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Welcome to the FMB Chartered Accountants Blog. We answer all of your financial and accountancy questions, as well as keep you up-to-date with the latest news from FMB.

Refund Claims Deadline

David McArdle - Friday, August 08, 2014

Revenue has recently launched a reminder for the deadline to claim tax refunds.


They have advised that PAYE taxpayers seeking an income tax refund for 2010 must submit their claim to Revenue by 31st December 2014

PAYE Anytime is the Irish Revenue On-Line Service for employees. This interactive facility offers individuals who pay taxes under the Pay As You Earn (PAYE) system, a quick, secure and cost effective method to manage their taxes online.

Once registered online, you can:

  • View your tax record

  • Claim a wide range of tax credits: Rent Credits etc.

  • Apply for refunds of tax including health expenses

  • Declare additional income

  • Request a review of tax liability for previous years

  • Re-allocate credits between yourself and your spouse

  • Track your correspondence submitted to Revenue

A small number of customers cannot claim a review using the PAYE Anytime such as:

  • Individuals selected by Revenue to complete a Return of Income

  • Customers who are registered for Income Tax and also have income subject to PAYE

Contact our team for advice and information. Call FMB on 01 645 2002 or email enquiry@fmb.ie.

You can also signup for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.


Relief to Individuals on Loans Applied in Acquiring an Interest In a Partnership

David McArdle - Friday, August 01, 2014

An individual could claim tax relief on interest paid on money borrowed to acquire a share in a partnership.


Finance (No.2) Act 2013 abolished interest relief for all loans made on or after 15 October 2013 (save for some acquisitions of interests in certain farming partnerships. Interest relief for existing qualifying loans is to be phased out over 2014 - (75%), 2015 – (50%) and 2016 – (25%) with no relief available after 1 January 2017.


Revenue has confirmed that where a loan is issued post 15 October 2013 but it replaces an existing qualifying loan and the replacement loan does not exceed the balance and term of the existing loan, tax relief will still be permitted in line with the phased out relief until 1 January 2017.


Contact our team for advice and information. Call FMB on 01 645 2002 or email enquiry@fmb.ie.

You can also signup for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.



HRI Electronic System

David McArdle - Wednesday, July 30, 2014


Revenue has launched a new Home Renovation Incentive (HRI) electronic system which homeowners can use to check if a contractor is tax compliant. Contractors can enter details of qualifying works and payment received through the HRI on ROS.


The HRI scheme provides for tax relief for homeowners by way of an income tax credit at 13.5% of qualifying expenditure on repairs, renovations or improvements carried out to the Homeowners main home by qualifying contractors.


A homeowner cannot claim a tax credit if details of the works done and payment information is not logged online by the contractor. Where work has been carried out from 25 October 2013 to 9 April 2014, contractors must enter the relevant information online before 8 May 2014.


Homeowners are encouraged to check online to see if the relevant details have been updated prior to claiming the tax credit.


Contact our team for advice and information. Call FMB on 01 645 2002 or email enquiry@fmb.ie.

You can also signup for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.



How to Protect your Business from Becoming Involved in VAT Fraud

David McArdle - Saturday, July 26, 2014

Revenue have recently published guidelines on How to Protect your Business from Becoming Involved in VAT Fraud.




These guidelines are there to warn about the consequences of becoming involved in a set of transactions with a VAT fraud even if the transactions in which the business is involved are not themselves unlawful.


What to expect in the Revenue Guidelines

The European Court of Justice in a number of cases concerning VAT fraud has held that:


(a) a taxable person who knew or ought to have known that, by his purchase of goods, he was party to a fraudulent transaction can have his right to deduct related input credits refused.


(b) a taxable person who knew or ought to have known that the transaction carried out was part of a tax fraud committed by the purchaser may be denied the right to zero-rate the intra - Community supply to that purchaser. Revenue will apply the principles established in these cases where it has satisfied itself, having regard to objective factors, that the taxable person knew or ought to have known that he was participating in a transaction connected with VAT fraud. Revenue will also apply addition penalties where appropriate.


Due Diligence

It is good business practice to undertake due diligence when entering into a business transaction, particularly with an unknown party. In order to help avoid being an unwitting party to a VAT fraud, we have set out examples of reasonable steps you can take to establish the integrity of your customers, supplies and supplies. Revenue expects that as legitimate traders you will, on an ongoing basis, assess the integrity of your supply chain and the suppliers, customers and goods within it.


Risk Indicators

You should be particularly alert to practices that deviate from normal commercial practices within you industry. To minimise your risk, you should, in addition to the due diligence checks, consider:


  • The nature of the supply;

  • Payment arrangements and conditions; and

  • Details of the movement of goods involved.

“If a commercial proposition looks too good to be true it probably is and you need to undertake whatever inquiries are necessary to establish the bona fides of the transaction or transactions concerned and the trading partners involved" - Revenue


Get the full Guidelines from Revenue HERE.


Contact our team for advice and information. Call FMB on 01 645 2002 or email enquiry@fmb.ie.

You can also signup for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.



Adjustment of VAT deductible where consideration is unpaid after six months

David McArdle - Friday, July 18, 2014


Source: Revenue.ie

The Finance Act 2013 has inserted a new section 62A in the VAT Consolidation Act 2010. This deals with the adjustment of tax deductible in relation to unpaid consideration.


The point of this section is to provide for an adjustment of the amount of VAT deductible where a person who has made a deduction of VAT in a taxable period, has not paid the supplier for the related goods or services within six months of the end of that taxable period. For part payment that has been made, the adjustment is required for that element that remains unpaid after six months.

Where an adjustment is made and the person subsequently pays the full consideration or part thereof, a corresponding re-adjustment should be made. 

In exceptional circumstances, where there are genuine commercial reasons for not having paid the consideration and Revenue are satisfied with these reasons, no adjustment is required. This new provision has effect in relation to tax deducted in VAT periods from January 2014.

Contact our team for advice and information. Call FMB on 01 645 2002 or email enquiry@fmb.ie.

You can also signup for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.


LPT - Deduction at source from wages, salary or pension

David McArdle - Friday, June 27, 2014

The legislation governing Local Property Tax provides for payment by a liable person of the amounts due in respect of 2013, 2014 and arrears of 2012 Household Charge in either a single payment per year, or by phased payments over the course of each year.

Advised in the Revenue eBrief of 2013, employers and pension providers have been required to make this facility available to their employees/pension recipients since July 2013. Deduction at the source is the means by which LPT/HHC is to be paid.

It is organised that Revenue will notify the employer/pension provider through the Tax Credit Certificate (P2C) to deduct the amount from the employee’s net salary or pension recipient’s occupational pension.

The employer/pension provider must also account for and remit the deducted LPT/HHC to Revenue on Forms P30 and P35, and to employees on payslips, P60s and P45s.

If you need any advice, contact FMB by calling 01 645 2002 or emailing enquiry@fmb.ie.

Sign up for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.


Automatic Exchange of Information

David McArdle - Wednesday, June 25, 2014

‘Automatic Exchange of Information ("AEOI") is a relatively recent component of international cooperation in tax matters. Ireland fully supports the global move towards AEOI and is actively involved in progressing AEOI within the EU, the OECD, and on a bilateral basis.’ - Revenue.ie

The Foreign Account Tax Compliance Act (FATCA)

In December 2012, Ireland concluded an Intergovernmental Agreement with the United States. This was put in place to improve International Tax Compliance and Implement FATCA. In order for the exchange of information, the Irish financial institutions must report to Revenue the details of accounts held by them.

1, July 2014 is the deadline for the Regulations to be enacted and in force. This will allow Financial Institutions to commence the required due diligence and account information gathering from that date. The Guidance Note is in the final stages of review.

Common Reporting Standard (CRS)

The Common Reporting Standard ("CRS") for the automatic exchange of financial account information was approved by OECD in February 2014. This is a common model of AEOI which draws on the work of global anti-money laundering standards and the model FATCA Intergovernmental Agreement. Over 40 countries, including Ireland, have committed to the early adoption of the CRS.

Ireland will bring forward legislation to enable Revenue to make regulations to govern the collection of data from Irish financial institutions when the Commentary for the interpretation of CRS is finalised.

EU Directive on Administrative Cooperation (Council Directive 2011/16/EU)

The EU Directive on Administrative Cooperation states that ‘EU Member States shall engage in the automatic exchange of available information concerning residents of other Member States in respect of 5 categories of income and capital:

  • Employment income;

  • Directors’ fees; Life insurance products not covered by other Directives

  • Pensions;

  • Ownership of and income from immovable property.’


If you need any advice, contact FMB by calling 01 645 2002 or emailing enquiry@fmb.ie.

Sign up for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.



PAYE: Employer’s obligation to Register Employees

David McArdle - Thursday, June 19, 2014

On 13th June 2014 the Revenue Office released a Tax Briefing with regard to new responsibilities for employers in relation to the PAYE system. Employers are now obligated by law to maintain and keep a Register of Employees and may at any time be requested to produce a hard or soft copy of the register.




The Register of Employees details

The Register of Employees must contain certain details of each employee beginning from the tax year 2012 and cover all subsequent years. Details that must be included in the register for each employee are:

  • the name,

  • address and

  • Personal Public Service Number (PPSN) of each employee;

  • the date of commencement of employment of each employee;

  • and where relevant, the date of cessation of employment of each employee.


The brief also states that employers must keep and maintain the Register of Employees (or a copy of it) either at the normal place of employment of each employee or at the main place of business of the employer. In the event of an employer having more than one place of business, the Register of Employees may be kept in one location where the records are held may be accepted as that employer’s main place of business for the purposes of being the place of retention of that employer’s Register of Employees.


Producing the Register of Employees

Revenue officers carry out pre-arranged and unannounced visits to businesses to ensure that such businesses comply with their tax and duty obligations (including obligations on employers to register with Revenue for the purposes of the PAYE system and to keep and maintain, for PAYE purposes, a Register of Employees). Such visits may be random, may be part of a "sectoral review" of specific types of businesses or may stem from complaints to Revenue as regards an employer’s failure to operate the PAYE system (or to operate the PAYE system correctly).


Employers may be requested to produce an extract of their Register of Employees within a specified time period. There is a statutory obligation on employers to produce either their Register of Employees or an extract of same, upon request from a Revenue Officer, within a specified time period.


Penalties

Where an employer is obliged, but fails, to keep and maintain a Register of Employees at the normal place of employment of each employee or at that employer’s main place of business, Section 987 Taxes Consolidation Act 1997 provides that that employer shall be liable to a penalty of €4,000. In addition to the penalty of €4,000, where that employer is a company, the secretary of that company is liable to a penalty of €3,000.

In some instances, an employer may, for the purposes of payroll, human resources or fulfilling a non-tax related statutory obligation, hold a record or register of all employees (and former employees). Such a record or register will suffice as a Register of Employees for PAYE purposes provided that it includes the relevant details outlined above.


If you need any advice, contact FMB by calling 01 645 2002 or emailing enquiry@fmb.ie.


Sign up for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.



Taxman gets €9m in expenses crackdown

David McArdle - Tuesday, June 17, 2014


The Tax authority has been conducting a National Audit Project on those who work for one client and provide services through their own company, mainly contractors in the IT, Scientific, Technical and Administrative sectors.


It is said that the claim of excessive expenses from professionals through a company has yielded €9.3m for the Revenue Commissioners since last year.


Quoted by Finance Minister Michael Noonan, the expenses reimbursed tax free “was found to be excessive and several cases included expenses which had not been incurred at all or were personal rather than business related.”


Michael McGrath of Fianna Fail advised, "In light of these startling figures any self-employed contractor providing services through a company under contract to a third party client would be well advised to have their tax situation independently checked to ensure they are not building up a massive bill of underpaid tax,"


Following a Revenue pilot project which yielded €4.5m in the South West region, a total number of 385 audits have been closed with additional tax due in 299 cases. 49 have agreed to settlements. 368 companies are still under audit, and €9.3m in interest tax and penalties has been collected.


If you need any advice, contact FMB by calling 01 645 2002 or emailing enquiry@fmb.ie.


Sign up for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.



CGT Exemption for Assets

David McArdle - Monday, May 19, 2014

Capital Gains Tax Exemption for Assets

Land or Buildings acquired between 7/12/2011 and 31/12/014


TIME IS RUNNING OUT!


‘Where land or buildings are acquired between 7 December 2011 and 31 December 2014, and held for at least 7 years, the chargeable gain will be reduced in the same proportion that 7 years bears to the period of ownership of the relevant asset.


For example, if a building which has been held for 10 years is disposed of, the chargeable gain in respect of that building will be reduced by seven-tenths.


This relief applies in respect not only of land or buildings in the State but also to land or buildings situated in any EEA State.’


Finance minister, Michael Noonan, has indicated that this very generous relief will not be extended beyond 31 December 2014. Therefore, to ensure you can avail of this relief you need to act prior to 31 December 2014.


Remember, this relief applies to all commercial property, residential  property and land.


If you need advice on this topic or any other tax matter please do not hesitate to contact any of our team, call FMB on 01 645 2002 or email enquiry@fmb.ie.

Sign up for our quarterly Newsletter and keep up-to-date with FMB news on business, finance and more.











  
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