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Tax Indemnification Agreement Template for Ireland

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Key Requirements PROMPT example:

Tax Indemnification Agreement

"I need a Tax Indemnification Agreement governed by Irish law for the sale of my technology company to a multinational corporation, specifically covering historical R&D tax credits and potential VAT liabilities for the period up to January 2025."

Document background
The Tax Indemnification Agreement is a crucial document in Irish corporate and commercial transactions, particularly in mergers, acquisitions, corporate restructurings, and business separations. It is designed to allocate tax risks and responsibilities between parties by clearly defining which party will bear the burden of specific tax liabilities, including historical tax exposures, pending assessments, and future tax claims. The agreement operates within the framework of Irish tax law and is structured to comply with requirements set by the Irish Revenue Commissioners. It becomes particularly important in scenarios where businesses are being transferred, assets are being sold, or corporate groups are being reorganized, as it provides certainty regarding the handling of pre-closing and post-closing tax liabilities. The document typically includes detailed mechanisms for managing tax claims, specific indemnification triggers, and procedures for resolving tax-related disputes.
Suggested Sections

1. Parties: Identification of the Indemnitor and Indemnitee and their registered details

2. Background: Context of the agreement, including the underlying transaction or relationship giving rise to the tax indemnification

3. Definitions: Detailed definitions of key terms including 'Tax', 'Tax Liability', 'Tax Claim', 'Tax Authority', and other relevant terms

4. Scope of Indemnification: Clear outline of the tax matters covered by the indemnification and the extent of coverage

5. Indemnification Obligations: Detailed provisions regarding the Indemnitor's obligations to pay and indemnify

6. Payment Mechanisms: Procedures and timelines for making indemnification payments

7. Claims Procedure: Process for notifying and handling tax claims, including cooperation requirements

8. Limitations: Time limits, financial caps, and other limitations on the indemnification obligations

9. Conduct of Tax Matters: Rights and obligations regarding the conduct of tax audits, investigations, and disputes

10. Representations and Warranties: Basic representations regarding tax matters and authority to enter agreement

11. Governing Law and Jurisdiction: Specification of Irish law as governing law and jurisdiction for disputes

12. General Provisions: Standard boilerplate clauses including notices, amendments, and severability

Optional Sections

1. Tax Gross-Up: Additional provisions for grossing up payments to account for tax on indemnification payments - include when payments may themselves be taxable

2. Cross-Border Provisions: Special provisions dealing with international tax aspects - include when parties are in different jurisdictions

3. VAT-Specific Provisions: Detailed provisions specifically dealing with VAT indemnification - include when VAT is a significant concern

4. Tax Records and Access: Detailed provisions regarding maintenance and access to tax records - include for complex tax situations

5. Third Party Rights: Provisions dealing with rights of third parties - include when other parties may have interests in the tax matters

6. Tax Insurance Provisions: Provisions relating to tax liability insurance - include when tax insurance is part of the arrangement

7. Change in Law: Provisions dealing with changes in tax law - include when agreement is long-term or covers future tax periods

Suggested Schedules

1. Schedule 1 - Covered Tax Matters: Detailed list of specific taxes and tax matters covered by the indemnification

2. Schedule 2 - Calculation Methodology: Methodology for calculating tax liabilities and indemnification amounts

3. Schedule 3 - Claims Procedures: Detailed procedures and timelines for making and responding to tax claims

4. Schedule 4 - Excluded Tax Matters: List of specific tax matters excluded from the scope of indemnification

5. Appendix A - Form of Tax Claim Notice: Standard form for notifying tax claims under the agreement

6. Appendix B - Contact Details: Contact details for notices and communications regarding tax matters

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

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Company Secretariat

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Chief Financial Officer

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