As the summer season enters full swing and we begin to see the summer sale signs crop up in all the high street stores, it would be easy to fall into the trap of believing that Irish businesses are fully safe from the dangers of recession and financial instability for the foreseeable future. As we see consumer spending continue to remain strong, it is easy to overlook the many stores and businesses closing and falling victim to financial difficulty.
Although it has now been many years since the height of the recession and we often find ourselves thinking of it as a long distant memory, it has recently been suggested that the woes of recession may not be as far in the rear view mirror for us as we may like to believe. The CEO of the National Treasury Management Agency Conor O’Kelly has suggested that the chances of Ireland being hit by another recession are 100%. He has suggested that a combination of Brexit concerns, changes to taxation and other thus far unforeseen issues are likely to plunge our small Ireland into another recession in the future.
In terms of having country wide safeguards in place for Brexit, Mr. O’Kelly concluded that Ireland may not be sufficiently protected from the negative impact of worldwide trade around us in the shadow of so much uncertainty. He also suggested that a contingency plan needs to be put in place going forward to better assist us in navigating these issues.
“I suppose whether Brexit, Italy, corporate tax or some other challenge that we have Ireland is a small, open economy, highly indebted, relies on international investors for 90pc of its borrowings. […] People talk about whether the bond market is predicting recession or who’s predicting a recession. I’ll give you a prediction of recession. The chance of a recession in Ireland is 100pc. So, we can’t afford not to have a contingency in place. We have to remain vigilant to that and we do that by having significant cash buffers at all times, smoothing out the profile of the debt to make sure we minimise the refinancing risks in the future.”
It has been suggested while there are some safeguards and rainy-day funds in place, more will need to be done to ensure that we do not leave ourselves entirely vulnerable to threat and that although this prediction seems bleak, that it is not a certainty regarding Brexit etc. Rather it is a suggestion for some point in the future that a recession in Ireland is once again a future inevitability. The possibility of a Hard Brexit however does place us in a precarious position and ensure that as a country we are unfortunately more vulnerable than we would otherwise have been to financial instability.
As always, our advice is to safeguard your own business and finances in any way possible going forward and to remain vigilant of any possible threats.
Should you have any concerns or queries, please don’t hesitate to contact us here at EcovisDCA where we are always happy to be of service.
– – –
~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
Budgeting for the Budget
/in DCA News & Views /by ecovis_adm1n_17As the Budget announcement approaches, conversation has turned largely to conjecture over what changes may be made to safeguard against Brexit related issues. As you will all be aware, we here at EcovisDCA are massive supporters of Small and Medium Enterprises (SMEs). These vital businesses are enormously important to Irish business in general and due to their size are vulnerable during this uncertain time.
Recently Dublin Chamber Chief Executive Mary Rose Burke spoke out about the importance of safeguarding these businesses and enabling them to not only survive but to thrive in a post-Brexit world and suggested that Burget 2020 must endeavour to help SMEs to compete with larger, more economically attractive companies. In order to face Brexit head on, Burke suggests that Capital Gains Tax may be the first port of call as the current set up of an overall 33% rate is damaging to small companies and favours attracting larger companies. It is suggested that this be reduced to 20% for all unlisted trading firms and should take into account the level of risk taken by entrepreneurs in order to protect these important business owners.
“We need to foster an entrepreneurial environment and strengthen Ireland’s indigenous business base.”
Given that SMEs form over half of all Irish business operations, it would be wise to begin investing heavily in the entrepreneurial spirit that exists in our country. The Dublin Chamber has stated that the UK is ahead of Ireland in terms of supporting Irish SMEs, and proposes that we follow suit. The current taxation system which applies across the board actively encourages investment in larger multinationals over SMEs. As these large companies are such a small fraction, it is easy to see how smaller businesses may suffer further blows following Brexit, as Burke suggests;
“[Large multinationals] are already more attractive for entrepreneurs. We need to look to improve our competitiveness in ways that are under our control. […] with Brexit on the horixon, it is vital that we react and fight back.”
There is a concern that if changes are not made in the coming Budget, the UK may eclipse our small island in terms of attractiveness to foreign trade which could see significant damage dealt to our economy. As such a long term plan in the coming Budget would be a welcome safety net for Irish SMEs
As always, we will be reporting on this year’s budget as it happens and keeping you up to date on what these changes will mean for you and your business. Should you have any concerns or queries on any business or financial issues, please don’t hesitate to contact us here at EcovisDCA where we are always happy to assist.
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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
Home Renovation Incentive Tax Credit
/in DCA News & Views /by ecovis_adm1n_17A Bit of a Fixer Upper
We have spoken many times over the years about the ongoing struggle people face in attempting to gain a foothold on the elusive property ladder, but what about those who are already securely on the ladder and seeking to upgrade their home whether the home is their forever home or being rented out to tenants? The good news is there is relief available in the form of a Home Renovation Incentive Tax Credit. Tax Credit is always a welcome term, particularly when it comes to necessary renovations.
The HRI is a form of Income Tax relief for homeowners including landlords and local authority tenants who are paying tax. The relief applies to renovations and approvements including painting, tiling, plastering, electrical work, window replacements, attic conversions, fitted kitchens and more. This relief allows the homeowner to claim a tax credit of 13.5%. New builds do not qualify for this scheme and the home must be either your main home, a home you rent out to tenants, or a local authority home and you must be registered as the homeowner on Revenue’s Local Property Tax Register. If the property is jointly owned, both owners can claim the credit.
To qualify for the tax credit, the homeowner must spend at least €4,405 on either one or a number of projects on the property and can be completed by one or more qualifying contractors. A maximum claim of €30,000 of total cost applies. If the property is divided into multiple rental units, each can be treated individually for the purposes of HRI.
The amount of HRI credit that can be claimed will depend on the amount spent on the renovations and also any grants or compensations claimed. In the event that you have received a grant for the works, the qualifying amount will be reduced by three times the grant amount.
Should you have any queries on any business or financial matters, please don’t hesitate to contact us here at EcovisDCA where we are always happy to assist.
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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
Is your Business Brexit Ready?
/in DCA News & Views /by ecovis_adm1n_17Let’s Get Ready…
One of the most popular topics of conversation over the past few months, and certainly something we have touched on multiple times over the long and drawn out course of negotiations is Britain’s Exit from the European Union, more commonly known as ‘Brexit’. Ireland is certain to be the EU member state most directly affected by this change.
Since the impending exit was announced, a series of extensions, questions and near blunders has left many wondering if the exit would in fact ever take place. With a new Prime Minister now in place in the form of Boris Johnson, a set date of October 31st 2019 and the knowledge that business dealings between Ireland and Britain are certain to change with the possibility of hard borders being implemented it is high time to begin considering measures to protect your business if this hasn’t already been considered.
According to the government, there will be a number of contingency measures in place to navigate the complexity of Brexit, but what about what really matters to you, the direct effect of Brexit on your company or business? What measures can be taken to directly safeguard what matters most to you?
These are just a couple of ways in which you can navigate Brexit issues in advance, as well as these, we would recommend studying the government’s booklets on Brexit and complete the Brexit preparedness checklist which can all be accessed here:
» Click here to download the Brexit Ready Checklist
Should you have any queries on any business or financial matters do not hesitate to contact us here at EcovisDCA where we are always happy to be of service.
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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
Brexit, the first signs of its impact?
/in DCA News & Views /by ecovis_adm1n_17Stall the Ball
As we head into the Autumn months, Britain’s planned exit from the European Union in October looms ever larger, and the expected repercussions for Ireland and Irish trade with the United Kingdom remain in question. As we have discussed previously, preparation is key for this massive change as we are sure to see some impact on our shores.
It was suggested this week that we might already be seeing signs of Brexit fears creeping in. This is unsurprising as thus far we have had no definite answers and many time extensions. With a set time now on the table, the situation becomes instantly more real and as a result, we will begin to see fears seep into the world of trade in Ireland.
Despite the fact that latest employment figures show that employment increased by 2% in the 12 months to the end of June. On the surface this might seem like further good news for our continued economic recovery as growth in any area is undoubtedly positive. However, this is the slowest growth in employment we have seen since the beginning of 2013, hinting at the first true sign of Brexit fears among employers. Growth is naturally always a good thing, but here we see a serious slowdown of growth alongside a very small fall in employment figures (a 1% drop) showing that the looming ghost of Brexit is starting to solidify in the minds of Irish employers as a real threat.
Minister for Finance Paschal Donohue has dismissed any notion that Brexit and this slowdown may be connected but interestingly pointed out other areas of the economy which are being affected by Brexit concerns, stating:
“If you look at the half overall in the numbers they show annual employment growth overall of over 40,000 jobs in our country […] They show more people at work than we’ve ever had and indeed they show more people moving to Ireland to work in our economy. So, for all those reasons the trend in quarter two I don’t see reflecting Brexit points for now. […] But I would acknowledge that there is a growing reserve in consumer sentiment and investment point of view regarding the effect that Brexit might have on the economy both now and in the future,”
There are conflicting reports over whether the two can truly be connected as there are currently so many outside forces at play that can affect the Irish economy, but the general consensus is that it is as always something to be wary of and take into account moving forward into an uncertain future.
Should you have any queries or concerns on any business or financial matters please do not hesitate to contact us here at EcovisDCA where we are always happy to be of service.
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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
The EORI – In Advance of Brexit
/in DCA News & Views /by ecovis_adm1n_17What’s Your Number?
As you will all know, we have spoken many times over the past year about Britain’s exit from the European Union, the term ‘Brexit’ has been utilised so often by so many people over the past few months that it has almost lost all meaning, with various extensions making the exit seem more like a myth than an impending reality. With so much uncertainty surrounding our position in this puzzle it has been quite difficult to predict where we will stand, with a ‘Hard Brexit’ with Irish borders becoming more and more likely as the months go on. There are a couple of things that we do know for certain, by virtue of the rules surrounding the European Union, today we will be focusing on one such change which will directly affect all companies with trade dealings with the United Kingdom.
Following the eventual Brexit, there will be a new requirement for all Irish companies trading with the UK. From October, any company trading with the UK will need an EORI (Economic Operators Registration and Identification) Number in order to trade. This number is a requirement for all traders who import or export goods into or out of the European Union, the number is valid throughout the EU and is used as a reference number for customs authorities within any EU member state. As the United Kingdom will soon exist outside of the boundaries of the European Union, this number will now be a requirement for all Irish companies trading with the UK.
You can obtain your EORI number online via the Revenue website, and there is also an eLearning tool available regarding the EORI numbers on the European Commission website. If you are not already familiar with this system prior to Brexit, we would suggest making full use of these resources in advance so that you understand the requirement and are prepared well in advance of any changes due to Brexit coming into effect.
In order to utilise the Revenue service to set up your new EORI number you will need the following:
The Revenue Online System will then take you through the rest of the process. Should you have any concerns or queries about any business or financial matters, please don’t hesitate to contact us here at EcovisDCA where we are always happy to be of service.
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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
What is the Beneficial Owner Register?
/in DCA News & Views /by ecovis_adm1n_17…Get on the Register
You may have heard whisperings of a new central register of beneficial ownership being set up in recent years, with official legislation having been confirmed last year and signed into law recently. Improved and modernised legislation on this topic has long been expected, but saw delays due to the new GDPR guidelines as well as the Anti Money Laundering Directive. It is already a legal requirement for companies in Ireland to have an internal register of beneficial owners but it will now be a requirement to have your information on this new central register. The deadline for this will be 22nd November 2019 and registration is now open as of 29th July 2019.
What does this new legislation mean for you and your business, and what do you need to be aware of?
What is a “Beneficial Owner”?
The term beneficial owner refers to the person who holds 25% or more of a company’s shares.
What information is required?
A delay was incurred in signing off on the legislation due to the new GDPR guidelines as information will be available to the public. Under the new guidelines, only lower level information will be accessible such as name, extent of ownership, partial date of birth, and country of residence.
Part of the reason for both the implementation of this legislation and the significant delays incurred in signing it in, come from the abovementioned Anti Money Laundering Directive. This directive states that all EU Member States must implement a central register of beneficial ownership information. In the case of Ireland the CRO (Central Registration Office) will be the responsible body.
We recommend taking immediate steps to ensure that your company is compliant with this new legislation and as always we advocate ensuring all your information is correct and collected in advance of any requirements. This will ensure that you avoid incurring the fine of €5000. Filing must be done online via the website: https://rbo.gov.ie and can be done either by the Company in question or an agent working on their behalf.
Should you have any concerns or queries on any business or financial matters, please don’t hesitate to contact us here at EcovisDCA where we are always happy to be of service.
– – –
~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
When Planning Ahead, Never Forget the Danger of Recession…
/in DCA News & Views /by ecovis_adm1n_17As the summer season enters full swing and we begin to see the summer sale signs crop up in all the high street stores, it would be easy to fall into the trap of believing that Irish businesses are fully safe from the dangers of recession and financial instability for the foreseeable future. As we see consumer spending continue to remain strong, it is easy to overlook the many stores and businesses closing and falling victim to financial difficulty.
Although it has now been many years since the height of the recession and we often find ourselves thinking of it as a long distant memory, it has recently been suggested that the woes of recession may not be as far in the rear view mirror for us as we may like to believe. The CEO of the National Treasury Management Agency Conor O’Kelly has suggested that the chances of Ireland being hit by another recession are 100%. He has suggested that a combination of Brexit concerns, changes to taxation and other thus far unforeseen issues are likely to plunge our small Ireland into another recession in the future.
In terms of having country wide safeguards in place for Brexit, Mr. O’Kelly concluded that Ireland may not be sufficiently protected from the negative impact of worldwide trade around us in the shadow of so much uncertainty. He also suggested that a contingency plan needs to be put in place going forward to better assist us in navigating these issues.
“I suppose whether Brexit, Italy, corporate tax or some other challenge that we have Ireland is a small, open economy, highly indebted, relies on international investors for 90pc of its borrowings. […] People talk about whether the bond market is predicting recession or who’s predicting a recession. I’ll give you a prediction of recession. The chance of a recession in Ireland is 100pc. So, we can’t afford not to have a contingency in place. We have to remain vigilant to that and we do that by having significant cash buffers at all times, smoothing out the profile of the debt to make sure we minimise the refinancing risks in the future.”
It has been suggested while there are some safeguards and rainy-day funds in place, more will need to be done to ensure that we do not leave ourselves entirely vulnerable to threat and that although this prediction seems bleak, that it is not a certainty regarding Brexit etc. Rather it is a suggestion for some point in the future that a recession in Ireland is once again a future inevitability. The possibility of a Hard Brexit however does place us in a precarious position and ensure that as a country we are unfortunately more vulnerable than we would otherwise have been to financial instability.
As always, our advice is to safeguard your own business and finances in any way possible going forward and to remain vigilant of any possible threats.
Should you have any concerns or queries, please don’t hesitate to contact us here at EcovisDCA where we are always happy to be of service.
– – –
~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
The Irish Economy’s Debt Situation
/in DCA News & Views /by ecovis_adm1n_17As we have previously discussed, there is still an atmosphere of fear surrounding the possibility of another financial crisis or recession in Ireland. With the news that financial experts predict that it is almost a certainty that another financial crisis will hit Ireland in the future based on current figures, it is difficult to avoid the reality that despite major improvements in recent years, financially speaking Ireland is not out of the woods just yet.
As we are all aware, the debt on Ireland’s shoulders still remains, but recent reports have queried who is truly to blame for the level of debt we find ourselves in? It has been reported that at the peak of the financial crisis, spending was approximately €23billion more per year than what was taken in. The Irish economic debt situation of €205billion has long been blamed on the elusive villain known only as “The Bankers” in that the bailing out of bank debt was the sole cause of the financial crisis, which is not the case in actuality as only just over a quarter of this debt can be attributed to the bailing out of the banks, a figure which stands at €60billion.
In reality we are all aware of the heyday of the Celtic Tiger and its series of mishaps that lead us to the point of no return. Far from the bailing out of the banks being the only cause of the financial collapse, it is estimated that a little over €100billion of the Irish debt relates to governmental mismanagement of public funds, budget deficits and a desperate attempt by the then government to cover for lavish spending and plug a hole in the debt before it inevitably began to spiral. In order to stem the haemorrhage of funds, the government had used windfall tax revenues from the property sector.
Naturally, these funds were by no means bottomless and so when they were no longer available we began to see our budget deficits grow exponentially. It has been reported that at the height of the crisis in 2009, the State was spending approximately €23billion more than it was taking in each year before they began borrowing in earnest which found us in the midst of massive debt.
As we discussed recently, there is always the danger of finding ourselves in this position again, and as such safeguards need to be put in place, in the same way we would suggest safeguarding your business, it is vital that we safeguard our country’s finances. With this in mine, the Irish Fiscal Advisory Council has begun to criticise the government over their spending and has suggested that current spending and debt has “worrying echoes” of the past. It is hoped that change will be implemented and safeguards put in place to ensure that we do not snowball into harms way once more but as always we recomment being vigilant with your own finances and business and ensuring that you are as protected as possible.
Should you have any queries, please don’t hesitate to contact us here at EcovisDCA where we are always happy to help.
– – –
~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
Landlords – New Notice Periods to be Aware of
/in DCA News & Views /by ecovis_adm1n_17Although this June weather may not be what we had all expected, something you can always rely on us here at EcovisDCA to continue to bring you information which is vital to your business and financial lifestyle. This week we will be continuing in our series of posts detailing the new changes to rental legislation recently announced and put into place. Legislation can often be a bit of a minefield and with so many changes to the rental sector, we want to ensure that our clients and friends are well informed. This week we will be focusing on the new notice periods which have been put in place for landlords as well as the new introduction of remedial notices.
As of June 4th, 2019, the notice periods that a landlord must provide to a tenant when serving a notice of termination have been extended. It is vital that all landlords, regardless of their experience levels or how long they have been renting should keep a record of the below and familiarise themselves with these new requirements as any failure to serve the correct notice can result in the notice being rendered invalid. Changes can be agreed between both tenant and landlord, but this can only be done once the official termination letter with the appropriate notice period has been served. Below is a list of the new notice period requirements which will now be dependent on the length of time the tenant has been renting the property.
Tenancy Duration: Notice Period:
Less than 6 Months 28 Days
Between 6 Months and 1 Year 90 Days
Between 1 and 3 Years 120 Days
Between 3 and 7 Years 180 Days
Between 7 and 8 Years 196 Days
8 Years or More 224 Days
It is advisable that Landlords keep a printed record of these new notice periods and make themselves aware of these changes to avoid any issues going forward.
Another major change in terms of termination notices is the introduction of remedial notices. As of June 4th, 2019. This notice has been introduced to assist both landlord and tenant as an original notice served to fix the defect identified by the Tribunal can now be remedied by the issuing of a new remedial notice. Following a case lodged with the RTB, if deemed acceptable by the decision maker, either the tenant or landlord may have 28 days in which to serve a remedial notice. If the correct notice period was given, 28 days additionally may be served under the remedial notice, whilst if the incorrect period was given the new notice period will be 28 days in addition to the number of days the given notice period was short.
We hope that this series of posts is of assistance to you. As always, should you have any concerns of queries on any financial or business matters, please don’t hesitate to contact us here at EcovisDCA where we are always happy to assist.
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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY
Funding Reluctance from SMEs
/in DCA News & Views /by ecovis_adm1n_17As you will no doubt know by now, we are massive supporters of Irish Small and Medium Enterprises (SMEs). These small and often unsung heroes of the Irish business world form the backbone of Irish business and make up more than half of all Irish businesses. As such, we have long been supporters of these businesses and championed their successes. In recent months we have spoken about funding opportunities available to these forms of business as well as the ways in which they can be protected and encouraged to grow.
The term Brexit is one which has been utilised so much in recent months that it has almost lost all meaning entirely. Terms like “hard Brexit” strike fear into the hearts of many Irish businesses who have dealings with the UK, and the constant shifting of deadlines and back and forth makes it difficult for businesses to implement sufficient safeguards for their businesses.
Reports this week suggest that Irish SMEs are becoming somewhat reluctant to borrow at present which may show a level of wariness in the looming shadow of uncertainty that is Brexit at present. The Strategic Banking Corporation (SCBI) was started in 2014 in others to allow access to credit for SMEs and functioned by channelling credit through other avenues. This has often been a popular choice for SMEs seeking to fund their business activities, but in the last year we have seen a major slump in uptake on this funding which even an additional Brexit loan to the scheme couldn’t fix. Figures show that 2018 saw only approximately a third of the funding taken up as was accessed in 2017. This shows that in the current climate, Irish SMEs are becoming increasingly reluctant to take their chances on accessing funding.
The SCBI themselves have said of the issues:
“The modest deployment in the nine months to end-December 2018 is a clear reflection of SMEs remaining reluctant to invest in an environment of increased uncertainty and risk as Brexit approaches.”
As things stand we remain almost none the wiser on how the Brexit issue will play out and as always, we advise having a plan in place and safeguarding your business as much as possible in advance. The current advice remains that old Irish refrain that fell from the lips of all parents at one point or another: “Hope for the best, prepare for the worst.” In this way, your business will be protected against all eventualities and in the best position possible to flourish in the face of challenge and adversity in the current uncertain climate.
Should you have any concerns or queries on any business or financial matters, please don’t hesitate to contact us here at EcovisDCA where we will be happy to help in any way possible.