The Supernanny Tax

Recently, the Revenue Commissioners have collected approximately €61million in taxes, penalties and interest during their ongoing investigation of over 800 medical consultants. It is believed that there was a significant underpayment of taxes by 276 consultants who had incorporated their private medical practices and other companies. These investigations are currently ongoing and to date, 36 consultants have been published on the Revenue’s list of tax defaulters. The findings include so-called “future uplift” or the estimation of future taxes collected.

Chairman of the Revenue, Niall Cody has been recently quoted as saying of the investigation:

“These are high-wealth individuals. These are people with significant incomes and there has been significant underpayment of taxes.”

This investigation has been underway since 2010, when Revenue suspected that a wrongful tax planning strategy was being marketed towards medical consultants. The incorporation of medical practices can be a legal form of tax avoidance, however many of the practices registered have been found to have no commercial reality, positioning these particular practices in the realm of illegal tax avoidance.

The chairman was also quoted as saying that these individuals had seemingly forgotten the “legitimate boundaries” in relation to tax matters and had wrongfully claimed expenses that were either non-existent or not relevant to the business they were claimed against. Nanny costs and private home expenses were among the expenses wrongfully claimed in some cases. Other issues identified are wages paid to underage family members. Mr Cody explained that in one case expenses were claimed for the services of a child working on a website “because the child was proficient in IT and the consultant wasn’t.”

825 cases have been opened in this investigation, with 552 cases now closed. In all cases closed to date it has been found that the consultants were not in fact acting in goodwill and were evading taxes wilfully and under full knowledge.

Wages were paid to underage family members by some consultants. Mr Cody described one case in which the expenses were claimed for the services of a child for work on a website, “because the child was proficient in IT and the consultant wasn’t.”

The Irish Hospital Consultants Association and tax advisers have asked Revenue to publish guidance on goodwill for medical practices.

Mr Cody was also quoted as explaining that if it seems too good to be true it is probably unethical which is a good rule for your tax matters. If you require any further guidance or advice on your own tax or financial matters, please don’t hesitate to get in touch with us.

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

PAYE UP

In recent years life and business have been taking a turn for the seemingly more convenient with it becoming increasingly easy to complete important tasks and meet deadlines remotely or via phone. Banking too became more convenient with online banking beginning to take over and allowing customers to complete many banking transactions online. Similarly, issues like tax submission etc. have become more convenient with the advent of online systems and the availability of important submission forms to download.

The Revenue website is one area which has been making a marked move towards online services with many day-to-day checks and queries being able to be answered via the ‘myAccount’ area of the Revenue website. This week, Revenue have announced that development of the myAccount system is ongoing and that there would be changes imminent in the coming weeks, which we felt might be relevant to you.

Revenue have announced that from the middle of June, their PAYE anytime service would no longer be available. This is due to the ongoing works on the website and the findings that the service is not easily accessible on mobile devices. This shows a very marked belief in progress as the need to have all services easily accessed via a tablet or smartphone showcases our current and continued reliance on these devices. The PAYE anytime service was released in 2005 and has certainly served its time and purpose well but it is time to move on.

PAYE business will now be completed via myAccount through newly enhanced PAYE Services, easily accessed on all mobile devices. Interestingly, this will also be available through the very modern RevApp allowing you to have your tax issues and queries resolved at the push of a button.

Through these new services you will be able to:

  • Manage your tax 2017.
  • Review your tax 2013 – 2016.
  • Request an End of Year Statement (P21).
  • Add a Job or Pension.
  • View your Tax Credit Certificates and End of Year Statements (P21).

The new Revenue website will be available to view from early June on all mobile devices and PCs, we are never ones to complain about convenience.

Should you require any help, advice or guidance on your own tax or other business and financial matters, please don’t hesitate to contact us here at EcovisDCA where we will be happy to help.

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

Score One for SMEs

For the past few months, the term Brexit has acted as somewhat of a Bogeyman figure looming over many Irish business as the haze of uncertainty for what a British exit from the European Union would mean for Irish borders and trade with the UK, on which many companies rely. Perhaps the most concerning idea for Irish businesses would be what this would mean for Irish Small and Medium Enterprises (SMEs). We have spoken at length in the past about how important the SME sector is in Irish business, forming the backbone of our economy, and how vital it is to protect these types of businesses in changing times. Many Irish SMEs rely on business with the United Kingdom and so a cloud of uncertainty and insecurity has plagued the sector in recent months.

 

Recently, we have spoken about new funding opportunities coming to light for SMEs and this week it appears that the future may be beginning to look even brighter for these vital enterprises. The Minister for Employment and Small Business Pat Breen has urged SMEs and micro businesses to turn to their Local Enterprise Offices (LEO) for information about a range of supports now available to them. A newly announces suite of Brexit supports is now available to SMEs and microbusinesses through their Local Enterprise Offices which include

  • Access to the ‘Brexit SME Scorecard’ online tool where micro and smaller businesses can self-diagnose their readiness for Brexit – A vital planning tool which may assist many small businesses.
  • A ‘Technical Assistance for Micro-enterprises’ grant to help LEO clients to find new markets and exports.
  • Rollout of ‘Lean for Micro’ nationwide which will make small businesses more efficient and competitive.
  • A ‘LEO Innovation and Investment Fund’ pilot programme to support innovation in micro-enterprises and get them investor ready to scale their businesses.
  • Tailored mentoring to address Brexit related business challenges.
  • Training on specific Brexit challenges, including financial aspects.

As you can see from this list, these supports are specifically aimed at providing information and a framework of support and guidance for these businesses to utilise when navigating the uncertain times ahead. Minister Breen was quoted as saying of the support:

“I am delighted to announce this suite of important Brexit supports which will be available for small and medium enterprises. It is imperative that micro and small businesses have the tools and supports needed to navigate through what is uncharted territory. This is part of the Government’s Brexit planning and I am very pleased that my Department through Enterprise Ireland has been able to accelerate the rollout of these new LEO offerings worth up to €3.4 million, and I urge small and micro business owners to get in touch with their LEO to see how they can help.” 

These supports focus heavily on planning ahead which will be vital in the coming months for all businesses. Should you require further information, guidance or assistance please give us a call.

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

Are you Talkin’ to SME?

We have spoken in the past about the dearth of financing options for Small and Medium Enterprises in Ireland following the recession. Recently, there seems to be a push towards recognising the importance of SMEs as the backbone of our economy and as such, the need for available funding to ensure their continued success.

One such form of funding of which Ireland has seen very little in recent years is ‘Peer to Peer’ (P2P) lending. The term might bring flashbacks of desperately attempting to download your favourite songs on a dial-up connection but rest assured this is a far more functional process. Peer to Peer lending is now one of the most popular methods of funding a business or idea (think Kickstarter, IndieGoGo etc. these options are also known as ‘crowdfunding’). The process allows ordinary individuals with cash to invest be ‘matched’ with a business seeking finance. The entire process is done online which reduces overhead costs and generally makes for a smoother and cheaper lending process for both parties.

One such Irish Peer-to-Peer lender, Linked Finance has recently received full authorisation by the UK’s Financial Conduct Authority (FCA) to allow the company to enter into the UK Market. Linked Finance’s CEO Niall Dorrian was quoted as saying the following about the authorisation:

“I am very pleased that we have secured full FCA approval. It puts us ahead of the curve in terms of preparing for any regulation of the sector in Ireland. It also demonstrates to lenders and borrowers here at home that Linked Finance operates to the highest standards.”

The authorisation is well timed for Linked Finance as our own Department of Finance has initiated a public consultation process with the view of imposing some regulations on Peer-to-Peer lending in Ireland, aiming to make this a safer process for all parties. The UK already has a comprehensive regulatory procedure with regard to P2P lending, and it is thought that Irish practises will begin to follow suit as P2P lending grows in popularity here. The UK also already has many options in place for funding SMEs which Ireland may eventually follow suit on given that these enterprises make up such a large chunk of our business.

Linked Finance have already facilitated more than €25m in loans to Irish SMEs and it is hoped that in the future there will be a marked increase in lending options for SMEs as they continue to be the backbone of our economy. Linked Finance in particular hope that any kind of regulation will be a help to the sector rather than a hindrance as CEO Dorrian has said:

“Any regulation of the sector in Ireland should seek to encourage, rather than inhibit, further diversification within the financial landscape.”

For now, at least, times seem to be changing positively for Irish SMEs and long may this last.

Should you have any queries or require further information on this or any other business or financial matter please don’t hesitate to contact us here at EcovisDCA’s new head office, where as always we will be delighted to help.

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

Blowing Up the Housing Bubble

The housing ladder has remained a hot topic of conversation since the economic downturn and subsequent changing of the rules for applying for a mortgage. The conversation doesn’t seem to be going anywhere as the concern of Ireland falling into the housing bubble trap increases as more and more prospective buyers find themselves unable to pay increasing asking prices.

This week it was reported that these increasing house prices do not look likely to slow down in the coming years. Goodbody Stockbrokers have stated in their latest economic report that the average price of a house is set to continue to rise by up to 10% this year followed by another 8% in 2018 meaning an additional 18% cost increase on houses which have already increased massively in price in the previous three years.

The report states that:

“Mortgage approvals, even excluding cash purchases, are in excess of the amount of new supply expected to come to the market, thus house price inflation is expected to remain strong over the forecast period. […]“While supply remains low, demand appears to be running ahead of expectations”.

Existing housing demand is said to be 30,000 per year, and it is reported that it will take another number of years in order for the number or houses built to match up to tahis demand. This lack of balance between supply and demand is what has encouraged this somewhat bleak forecast from Goodbody Stockbrokers, who have also stated that they expect there will be €13.5billion in new mortgage lending in the coming years.

An additional issue with supply and demand is that there are far more prospective homeowners being approved for mortgages than there are houses available, which continues to push prices higher. A recent infographic shows the increasing prices as they continue to grow. Mortgage approvals are being boosted by the Government’s popular help-to-buy scheme but many of those approved will find themselves without a home to buy.

Should you have any queries on home ownership, or any other financial or business matters, please don’t hesitate to contact us here at EcovisDCA, where we will as always be happy to help.

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

Granting your Switch Wish

It is obvious that the changing mortgage rules have made it more difficult for first time buyers to enter the property market in recent years. Despite recent changes allowing for a decrease in the necessary deposit required (abolishing the 225,000 cap on a 10% deposit) the continuing rise in house prices has all but ruled many first time buyers out of the market for the foreseeable future. An issue which affects many but has seen much less column inches is the issue of switching your mortgage to another bank. This is something which has been increasingly difficult to accomplish in recent years with the ever changing financial market, but there may be a distant light at the end of the tunnel for those wishing to switch their mortgage in the future to reduce their repayments.

The Central Bank has recently stated that it will be considering imposing new rules which will make it easier for people to switch their mortgage to another lender. This exciting development follows recent research by Behaviour and Attitudes which found that only 4% of mortgage holders had switched to a new lender. Switching your mortgage to another lender can often result in a reduction in your repayments and other benefits as your needs grow and change in your home.

The proposal by the Central Bank would ensure that banks must offer greater clarity to their borrowers to ensure that they have all the information available regarding switching, something which is sorely lacking in the current market. There is also a suggestion that the banks will be required to ensure that borrowers have all the information regarding switching mortgage product and the associated costs of this.

The fact that so many of those surveyed had never even considered changing their mortgage is surprising given that Ireland’s variable mortgage rates have been found to be among the highest in the Eurozone. Lenders do not currently offer enough accessible information about these issues and as such it is not something at the forefront of buyer minds. Acting Deputy Governor Bernard Sheridan has been quoted as saying:

“It is clear that lenders could be doing more to facilitate consumers who are thinking about switching.”

The Central Bank suggests these new changes will be beneficial as over 109,000 people could save money by switching mortgages and will reportedly publish a paper later in the year in which these proposals will be set out.

Should you require any help, guidance or advice on these or any other business and financial matters please don’t hesitate to contact us here at Ecovis DCA where our dedicated advisors will be delighted to be of assistance.

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

The Wheels on the Company Car Go…

In our ever shifting modern landscape it can be hard to stay consistently abreast of small changes to rules and regulations and amendments to costs we don’t often consider (is anyone else lamenting the increasing cost of stamps and feeling like their grandmother when admitting it? No? Just us?) Occasionally, changes to important parts of our everyday lives can be implemented almost without our knowledge as they may not be widely publicised or may simply fall beneath the din of the other news of the day. Here at EcovisDCA we want to ensure that you are always aware of changes which may affect your pocket whether positively or negatively, and today we want to inform you about a change to motor travel rates for Civil Servants which may have escaped your notice as these changes have not been massively advertised.

The motor travel rates for Civil Servants apply where employees use their private vehicles for business purposes. In these cases the costs can be reimbursed through the flat-rate mileage allowances which have been amended per a general review as of April 1st 2017.

  • Key changes to previous arrangements include:
  • Distance bands increased from 2 to 4, which may benefit workers who do a great deal of driving for business.
  • Lower recoupment rate for the first 1,500km.
  • Increased recoupment rate from 1,500 to 5,000km which again may benefit those who do a lot of business driving.
  • More beneficial compensation rates for cars with lower engine sizes and emissions, benefitting those workers already conscious of their carbon footprint and encouraging others to be more aware.
  • Changes to the mileage formula apply and rates will be locked in for a period of 3 years.

Should you require further information or guidance on how this may affect you and your business or any other business or financial issues, please don’t hesitate to contact us.

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

If you Own It Then You Need to Put Your Name On It (All The Beneficial Owners)

As of the 15th of November 2016, all Irish business owners or part-owners are required to create and maintain a list of the beneficial owners of the aforementioned business. This new order is in accordance with Statutory Instrument 560 of 2016. The new rule applies to all Irish companies, partnerships and all business entities whether publically listed or not.

A beneficial owner is defined as being a person who currently holds more than 25% of a business either directly or indirectly. This is a legal term wherein specific property rights belong to a person even when legal title of the property belongs to another person. Therefore even if you are not publically an owner of the business, if you hold more than 25% you will be required to be listed on this new document, the register of beneficial owners for the company.

 

The register of beneficial owners for the company must include for all parties:

  • Full Name
  • Date of Birth
  • Nationality
  • Residential Address
  • Nature and extent of interest and involvement with the company
  • Date entered into or removed from the register.

 

This new requirement will naturally take some time to implement accordingly, and we would advise all companies to ensure that this register is kept fully up to date with leaving and entering dates etc. to ensure that no issues arise in the future as a result of incomplete information.

 

It is also advised that the company issue letters to all those viewed as beneficial owners to inform them of this new register and to request the required information. It is essential to have a record of all endeavours to identify all beneficial owners and should they still be impossible to identify, the names of the directors and CEO must be entered on the Register.

The CRO will create a central register by the middle of 2017 so it is essential that all beneficial owners are reported to them before this time.

It is heavily advised that this be put in place as soon as possible as failure to comply can result in a fine of up to €5,000 being applicable to your business.

 

Should you have any concerns, queries or require further information on these or any other business and financial matters please don’t hesitate to contact us we are always available to help.

 

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

TaxSaver TaxSaver, They Know how to Save you

There is no denying that we live in quite expensive times with the general cost of living continuing to increase steadily. As a result, both business owners and employees alike are as always looking to where costs can be cut or savings can be made. Travel and food are often the biggest savings downfalls for employees. When hoping to cut costs these are often the first avenues to be explored, which is often exploited by advertisers insisting on informing of us of the many varied other things we could do with the cost of our morning cappuccino.

For those of us who simply cannot function in the morning without that well needed caffeine fix and the knowing glance from our local barista, the good news is that there are many available ways to save without sacrificing the sacred morning routine. For both business owners and employees alike, the travel Taxsaver could be a fantastic solution which can save the company money whilst also ensuring a happy workforce by saving the employees money on their daily commute.

This scheme has proven its worth as over 3500 companies currently purchasing travel tickets for their employees. The system allows companies to save up to 10.75% in PRSI whilst employees can save between 31 and 52% in tax on the cost of their travel.

The taxsaver travel ticket is purchased through the company and can be paid for by the employee through salary sacrifice, in place of a bonus or as an additional perk as part to their salary. Companies can register to take part in this service via www.taxsaver.ie and can now order employee tickets via an online service to be delivered directly to the company saving time as well as money, which none of us will ever complain about these days.

Employees hoping to save up to 52% on their commute can contact taxsaver on 1850211777 to see if their company is registered or direct their employer to the website in order to register. Once organised the company will purchase the ticket on your behalf (payment method to be agreed upon) and this will be delivered direct to your workplace so you can start saving for those cappuccinos or rainy days.

Additionally, there is a choice of travel options available as you can choose bus, rail or a combination of the two depending on your most used mode of transport.

With such large savings at the fingertips of both employers and employees, it is no surprise that this has already proven to be a popular choice, and is sure to grow.

Should you have any concerns, queries or require further information on these or any other business and financial matters please don’t hesitate to contact us we are always available to help.

 

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

Taking the Fear out of Arrears

Following on from the economic crisis and the subsequent increase in the cost of living and decrease in available work, many thousands of Irish people have been left in mortgage arrears which is a very stressful and uncertain position to be in. As the country begins to regain its financial footing there are of course increases in finance options, but up until this point many Irish householders may have found it quite difficult to avail of advice on these matters during what is of course a difficult financial time.

Recently, Tánaiste Frances Fitzgerald and Minister for Social Protection Leo Varadkar announced an awareness campaign to promote Abhaile, a free mortgage arrears support service which many of those struggling were unaware of.

This news follows a survey which found that many struggling with mortgage arrears are too embarrassed to tell their family and friends about their ongoing issues. This in itself is incredibly problematic as the weight of these issues alone can cause isolation, depression and other mental health difficulties. As such, it is essential that all homeowners who find themselves in arrears should have someone to speak to. That is the service that Abhaile hope to provide. Tánaiste Fitzgerald has stated that despite falling numbers, there are still approximately 34,500 people in this country in long-term arrears. These are the people they hope to reach with this new campaign as it also emerged that over two thirds of people did not know that there were any services available to them to discuss these issues. Minister Varadkar was quoted as saying:

“It’s our firm hope we’ll bring forward thousands more people who are now in need of similar help. The key message is to come forward and seek the help that you need. Don’t be afraid, help is available at no cost and we’re on your side.”

Whilst the fact that the number of repossession cases has halved in recent years is indeed positive news, it is also essential that those still struggling be aware of all of the assistance at their disposal to ensure that these rates continue to fall in the coming years so that we can see a significant reduction in people feeling alone in these issues. It was also revealed that those in long-term arrears are those least likely to seek advice or assistance as they may feel that their situation is hopeless.

Angela Black of the Citizens Information Board has said:

“What we’re doing is asking members of the public to go out there and take a look around at their family and friends and people who might look ok on the surface but who are struggling behind closed doors with mortgage arrears. They might not realise they have access to this free expert financial and legal advice. Family and friends can play a vital role in encouraging people to look for help”

The Abhaile service has assisted 4,500 people since it became fully operational last October.

The Abhaile scheme is administered by the Money Advice and Budgeting Service (MABS).

Its helpline, which is open Monday to Friday 9am to 8pm is 0761072000.

 

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY