Tax clearance certificate in Ireland: how companies get one

Tax clearance is issued under sections 1094 and 1095 of the Taxes Consolidation Act 1997. Revenue holds your status on its system, keeps checking it, and gives you a Tax Clearance Access Number (TCAN) so that others can confirm it. Revenue's own wording is that the certificate confirms your tax affairs are in order at the date of issue. It is a snapshot backed by ongoing monitoring, not a permanent stamp.

Revenue lists the main situations where a certificate is needed: applying for or renewing certain licences and schemes, applying for certain grants and public sector contracts, and a small number of other purposes. Outside those, nobody is legally obliged to ask for it, but many commercial lenders do. See our glossary entry on tax clearance for a short definition.

A lender is not checking Revenue's paperwork for its own sake. It wants comfort on three points:

• No hidden tax arrears. Revenue has strong collection powers, and a large unpaid tax bill can take cash ahead of loan repayments.
• Returns are filed. A company that is behind on CT1, VATA tax charged on most goods and services supplied in Ireland, collected by VAT-registered businesses and paid to Revenue. or payroll returns may also be behind on its management information, which makes the accounts you submit less reliable.
• The directors and controlling owners are compliant too, because Revenue's connected-person checks extend beyond the company itself.

Not every lender asks for it, and some will consider a company on an agreed Revenue payment plan. But a missing or refused certificate is one of the most common reasons an otherwise sound application stalls. It sits alongside the other items in our checklist of documents for a business loan application, and our guide to business loan requirements explains where tax compliance fits in a lender’s wider checks.

Revenue's system checks everything at once, so tidy up first. Work through this list with your accountant or bookkeeper:

• Corporation taxThe tax Irish-resident companies pay on their profits.: CT1 returns filed for all periods due, and preliminary taxAn advance payment of corporation tax made before the end of a company's accounting period. paid on time.
• VAT: every VAT 3 return filed, including nil returns.
• Payroll: monthly PAYE submissions made and the amounts due paid.
• Relevant Contracts TaxA withholding tax that applies when a principal contractor pays a subcontractor for work in construction, forestry or meat processing.: if your company is a principal contractor, deduction summaries filed and RCT paid.
• Connected persons: at least one director's details on record, and any director or other person who controls more than half of the company up to date with their own tax.
• Other items Revenue links to the company, such as properties it owns and partnerships it is a member of.
• Any arrears either paid or covered by an agreed phased payment arrangementAn agreement with Revenue to clear overdue tax in instalments rather than in one lump sum..

Business customers apply through ROS. You need ROS access for the company, either directly or through your tax agent.

1. Log in to ROS. Either open the Manage Tax Clearance option under the My Services tab, or click the tax clearance status shown at the top right of the ROS home screen.
2. Choose Apply and select the reason for your application from the list.
3. Check the Review your details screen. It lists the connected persons and properties Revenue holds for your company. You are responsible for making sure these are accurate, so update anything out of date before you continue.
4. Complete the application and submit the declaration.
5. Read the result. If your affairs are in order, Revenue issues the certificate with a TCAN. If not, the screen shows the reasons for refusal. The result is also sent to your ROS inbox.
6. Save or print the result screen. You can view, print or save it again later under Manage Tax Clearance.

Most applications are assessed automatically in seconds. Some need a manual check by a Revenue caseworker, for example where arrears are covered by a phased payment arrangement. These show as under review. Revenue does not publish a set timeframe for reviews, so allow extra time if a lender or tender deadline is close (our guide to how long a business loan takes shows where tax clearance fits in the timeline), and quote your tax reference number or application reference when you contact Revenue.

This is the part that surprises most company owners. When a company applies, Revenue checks more than the company's own record. Its guidance for company applicants lists:

• Directors who own more than half of the company. The company must supply at least one director.
• Other people who own more than half of the company.
• Properties connected to the company.
• Partnerships in which the company is a member.
• Where relevant, the VAT compliance of the remitting company in a VAT group.

So if your company is fully up to date but its majority owner has an outstanding personal tax return or an unpaid personal tax bill, the company's application can be refused. Check the personal tax positions of the directors and owners in myAccount or ROS before the company applies.

A certificate stays valid for as long as your company remains compliant, up to a maximum period that depends on the reason you gave:

• Grant applications: valid for one year, so you need to apply again each year.
• All other purposes: valid for up to four years.

The eTC system checks holders' compliance regularly, and Revenue officials can reassess a case at any time. If a VAT return is missed or a payment goes unpaid, the certificate can be withdrawn in the middle of its term. Many lenders therefore verify your status close to drawdown, not just at application.

Revenue does not print tax clearance certificatesConfirmation from Revenue that a company's tax affairs are in order.. To prove your status, give the lender or public body your TCAN and your company's tax reference number. They then verify your status online with Revenue. You can also send a copy of the result screen from ROS, but the TCAN check is what most organisations rely on, because it shows your status on the day they check rather than the day you printed it.

A refusal is not a penalty. It means Revenue's system has found something outstanding. The result screen lists the reasons. Withdrawals come with a letter to your ROS inbox, with a schedule of the reasons. Your options are:

1. Fix the issue and reapply. File missing returns, pay what is due, or ask the connected person to bring their affairs up to date. Then submit a new eTC application. There is no automatic re-check, so you must apply again.
2. Agree a phased payment arrangement (PPA). Revenue's eTC manual confirms a certificate may be issued where arrears are covered by an agreed phased payment arrangement. The standard maximum term is 36 months, with up to 60 months possible where the business case supports it. Our guide to phased payment arrangements versus tax funding compares the two routes.
3. Clear the arrears with funding. Some companies use a general business loan to pay a tax bill in full, then reapply. This only makes sense if the company can afford the repayments and the total cost compares well with a PPA.
4. Appeal. You can appeal a refusal to the Tax Appeals Commission within 30 days of the refusal notice, stating your grounds in detail and including a copy of the refusal. You cannot appeal the amount of tax, duty or interest due through this route, and any undisputed amount must be paid.

Illustrative example

Construction companies sometimes confuse tax clearance with their Relevant Contracts Tax deduction rate. They are separate. Your RCT rate of 0%, 20% or 35% is set by Revenue's RCT rate reviews, which look at your compliance history and that of your directors and larger owners. A good compliance record helps with both, but holding a certificate does not set your RCT rate. Our guide to RCT and cash flow for construction companies explains how the rate works.

If your company needs to pay a tax bill to restore its compliance, a general business loan from one of the specialist lenders on our panel may help in some cases. See tax and VAT funding and try the tax and VAT funding calculator to model repayments first. Tell us what your company needs and we'll tell you honestly whether our panel can help, or where to apply instead. We do not charge your company a fee and never ask for payment upfront; lenders pay us commission when finance completes. Welcome Finance is a commercial finance broker, not a lender, and is not regulated by the Central Bank of IrelandIreland's financial regulator and part of the Eurosystem.. We work only with limited companies registered in Ireland (LTD, DACA type of Irish private company under Part 16 of the Companies Act 2014 that keeps an objects clause in its constitution, limiting what it can do, and uses the suffix DAC., PLCA company type under Part 17 of the Companies Act 2014., ULCA company under Part 19 of the Companies Act 2014 whose members have unlimited liability for its debts.).