Apple and Ireland agree on possible €13 billion repayment

Apple and Ireland have agreed on the payment of the equivalent of 13 billion euros to Ireland. The money, Irish tax credit that Apple received, will be deposited into a separate account. Whether it will be repaid to Ireland is still subject to the judgment of the EU Court.

Ireland’s Chancellor of the Exchequer Paschal Donohoe has said his government has agreed with Apple on the terms and operation of the trust account into which the funds will be deposited. Donohoe expects Apple to begin depositing funds into this account sometime in the first quarter of 2018, The Wall Street Journal reported.

The case is currently still before the European Court of Justice, which must consider the legality of the tax structure and the European Commission’s judgment that there is unlawful state aid in the form of tax benefits. Apple previously appealed the Commission’s decision; Ireland later did the same. Pending the judgment of the EU Court, the money remains in the separate third-party account. So it is not yet certain whether Apple will actually pay the money to Ireland.

In August 2016, the European Commission announced its decision on tax refunds. The Irish tax law meant that the profits of Apple Sales International and Apple Operations Europe remained largely untaxed, so that, according to the Commission, there was in fact state aid. Due to two decisions by Ireland against Apple companies, the effective tax rate was 1 and 0.005 percent in 2003 and 2014, respectively.