Credit in respect of tax deducted from emoluments of certain directors and employees – Section 997A TCA 1997

The purpose of Section 997A is to deny certain directors and employees a credit for tax deducted from their remuneration until such tax has been remitted to the Collector-General. The section applies to a person, being a director or employee of a company, who either alone or with one or more connected persons is able to control more than 15% of the ordinary share capital in that company or where any person connected with such director or employee, either alone or with any other person who is so connected, is able to exercise such control.

Tax and Duty Manual pdfPart 42-04-59 (PDF,123KB) has been amended to provide guidance on the meaning of ‘connected person’ as defined by Section 10 TCA 1997.

The manual further clarifies that for the purposes of section 997A ‘tax’ includes any tax deductible under the PAYE system. It therefore includes income tax, USC, PRSI and LPT.

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