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Roberts Nathan News
Extended Easter Break for our team!
Temporary Covid-19 Wage Subsidy Scheme
- The scheme will operate to refund employers up to 70% of the net wage paid to employee subject to the thresholds detailed below.
- Refunds under this Scheme will be issued to employers with 2 working days.
- It replaces the previous €203 refund scheme and any employer who opted to operate this scheme will be contacted by Revenue to transfer to this new scheme.
- Employers are encouraged, but not obliged, to top-up the subsidy to bring the net wages of employees as close to 100% as possible.
- The Scheme can be applied even if an employees working hours have been reduced.
- The Scheme will operate in 2 phases:
- The Scheme is available to employers who are:
- During this period the Scheme will refund employers a maximum of €410 regardless of the employee’s income.
- However for administration purposes the employer is being asked to return the following information on the payroll:
- The Scheme does not currently allow for any refund where the employees average net weekly pay is greater than €960 per week.
- No IT, USC or PRSI is to be levied on the subsidy payment through payroll. The subsidy will be liable to IT and USC on review at the end of the year. Revenue have yet to announce how this will operate.
- Employer’s PRSI at a rate of 0.5% (down from 11.5%) applies to any top-up amounts.
- IT and USC should be applied on any top-up amounts.
- It is likely that the Scheme will trigger tax refunds for employees and employers can pay over the tax refunds to employees. Revenue will reimburse the tax refunds to employers.
Government Supports for Covid-19
- The application of interest on late payments is suspended for January/February VAT and both February and March PAYE (Employer) liabilities.
- All debt enforcement activity is suspended until further notice.
- The current tax clearance status will remain in place for all businesses over the coming months.
- The RCT rate review due to be conducted on 28th March 2020 has been suspended.
- If you do not currently hold a Public Services Card an application form for the new Covid-19 Pandemic Unemployment Payment can be completed and returned to FREEPOST PO BOX 12896, Dublin 1;
- You can apply for Jobseekers support through the online portal MyWelfare.ie, (you will need a Public Services Card);
Tax Relief for Working from Home
Roberts Nathan – Business Continuity Update
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 Ahead Before 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.