Dáil Éireann Debate, Tuesday - 15 September 2020
260. Deputy Mairéad Farrell asked the Minister for Finance if there is a requirement for firms that have been afforded section 110 status under the Taxes Consolidation Act 1997 by the Revenue Commissioners to state in their financial statements that they are availing of this tax relief. [23601/20]
View answerThere are a number of conditions which a company must meet in order to be regarded as a qualifying company for the purposes of section 110 of the Taxes Consolidation Act 1997 (“TCA 1997”). One such conditions is that the company must notify Revenue of its intention to be a qualifying company by completing a Form S.110 no later than 8 weeks from the date the company commences its business as a qualifying company for the purposes of section 110 TCA 1997.
A qualifying company is also required to indicate on its annual corporation tax return that they are a qualifying company within the meaning of section 110 TCA 1997 and provide additional information in relation to the assets held by the company. Along with the filing of their annual corporation tax return, a qualifying company is required to file their annual financial statements with Revenue.
In addition to the Revenue reporting requirements, under section 18 of the Central Bank Act 1971, all qualifying companies are obliged to report quarterly data to the Central Bank. More information on this requirement is available at the following link: https://www.centralbank.ie/statistics/statistical-reporting-requirements/special-purpose-vehicles.
This is in addition to other reporting obligation which many such companies already have - where such vehicles are “Financial Vehicle Corporations” (securitisation vehicles), they are required to report quarterly data to the Central Bank under Regulation ECB/2013/40. More information on this requirement is available at the following link: https://www.centralbank.ie/statistics/statistical-reporting-requirements/financial-vehicle-corporations. This information is then reported to the European Central Bank. The European Central Bank statistics provide harmonised information on the securitisation market and can also be broken down by country. The country by country list can be accessed at the following link: https://www.ecb.europa.eu/stats/financial_corporations/list_of_financial_institutions/html/index.en.html.
There is no legislative requirement contained in the Tax Acts which requires a company to state in their financial statements that they are a qualifying company for the purposes of section 110 TCA 1997. However, where the qualifying company is an Irish registered company, it must prepare financial statements in accordance with the Companies Act 2014, which must give a true and fair view of the assets, liabilities and financial position of the company. This is generally taken to be the case where the financial statements are prepared under Irish or International accounting standards. Both such accounting standards require that a note to the financial statements explains the tax charge in the accounts. In addition, the Companies Act 2014, at paragraph 64 of Part IV of Schedule 3, requires that the financial statements of larger companies include certain particulars on the tax charge in the accounts. Given the material impact of being a qualifying company on the tax charge of the company, the tax note generally explicitly states that the company’s current tax is calculated in accordance with section 110 TCA 1997.
