Advanced Taxation Ryanair Limited

Question: Discuss about the Advanced Taxation for Ryanair Limited. Answer: Introduction The present study incorporates a case summary between Ryanair Limited and The Revenue Commissioners by considering the point of law, background of the case along with the facts. The discussion also covers the concept on revenue position including the discussion on misinterpretation of Rompleman and Centime case laws. The study involves discussion on the eligibility of taxable person as per the regulations under Value Added Tax Act 1972. In addition, the discussion also involves explanation based on CIBO case for considering taxable revenues for the department. Discussion The present case of Ryanair Limited v The Revenue Commissioners (2013) IEHC 195 contains an issue on determination of appellants entitlement for deducting input VAT on the amount of professional fees. It has been noted that the taxpayer was involved in the business of transportation of air passenger and the income derived from the business was not subjected to Irish VAT. However, the taxpayer claimed his entitlement for reclaiming the amount of input VAT on the service cost in relation to the business activities (Strangio and Tamborrino 2016). It has been stated in the case that a taxpayer is entitled to deduct an amount only during the time of chargeability of deductible tax. In the given case, the appellant earned VAT on the professional fees with respect to Bid in which the taxpayer claimed deduction based on the taxable supplies. The court in this connection contended the valuation and inclusion of Value Added Tax for supply of goods and services in accordance with the VAT regulations as per Irish Tax Act. Further, the court considered the concept of taxable person as per the regulation under Article 4 that provides a taxable person is considered as an independent individual who carries economic activity in any place comprising the producers or traders activity (Irishstatutebook.ie 2017). Under the rulings in case of Ropelman v Minister van Finance, the court contended that the attainment of right for the future property transfer was an economic activity. The court considered the contents of Article 4(1) on harmonization of law that is related to the turnover tax consists in several commercial transactions. It has been clarified that the asset acquisition, immovable property acquisition and transfer of rights consists as a part of commercial transactions hence, should be considered as economic activity (Pfeif fer 2015). Similarly, in case of Centime Limited v Crawford Inspector of Taxes (2005) IEHC 328, the respondent required repayment of VAT that was charged by the concerned suppliers. However, it was contended under the rulings that the appellant was having taxable interest in the transfer of property before the registration on VAT has been made (Harris 2015). The court held that the appellant had clear purpose to develop the football stadium meant to be used for other activities; hence it was considered as economic activity for the purpose of VAT. The present case contained the proceedings based on the regulations of section 941 under VAT Consolidation Act 2010. The court held that the appellant conducted a formal bid in order to purchase the securities of Aer Lingus with an intention to operate the business of airline through a single group but with different brands. It was further contended that the business will be conducted by using substantial proficiency to enhance Aer Linguss performance. Even though the appellant could not win the entire bid, Ryanair Limited acquired a part of share capital which was not considered as significant acquisition (Webb et al. 2013). On the contrary, court held that the appellant, Ryanair Limited incurred Value Added Tax on the professional fees that was paid with respect to the process of Bid. The respondent that is Revenue Commissioner refused to allow the claim for deducting Value Added Tax based on the condition that the bid was not an economic activity and it was not connected to the ta xpayers general business. However, the court held that the bid was conducted to acquire rights on shares for future transactions hence, it shall consists a part of economic activity and hence the appellant is entitled to claim VAT deduction paid of professional fees (Marcum, Martin and Strickland 2015). Conclusion In view of the above case discussion, it can be said that deduction of Value Added Tax on the taxable supplies can be claimed on the basis of economic activities as per the regulations stated in Irish Tax Act. The given case provided that the appellant was entitled to claim VAT deduction on the professional fees incurred for bid process as the bid was conducted to acquire the acquisition rights for future business transactions. The process was held to be an economic activity as per Article 4(1) hence; Ryanair Limited was entitled to claim VAT deduction. Reference List Harris, D., 2015. International Tax Implications of the Organisation for Economic Co-operation and Development Proposal to Neutralize Hybrid Mismatch Arrangements.Cath. UL Rev.,65, p.635. Irishstatutebook.ie. 2017. Irish Statute Book. [online] Available at: https://www.irishstatutebook.ie [Accessed 7 Apr. 2017]. Marcum, B., Martin, D.R. and Strickland, D., 2015. 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