Global Daily Tax News, Ireland Updates Guidance On Anti-Hybrid Rules, (Dec 1, 2025)

The Irish Revenue has updated its guidance on the nation's anti-hybrid rules.

Tax and Duty Manual Part 35C-00-01 has been updated to reflect changes to the application of the associated enterprises test in relation to partnerships.

Further, the guidance newly confirms that partners in a partnership will always be considered to be "acting together" with respect to the voting rights of shares held through a partnership.

The updates are to Sections 3.3.2 and 7.3 of the guidance.

The guidance concerns provisions implemented by Ireland in response to the second Anti-Tax Avoidance Directive, which are intended to prevent arrangements that exploit the differences in the tax treatment of an instrument or entity arising from the way in which that instrument or entity is characterized under the tax laws of two or more territories to generate a tax advantage or a mismatch outcome.

A hybrid mismatch outcome arises due to differences in the tax characterization, or the hybrid nature, of an instrument or entity.

The guidance is intended to provide guidance as to the various concepts that arise in the anti-hybrid rules.