Ireland

Interest Limitation Rules (ILR)

Finance Act 2022 proposed a number of welcome clarifying amendments to bring the legislation in line with guidance previously issued by Revenue. It includes an update on the operation of the exemption for interest on legacy debt, to specify that a 'first-in-first-out' basis applies where there is a repayment in respect of facilities that have a mixture of legacy debt and non-legacy debt. 

The extension of the definition of long-term infrastructure projects to include large-scale residential projects is another welcome development that could increase the attractiveness of investment in this sector (see the Group taxation section for further details).

Mandatory Exchange of Information for Digital Platform Operators (DAC7)

Finance Act 2022 repeals and replaces the Finance Act 2021 provisions introducing European Union (EU) tax transparency rules for digital platform operators into Irish law. DAC7 rules apply from 1 January 2023, with the first reporting obligation due on or before January 2024 (see the Group taxation section for further details).

Research and development (R&D) tax credit

Finance Act 2022 introduced changes to the operation of the R&D tax credit. Apart from affording greater flexibility for taxpayers in claiming the credit, the modifications respond to external changes such as the Pillar Two Global Anti-Base Erosion (GloBE) rules and changes to the United States (US) foreign tax credit regime. The changes provide for a three-year fixed payment regime for R&D tax credits and the removal of limits to the amount of credits that can be claimed in cash (see the Tax credits and incentives section for further details).

Temporary Business Energy Support Scheme (TBESS)

In circumstances where a business experiences an increase of 50% or more in its electricity or gas bills when compared with the electricity or gas bill received in the same month in the previous year, it may be eligible for a refund of up to 40% on the increase in electricity or gas prices. This is subject to a monthly cap of 10,000 euros (EUR) per trade or profession. An increased cap of EUR 30,000 can apply where a qualifying business has more than one MPRN/GRPN at different locations. An overall maximum payment limit also applies.

Digital gaming credit

A digital gaming credit was introduced into Ireland by Finance Act 2021; however, as the credit required EU State Aid approval, it was subject to a Ministerial Commencement Order. The Ministerial Commencement Order was made in November 2022. Finance Act 2022 included a number of amendments to the legislation for the relief for investment in digital games to ensure compliance with State Aid requirements and to make minor technical corrections.

Transfer pricing

For chargeable periods commencing on or after 1 January 2023, the definition of 'Transfer Pricing Guidelines' has been updated such that Irish transfer pricing rules should be construed in accordance with the 2022 version (as opposed to the 2017 version) of the OECD Transfer Pricing Guidelines.