The Gazette 1992

GAZETTE

JULY/AUGUST 1992

The following response (dated 29 May) was received from Dr. Thornhill: " I refer to your letter of 28 April, 1992 regarding the retention tax deducation from gross fees inclusive of VAT. I apologise for the delay in replying but I have been heavily involved with the 1992 Finance Bill. The practice in relation to the retention tax is that VAT charged by a solicitor on his or her own fee should not be included in the total on which the retention tax is calculated and clear instructions have issued to accountable persons on that point. The question of outlay is not within my area. This aspect of your letter is being dealt with by Mr. Eddie Dwyer, Taxes Secretariat, Dublin Castle, who will be in touch with you shortly."

(a) to get a direction as to whether the particular transaction gives rise to a charge for VAT, and (b) to ascertain whether a refund will be forthcoming without problems if payment is made on foot of that invoice. Accordingly, the Committee recommends that practitioners should, in a situation where they are in any way doubtful, contact the Inspector of Taxes as outlined. The Committee has been assured of prompt attention on all such enquiries.

register at their office of land in their area designated as Derelict Sites and this register shall be opened for inspection at the Local Authority Offices during office hours.

Professional Purposes

Committee

Retention Tax Deduction from Gross Fees inclusive of VAT

An exchange of correspondence has taken place between the Law Society Taxation Committee and the Revenue Commissioners on the retention tax deduction from gross fees inclusive of VAT. The chairman of the Law Society Taxation Committee, Laurence Shields, wrote on 28 April, 1992 to Dr. Don Thornhill, Assistant Secretary, Capital Taxes Branch, as follows: " I refer to our recent meeting when we discussed a number of matters including the Retention Tax on Professional Fees. You will recall that at the meeting we expressed concern that no allowance was given until the following tax year for the deduction which places practitioners at a considerable disadvantage. You indicated that in the present tight financial circumstances there was unlikely to be any change in the current situation. There is, however, one matter which is of concern in relation to the present operation of Retention Tax. The Law Society is concerned about the practice whereby Retention Thx is deducted from the gross fees inclusive of all outlays and VAT. It is submitted that the original intention was for the Retention Tax to be deducted from the fee element only of all costs and outlays due to solicitors in respect of work done for and on behalf of those bodies or institutions who are obliged to apply the Retention Tax. We would be grateful, accordingly, if you would give serious consideration to amending the current practice."

Conveyancing

Committee

Derelict Sites Act, 1990

The Professional Purposes Committee wishes to bring to the notice of the profession the provisions of Section 29 of the above Act. Sub-section (1) provides that any person who is the occupier of any structure or land receiving rent (whether for himself or for another) must give particulars to the Local Authority including the name and address of every person who to his knowledge has any estate or interest in the property. Sub-Section (2) provides that where property has been entered on the Register of Derelict Sites then, in the case of a sale, it is the duty of both vendor and purchaser to notify the Local Authority of the transfer not later than four weeks after the date of the transfer. Under Sub-Section (3) where a person obtains a derelict site by will or on intestacy the obligation is placed both on the personal representative and the beneficiary to notify the local Authority as to the ownership, not later than six months after the date of the transfer.

Taxation

Committee

Gifts and Inheritances Between Spouses

Since publication of the Practice Note in the June 1991 issue of the Gazette it has come to the attention of the Taxation and Conveyancing Committees that the Revenue Commissioners take the view that notwithstanding the provisions of Section 127 of the Finance Act, 1990 there are circumstances where a charge to CAT may arise in a gift between spouses, or as a result of a prior gift between spouses. Section 8 of the Capital Acquisitions Tax Act, 1976 provides where a donee takes a gift from a disponer and within three years a further disposal of the gift takes place the beneficiary of the second gift is deemed to take the gift from the original disponer.

Section (8) of the Act provides that the Local Authority shall keep a '

For example, if a parent gives

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