Posted: May 5th, 2015

Tax 2

Paper, Order, or Assignment Requirements

1. “The taxation of expatriates in Ireland has always being a contentious, political and sensitive issue”. 
Requirements: Discuss the above statement; setting out what the manner in which Irish tax legislation has evolved since 2000 with regard to the taxation of expatriates. 

2. “There has been a growing trend of international groups relocating to favourable jurisdictions in order to reduce compliance costs and simplify their tax and financial affairs to better facilitate the group’s financial management. The relocation is typically achieved by incorporating a new holding or parent company in that jurisdiction or changing the tax residence of an existing holding or parent company to that jurisdiction. Despite the attractions of other more established holding company jurisdictions, recently quite a number of international groups have selected Ireland as the location of choice.” 
– McCann Fitzgerald, 2010 
Requirement: In the context of the statement outlined above discuss: 
(a) the key features a Multinational Company (MNC) looks for when assessing a suitable location for an international holding company; 
(b) (b) Ireland’s attractiveness as a holding company location based on the criteria you have set out in Part (a) above. 

3. Ireland has been one of the pre-eminent jurisdictions for aircraft finance and leasing for almost 40 years. As one of the world’s major centres for aircraft lessors, a survey conducted by the Federation of Aerospace Enterprises in Ireland estimated that aviation leasing companies in Ireland manage assets worth in the region of €82.9 billion and provide approximately 1,000 high value jobs here. A key component of the success of the industry in Ireland has been the tax regime. 
Requirements: Discuss the above statement, setting out what specific tax measures are attractive and the type of structures typically used by the aircraft leasing industry. 

4. The definition of permanent establishment (PE) must be updated to prevent abuses. In many countries, the interpretation of the treaty rules on agency-PE allows contracts for the sale of goods belonging to a foreign enterprise to be negotiated and concluded in a country by the sales force of a local subsidiary of that foreign enterprise without the profits from these sales being taxable to the same extent as they would be if the sales were made by a distributor. In many cases, this has led enterprises to replace arrangements under which the local subsidiary traditionally acted as a distributor by “commissionaire arrangements” with a resulting shift of profits out of the country where the sales take place without a substantive change in the functions performed in that country. 
BEPS Action Plan Report, 2013, p.19 
Requirement: Discuss the above statement in detail, describing and explaining the type of structures that have been highlighted in the media and UK parliamentary inquiries. Reference should be made to the wording in the Model Double Tax Treaty, which accompanies this paper, to support your explanation. 

5. “When it comes to establishing the residence of a company, case law continues to re- visit the concept of central management and control”. 
Requirement: Discuss the above statement, making reference to an old case and a new case that have dealt with the concept of corporate residence. 

6. “In recent years there have been a number of significant changes to the corporation tax rules pertaining to the availability of Group loss relief. The start of the process began with changes introduced post ICI v Colmer, later changes as result of the Marks and Spencer case and more recently by the FCE Bank case” 
Requirement: Discuss the above statement, explaining the changes that have occurred and the rationale for the changes. Diagrams illustrating the impact of the changes made should be presented. 

7. The remittance of taxation has been at times a controversial subject matter in the context of taxing non-domiciled individuals to income taxation and capital gains tax. Changes introduced in 2006 reduced some of the inequity in the system yet planning opportunities remain for this category of taxpayer to reduce his/her Irish tax exposure quite significantly. 
Requirement: Discuss the above statement, explaining the changes that have occurred and the rationale for the changes. Diagrams illustrating the potential planning opportunities should be presented. 

8. The REIT regime, introduced by Finance Act 2013, provides a tax exemption in respect of the income and chargeable gains of a property rental business held within a company which satisfies a number of conditions. 
Requirement: Discuss the above statement, explaining the manner in which the tax provisions apply and the rationale for the legislation. 
9. By far the most widely used tool in limiting treaty benefits to those for whom they were intended is the ‘beneficial ownership’ requirement which is commonly applied in tax treaties to payments of dividends, interest and royalties. A similar concept applies in EU directives enshrined in Irish tax legislation. The concept has been considered in a number of milestone cases. In a well-known ICT case, Ireland has stood accused of not applying the strict interpretation of the term in the administration of the tax system. 
Requirement: Discuss the above statement, explaining the manner in which the tax provisions apply, the issues considered in the relevant case law and the outcome of each case and the rationale for the criticism noted. 

10. ‘The international common principles drawn from national experiences to share tax jurisdiction may not have kept pace with the changing business environment. Domestic rules for international taxation and internationally agreed standards are still grounded in an economic environment characterised by a lower degree of economic integration across borders, rather than today’s environment of global taxpayers, characterised by the increasing importance of intellectual property as a value-driver and by constant developments of information and communication technologies.’ OECD 2013 BEPS, p.5 
Requirement: Discuss the above statement in detail, describing and explaining background and the rationale for the BEPS initiative. Students are required to provide detailed commentary on at least one Action Point and the potential implications from an Irish tax perspective.