CAT & Debt Forgiveness Arrangements

CAT & Revenue

Revenue Iamge

Section 5 of the Capital Acquisitions Tax Consolidation Act 2003 provides that a person is deemed to take a gift where, under or in consequence of any disposition, that person becomes beneficially entitled in possession, otherwise than on a death, to any benefit otherwise than for full consideration in money or money’s worth paid by such person.

By virtue of the definition of “disposition” in section 2 (1) CATCA 2003 the release, forfeiture, surrender or abandonment of any debt or benefit, or the failure to exercise a right may be subject to CAT in certain situations.

Where for bona fide commercial reasons, a financial institution enters into a debt restructuring, forgiveness or write-off arrangement with a customer, Revenue’s approach, subject to being satisfied as to the bona fides of the arrangement (which may be subject to Revenue audit or enquiry) is that the financial institution is not intent on making a gift of any sort to the mortgagor/debtor – and accordingly the mortgagor/debtor would not be subject to a CAT charge in respect of any such debt restructuring, forgiveness or write-off arrangement.

This approach will only apply in the above-mentioned circumstances. In particular, should any debt restructuring, forgiveness or write-off arrangement be undertaken for the purposes of the avoidance of tax, the treatment outlined above would not apply.

Revenue Commissioners

Main Provisions of the Companies Bill 2012

The Companies Bill 2012 was published on the 21st December 2012. 

Companies Act2012

The legislation, which comprises of over 1,100 pages of text is the most significant reform in Irish company law since 1963. The new Bill consolidates the 16 existing Company Acts as well as a number of statutory instruments and judgments. (more…)

Local Property Tax (LTP) Explained

The new Local Property Tax is effective for all residential properties in Ireland in 2013.

We set out below a short summary of some of the main issues likely to arise in practice and indeed the consequences of not adhering to the strict deadlines set out by Revenue in relation to paying and filing the tax as it falls due.



LPT is a tax that will arise on every residential property at a rate of 0.18% on valuations up to €1 million with a higher rate of 0.25% on the amount by which a property exceeds this value. A full charge will be imposed in 2014 and subsequent years but this is reduced by 50% in 2013.