Taxes Consolidation Act 1997 section 826B

Repayment of tax in case of ceased company: double taxation relief

Section 826B allows a tax repayment arising from a double tax treaty correlative adjustment or mutual agreement procedure to be redirected to another group company where the company originally entitled to the repayment has ceased to exist.

• Where a correlative adjustment or mutual agreement reached under a double tax treaty gives rise to a tax repayment, and the company entitled to that repayment has ceased to exist, the repayment may be made to another company within the same group, provided certain conditions are met.
• The ceased company must, immediately before it ceased to exist, have been an "effective 90 per cent subsidiary" of an ultimate parent entity — meaning the parent owned at least 90 per cent of its ordinary share capital (directly or indirectly), was entitled to at least 90 per cent of its distributable profits, and would have received at least 90 per cent of its assets on a winding up.
• The nominated "group repayment company" must be resident in the State and must be either the group parent company itself, an effective 90 per cent subsidiary of that parent, or — where the original group parent has also ceased to exist — the successor group parent company or an effective 90 per cent subsidiary of that successor parent.
• The group parent company (or successor group parent) must submit a valid application to Revenue containing all information reasonably required to verify the conditions; if Revenue approves the application, sections 864 and 865 apply as if the group repayment company were the ceased company, but the repayment cannot exceed the amount that would have been due to the ceased company.