Taxes Consolidation Act 1997 section 237

Section 237 provides for the deduction of income tax at source from annuities, other annual payments, and patent royalties that are paid wholly out of profits or gains that have been brought into charge to income tax.

• Where an annuity or other annual payment is made wholly out of taxed income, the payer is assessed to income tax on those profits or gains and is entitled to deduct and retain income tax at the standard rate for the year in which the payment becomes due.
• The recipient must accept the net payment after deduction of tax, and the payer is treated as having discharged the full obligation once the net amount is paid.
• Patent royalties paid wholly out of taxed income are treated similarly, with the payer entitled to deduct and retain income tax at the standard rate for the year in which the royalty becomes due.
• Yearly interest and rents or similar payments chargeable under Case V of Schedule D are excluded from this section.