Taxes Consolidation Act 1997 section 1038

Merchanting profit

Section 1038 allows a resident person who is assessed to Irish income tax on behalf of a non-resident to apply for the assessment to be reduced to reflect only the merchanting or retail profit margin, and provides a right of appeal against such assessments.

• Where a non-resident person is taxable through an Irish-based agent on profits from goods manufactured outside the State, the agent may apply to have the assessment adjusted.
• The adjustment bases the assessment on the profit a merchant or retailer would reasonably have earned if buying directly from the manufacturer, rather than on the full manufacturing profit.
• If the inspector is satisfied with the proof of profit on that basis, the assessment must be made or amended accordingly.
• A person aggrieved by the original or amended assessment may appeal to the Appeal Commissioners within 30 days of the notice of assessment.