Matheson Proposals To Improve Irish Tax Law In Finance Bill 2026

On 22 April 2026, Matheson made a submission to the Department of Finance suggesting a number of changes that we think should be made to the Irish tax rules. The suggestions are based on our experience in practice.

Our submission included eight requests:

1. Make the DWT exemption for ILPs workable: the application of the outbound payments defensive measures undermines the changes made in last year’s Finance Act to provide an exemption from dividend withholding tax for dividends paid to investment limited partnerships (“ILPs“). We think there is a better way to address the Government’s concerns while improving the Irish ILP offering.
2. Clarify the treatment of US LLCs in US multinational groups for the purposes of group relief: an Irish Court of Appeal decision on the treatment of a US LLC under the Ireland / US double tax treaty has caused some confusion about how US LLCs should be treated for the purposes of Irish law. One area where we are seeing this confusion arise in practice is in the context of claims for group relief from tax on chargeable gains. We have recommended that the law be clarified to address the point.
3. Improve the participation exemption: while welcome improvements were made to the participation exemption in last year’s Finance Act, there remains room for further improvement. We make a number of suggestions including with respect to geographical scope, waiting periods following acquisitions / migrations and the requirement that distributions be made out of profits.
4. Introduce a branch exemption: we identify Ireland’s regime for taxing foreign branches as being out of kilter with other EU Member States and recommend that the Government open a consultation to kick-start the reform.
5. Improve the provisions that promote tax compliance: the Irish regime includes a number of provisions that promote a culture of tax compliance. Those provisions could be improved to further foster that culture.
6. Remove the residual charge to stamp duty on transfers of foreign shares: in some limited circumstances a charge to Irish stamp duty can arise on transfer of foreign shares. We don’t see the rationale for the charge and recommend that transfers of foreign shares should always be exempt from Irish stamp duty.
7. Exclude performing loans from CG50A requirements: the requirement to obtain a Form CG50A in transactions involving transfers of loans secured over Irish real estate causes consequential drags on commercial transactions where Irish tax is not at risk. We believe the provisions should be changed.
8. Improve the treatment of restricted shares: Ireland’s regime for taxing restricted share schemes has fallen behind the types of arrangements implemented in practice. Technical terms in the plans (e.g., bad leaver / good leaver terms) can undermine the availability of the relief. We have recommended some easy fixes.

You can read the full submission here.

We expect that the next budget statement, Budget 2027, will be issued on 6 October with a first draft of Finance Bill 2026 being issued the following week. The Finance Bill is usually signed into law before the end of the year.

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