The recently published 2021 Annual Report of the Tax Appeals Commission (the "TAC") illustrates the TAC's continuing success and efficiency as a forum for resolving complex and high-value tax disputes. Interestingly, the report highlights that 41% of appeals closed in 2021 (representing approx. €2.23 billion of disputed tax) were resolved by settlement between the parties.
2021 Headline Statistics
The main statistics emerging from the report demonstrate that the TAC continues to be an extremely active adjudicative body, with taxpayers remitting appeals to the TAC on a wide range of tax matters.
Key points highlighted in the report include:
- 1,793 appeals (representing €3.146 billion of disputed tax, over 90% of which was corporation tax) were closed by the TAC in 2021. This is the highest number of cases closed by the TAC in a single year to date.
- 1,476 appeals were received by the TAC in 2021, an increase of over 750 cases from 2020. However, more appeals were closed than received for the second year in a row, demonstrating the TAC's growing efficiency.
- 130 determinations were issued by the TAC in 2021, a slight drop from the 171 determinations issued in 2020 but, by way of comparison, considerably higher than the 42 determinations issued in 2018.
- 22 appeals against determinations of the TAC (by case stated to the High Court) were filed in 2021 (down from 28 in 2020).
Settlement of Disputes at TAC
The role that TAC proceedings can play in facilitating practical resolution of tax disputes is illustrated by the significant number of cases closed in 2021 by settlement (€2.247 billion or 71% of the total tax in dispute in cases closed during the year).
Of the 188 appeal hearings scheduled to take place in 2021 (representing €1.962 billion of disputed tax) 32 were settled or withdrawn prior to a hearing taking place. Interestingly, these 32 cases represented 92% of the total tax in dispute in the 188 cases that were scheduled for hearing during the year. This indicates that higher value cases were more likely to be settled at a later stage in the process.
Advice for Clients
It is clear from the report that the TAC has become a very efficient forum for tax dispute resolution – both by way of final determination and through facilitating settlement. The Annual Report also reflects the continuing trend of high value tax disputes coming before the TAC.
Taking into account the other beneficial features of the TAC process (eg, greater procedural flexibility and less formality, EU law jurisdiction, in camera proceedings), taxpayers should consider the suitability of the TAC in all disputes with Irish Revenue.
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.