Archive for the ‘Taxation’ Category

Dividend Witholding Tax Exemption for Non-Resident Corporate Shareholders

Monday, May 24th, 2010

I was discussing with a new client today the new process for non-resident corporate shareholders to receive dividends from their Irish subsidiary. The latest Finance Bill has simplified the process of paying dividends free of Irish witholding tax, currently at 20% of the gross dividend.

Providing the non-resident company is located either in the EU (except for Ireland) or a double tax treaty country – DTT (of which there are currently 48 in force)  and a declaration has been made in the prescribed format then it is possible to pay dividends in this way.

How the dividends are then taxed in the recipients country of residence depends on the tax laws of that country.

If you would like assistance with this process either in Ireland and/or in the recipient country See O’Mahony Donnelly contact details.

We can also introduce you to one of our associated firms in Enterprise Worldwide who can assist with advice in the parent company’s country.

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Employer Deadline Approaching for PAYE Return of Benefits in Kind

Wednesday, May 5th, 2010

I was preparing a return for a client today who had made medical benefit payments on behalf  some employees. These payments are normally required to be returned on the monthly payroll as benefits in kind (BIK). However in this case certain employees had left the company. Because there was a commitment to pay the full term of the medical payments, which did not become apparent until the employees had left,  some of them were omitted from reporting through the regular payroll run.

A P11D, employer return of benefits in kind, is obligatory where the employee has left and also where there may be other benefits not reportable through the payroll.  Such benefits may include employer PRSA payments, where the total employee and employer PRSA payments exceed the maximum tax free % normally allowed for an individual. The deadline for a P11D for year ended 31/12/2009 is 31 May 2010. This is just over 3 weeks so if you require any assistance from us with your P11D compliance see O’Mahony contact details.

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Non-Domiciled in Ireland – Implications of becoming Tax Resident in Ireland

Thursday, March 4th, 2010

If you are considering moving to Ireland from the UK, USA or other foreign country then you will need to consider the tax implications of such a move. We have many clients who we advise on such matters and are fully conversant with the Irish tax issues involved. The timing of such a move is crucial in ensuring you do not overpay Irish taxes and minimise your potential Irish taxation exposure. There are also other issues you would need to be aware of surrounding potential capital taxes on capital assets you may hold abroad. If you would like to discuss with us how we can help you make the move with minimum of tax worries please contact me. Contact page at O’ Mahony Donnelly, Chartered Certified Accountants.

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UK Citizens Living Abroad as Tax Exiles Face Higher UK Tax Bills?

Tuesday, March 2nd, 2010

Thousands of UK citizens living abroad as tax exiles could find themselves facing a retrospective tax bill stretching back as far as the previous six years, following a recent Court of Appeal ruling.

The case involved businessman Robert Gaines-Cooper, who has lived in the Seychelles since 1976. Despite the fact that he had adhered to previous HM Revenue & Customs (HMRC) guidance by spending fewer than 91 days in the UK on average each year, the judges ruled he had nevertheless maintained ties with the country.

The Appeal Court said that the 91-day rule did not actually establish non-residency, and ruled that the UK had remained the ‘centre of gravity’ of the defendant’s life and interests.

The ruling means that thousands of UK tax exiles could have their lifestyle scrutinised by the Revenue, with factors such as the number and length of visits to the UK, any economic and business ties, and ongoing connections such as membership of UK banks or sporting clubs, being taken into consideration. Source :www.lawrencegrant.co.uk

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Ireland’s ‘Non-Domiciled’ Rules to Benefit UK Expats

Thursday, December 17th, 2009

Two major Irish and UK financial events of the year occurred last Wednesday 9th December…..In Ireland the nobudget report was presented by Minister Brian Lenihane …..while UK Chancellor Alastair Darling announced the UK’s  final pre-budget report.  Whilst both countries have similar economic problems, albeit on a different scale….Ireland made € 4bn cuts to public service spending with the aim of reducing our deficit to below 3% of GDP by 2014…this will be achieved over a succession of budgets….the UK’s government borrowing is expected to fall from £ 178bn (12.6% of GDP) this year to £82bn (5.5% of GDP) by 2014.

There has been  pressure for Ireland to make significant changes to our system following the commission  on taxation report recently… to provide further equity in our tax system….which they did in some key areas such as the new minimum tax on certain non Irish resident, Irish domiciled individuals.

However, Ireland continues to favour the remittance basis of taxation for Irish resident, non- domiciled individuals…a key difference between Ireland and the UK, who have a minimum tax on their UK resident non domiciled individuals of £ 30,000  per annum. This has resulted in several UK expatriates to re-locate to Ireland making substantial savings in personal income tax.

If their tax affairs and finances are structured in the correct way many can benefit to the tune of several thousands of pounds.

Further proposed increases in UK Income tax from 06/04/2010…an additional tax rate of 50% on Income over £ 150,000 may act as the ’straw that broke the camel’s back’ for many…and will increase the gap between the UK and Ireland’s personal taxation of non-domiciled individuals, re-affirming Ireland’s position as a location of choice .

With the UK’s minimum tax charge of £ 30,000 per annum coupled with a marginal tax rate of 50% on UK earnings over £ 150,000, it is easy to see why UK resident non domiciled individuals may be looking to head west for a solution to their mounting UK tax burden.

We advise several Irish resident non-domiciled clients on how these issues work in practice and would be delighted to assist with any queries or issues you have.

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DEADLINE NEAR FOR TAX EXEMPT IRISH LIMITED COMPANIES

Thursday, November 12th, 2009

The tax free threshold of 0% corporate tax which applies to Irish Limited Companies that are incorporated and begin trading no later than 31/12/2009 will soon arrive. This deadline is further shortened by the CRO (company registration office) christmas opening times. They can only guarantee new company applications received by 14/12/2009 will be processed before 31/12/2009. To meet the criteria as incorporated and having begun trading during 2009 a tax registration application also has to be submitted. This  can only be done after the company is incorporated. It is therefore vital that these applications are made now, preferably in November, to ensure you meet the above conditions.

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Commission on Taxation to Publish Report on Monday 07 September 2009

Thursday, September 3rd, 2009

The commission on taxation, set up on 14/02/2008 by Brian Cowen  ’to review the structure, efficiency and appropriateness of the Irish taxation system’ is set to publish its report next monday 07/09/2009. The objective of the commission was ‘to establish the framework within which tax policy would be set for the next decade at least’. This could well result in far reaching changes for our tax system. More information can be found at http://www.taxcommission.ie/. Following publication of next weeks report  I would be happy to assist with any queries you may have on how this affects your own business or personal tax status. O’Mahony Donnelly Chartered Certified Accountants Contact Details

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