Mary Butler (Waterford, Fianna Fail)
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213. To ask the Minister for Finance if he will confirm that in circumstances where the Revenue Commissioners deemed and directed an expenditure, in this case Non-Principal Private Residence charge, as not being an allowable expense and such expense is subsequently deemed to be allowable, that the statutory limit in such a case runs from the date of the confirmation that the expense is deemed an allowable expense and not the chargeable period to which the claim relates, in view of the fact that to have claimed within that period would have been futile as it would have been disallowed; and if he will make a statement on the matter. [13442/17]

Michael Noonan (Limerick City, Fine Gael)
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I am advised by Revenue that the applicable provision giving a right to repayment of tax is Section 865 of the Taxes Consolidation Act (TCA) 1997, where a person has paid an amount of tax which is not due. However, as I advised in my responses to PQ numbers 130 and 156 of 14 February 2017 and PQ number 170 of 7 March 2017, Section 865 (4) of the TCA provides that that right is subject to the making of a claim within a statutory limit of four years after the end of the chargeable period to which the claim relates. That statutory limit is binding on Revenue as well as on the taxpayer. Decisions of the Tax Appeals Commission in differing appellant circumstances published recently have confirmed that there is no discretion in the application of the 4 year rule for claiming repayments.

Section 865 TCA was introduced in 2003 and provides a statutory general right to repayment of tax as well as payment of interest, subject to a four year time limit.  It provides that no repayment may be made based on claims submitted more than four years after the end of the period to which they relate. Prior to that there was no statutory right to repayment, though a taxpayer could sue for repayment under common law.  The Minister at the time indicated that, in introducing the new arrangements, he was satisfied that they achieved the necessary balance between establishing a fair and uniform system for taxpayers while providing necessary protection for the Exchequer.

At the same time, the general right of the Revenue Commissioners to raise assessments or make enquiries as respects taxpayer returns was also reduced to four years though in certain circumstances, for example where fraud or neglect is suspected or in the context of the application of general anti-avoidance rules, Revenue's right to enquire or raise assessments is not time limited. Previously, the general time limit on the raising of assessments by Revenue had been ten years. The convergence of these various time limits on four years creates parity between a taxpayer's right to repayment and Revenue's powers to raise assessments.

I am further advised by Revenue that the decision of the High Court regarding the deductibility against rental profits of the NPPR charge has been appealed by Revenue to the Court of Appeal. Until that appeal is decided Revenue is not in a position to amend assessments or process repayment claims based on the High Court judgement. Any repayment claims made in relation to this matter that are received within the statutory time limits, as they apply to each year of assessment, will be retained and processed when the outcome of the Appeal case is known. Revenue also advise that they are developing a simple, easy to use process to facilitate taxpayers who may wish to lodge a claim in relation to this matter and that this will be available in the very near future.