Advanced Taxation Flynn Construction Company Limited

Question: Discuss about theAdvanced Taxationfor Flynn Construction Company Limited. Answer: Summary of the Case on Revenue Commissioners v OFlynn Construction Company Limited Issues: The case involves the composite transactions completed for the period from December 5 1991 to January 1992 with respect to profit derived from the qualifying exports to be exempted from the liability under corporate tax[1]. The case involved the issue on assessment of dividend declaration from the profit earned, which was relieved from the shareholders income tax. It was also observed that the case incorporated the certain addition under the basic scheme; it was considered that the dividend payment had been devalued since the securities of the exporting organization were held by other organizations. Facts: Facts of the case incorporated scheme under which the directors of the company received 60 million punts of dividend incentives as a tax- free scheme. It was noted that the taxpayer contended that the dividend should be disallowed from the assessment of the revenue since it was considered as tax avoidance, which associates with the transactions of export sales in order to avail the tax reliefs. Analysis of decision: Considering the issues and facts of the case, it was considered the company was engaged in the business of construction but it was not involved in goods manufacturing process while the company was also not involved in the business of exports. Accordingly, the Commissioner of Revenue contended that the steps incorporated by the taxpayer company involved tax avoidance measures and undertook several tax advantages to avoid the tax liability as per the Act of Corporations Act[2]. According to the regulations of Corporation tax in the region of Republic of Ireland is levied on the amount of profits earned by the companies with respect to the business operations. For the companies engaged in the manufacturing or construction business required to pay 10% together with the applicability of special rates in terms of advance tax rules[3]. Accordingly, in the present case study, judgment given by Supreme Court provided that the company entered in the dispute and unfair tra nsaction to avoid the tax therefore, distribution of dividend to the shareholders of the company would attract tax liability. Relevant case laws and cases: Regulations of Corporate tax in Ireland states that the business organizations if the company is involved in the unquoted securities, which is up to 90% of the tax, value reduction. Further, Corporation tax also provides tax credits for several business transactions that do not incorporate payment of dividend incentives[4]. Similar to the case of Revenue Commissioners v. Doorley Ors (1933) 1 I.R. 750, court held the taxpayer was involved in tax avoidance acts as per section 86 of Finance Act 1989 amended as section 811 under Tax Consolidation Act 1997. Reference List Cadot, Olivier, et al. "Are the benefits of export support durable? Evidence from Tunisia."Journal of International Economics (2015)97.2: 310-324. Contractor, Farok J. "Tax Avoidance by Multinational Companies: Methods, Policies, and Ethics."AIB Insights(2016) 16.2: 10. Grg, Holger, and Eric Strobl. "Does corporate taxation deter multinationals? Evidence from a historic event in Ireland."The World Economy(2015) 38.5: 788-804. 'Irish Statute Book' (Irishstatutebook.ie, 2017) https://www.irishstatutebook.ie accessed 4 February 2017