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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

Voluntary Strike off VS Liquidation

Unfortunately, it is not always prudent or financially viable to keep your business going. To assist you if this is the case, we will today be discussing two ways in which your company can be formally closed down. We will be focusing on Voluntary Company Strike Off and Members Voluntary Liquidation – two very different processes which should not be confused. Rather than incurring the on-going costs of continuing to file annual returns, you can choose to either liquidate or strike the company off. It is inadvisable to simply abandon your company as this can incur ongoing costs as well as causing legal trouble down the line.

Voluntary Company Strike off is the process wherein a company is formally de-registered from the Register of Companies and the Revenue Commissioner. The liquidation process involves the appointment of a liquidator to collect and assign any existing assets.

Voluntary Strike Off is often seen as a quicker and more cost effective option than liquidation. This option is available to companies which have had little or no activity and have no more than €150 in assets or liabilities. Voluntary Strike Off leaves an option to restore the business open for a period of 20 years following the date of dissolution.

Members Voluntary Liquidation is the alternative option for companies which have had activity and remain solvent at the time of cessation. Members Voluntary Liquidation is often seen as the more correct way to dispose of a company as it is not possible to resurrect the company after liquidation.

Voluntary Strike Off is also a cheaper option than Members Voluntary Liquidation despite its inherent lack of finality,

If you require any further information on either Voluntary Strike Off or Members Voluntary Liquidation or indeed any business or financial matters please don’t hesitate to contact us. We are always happy to help.

 

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DCA PARTNERSDECLAN DOLAN & EAMONN GARVEY

2016 – A NEW YEAR OF BUSINESS

Hello again and a very Happy New Year to all of you from us here at DCA Accountants. The foggy haze of a holiday season well spent may not have fully lifted just yet and this month may see all of our wallets a little lighter. To combat this, we have compiled a list of some handy tips to increase cash flow for you and your business and start 2016 off on the right foot.

Budget Budget Budget

No, we don’t mean another governmental offering, lay down the pitchforks, rather a budget for both your business and your own income. It may seem basic to suggest setting out a budget for your business as there has probably been a general one in place for years. However, when entering a new year we would advise setting out an immediate new budget to ensure that you have a clear idea for your finances and where you want them and your business in general to be for the year ahead. On a more personal level, it is advisable to map out exactly what your monthly income is and make a note of the absolutely essential outgoings. From there you will be able to add on the less crucial expenditures and have an idea of how much it will be possible to save each month.

Pay up

The easiest way to keep track of both personal and business finances is to ensure that bills are paid as soon as possible, rather than waiting until the last minute deadline. This will prevent you from overspending as the cash will already have been spent, rather than existing in a limbo of “to be spent” where the temptation to dip in can be strong. In business, you should always set clear and attainable payment terms with all suppliers to avoid confusion.

Be Flexible

Yoga might have played a part in your New Year’s resolutions so keep up the good work, but here we do not mean flexible in the physical sense. In both personal and business finances there will always be unforeseen expenses that creep up and threaten to derail your budgeting. The key when these issues arise is to be flexible and accept that this expense must be paid, but it doesn’t need to be the end of your savings. As much as it is tempting to derail a healthy eating plan after a day of indulgence, it is incredibly easy to allow your finances to become confused after unexpected expenses. Instead of allowing this to happen, a clear budget should allow you to figure out a way to get your savings and finances back on track.

Keep in Touch

In business, it is advisable to keep regular contact with your accountant and bank so that you are at all times aware and knowledgeable about the cash flow of your business. This contact will also assist you in identifying areas of concern early on to help avoid any issues.

We hope that these simple tips will assist you going into the New Year and that 2016 will be a successful year for you and your business. As always, should you have any concerns or queries please contact us at DCA

CREDIT CARD INFORMATION AND TAX EVASION

It was reported earlier this month that the Revenue were to begin targeting credit card transactions as a way of uncovering tax evasion. This new endeavour came to light after it was revealed that over 2000 Irish companies had made payments to the Revenue Commissioners after failing to declare tax in full.

The Revenue Commissioners say that the practise of examining credit and debit card data to investigate tax payments is now active. The information is being released by merchant acquirer firms. These firms process credit card payments on behalf of the merchant you purchase from. Their data will then be compared to the data submitted by the individual or business in order to assess any issues or differences. Any discrepancies found would be flagged as a potential risk of evasion, to be given a closer look.

How is this information being released, you may ask? Legislation enacted two years ago states that these merchants are obliged to divulge information on transactions over a certain threshold. The Revenue are currently making an attempt to ramp up its digital focus as concerns grow regarding the easier tax evasion in this area.

The general idea here, is to ensure that The Revenue Commissioners have all the information they possibly can, in order to assess effectively. In order to do this, As the Revenue Commissioners have now increased their digital focus, they are now engaging new teams in the advanced analytics area. This process utilises a wealth of digital resources in order to flag potential tax evasion.

Declan Rigney, assistant secretary in the Revenue’s planning division has stated that the information has been of great benefit to their research into potential evaders:

“We are able to match information up with our records and see firstly, do we know about them, and secondly, have they registered with us and have they declared income and so on. After that, we can examine if that cumulative figure for the year matches what they have told us in their income tax or corporation tax returns”

Revenue have now stated that their advanced software, known as the Risk Evaluation Analysis and Profiling (REAP) system – (which sounds a lot more violent than it is we promise), can now accurately predict whether someone is potentially evading tax payments or not. This system can also compare cases in order to highlight potential issues that may otherwise have gone unnoticed.

So, it would seem that the ‘Tax Man’ has now well and truly entered the modern age, and with all this technology at the Revenue’s disposal it hopes to ensure that tax evasion becomes a thing of the past.

If you require any assistance or advice on managing your own or your businesses taxes and finances, please don’t hesitate to contact us at DCA Accountants.

CREATING AN EFFECTIVE WEBSITE FOR YOUR COMPANY

In this digital dominated age, a website is a necessity for fledgling and well established businesses alike. A website may be the first port of call for customers or investors searching for the services and products you offer. Regardless of any other marketing methods you may put in place, a website is of great importance in order to get the message of your business out there and give potential clients the information they need. Think of your website as being an extended, digital version of your business card. A way of introducing yourself and your company to the wider world.

As well as the existence of your website, the quality of your website and the ease with which it can be navigated could make or break a transaction with a potential customer. How can you ensure that your website is both visible and accessible to those who will need it? We have compiled a few handy tips for you to consider:

Choose Format.

This is one of the most important initial decisions you will make regarding your website. This will decide how your content is updated and managed. If you intend on doing regular updates yourself, a content management system such as that used by WordPress or Joomla would be the best choice. With a Content Management System you simply input blocks of text and photos as necessary using a set template. Alternatively, if you have hired a web developer or have experience with code yourself, you can build your website from the ground up. Of course this option comes with its challenges and may make regular updates more challenging.

Generate Content

Next to your website’s general layout and design, your content and copy will be the key to generating website traffic. Content is what will attract and keep visitors on your website so it is important to keep content varied and interesting and avoid having massive blocks of text apart from the blog section. It has been suggested that visitors decide whether to stay on your website or go elsewhere within 4 seconds so this is good to bear in mind when generating content. You have a limited amount of time to impress your visitors, and it would be advisable to have some copy already on hand so that as soon as your website is up and running there are a few options for your new visitors to choose from.

Social Media

Social media is one of the biggest ways of generating a following these days so as well as setting up a website it is a good idea to set up relevant social media channels for your business such as Twitter and Facebook. Linking these social media channels to the blog aspect keeps your followers updated and generates some extra traffic to your website. These are also excellent tools for getting your company message out in a quick and informal format.

Maintain Content

Finally, the most important thing to remember when creating your own business website is that it must be consistently in flux. Your content must change and be updated on a regular basis as this is what will keep prospective clients returning to your website.

DIFFICULTIES IN VALUING A BUSINESS

Valuing a business can be one of the most challenging issues faced by business owners and analysts alike. Valuing is a difficult and incredibly complex task, but one that is utterly essential. On occasion, traditional modes of valuation simply do not suit the business type. These techniques often assume a certain level of stability and an imagined risk profile which may not be applicable, and without being adapted, this can result in critical errors in valuation.

In the early stages of your business it can often be a struggle to value the business in an accurate way. This is also often a stage in which it can be difficult to predict the risks associated with the business. In this instance three things must be predicted which can be challenging to do in changing financial times: how will the market you are entering grow and change? What is the likelihood of your business surviving and what risks will be associated with the venture in the longer term?

Analysts can often be more concerned with the general economic growth, rather than the growth of the individual company and this may be something you will have to take into account in your own calculations. For ease: we have collected some of the most common forgotten issues that may become a problem in your valuation and risk assessment, in the hope that you may be able to avoid these pitfalls.

Originality/Diversity: A good thing to bear in mind when valuing your business is that businesses which offer an original/single product or service are subject to a higher risk level than those which offer a well-known or a great many products and services.

Clientele: It is important to take into account your current and projected clientele when valuing and assessing your business. For example, if your business is one which has relatively few clients, then your risk factors will be much higher as the results of losing one of your clients will be much more detrimental to your business than one which has a wide range of clients.

Projected Lifespan: Your Company’s projected lifespan is often difficult to assess but it is important to take into account the changing business world you are entering and whether or not it is likely that your product or service may soon become outdated.

Location: Location is not only a factor in setting up your business, but also in valuing it and assessing its growth capabilities for the future.

Assets/Liabilities: When valuing your business it can be easy to forget to factor in current and projected assets and liabilities. When included, these can paint a more in depth picture of the current and projected value of your company.

Expectations: It is vital to remember that valuations are essentially expectations by nature, and they can be used as a blueprint for the planning and maintenance of your business.

There are always unforeseen circumstances both negative and positive that will affect your business and these cannot be predicted. As such, your valuation is a blueprint for you to build upon rather than a strict prediction.

If there is any way at all we can be of benefit to you in the start-up, maintenance or valuation of your business please don’t hesitate to contact us at DCA Accountants.

TAX RELIEF FOR FIRST TIME ENTREPRENEURS

It was announced this month that there will be a revamp of a previously existing entrepreneurial scheme. This newly revamped scheme will mean that first time entrepreneurs will be able to claim back thousands of euro in tax relief in order to offset their start-up costs.

 

The SURE scheme (Start-Up Relief for Entrepreneurs) was recently launched by Finance Minister Michael Noonan and Jobs Minister Richard Bruton. The scheme comes as a response to the latest employment figures, which suggest that two thirds of all new jobs are created by new start-up companies. Minister Bruton has stated that this new tax relief is important because many start-up companies have “fallen into pitfalls where cash runs out before their potential is fulfilled.” This new scheme could mean increasing longevity for these companies who may need an extra push in today’s difficult marketplace.

 

Some of you may remember that a similar scheme had previously been in place as well as the capital gains tax incentive for new entrepreneurs. Mr Bruton has suggested that this previous scheme received a relatively small amount of interest, as there was a lack of understanding about what was involved in the process. It is hoped that the SURE scheme will offset these difficulties as it essentially involves directly offering assistance to those considering starting their own business. The funds will be offered up to a value of 41% of the total capital invested. Depending on the size of your investment you may be entitled to a refund of income tax paid over the 6 years prior to year in which you invest.

 

So, how do you know if you qualify for this scheme? The following are the basic guidelines:

 

You must:

  • Establish a new company carrying on a qualifying trading activity.
  • Have mainly PAYE income in the previous 4 years.
  • Take up full-time employment in the new company and not be employed elsewhere.
  • Make an investment by purchasing new eligible shares.
  • Hold at least 15% of the issued share capital of the company for 12 months.
  • Ensure that the company is a qualifying new venture.
  • Ensure that the company is incorporated in this or another EEA State.
  • Ensure that the company is between a micro or medium-sized enterprise.
  • Ensure that the company does not have any trading arrangements with your former employers.
  • Ensure that the company is not controlled by any other company.

 

These are, of course, just the basic guidelines to give you an idea of how to qualify for this exciting new scheme. If you should be interested in assessing your own eligibility for the SURE scheme, we at DCA Accountantsare here

KEEPING IT IN THE FAMILY

When going into business with anyone it is important to make sure that you are acting in your own best interests. But is it harder to secure your position when your business partners are your family?

 

 

There are benefits to going into business with your family. You have a certain amount of trust built up and it’s hard to double cross someone who you’ll see at Christmas dinners and family barbecues. However, if that trust gets broken during your business dealings then it can affect both your personal and professional lives and therefore be doubly difficult to deal with.

 

In order for any business to be successful it needs to be run professionally. All family members must conduct themselves in a professional manner. That means trying to keep a firm distinction between your business lives and your professional lives, and it also means that when you’re in work you need to act like you’re with any group of colleagues. This creates a better impression to clients and non-familial employees.

 

Part of acting professionally is making sure that you are protected legally in case the business fails, or goes in a direction that you’re not comfortable with. For some people this seems counter-intuitive. Surely the biggest plus to going into business with your family is not having to worry about being treated shoddily. But families can fall out, and if yours does its best that you walk away from this business with what you’re legally entitled to.

 

While it might make sense to you to cover yourself, you might find it difficult to broach the subject with your loved ones. It might feel like you’re accusing them of not having your best interests at heart, or that you suspect that they may not be honest in their dealings further down the line.

 

However, the reasons for families needing to cover themselves legally aren’t necessarily malicious. Most of the time it’s not because of acrimonious fallings out, it’s because their life is in flux. If a member of the family committed money to the business, and then needs to withdraw capital or sell their share due to an ill child, it may be difficult to agree what the person is entitled to. This failure to agree may cause bad feeling, whereas if there is a legal agreement written up prior it’s clearer what is supposed to happen if circumstances change. Therefore it acts as a firewall, separating your business and professional lives.

 

Eamonn Garvey

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