Implications Of New Anti-Avoidance Provisions For Non-Irish Domiciled Individuals

The Finance Act 2012 (the "Act") became law on 2 April 2012. Among other things, it provides for amendments to anti-avoidance provisions in the area of capital taxes, with significant implications for non-Irish domiciled individuals. From a Private Client advisory perspective, the noteworthy elements are as follows:

Attribution of trust gains / capital gains tax

The anti-avoidance legislation concerning the attribution of trust gains to the settlor of an offshore trust, can be found in section 579 of the Taxes Consolidation Act 1997 (TCA 1997).

For many years, section 579(1) TCA 1997 attributed gains of an offshore trust among beneficiaries, and since 1999 imposed a Capital Gains Tax (CGT) charge on the settlor in respect of gains attributed to Irish resident beneficiaries.