Taxes Consolidation Act 1997 section 111AZ

Delayed application of IIR and UTPR by Member States

Section 111AZ deals with the application of the Undertaxed Profits Rule (UTPR) top-up tax to Irish constituent entities of multinational groups whose ultimate parent entity is in an EU Member State that has elected to delay implementing the Income Inclusion Rule (IIR).

• Where the ultimate parent entity of a multinational group is in a Member State that has deferred its qualified IIR under Article 50.1 of the Directive, any constituent entity of that group located in Ireland must pay UTPR top-up tax for fiscal years beginning on or after 31 December 2023.
• The UTPR top-up tax is calculated in accordance with section 111N, and its application is subject to the UTPR group rules in section 111AAL.
• The ultimate parent entity must nominate a designated filing entity in a different Member State, or — if no group entity exists in another Member State — in a non-EU jurisdiction that has a qualifying competent authority agreement with the Member State where the ultimate parent entity is located.
• If the designated filing entity is in Ireland, it must file a top-up tax information return under section 111AAI, and the constituent entities in the deferring Member State must provide it with the information needed to comply with that filing obligation.

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