Revenue have announced the commencement of a new special investigation into the tax treatment of property, assets and funds settled by persons on foreign and Irish trusts. The investigation will commence on 1 September 2009.

The new investigation is largely structured in the same way as previous investigations into Deposit Accounts, Offshore Assets and Single Premium Insurance Policies.

Taxpayers who have tax issues in relation to these trusts (and are not excluded from doing so) must make a submission of a notice of intention to make a qualifying disclosure by 1 September 2009. A full disclosure, together with tax, interest and penalties, must be made by 31 October 2009.

Background

Finance (No. 2) Act 2008 put in place Third Party Reporting obligations for settlements involving nonresident trustees made since 24 December 2003. This means that accountants and tax practitioners are amongst the categories of persons who must make a Third Party return. Returns for the period 24 December 2003 to 23 December 2008 must be submitted by 1 September 2009 (this deadline has been extended from 24 June 2009). As a result of this legislation, Revenue anticipate receiving details of settlements made on offshore trusts on or before 1 September, hence the deadline for the notice of intention.

Relevant link for Investigation

The Revenue press release announcing the investigation, an explanatory note on the making of disclosures and the actual disclosure form is available from the Revenue website – click http://www.revenue.ie/en/practitioner/investigations/trusts/index.html.

The Revenue Explanatory Note is reproduced at Section 2.03.

Relevant link for Third Party Returns

Guidance Notes on the requirement to make Third Party Returns on settlements involving non-resident trustees, together with Form 8-S (the actual Third Party Return) are available on the Revenue website – click http://www.revenue.ie/en/practitioner/investigations/trusts/index.html.

The Revenue Guidance Note is reproduced at Section 2.04.