Taxes Consolidation Act 1997 section 172H

Obligations of authorised withholding agent in relation to relevant distributions

Section 172H sets out the obligations of an authorised withholding agent (AWA) under the dividend withholding tax (DWT) scheme when receiving and passing on distributions from Irish resident companies on behalf of other persons.

• An AWA must give written notice to each Irish resident company (or recognised qualifying intermediary) from which it receives distributions on behalf of others, confirming its status as an AWA — this allows those companies to pay distributions without deducting DWT.
• When the AWA passes on the distributions to its clients, it effectively steps into the shoes of the paying company and must operate the DWT scheme as if it were the company that made the distributions, deducting DWT where appropriate and accounting for it to the Collector-General.
• If the AWA fails to provide the required written notification, the paying company must deduct DWT from the distributions as normal under section 172B.
• The key distinction between an AWA and a qualifying intermediary (QI) is that an AWA has the power to receive distributions without DWT being deducted and to then deduct and account for DWT itself, whereas a QI does not have this power.