or repayment, shall be treated as affecting any tax charged by an assessment to—

(a) income tax or any income tax due and payable unless it is a relief from income tax,

(b) corporation tax or any corporation tax due and payable unless it is a relief from corporation tax, or

(c) capital gains tax or capital gains tax due and payable unless it is a relief from capital gains tax.”.

Calculation of interest on unpaid duty and other amounts.

159D.—(1) In this section—

‘period of delay’, in relation to any unpaid duty or other amount referred to in a specified provision, means the period referred to in the specified provision in respect of which period interest is chargeable, charged, payable or recoverable, as the case may be, in accordance with that provision;

‘specified provision’ means any section of this Act other than section 126(7) which provides for interest to be charged, chargeable, payable or recoverable, as the case may be, in respect of any unpaid duty or other amount due and payable under that section.

(2) The amount of interest charged, chargeable, payable or recoverable in respect of any unpaid duty or other amount due and payable or recoverable under a specified provision shall be the amount determined by the formula—

A × D × P

where—

A is the duty or other amount due and payable under the specified provision which remains unpaid,

D is the number of days (including part of a day) forming the period of delay, and

P is 0.0273 per cent.”.

TABLE

Part 1

From 1 August 1978 to 31 March 1998

From 1 April 1998 to 31 March 2005

Part 2

From 1 April 1998 to 31 March 2005