Inside this issue:

Tax News

• When the taxman comes calling
• Grants and supports

Insolvency News

• Closing down a limited company
• Retention of title

Service Area Spotlight

• Company Secretarial

Hot Topic

• Update on the Charities Act 2009

NERA has a total of 90 inspectors, who are currently carrying out ‘announced’ and ‘unannounced’ inspections nationwide.  These inspections arise as a result of complaints received of alleged breaches of employment rights.  Breaches are identified through targeted inspection campaigns and routine enquiries.

Their most recent campaign has been in the catering sector.  Colette Nagle, Partner in Crowleys DFK, commented on recent outcomes, ‘In 2009, the number of inspections in the catering sector alone was close to 450, identifying a low compliance rate of 21%.  Over 700,000 euro was recovered and paid to employees for underpayments in statutory minimum entitlements.’’

Download a PDF of this Press Release

1. Invoice Basis
The invoice basis requires traders to account for VAT on invoices issued in the VAT period in question.

This scheme can be disadvantageous from a cash flow point of view as traders must pay VAT to the Revenue Commissioners before they have received payment from customers.

2. Cash receipts basis
The cash receipts basis, also known as the monies received basis, allows traders to account for VAT on cash actually received by them in the VAT period in question.

This cash receipts is can be availed of if:

• annual turnover is less than €1,000,000 or
• 90% of the trader’s annual turnover comes from the supply of goods or services to those who are not required to register for VAT (the general public etc.)

The VAT rate applied is the VAT rate in force at the time of the supply and not when payment has been received. This can be disadvantageous for the trader if the VAT rate increases in the meantime.

Under both the invoice and cash-receipts basis, a trader is entitled to reclaim the VAT on invoices received from suppliers during the period in question, whether or not the trader has paid the invoice.

If you require any advice on any of the points raised above, please contact our tax department
Karina Janeczek
Tel: 021 427 2900
Email: kjaneczek@crowleysdfk.ie

Certain trading activities are VAT exempt. Traders who engage in these activities are not entitled to register for VAT. These activities include insurance services, the services of a doctor, dentist or optician and educational services.

Traders who supply VAT-able goods or services are obliged to register for VAT if their supply of goods or services exceeds the following thresholds in a continuous 12 month period:

a) €37,500 for the supply of services
b) €75,000 for the supply of goods

Traders who acquire goods or services must register for VAT where:

1. The acquisition of goods from other EU member states exceeds €41,000 in a continuous 12 month period. This threshold applies even if the trader is supplying VAT-exempt goods/ services.
2. The trader acquires a ‘new means of transport’ from another EU member state. This applies to persons buying new cars from other EU member states. Persons in this category must register for VAT regardless of the cost of the vehicle or regardless of whether it is in the course of business or for private use. 
3. The trader receives certain ‘fourth schedule services’ for business purposes from the EU. Registration for VAT is required regardless of the sum paid for the services. Such services include banking, financial and insurance services and also the services of solicitors, consultants and accountants. Persons acquiring ‘fourth schedule services’ for private purposes are not required to register for VAT. 

If a trader’s VAT liability for the year has fallen below thresholds outlined above, they may apply to Revenue to de-register for VAT. 

If you require any advice on any of the points raised above, please contact our tax department
Karina Janeczek
Tel: 021 427 2900
Email: kjaneczek@crowleysdfk.ie

A caller (reported to have a non-Irish accent) claiming to be a Revenue official has been contacting businesses seeking PPSN numbers or addresses of named taxpayers.

Revenue have confirmed that they would not make this type of telephone call.

If you receive a telephone call purporting to be from Revenue about which you have doubts contact your local Revenue office.

Member firm fee income has risen consistently year on year throughout the last decade and DFK is now clearly established as one of the top 10 international accounting Associations. 

Commenting on these results, James O’Connor, Managing Partner said he is delighted with the growth of the association and that these results highlight the real strength of DFK International and its member firms.

Whilst reporting record results, DFK International also announces the appointment of its new Executive Director, Martin Sharp.  Martin has had a distinguished international career in the UK Royal Air Force.  He commented that “Against the background of continued worldwide recession, DFK has reported great results.  I have been very impressed by the partners I have met and their commitment to meeting the needs of clients with international operations – so I am not surprised by these results.  I relish the challenge of contributing to the further growth of such a dynamic international Association”.

The Association was formed in 1962 and will be celebrating its 50th anniversary in July 2012 in Paris ahead of the London Olympics.

For more information on expatirate tax please click here.

Residential properties liable to the charge include:

• Private Rented Property,
• Vacant property (except new but unsold residences),
• Holiday Homes,
• Residential Property occupied by a person other than owner and where rent is not paid.

Houses, maisonettes, flats, apartments and bedsits all come within the definition of a residential property.

You may pay on line from 31st March 2010 onwards at www.nppr.ie or at your local City/ County Council offices.

• Bi-annual returns may be made by traders whose total VAT payments for the year are €3,000 or less.
• Four-monthly returns are an option for those whose yearly VAT payments are between €3,000 and €14,000.
• Revenue may, by concession, allow traders to file annual VAT returns. A trader has the option in this case of aligning their VAT year end with their accounting year end. This concession is only available to smaller traders.
• It is also possible to pay your VAT liability by monthly direct debit. This option is open to those whose bi-monthly VAT liabilities do not exceed €50,000. You need only make one annual VAT return. Where the direct debit payments have not covered the VAT liability for the year in full, there will be a balance of tax to pay at the year end. You should note that where the balance of tax is not paid on time, interest will be applied. Where the amount underpaid exceeds 20% of the final liability, interest will be backdated to middle of the VAT period. Where the direct debit payments have exceeded the final liability for the year, there will be a refund of tax paid.

If a trader’s VAT liability for the year has fallen, they may apply to Revenue to reduce the frequency of the VAT returns that must be filed during the year.

VAT returns must always be made by the 19th day of the month following the end of the VAT period. E.g. If the VAT period is 1st March 2010 -30th April 2010 the return must be filed and any liability paid by the 19th May 2010. This date is extended to the 23rd of the month for returns filed and paid using ROS (Revenue Online Service).

If you require any advice on any of the points raised above, please contact our tax department
Karina Janeczek
Tel: 021 4272900
Email: kjaneczek@crowleysdfk.ie

A US based NASDAQ listed company in the semi-conductor industry with European subsidiaries in Germany, UK, France, Italy and Sweden.

Our Brief

The company wished to establish a Research & Development facility in Ireland and contacted Chantrey Vellacott DFK (its UK auditors). Crowleys DFK were introduced to the client by Chantrey Vellacott DFK.

Specifics of Work

We performed the initial set up of the Irish Research & Development company. We recommended lawyers to advise on employment and property issues. We registered the company for Irish taxes. We assisted in a successful application for grant aid from Enterprise Ireland. We arranged banking facilities. We provide ongoing support in the form of bookkeeping, monthly reporting, VAT, payroll, tax compliance, company secretarial and audit.

We were appointed by a multi million dollar International US company to assist them with all aspects of setting up an Irish organisation

Our Brief

We were asked to provide all accounting services: management and quarterly accounts, bookkeeping and payroll bureau services.

Specifics of Work

Our initial work involved heavy negotiation with Irish banks on behalf of the client, setting up the corporate and financial function. We also set up effective internal financial controls.

An existing client wanted to purchase a division of a large multinational communications company.

Our Brief

We were appointed to value the target and assist with the purchase.

Specifics of Work

We prepared a business plan and financial projections. We carried out the financial and commercial due diligence and prepared a comprehensive report to the directors. We provided financial advice on the structure of the new business and assisted in raising finance.

A well established interior design company serving a very niche market wished to move firms and contacted Crowleys DFK. They required assistance with financial planning and budget projections.

Our Brief

We were asked to review their previous accounts and internal financial control systems. There was also an immediate requirement for a re-organisation strategy.

Specifics of Work

We immediately implemented corrective action to remedy inadequacies found within the accounting function. One of the directors was nearing retirement age. Our tax specialists advised all the directors on efficient individual and company tax planning matters. The directors also requested our assistance regarding a more efficient organisational structure within the company. All of the above was delivered by a multi-disciplined team of tax specialists, advisory consultants and auditors from within the firm.

Health & Safety Authority

Background

In 2009, Crowleys DFK was awarded a third consecutive contract with the Health and Safety Authority for the provision of a fully outsourced internal audit service. Each 2 year contract was awarded following a lengthy tender process and had the option to be extended for a further year (subject to satisfactory performance). On each occasion to date the Authority has exercised its option to extend the contract for a further year.

Our Brief

Review and determine the adequacy and effectiveness of existing internal control. Provide a risk assessment of the internal infrastructure.

Specifics of Work

To date we have prepared three strategic 3-year internal audit plans, each following an initial risk assessment. All phases of the plans have involved discussions with management and key staff; documentation and testing of systems and procedures; reviewing progress on implementation of any agreed changes to systems/controls resulting from findings at earlier phases of the plan; documentation of results and observations, written reports of key findings and recommendations and reporting relevant findings and recommendations to the Audit Committee. The topics audited relate to both financial and non-financial controls. We have ensured that each plan has included a minimum number of financial areas on an annual basis so as to enable the Chairperson to sign off on the Statement of Internal Financial Control.

As well as attending approximately 4-5 Audit Committee meetings per year, we also provide the Authority with on-going advice on various issues as they arise and have carried out a number of special investigations as requested by the Audit Committee.

A multi million euro construction company experienced trading difficulty due to a sudden reduction in new contracts. The company had fixed costs which could not easily be reduced. These included costs associated with the financing of plant and equipment which was now surplus to the requirements of the business. This, together with delays in getting paid for work completed, meant the company could not pay its creditors.

Our Brief

Crowleys DFK was asked to undertake a review of the business.

Specifics of Work

Working closely with our client we implemented a voluntary scheme of arrangement with the company’s creditors. This resulted in the creditors agreeing to write off a portion of their debt, which provided the company with time to dispose of surplus assets and continue trading.

We were asked by a financial institution to review asset values, bank debt and cashflow of a property developer client who was unable to meet loan repayments.

Specifics of Work

The review led to the restructuring of bank facilities, disposal of assets and the introduction of new capital.

We were asked by the legal advisors to a family sportswear wholesale business to act as liquidators under a creditors voluntary winding up.

Specifics of Work

We disposed of fixed assets and stock and collected debts to maximise the return to secured, preferential and unsecured creditors.

We were appointed by the stakeholders of a bakery & chain of confectionery shops as liquidators under a creditors voluntary winding up.

Specifics of Work

We continued the business as a going concern for a number of months leading to the sale of the business. This maximised the purchase consideration for the benefit of the company’s finance providers and creditors and led to the business being sold as a going concern. It also resulted in many jobs being saved.

An existing client in the medical sector was seeking advice on the purchase of an additional business.

Brief

We were asked to act on behalf of the purchaser and assist in the valuation and negotiation of the terms of purchase.

Specifics of Work

We liaised with the vendors advisors in negotiating a purchase price. We assisted in dealing with the new landlords and carried out a review and valuation of the existing business. Our tax and finance specialists advised the client on a suitable funding strategy.

Our client is a medium-sized retail pharmacist and has 3 full-time staff and a number of locum pharmacists engaged since early 2008.

Background

The Revenue Commissioners had recently issued a briefing document on the tax treatment of “locums” in the medical and pharmacy sectors. Our client was concerned that they weren’t treating the locums correctly for tax purposes.

Our Brief

Our client asked us  to review the nature of the locums’ engagements and to advise them on whether they should be treated as employees or self-employed consultants going forward. We were also asked to advise them on how they should rectify any incorrect treatment in the past.

Specifics of Work

We reviewed the terms of the each locum’s engagement to establish the relationship between the parties. We then formed an opinion as to whether they were an employee or self-employed.

We assisted our client with implementing procedures to ensure the correct treatment for all locums going forward. Where applicable, we provided them with a letter for each locum outlining the reasons for their tax treatment changing.

We calculated the PAYE/ PRSI underpaid and advised our client to make a “self-correction” in respect of the underpayment. As the “self-correction” was made within 12 months of the due date for the 2008 P35 return, our client was able to avoid any penalty on the underpayment. If the error had been discovered during the course of a Revenue audit, our client would have been liable to penalties.

Our client is a medical professional both employed by the state and earning consultancy income from his private clinic.

Background

A recent development in tax legislation means that our client must now apportion his contributions to his employment and personal pension plans in a very specific manner in order to obtain maximum tax relief.

Our Brief

Our client asked us to examine his contributions to both his employment and personal pension plans in a particular year to establish what additional sums he could contribute to each to obtain maximum tax relief.

Specifics of Work

We:

• Examined the breakdown of the client’s income for the particular year.
• Established what contributions he had already made in respect of his employment and consultancy income.
• Calculated the optimal contribution he could make in respect of each pension plan.
• Lodged the appropriate return with the Inspector of Taxes.
• Secured significant refund on the client’s behalf.

Group A €414,799 – Applies where the beneficiary is a child (including adopted child, step-child, and certain foster children) or minor child of a deceased child of the disponer. In certain circumstances parents also fall within this threshold where they take an inheritance from a child.

Group B €41,481 – Applies where the beneficiary is a brother, sister, niece, nephew, or lineal ancestor or lineal descendant of the disponer.

Group C €20,740 – Applies in all other cases.

The Group Thresholds are indexed annually by reference to the Consumer Price Index.

Inside this issue:

Budget 2010

• Highlights from the Budget

Tax News

• All is not lost! – the way in which losses can be used to minimise income tax, corporation tax and capital gains tax liabilities

Hot Topics

• Early public sector retirees and the state pension
• Why creditors should attend creditors meetings?

Service Area Spotlight

• Outsourcing your payroll

The e-brief sets out the criteria that Revenue will apply in reviewing whether a person is a self-employed locum or an employee. The tax treatment of both is different for the employer/contractor and the employee/locum.

Please click here for further details on this e-brief.

Located in the heart of the Waterford business community, Michael Walsh & Co has delivered audit, accountancy and tax services to individuals, companies and the local business community for over 10 years.  The firm is especially strong in the Tourism & Hospitality industry and has particular expertise in providing management reporting and advisory services, including providing monthly reports on business performance and benchmarking.

Michael Walsh & Co. and Crowleys DFK share a commitment to delivering a professional, prompt and value-added service. 

Commenting on these developments, Managing Partner James O’Connor said, “This acquisition allows us to branch into new markets and develop new specialisms within the firm.   We are particularly excited by the quality of specialist advisory services being provided by the staff.  With established offices in Dublin, Cork and Waterford our clients now have greater access to broader expertise in an ever-changing environment. 

Download a PDF of this Press Release

According to the Department of the Environment, the payment date was late this year as it took time to introduce the scheme.  Payment was due on September 30th, with one month’s grace before penalties of €20 per month were charged.  The Department states that from 2010 onwards, legislation provided for March 31st  as the ‘liability date’.  Payment of the charge would fall two months later on May 31st, with a further one month’s grace before penalties.

Further information about the €200 charge and payment options is available at http://www.nppr.ie/.

If you require any further information or assistance on how this issue might affect you please contact the Crowleys DFK Tax Department.

Edward Murphy
Tel: 01 6790800 / 021 4272900
Email: emurphy@crowleysdfk.ie

The UCC PLUS+ Programme provides support for students that have an academic ability to succeed at third level, but for a variety of socio-economic reasons may be prevented from doing so.  The Programme seeks to target students and to provide motivational and educational assistance to them throughout their secondary schooling to enhance their ability to compete for third level places.  To date over 311 students have graduated from the University through this Programme. 

Cal Healy, Development Manager at UCC said “I am absolutely delighted that Crowleys DFK are renewing their support of the UCC PLUS+ Programme.  Their involvement over the last four years has enabled a number of students to complete their undergraduate studies at UCC.  By continuing their support, they will give other students the same opportunity.  In the current economic climate young people from disadvantaged backgrounds will need our help more than ever to pursue third level education and reach their full potential”. 

Continuing its already close association with UCC, James O’Connor Managing Partner at Crowleys DFK, said “Crowleys DFK is delighted and proud to continue to support such a worthy educational initiative and give back to the Cork community.  Education is a key element of our Corporate Social Responsibility strategy.  We believe that education is essential for the country’s economic recovery and for our ability as a community to develop and grow the future of Cork”.

Commenting on the results Managing Partner, James O’Connor, said ‘2009 has been another great year for the Crowleys DFK trainees.  We are very proud of our students’ record of consistently achieving first class results in professional exams.  The invaluable experience our trainees gain from working with our diverse client base has proven hugely relevant and beneficial when sitting the difficult Final Admitting Examinations.’

James concluded ‘We have a strong ethos in the firm of both study and professional development.  We encourage all our staff and partners to grow their network of contacts.  In turn we can offer clients a vast amount of resources and expertise through our remarkable network of connections.’

The breakfast, which was aimed at business advisers, was coordinated by The Community Foundation for Ireland.  The Foundation is one of Ireland’s leading grant-makers. It makes grants on behalf of individuals, families, businesses and other institutions that have set up their charitable funds under the umbrella of The Foundation. In 2008 alone 30 grants were made to a variety of projects in Co Cork.

Topics included new opportunities and ideas for building local philanthropy; how and why Community Foundations work with advisers and donors, and how, when and why to introduce the topic of philanthropy with clients.

Among the other speaker at the event were John Rockett, former head of Private Banking at AIB and Niall O’Sullivan, Head of Fund Development, The Community Foundation.

Up until now, this hasn’t been fully exercised by the Revenue Commissioners.

However, with the increase of the fixed penalty rates in the last Finance Act, reports suggest that Revenue has begun to enforce penalties for non-compliance.

From the Revenue Commissioners’ perspective, enforcing the fixed penalty regime could result in a significant tax-take for relatively little effort.

A fixed penalty can be imposed even where a taxpayer does not have any tax liability or is in a refund situation.  It is in addition to any interest that may be payable on the late payment of tax.

There are many different penalties for a variety of compliance failures. Some of the more common ones are outlined below:

With all the difficulties businesses are currently experiencing, it can be tempting to put off filing returns.  However, avoiding these penalties should provide taxpayers with a strong incentive to keep their compliance up to date.

If you require any further information or assistance on how this issue might affect you please contact the Crowleys DFK Tax Department.

Siobhán O’Neill
Tel: 01 6790800 / 021 4272900
Email: soneill@crowleysdfk.ie

Please click here for further information on the key admendments to the new Act.

As completing the form can be a daunting task, we have outlined some key information to help you complete your application. Please click here to download our information sheet.

Managing Partner, James O’Connor, commented ‘Vincent has been a key part in the growth of our expanding practice and we are delighted to promote him to this important position’.

Vincent is an experienced chartered accountant who joined Crowleys DFK in 2002. Working with both public and private sector clients, Vincent is particularly experienced in providing practical advice on business matters, corporate governance, financial reporting and management information systems.

Vincent aims to offer clients practical workable solutions through technical expertise and a hand-on approach.

James concluded ‘Vincent’s promotion expands our outstanding team, and reflects the firm’s commitment to delivering the highest quality services to our clients.’

Download a PDF of this Press Release

The charge applies mainly to owners of private rental property and holiday homes. It also applies to vacant residential property unless newly built but unsold.

The Act provides certain exemptions from the concept of ownership, including:

• Sole or main residence
• “Newly constructed” residential property which forms part of a builder/developers trading stock and is unsold, never been used as a dwelling and no income has been derived from the building since its construction
• Certain social housing
• Properties in the Rental Accommodation Scheme
• Limited exemptions where a person is moving house and, in the process, owns two houses for a relatively short period
• Other exemptions deal with Local Authority housing, shared ownership housing (with a Housing Authority), and some heritage buildings
• In certain circumstances, joint ownership of a property after a divorce or separation agreement
• Residential property liable for commercial rates – although few instances of such properties are anticipated

The Act should be consulted about these exemptions.

Liability to pay the charge is assessed by the owners themselves. Ownership of a non-principal private residence on the ‘liability date’ (31 July 2009) determines liability to pay the €200 charge.

Payment is due by 30 September 2009. A €20 per month late payment fee will apply from 1 November 2009 in respect of each month/part of a month for which payment is overdue.

Payment can be made on-line at www.nppr.ie  or at the offices of any county or city council. You will need your PPS number and the address of relevant property to make a payment. Further information about the €200 charge is available at www.nppr.ie.

If you require any further information or assistance on how this issue might affect you please contact the Crowleys DFK Tax Department.

Edward Murphy
Tel: 01 6790800 / 021 4272900
Email: emurphy@crowleysdfk.ie

Commenting on the results Tax Partner Edward Murphy said ‘The firm has a record of consistently high pass rates among professional staff.  I am personally delighted that the tax team is continuing to maintain this trend.

In recent years the Crowleys DFK Tax Department has grown into a progressive and dynamic hub within the firm offering expert and specialist advice to clients. 

For the personal client, it offers compliance, wealth management and tax planning services.  The corporate client base spans across most industry sectors.  The team advises these businesses on all areas of Irish taxation including corporation tax, VAT and capital gains tax.  It works with many Irish subsidiaries and branches of overseas and multi-national companies, helping to structure their Irish operations and minimize tax burdens. 

Edward concluded ‘Our people are the core of our business.  Providing quality training and developing their individual skills equips us to deliver expert technical know-how and excellence in customer service.’

Download a PDF of this Press Release 

Among the less publicised measures of the Act is the introduction of a 1% levy on contributions made to certain investment, savings, assurance and pension policies issued by life assurance companies.

The levy will apply to all contributions to both new and existing policies, made on/after 1  August 2009.

Among the type of policies affected by the levy are investment bonds, savings policies, personal pensions PRSA’s, annuities, income protection policies, buy-out bonds and approved retirement funds administered by a life assurance company.

Certain types of self-administered pensions and group pension schemes are not affected.

If your pension policy is affected by the levy and if you intend making a contribution to your PRSA or AVC scheme to avail of relief against your 2008 income tax liability, you should consider making it before 1st August 2009.

If you are unsure whether the levy applies to contributions to your particular policy, you should check with your broker/ life assurance company.

If you have any queries on the levy or on any other issue raised in this article, please contact:

Siobhan O’Neill
Tel: 021 4272900
Email: soneill@crowleysdfk.ie

Cork 2009 – City on a rising trajectory

Business leaders in Ireland’s second city have identified a focus on traditionally strong sectors, multinational investment and start-up support as imperative for Cork’s constant growth.

Please click here to view the complete article

At Crowleys DFK we are strongly advising you to file your 2008 tax return before the summer months in an effort to improve your cash flow management.  Our recommendation is to file now with the option of paying later.  Full payment can be made by either instalments or a lump sum before the October deadline.  By acting early, you will avoid the stress of an unknown penalty with little time to pay, letting you get on with running your business. 

Contact our tax department today to ensure that we have all the necessary information for preparing your tax return.  We will prepare a draft computation taking into account the latest changes to income tax announced by the Department of Finance in the Supplementary Budget.  We will discuss with you ways of reducing your liability and offer advice for managing both your business and personal cash flow.

We are here to help you improve the running of your business by putting in place effective solutions for operating in today’s environment. 

Edward Murphy
Tel: 01 6790800 / 021 472900
Email: emurphy@crowleysdfk.ie

Client testimonial
Fiona Barclay, Root Marketing

‘In April, Crowleys DFK advised me to file my tax return for 2008, without full payment. I wasn’t aware that the option of filing so early and without having to make full payment was open to me.  This advice has made a huge difference to my cash flow management. It has allowed me to budget towards October, pay my tax in instalments and research loan options available to me if required nearer the deadline.  By acting on their advice, I also have peace of mind that I will not face any surprises of hefty penalties later in the year.’ 

Click here to view the Spring/Summer 2009 Newsletter in PDF format

Inside this issue:

Tax News

• Highlights from the April 2009 Supplementary Budget
• Mandatory Electronic Filing and Payment
• Reduce your Tax Liability

Audit and Accounts News

• The Focus for Audit and Accounts in 2009

Hot Topics

• Redundancy Payments
• Managing your Cash Flow

Service Area Spotlight

• Business Recovery and Insolvency

Please click here to for further details.

Please click here to read more about company directors’ annual return responsibilities, filing deadlines and penalites and audit exemption.

Click here to view: Revenue eBrief

Edward Murphy
Tax Partner

Whilst the April 2009 Supplementary Budget delivers in terms of its severity, it is not readily apparent if it delivers in terms of correcting our economic weak points. One of the fears remaining is that the tax-take on which the budget is balanced may be over optimistic.
 
On the business front, the introduction of new tax reliefs on the acquisition of Intellectual Property is a welcome attraction to our Foreign Direct Investors. Disappointingly however, is that there was very little offered by way of business incentives to help create and indeed protect much needed employment.

Click here to view our highlights of the Supplementary Budget.

Please click here for more information.

Click here for more information on the implementation of the Public Service Pension-Related Deduction.  This document takes the form of questions and answers and should be read alongside or in conjunction with the Act.

Janice Lau-Burke

On Sunday 1st March 2009 Crowleys DFK Partner, Janice Lau-Burke, was a guest speaker at the launch of the programme of events organised by Dublin City Council in celebration of International Women’s Day 2009. 

The event, which was opened by Dublin City Lord Mayor Eibhlin Byrne at the Mansion House, acknowledged and promoted the contribution of women to life in Dublin City.  Invited speakers presented their experience of community regeneration, inter-culturalism, senior citizenship, and the history of achieving social, political and economic equality for women.

As a female partner in a major accounting firm, Janice Lau-Burke is in the minority.  But as a Malaysian woman of Chinese origin working in a Dublin firm, it’s probably safe to say that she’s one of a select few.

Speaking at the event Ms Lau-Burke said “my parents were firm believers in the necessity for a good education as a foundation to prosperity and sent me and my siblings to be educated at the highly-regarded Anglo Chinese School in Perak, Malaysia.  Being there certainly gave me an insight into life in the west”. 

In 1980 Ms Lau-Burke moved to Ireland.  “Ireland is essentially a very different country to the one I arrived in 28 years ago.  It has dramatically changed into a multi-racial country.  It‘s inspiring to see increasing numbers of both Irish and International women succeeding in this country”. 

After finishing her second level education she went on to study Accountancy and became a member of The Institute of Certified Public Accountants in Ireland.  Commenting on her profession she said ”even though the accountancy profession continues to be very male-dominated at the top levels, I am pleased to see increasing numbers of women breaking through the glass ceiling and juggling career and family”.

In 2004 Ms Lau-Burke became partner at Crowleys DFK, the progressive Cork and Dublin based firm of chartered accountants and business advisors.  “I have been fortunate to work for an organisation that has embraced my origins and has encouraged me to develop it as part of our overall business model.  With my team in Crowleys DFK, I work closely with the many Chinese owned businesses”.

Ms Lau-Burke concluded ”I truly feel like an International Woman!  I am proud to call myself both Malaysian and Irish”.

Download a PDF of this press release

A skilled work-force and various Government support packages encourage firms to locate their research and development centres. The R&D tax credit is also an important incentive for both Irish and multi-national companies.

Please click here to read more about the R&D tax credit.

It is often said that choosing your exit strategy is the most important business decision you will ever have to make.

Please click here to read more.

Please click here to read more.

From 2006 onwards, the Government introduced legislation that prohibited landlords of residential properties from claiming a deduction for their mortgage interest from their gross rent unless the tenancy was registered with the “Private Residential Tenancies Board” (PRTB). The PRTB is a State board that has been in existence since 2004. It is a requirement that landlords with rented residential properties located in Ireland register their tenancies with the PRTB.

In order to claim a deduction for mortgage interest, landlords are obliged to tick a box on their annual income tax return indicating that the tenancies are registered. Until now, the Revenue Commissioners had no way of verifying on a large scale whether landlords were accurately reporting the registration of their tenancies.

The recent Oireachtas Public Accounts Committee’s report entitled “Taxation of Rental Income Receipts”, called for greater communication between State agencies to ensure greater tax compliance by landlords. Following on from this, in the past few weeks, the Revenue Commissioners have applied to the Minister for Finance for the power to automatically access the PRTB’s list of registered tenancies.

If this application is successful, the Revenue Commissioners will automatically have details of every registered landlord’s PPS number, address and the rental income from his/ property. It would greatly increase the ability of the Revenue Commissioners to monitor landlords and to pinpoint non-compliant taxpayers in receipt of un-declared rental income.

It remains to be seen when/ if this additional power will be granted to the Revenue Commissioners. However, in these tough economic times for the Exchequer, any measure to enable the Government to maximise tax revenue will surely be introduced sooner rather than later.

If you have any concerns about your tax compliance, please contact:

Siobhán O’Neill
Tax Manager
soneill@crowleysdfk.ie
01 6790800 / 021 4272900

The seminar was based around the four core pillars essential to business survival – Maintaining Equilibrium, Internal Cost Competitiveness, Managing Cash and Internal Cost Competitiveness.

Colette and James presented on the third pillar – Managing Cash. Please click here to view a copy of their presentation in PDF format.

Please click here to read more on this topical issue and learn ways in which you can reduce your risk to fraud.  

DFK International is a major international association of independent firms and business advisers that has been meeting the needs of clients with interests in more than one country for more than 45 years.  The association has over 300 offices across the world.

Crowleys DFK was recognised for its contribution to the development of DFK UK & Ireland during the year.  The firm has been an active and prominent member of DFK since 1992.
 
Commenting on the award Managing Partner James O’Connor said, “It’s a great honour to receive this recognition from our colleagues in DFK UK & Ireland.  This award is an acknowledgement of our continued commitment to quality and the provision of a proactive professional service to our growing list of local Irish and international clients, and we are delighted to receive it.”

With offices in Cork and Dublin the firm has seven partners and is experiencing annual percentage growth rates in the mid-twenties.  Crowleys DFK clients include owner managed businesses, branches and subsidiaries of overseas and multi national companies and public sector organisations.  The firm is particularly strong in advising family businesses.

James continued “In these challenging times, our international affiliation differentiates us from other medium sized practices.  It enhances our ability to provide expert business and tax advice to our clients that are trading in different jurisdictions”.

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From 1st September 2008 onwards, where a principal contractor receives construction services from a VAT-registered sub-contractor, the principal is obliged to account for the VAT to the Revenue Commissioners on the supply of these services to him.

This is a change from the old system where the “principal contractor” paid VAT to the sub-contractor as part of the total cost of the services received.  

Significantly, “principal contractors” for the purpose of the new rules includes all government departments, local authorities, boards established under statute and certain other public bodies, which are required to operate relevant contracts tax (RCT).

For public sector bodies who receive construction services, this means they may have to register for VAT to enable them to pay the VAT to the Revenue Commissioners that previously, the body would have paid directly to the sub-contractor.

Public sector bodies are generally not entitled to reclaim any VAT on expenditure. The new rules have not changed this.
 
The new rules are important for public sector bodies as the definition of “construction services” is quite broad. It includes any alterations, repairs or extensions carried out to a building as well as the installation of heating and lighting systems, fire and burglar alarms and telecommunications systems, among others.

An example of how the new system will work in practice is as follows:

• A local authority engages a VAT-registered electrician to carry out some repair work. The cost of the work is €1,000 plus VAT.
• The electrician issues an invoice to the local authority for €1,000. The invoice indicates that VAT is to be accounted for by the local authority.
• The local authority pays the electrician €1,000 less any RCT (if applicable).
• The local authority must then register for VAT (if not already registered), and pay VAT of €135 (€1,000 at 13.5%) directly to the Revenue Commissioners through its bi-monthly VAT return.

For further information or advice, please contact Siobhan O’Neill at soneill@crowleysdfk.ie or phone 01 6790800 / 021 4272900.

The latest issue of the Bank of Ireland Business Start-up Barometer (July 2008), reports that despite the recent slowdown in the economy, over 4,000 new businesses have been established in the last quarter.  The Revenue Commissioners are said to be inundated with business expansion schemes (BES) proposals while applications for County Enterprise Board (CEB) Start Your Own Business funding are as numerous as ever.

According to the Bank of Ireland report, continued diversification in start-ups demonstrates the ability of Irish entrepreneurs to adapt to a changing economic environment.  Even in a downturn there will always be business opportunities. 

If you are considering starting up your own business, there are many issues you will need to consider. For example, you will require information regarding registering your business, employing staff and the taxation, legal and regulatory information that governs every business in Ireland.  A number of these issues are summarised as follows:

1.  Business plan
Before you think about setting up a business, it is important that you put together a business plan.  Your business plan is crucial as it helps you think through your business and what you actually need to do.  It is also a necessity when seeking funds from providers of finance.

2. The legal framework
There are three basic forms your company can take when considering its legal structure:

• Sole trader: Your main legal obligation as a sole trader is that you must register as a self-employed person with the Revenue Commissioners.  If you wish to use a business name you must register your business name with the Companies Registration Office.
• Partnership: This is where two or more people agree to run a business in partnership with each other. The partnership agreement should be drawn up by a solicitor.
• Limited company: If you set up your business as a limited company, the business is a separate legal entity and must be registered with the Companies Registration Office (CRO).  The company returns and accounts must be returned to the CRO each year.

3.  Tax obligations
How your business is taxed depends on its legal structure. A limited company is liable for corporation tax and a sole trader or partnership pays income tax.  It is necessary to notify the Revenue Commissioners as soon as possible of your business by completing the relevant tax registration forms.  This will register your business for various tax heads including corporation tax (limited company), income tax (sole traders/partnerships), employers PAYE/PRSI and VAT.

4.  Financing 
Financial support is a key requirement at the start-up phase of any business.  There are a number of alternatives available to finance your business, including:

• Debt financing 
• Equity financing
• Bank loans 
• Angel investors 
• Private lending
• Grants
• Leasing  
• Friends and family

5.  Financial Records
As the owner of a business you should be aware that the financial and accounting records you maintain are used to assess how your business is progressing.  Well organised financial records provide the basis for decisions made by any potential providers of finance.  It is also a requirement of Irish taxation law that these financial records be held for a period of 6 years.

For further information or advice on starting your own business, please contact Seamus Hayes at shayes@crowleysdfk.ie or phone 01 6790800 / 021 4272900.

For those who may currently pay them, tuition fees are the biggest financial burden, at approximately €3,500 a year.  Rent is the next biggest expense, with students living away from home spending approximately €3,300 per academic year.  Food averages at approximately €120 a month, with an average of almost €85 a month being spent on clothes, according to the Bank of Ireland research.

However, many parents and students may be unaware of the current tax reliefs available for a number of these expenses.

Tax relief is available to those paying tuition fees for certain approved courses in approved third level institutions. This is given at 20% on fees of up to €5,000 per course per academic year.

For those who pay college fees for more than one person, they are entitled to receive tax relief for the fees paid for each person up to the maximum limit per course per academic year.

Relief for rents paid for accommodation is also available. As with tuition fees, this relief is given at 20% subject to certain conditions and maximum limits which depend on your personal circumstances. This relief also covers rents paid for accommodation outside Ireland.

Naturally, the costs associated with going to college will rise substantially if the much talked about reintroduction of tuition fees goes ahead. A new system to make contributions to a university endowment fund tax-deductible is being suggested. This would prove welcome news to those parents who are looking for tax-efficient methods to provide for their children’s future education.

If you would like more information on any of the topics discussed in this article please contact Siobhán O’Neill at soneill@crowleysdfk.ie or phone 01 6790800 / 021 4272900

Irish capital gains tax may be payable on any profits arising from the sale of a foreign property by an Irish taxpayer.  Capital gains tax in Ireland is currently levied at 20%.

Where local taxes are also payable, a taxpayer will generally be entitled to claim an element of relief for these taxes against any Irish capital gains tax liability.  However, this will depend on a number of factors, including the personal circumstances of the individual taxpayer and the country in which the foreign property is located.

In all circumstances, to ensure that all reporting requirements and tax obligations are met and that all available reliefs are claimed, a taxpayer would be well advised to contact their accountant as well as their estate agent when contemplating a sale.

For more information please contact Siobhán O’Neill at soneill@crowleysdfk.ie or phone 01 6790800 / 021 4272900.