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Roberts Nathan News
Thank your Employees with a Tax Free Gift this Christmas
|Employee Cash Benefit||€500|
|Treated as net salary so must be re-grossed and taxed by the employer through payroll||€540|
- It must be a non-cash bonus – Most companies opt for gift vouchers to avail of the Scheme.
- The gift voucher must be purchased from company funds – For example from the company bank account or credit card. You cannot purchase the voucher yourself and then seek reimbursement.
- Each individual can only receive one tax-free voucher per annum – Even if the full amount is not utilised. For example, if you give a voucher of €200 in May and €300 in December, the second will be liable to tax. To maximise the tax relief use the full €500 in one go.
- Employees avoid PAYE, PRSI and USC, and employers don’t have to pay PRSI.
- It’s a tax-efficient way of rewarding your staff as these payments can be deducted from year end profits when calculating the Corporation Tax liability.
- Owners/directors whose spouse is also an employee/director can effectively double their benefit to €1,000 in gift vouchers.
- It makes sense to use as a Christmas bonus as the voucher can only be gifted once a year.
How to Complete a Successful Year End Stocktake
Suggested Method for Completion of a StocktakePlan AheadBefore you commence your stocktake you should have a full understanding of the resources and time required, so as to reduce the level of interruption to your business. To minimise disruption to your business a stocktake should be conducted during the quietest time of the day, with most businesses conducting stocktakes outside of business hours.As part of your planning procedures you should also ensure you have:
- A plan of how the stock count will be performed and controlled setting out counters and checkers and the overall objectives
- Stock sheets to enable a full systematic count of stock held
- Recording methods for stocktaking Pens / Calculators /Hand Held Scanners
- After incorporation – The Company’s Annual Return date (ARD) is set as 6 months after this date and is exempt from uploading Financial Statements.
- When the financial year/period end is set for a company the ARD must be submitted 9 months plus 28 day after this date.
- Form B1 – Annual Return
- Form B2 – Change of registered office
- Form B10 – Change of directors or secretaries details
- Form B72 – Nomination of new Annual Return date
Preliminary Tax – What is it?
- 100% of your previous year’s liability, OR
- 90% of your current year liability, OR
- 105% of your pre-preceding year’s liability.
|Income Tax Year ending 31st December 2018||File and Pay your Income Tax by 31st October 2019|
|Preliminary Tax for 2019||File and Pay Preliminary tax by 31st October 2019|
|Accounting Year-end||31st December 2018|
|Corporation Tax Deadline||23rd September 2019|
|Preliminary Tax Deadline||23rd November 2019|
Some Highlights of Budget 2020
- Income tax rates and bands and the USC rates and bands remain unchanged. The Minister for Finance did not want to commit to personal tax cuts in the lead up to a no-deal Brexit.
- The Home carer credit has increased to €1,600 and the Earned income credit has increased to €1,500.
- The Group A threshold for CAT has increased from €320,000 to €335,000. The increased threshold applies to gifts or inheritances received on or after 9 October 2019.
- There was no mention of employer’s PRSI however Budget 2019 announced this would increase from 10.95% to 11.05% from 1 January 2020. Employer’s PRSI has steadily increased over the last few years and represents a significant cost to businesses.
- SARP relief and the Foreign Earnings Deduction have been extended to 31 December 2022.
- In 2018, the Government implemented a 0% BIK rate for electric vehicles subject to a value limit of €50,000 in comparison to a rate of 30% of the car’s original market value for non-electric vehicles. This initiative has been extended to 2022.
- An increase in the credit from 25% to 30%.
- The ability to claim the credit on qualifying expenditure before the company commences trading. It should be noted that any credit claimed in this period can only be offset against VAT and payroll liabilities.
- An increase in the outsourcing limit applicable to third level institutes from 5% to 15%.
- Farm restructuring relief, a capital gains tax relief due to expire at the end of this year, has been extended to 31 December 2022.
- Several amendments will be made to the KEEP scheme to incentivise take-up in the scheme. This includes a change in the definition of a qualifying company so that the scheme applies to group structures and a change in the definition of a qualifying individual so that it applies to part-time and flexible employees.
- EII relief, an income tax relief for individuals who invest funds in certain companies, will also undergo changes which apply from yesterday. The amendments will allow individuals to claim full relief in the year of investment and the annual investment limit will increase from €150,000 to €250,000.
- The Minister for Finance announced there will be a significant overhaul to the DWT regime. From 1 January 2021, real-time date collected under the new PAYE Modernisation regime will be used to create a personalised rate of DWT on distributions received by individuals. In the meantime, an increase in the DWT rate from 20% to 25% will apply from 1 January 2020.
Is there still value in UK car imports post-Brexit?
- Complete a customs electronic declaration
- Pay Customs duty and Value-Added Tax.
- A valid Certificate of Conformity (CoC) that confirms European Union type-approval. Please note that the type approval number on the CoC must correspond to an EU Member State.
- An Individual Approval Certificate issued by the National Standards Authority of Ireland (NSAI).
Potential VAT and Customs Duty implications of trade with the UK post-Brexit
SME’s Welcome Changes to Subsistence Allowance Rates
- Employees and directors can now claim back an additional 10% of the costs incurred completely Tax Free while travelling on business.
- The cost to companies is considered to be an allowable expense for Corporation tax purposes, meaning it can be deducted from taxable profits.
- The daily subsistence ‘5 Hour but less than 10 Hour’ rate increases by 10%.
- The daily subsistence ‘10 hours or more’ rate increases by 10%.
- The increases are in line with the Consumer Price Index.
- The revised standard rates of subsistence allowance are effective from 1 July 2019.
- The standard overnight rate will not be increased.
- A separate Vouched Accommodation (VA) rate continues to apply whereby employees encounter difficulties in sourcing suitable accommodation in Dublin.
How to Calculate Annual Leave Entitlement
- Based on the employee’s working hours in one year. An employee who has worked at least 1,365 hours in the leave year is entitled to the maximum of 4 working weeks’ annual leave.
- By allowing 1/3 of a working week for each calendar month in which the employee has worked at least 117 hours.
- 8% of the hours worked in the leave year, subject to a maximum of 4 weeks.
Are you a UK Based Director of an Irish Registered Company?
- The affairs of the company are managed by one or more persons from a place of business established in the State and that person or those persons is or are authorised by the company to act on its behalf.
- The company carries on a trade in the State.
- The company is a subsidiary or a holding company of a company or other body corporate that satisfies either or both of the conditions specified in 1 and 2.
- The company is a subsidiary of a company, another subsidiary of which satisfies either or both of the conditions specified in 1 and 2.