The High Court has upheld an Appeal Commissioner’s finding that 6 Raglan Road in Dublin was not a permanent home available to the appellant during the 2000/2001 tax year under the Ireland-Portugal Double Taxation Convention.
The court was answering a case stated on a question of law under section 941 of the Taxes Consolidation Act 1997. The Inspector of Taxes challenged the Appeal Commissioner’s 2003 determination, which had effectively allowed the appellant’s appeal against a capital gains tax assessment. The High Court’s question was whether the Appeal Commissioner was correct to find that the Dublin property was not a permanent home available to the appellant. It answered yes.
The assessment, raised in October 2002, was €57,848,753 for the 2000/2001 tax year. The dispute arose after the appellant disposed of Esat Telecom shares in exchange for loan notes and later sold those notes. The appellant’s case was that he was not deemed resident in Ireland under the treaty’s tie-breaker rule because he had no permanent home available here. His Portuguese tax residence was accepted by the Portuguese authorities and was not contested by the Inspector; the Inspector maintained that the appellant was also resident in Ireland and that the Raglan Road property was available to him as a permanent home.
The property was bought in May 2000 by Parteney Limited, a company controlled by the appellant. It had previously been the White family home. The appellant and his family had moved to Portugal in February 2000, where they had their home during the relevant period. The Appeal Commissioner found that the family had never lived at Raglan Road before the end of the tax year in question. Extensive refurbishment began in June 2000, and the premises were under building works through 2001. The appellant’s wife took a one-year lease in February 2002; the family later occupied the house during visits to Ireland.
The High Court considered the treaty language in light of the OECD Commentary and relevant legal analysis. It concluded that the treaty test required more than control of a residential property: it also had to qualify as the individual’s “home”, be permanent, and be continuously available for use. The court accepted the Appeal Commissioner’s conclusion that there was no personal link between the appellant and the property during the relevant period, and that the works made it unavailable for residential use from June 2000 to February 2002. It also found that the facts did not show an intention to keep it for permanent use as a home.
The court held that the Appeal Commissioner had not taken a mistaken view of the law or drawn unreasonable inferences. Its answer resolved only the permanent-home question. The judgment said that, had the Appeal Commissioner’s decision been overturned, the matter would have had to return to him to decide the separate centre of vital interests test. The High Court did not reach that test.