Taxes Consolidation Act 1997 section 111J

IIR offset mechanism

Section 111J provides for the reduction of top-up tax allocated to an Irish parent entity where it holds an ownership interest in a low-taxed subsidiary indirectly through an intermediate or partially-owned parent entity that is already subject to a qualified Income Inclusion Rule (IIR).

• Where an Irish parent entity owns a low-taxed constituent entity indirectly through an intermediate parent entity or a partially-owned parent entity, the top-up tax allocated to the Irish parent may be reduced.
• The reduction applies only where the intermediate or partially-owned parent entity is itself subject to a qualified IIR for the relevant fiscal year.
• The amount of the reduction equals the portion of the Irish parent entity's allocable share of top-up tax that has already been charged to the intermediate or partially-owned parent entity.
• The purpose of the provision is to prevent double charging of top-up tax on the same underlying income.