Following the introduction of the 2021 Irish Budget, on October 22, the Irish Finance Minister published the draft 2020 Finance Bill (Finance Bill 2020). Once enacted, Finance Bill 2020 will give legislative effect to the Budget’s provisions.
Legislative changes likely to affect multinational companies include amendments to: (1) balancing charge provisions related to specified intangible assets under Ireland’s intangible property (IP) amortization regime and (2) Irish transfer pricing rules on certain non-trading transactions.
Finance Bill 2020 also contains several helpful technical amendments in areas such as the Irish controlled foreign company (CFC) rules and the anti-hybrid provisions. The Bill also extends certain relief, including the knowledge development box.
Finance Bill 2020 has introduced legislative reform which, once enacted, will result in action points for many companies. Multinational corporations with an Irish tax presence may welcome the anti-hybrid provisions in particular, while groups that have IP in Ireland or have loans between Irish entities will need to evaluate the potential impacts of the updates to the IP amortization and transfer pricing provisions on their structures.