For a close company, where distributable estate and investment income for an accounting period exceeds distributions, an additional corporation tax surcharge of 20% is charged on the excess. No surcharge applies where the excess is equal to or less than the lesser of €2,000 (pro rata if the accounting period is less than 12 months) and €2,000 divided by one plus the number of associated companies (pro rata if the period is less than 12 months). Where the excess is greater than that lesser amount, the surcharge is limited to 80% of the amount by which the excess exceeds that lesser amount.

If the aggregate of accumulated undistributed income at the period end and amounts transferred to capital reserves or used to issue shares as paid up otherwise than for new consideration (or otherwise used so as to reduce that accumulated income) is less than the excess, that aggregate substitutes for the excess. An associated company that has not carried on trade or business in the accounting period is disregarded; associated companies are counted even if associated for only part of the period and are counted separately if associated in different parts. The surcharge is charged for the earliest accounting period ending on or after 12 months after the end of the relevant period (or, if none, for the period in respect of which it is made) and is treated as corporation tax; corporation tax assessment, collection and recovery provisions apply to the surcharge.