1.1 Domestic law

1.1.1 Briefly describe your legal system and its origins

The legal system of the Republic of Ireland is a common law system. In order to ensure consistency, a legal principle developed whereby courts were generally required to follow earlier relevant decisions. This doctrine of precedent established the methodology by which relevant legal principles are extracted from earlier decisions.

By the 17th century, the common law of England was imported into Ireland when it replaced the Irish system of laws known as the Brehon laws. Given the origin of the Irish legal system and the traditional links between the two jurisdictions, it is not surprising to find UK decisions are the most frequently cited foreign decisions.

1.1.2 What is the scope of your succession law?

Statute law including the Administration of Estates Act 1959 and primarily, the Succession Act 1965 govern succession law, together with rules of procedure enshrined in the rules of the Superior Courts. Freedom of testation applies but is subject to two principal exceptions relating to spouses and children.


Where a person dies wholly or partially testate, the surviving spouse shall be entitled to:

  • One-half of the estate where there are no children.
  • One-third of the estate where there are children (section 111 Succession Act 1965).

The legal right taken by the spouse in these circumstances is known as the "legal right share".


Children do not have a formal right to an entitlement to the estate. At best, their right could be described as a "right to apply". Upon an application to a court, the court has the authority to make proper provision for that child where it believes that the testator has failed in his or her moral duty to make such proper provision for that child in accordance with his means (section 117 Succession Act 1965). Lawfully adopted children and children born outside of marriage are entitled to make an application.

Civil partners

Under the Civil Partners and Certain Rights and Obligations of Cohabitants Act 2010 (CROC Act), civil partners have rights almost identical to those of spouses, with one important exception. The legal right share of a surviving spouse cannot be decreased by a successful section 117 application by a child of the deceased. There is no such protection of the legal right share of a surviving civil partner. A referendum on the subject of full marriage equality is planned for 2015.

There are no other statutory provisions under which disappointed heirs can seek relief save those in favour of the deceased's spouse and children outlined above and general part performance and estoppel principles.

1.1.3 When are individuals and their property subject to succession rules?

See 1.1.2 above.

1.2 Private international law

1.2.1 What is the jurisdiction of local courts in international disputes?

Ireland applies the Brussels Regime which consists of the Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (Brussels Convention), Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels I) and the 1988 Lugano Convention and the 2007 Lugano Convention (Lugano Convention). The Brussels Convention determines which member states' courts have jurisdiction and how the judgments of a court of one member state acting under the Convention must be recognised and enforced in another member state. The Brussels Convention also formed the basis of the Lugano Convention which extended the rules on jurisdiction and enforcement of judgments to the European Free Trade Association countries. For all member states except Denmark, the Brussels Convention was replaced from 1 March 2002 by Brussels I. Brussels I is directly applicable and forms part of the body of EU law. Also applicable is Council Regulation (EC) No 2201/2003 of 27 November 2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility. Matrimonial matters include divorce, annulment and legal separation but do not include, for example, the property consequences of marriage and the grounds for divorce.

The basic rule of the Brussels regime is that a defendant must be sued in the courts of his domicile. However when attempting to determine which court will have jurisdiction to hear a particular matter, the first step should always be to determine the type of dispute at hand as there are some exceptions to the basic rule. For example disputes as to rights in rem on immoveable property, the jurisdiction to hear the dispute is conferred on the member state in which the property is situated.

It is possible that the courts of more than one member state may have jurisdiction over a matter. In such situations it is generally the court in which proceedings were commenced first which takes priority.

In respect of the recognition and enforcement of foreign judgments, in order to be enforceable a judgment must meet certain criteria. Firstly, it must be for a definite monetary sum. Secondly, the foreign judgment must be final and conclusive. Finally, the judgment must have been given by a court of competent jurisdiction.

A recast Brussels I regulation became effective from January 2015. The recast regulation now also applies to jurisdiction in respect of non-EU residents. It abolishes formalities for the recognition of judgments and simplifies the procedure for a court chosen by the parties to commence proceedings (even if proceedings have started in another member state already).

For disputes falling outside of the scope of the Brussels and Lugano regimes, the common law rules apply. The procedural rules in respect of service outside of the state and the appropriate forum to hear disputes are set out in the Irish Rules of the Superior Courts and are laid down in case law. Irish courts will apply the doctrine of forum non conveniens whereby they may refuse jurisdiction to hear a dispute where they are of the opinion that there is a more appropriate forum.

1.2.2 What approach do local courts take to conflict of laws?

Regulation (EC) No 593/2008 on the law applicable to contractual obligations (Rome I Regulation) and Regulation (EC) No 864/2007 on the law applicable to non-contractual obligations (Rome II Regulation) determine the correct law to be applied to cross-border disputes arising between parties from different EU member states. These Regulations replaced the Convention on the Law Applicable to Contractual Obligations 1980 (Rome Convention). The Rome I Regulation deals with the proper law to be applied to contractual disputes and provides that typically, the law to be applied in relation to breaches of contract should be the law of the country with which the contract is most closely connected. The Rome II Regulation deals with non-contractual disputes such as torts and delicts (civil wrongs). It provides broadly that the law to be applied is that of the member state in which the wrong was committed or the injury sustained. There are however a series of exceptions to the general rules.

The Irish Common Law rules will apply where one or more of the parties to the dispute are not within the scope of the Rome regime. The Irish courts apply the doctrine of renvoi whereby disputes can be referred back to courts in the jurisdiction where the proper law of the dispute should be applied. These rules are notoriously complex.

Where there are foreign elements to a will or succession matter, and a conflict of law arises, the connecting factor used by the Irish courts is the domicile of the deceased and the lex domicili (law of the domicile) is applied. However in respect of immovable property it is the lex situs (law of the place where the property is situated) which is applied.

Ireland did not exercise its right to opt in to the Regulation 650/2012 on jurisdiction, applicable law, recognition and enforcement of decisions and acceptance and enforcement of authentic instruments in matters of succession and on the creation of a European Certificate of Succession (Succession Regulation) pursuant to Title V under Protocol 21 of the Treaty on the Functioning of the European Union. The regulation may still have relevance however for Irish clients where they die habitually resident in a participating member state or if a valid professio juris (election for the law of the individual's nationality to be applied to his estate in will) in favour of a participating member state has been made. In such cases there may be a conflict of laws with regard to the law of the domicile of the individual and the law of the state in which he was habitually resident.

Another practical concern is the fact that there is no distinction between member states and participating member states in the final text of the Succession Regulation and so there exists some ambiguity in respect of the position of Ireland, the UK and Denmark.


2.1 What are the criteria for liability to main taxes?

The tax treatment of an individual in Ireland will depend on whether they are Irish resident, ordinarily resident or domiciled. There is no statutory definition of domicile. Domicile is a legal concept and can be broadly defined as a person's natural home. Every individual is born with a domicile of origin. It is possible for a person to lose their domicile of origin and acquire a domicile of choice. Likewise it is possible for an individual to lose their domicile of choice and revive their domicile of origin. Domicile is an important concept under Irish law as it is relevant not only for tax purposes but also for determining the rules of succession.

There is a statutory definition of tax residence in Ireland (noted below). Where an individual is resident and domiciled in Ireland, they will be taxable on their worldwide income, regardless of its source. If a person is resident or ordinarily resident but not domiciled, then liability to income tax and capital gains is limited to Irish source income and Irish gains and other income and gains to the extent they are remitted to Ireland.

The residence test

A person will be regarded as Irish resident if they are:

  • Present in the state for a period of 183 days or more in the tax year (which is a calendar year).
  • Present in the state for a period of 280 days or more in the current and previous tax year, subject to the provision that where a person is present here for 30 days or less, he will not be regarded as resident for that tax year.

If a person is present during any part of the day, he or she is considered resident for that full day for the purpose of the residency rules.

The final issue is that of ordinary residence. Under section 820 of the Taxes Consolidation Act 1997, an individual becomes ordinarily resident in Ireland for a tax year after he has been resident in the state for three consecutive tax years. The individual continues to be treated as ordinarily resident for the subsequent tax years.

The legislation further provides that an individual who has become ordinarily resident in Ireland for a tax year shall not cease to be so ordinarily resident until after an individual has had three consecutive years in which he was not resident in the state.

Notwithstanding that an individual may not be resident for a particular tax year, ordinary residence is sufficient to bring an Irish domiciled individual within the Irish charge to capital gains tax on worldwide disposals. A person who is ordinarily resident and domiciled but non-resident is liable to income tax on their worldwide income, with the exception of (i) income from a trade or profession, no part of which is exercised in the state; or (ii) an office or employment all the duties of which are exercised outside the state.

Such a person is liable in respect of all other income (investment income) in excess of EUR3,810 and capital gains.

2.2 What are the relevant main taxes in your jurisdiction?

The following taxes apply:

  • Income tax.
  • Corporation tax.
  • Capital acquisitions tax (CAT) (gift/inheritance tax).
  • Capital gains tax (CGT).
  • Stamp duty.
  • Local property tax (LPT).
  • VAT.

2.3 Enforcement/collection of taxes

2.3.1 What are the basic procedures for collection and enforcement?

The Irish tax system is largely based on self-assessment, with income tax, corporation tax, CGT, CAT, stamp duty, LPT and VAT all being collected in this manner.

For the self-assessment system to work, there are deterrents to non-compliance. The Collector General's Office of the Revenue Commissioners has responsibility for collecting the taxes due and for pursuing tax payers when they fail to comply with their tax obligations.

Revenue powers

The main methods used by the Revenue Commissioners to encourage the timely payment of taxes are:

  • Interest and penalties – Interest may be charged at 0.0219% per day (or part of a day) on the late payment of income tax, corporation tax, CGT, CAT and stamp duty and 8% per annum for the late payment of LPT. In addition, penalties or surcharges may apply for incorrect or late payments.
  • Issuing demands – The Revenue Commissioners may issue various types of demands for payment of outstanding tax liabilities.
  • Audits and investigations – The Revenue Commissioners may audit at random the calculation of tax liabilities and interest. Where the Revenue Commissioners have strong concerns of serious tax offences having occurred, an investigation into a taxpayer's affairs may be ordered.
  • Right to information – The Revenue Commissioners may seek books, documents and other information from taxpayers or third parties in respect of a liability and where necessary may apply to the High Court for an order directing compliance.
  • Power to enter premises – agents for the Revenue Commissioners may enter a business premises at any reasonable time in order to inspect records relevant to establishing or verifying any tax liability.
  • Other measures – The Revenue Commissioners may also encourage compliance by taking such measures as withholding repayments of tax due to the taxpayer or not issuing a tax clearance certificate.


The most frequently used enforcement measures are:

  • Recovery action by the Sheriff – A Sheriff may seize certain assets from the taxpayer in respect of outstanding liabilities.
  • Notice of attachment – The Revenue Commissioners may recover a tax debt by issuing a Notice of Attachment to an amount owed to the defaulting taxpayer by a third party debtor.
  • Referral of the case to Revenue Solicitor – Tax debts may be referred to Revenue appointed lawyers for the purposes of pursuing collection through the court process. The Revenue Commissioners may then seek to recover the tax debt by way of enforcement of a judgment in their favour by forced sale of an asset that is the subject of a judgment mortgage, by way of an instalment order granted by the court followed by committal to prison in the event of non-payment, or by way of a bankruptcy petition (or a petition to wind up a company in the case of a debtor company).
  • Criminal proceedings – Irish tax law provides for both civil penalties and criminal sanctions for the failure to make a return, the making of a false return, facilitating the making of a false return, or claiming tax credits, allowances or reliefs which are not due.

Instalment arrangements

If justifiable in the circumstances of the individual taxpayer or business, the Revenue Commissioners may, as a concession, permit a taxpayer to pay their tax debt, including interest, by way of a phased payment arrangement.

2.3.2 To what extent is non-compliance an issue?

Tax compliance rates have improved markedly over the years due to significant deterrents and a robust enforcement framework. In 2014, compliance interventions including audits yielded EUR610 million including interest and penalties. A total of 1,199 tax defaulters' names were published and there were 25 successful prosecutions for serious tax evasion and fraud offences. The compliance rate for large cases (EUR500,000+ annual tax liability) was 99%; the compliance rate for medium cases (EUR75,000 – EUR500,000 annual tax liability) was 97%; and the compliance rate for small cases (all other cases) was 83%. The compliance rate for local property tax of 95% was much higher than expected considering the level of resistance upon its introduction.

2.3.3 Describe circumstances in which default can lead to imprisonment

Once a court judgment has been obtained, the Revenue Commissioners can apply to have the court examine the taxpayer's means and make an instalment order for payment of the tax debt based on the taxpayer's ability to pay. If a taxpayer fails to honour an instalment order, the Revenue Commissioners can apply to the court for a committal order. Furthermore if convicted of certain tax evasion offences, a significant jail term could ensue.

2.3.4 Any recent law on extradition for tax offences?

Extradition between EU member states is governed by the European Arrest Warrant Framework Decision. This was implemented in Ireland by the European Arrest Warrant Act 2003. Extradition to other countries from Ireland is governed by the Extradition Act 1965, as amended. In addition, Ireland is party to several multilateral treaties on extradition, the most notable of which are the 1957 European Convention on Extradition and extradition treaties with the US and Australia.

Section 13 of the Extradition Act 1965 follows the well-established principle of international law that one state will not enforce directly or indirectly the revenue laws of a foreign country. Prior to amendment by the Extradition (European Union Convention) Act 2001, section 13 provided that extradition would not be granted for revenue offences. This exception was diluted by a 2001 Act and section 13 now provides that extradition will not be granted for revenue offences unless the relevant extradition provisions otherwise provide.

This amendment gives effect to Article 6 of the European Union Convention on Extradition of 1996 which makes revenue offences extraditable between EU member states. This allows for extradition for revenue offences to be included in any future agreements that may be negotiated.

More changes were brought about by the European Arrest Warrant Act 2003. The Act is silent on the issue of whether there is an exception from extradition for revenue offences. It may therefore be assumed that there is no statutory revenue offence exception to extradition between EU member states.

2.3.5 Have there been any recent changes of behaviour by tax authorities?

The Revenue Commissioners are currently undergoing a consultation process on their 2015-2017 statement of strategy. The focus in the last number of years has been the issue of the cash-based "black economy" and the seizure of cigarettes, fuel and other items which have not been cleared through customs. There has also been a renewed focus on the collection of vehicle registration tax. There will be an emphasis on the efficient collection and processing of the impending water charges.

On the international level, the Revenue Commissioners are engaging with the Organisation for Economic Co-operation and Development Base Erosion and Profit Shifting project in order to come up with a framework to prevent the reduction of tax by multi-national corporations through jurisdictional arbitrage.

2.3.6 Are there any voluntary disclosure or amnesty programmes?

There is currently no formal amnesty procedure in Ireland. The Revenue Commissioners' Code of Practice for Revenue Audit and other Compliance Interventions does, however, allow for prompted and unprompted disclosures which may have the effect of mitigating penalties that would otherwise apply.

In recent years, the Revenue Commissioners have announced a series of voluntary disclosure initiatives which allow taxpayers to come forward and make a disclosure as to previously undisclosed tax liabilities. The disclosure must state the amounts of all liabilities to tax, interest and penalties with regard to all relevant tax heads and must be accompanied by payment of the total liability. The benefit to the taxpayer of making such a disclosure is that it entitles the taxpayer to significant mitigation of penalties. Furthermore, cases are not published where a qualifying disclosure is accepted.

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This article first appeared in the European Lawyer Reference Series, 3rd Edition of Private Client Tax.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.