Section 115 of the Finance Act, 1986 ("Section 115") entitles the Irish Revenue Commissioners to serve a notice ("Notice") on the holder ("Lender") of a fixed charge over book debts (debts which are due to the company in the ordinary course of its business) of a company ("Company") specifying monies owed by the Company to the Revenue Commissioners in respect of PAYE and VAT ("Relevant Taxation Amounts") and, following service of such a Notice, the Lender is obliged to pay over to the Revenue Commissioners up to the amount specified in the Notice, out of amounts received by the Lender from the proceeds of the book debts in respect of monies owing to it by the Company subsequent to service of the Notice.
Section 174 of the Finance Act, 1995 ("Section 174") provides that if the Lender furnishes the Revenue Commissioners, within 21 days of the passing of the Finance Act, 1995 (2 June 1995) or of the creation of a fixed charge over book debts whichever is the later, with a copy of the prescribed particulars (the details are those, contained on a properly completed Companies Registration Office Form 47, required to be filed in relation to the registration of a charge created by a company pursuant to Section 99 of the Companies Act, 1963) as filed in the Companies Registration Office, then the Lender's liability shall not extend to any Relevant Taxation Amount which the Company was liable to pay before the date on which the Lender received the Notice.
Unless the Lender furnishes the prescribed particulars to the Revenue Commissioners in accordance with Section 174, the liability of the Lender will extend to paying the Revenue Commissioners, out of amounts received by the Lender in respect of monies owing to it by the Company, after service of the Notice the relevant amounts due by the Company both before as well as after service of the Notice.
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