Month: March 2019

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Does your employer pay your rent?

If so, you must remember that income tax is due on the amount at your marginal rate, including PRSI & USC.

Employers are increasingly offering this benefit to their new employees, obviously easing the burden of renting in Ireland, especially if re-locating.

As we have seen in the news recently, senior executives can also be offered accommodation packages.

Let’s clarify this further;

If your accommodation is owned or rented by your employer, the employee must pay tax on the ‘taxable benefit’ by taxing a notional amount on your salary i.e the amount it costs the employer to offer the property. This is commonly known Benefit in Kind (BIK)

For example; An employer rents a property for €2,500 per month (€30,000 per year), therefore the employee living in it benefits from paying €2,500 per month and must pay tax, PRSI & USC on this, as if it were salary.

Living on business premises

This is treated differently by Revenue and employees who are effectively ‘on call’ outside normal working hours, do not need to pay tax on this benefit.

Relocation packages

Tax reliefs for employees re-locating from overseas are available, as covered in our recent blog here

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Special Assignee Relief Programme (SARP)

What is SARP?

SARP provides Income Tax relief to employees that are assigned to work in Ireland from abroad by their relevant employer.

What is a relevant employer?

A relevant employer must be a company that is incorporated and tax resident in a country in which Ireland has a double taxation or a Tax Information Exchange agreement with.

How do you qualify?

You can claim SARP by meeting the following criteria;

  • You arrive in Ireland between 2012 – 2020, at the request of your employer
  • You worked for your employer for 6 months before arriving in Ireland
  • Your employment in Ireland is for a minimum of 12 consecutive months
  • You were not tax resident in Ireland for the preceding 5 tax years
  • You remain a tax resident in Ireland for all years you claim SARP relief
  • You earn a minimum basic salary of €75,000 per annum, excluding bonuses, commissions, etc
Calculating the relief

A proportion of your salary is disregarded for Income Tax, i.e for 2019, the proportion available is 30% of your income over €75,000 up to €1 million.

This would apply if you commenced employment in Ireland on or after 01st January 2019.

Example – Year 1 only
Mary’s Salary €100,000
SARP Threshold €75,000
Balance remaining over threshold €25,000
Balance @ 30% €7,500
Relief @ 40% €3,000

Therefore, Mary is due €3,000 tax refund.
You can also receive certain travel expenses and tuition costs tax free.

How do you apply?

Employers are required to complete a Form SARP 1A for each employee and submit to Revenue within 90 days of the employee arriving in Ireland.

A tax return must be completed by an employee for each year they claim the relief.

Should you be claiming this relief? Contact us today 01 539 7999
Why not read some of our previous blogs here

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Phased Payment Arrangement (PPA) with Revenue

Revenue are introducing a new facility to enable taxpayers to pay their tax liabilities by phased payments through ROS.

From March 25th, taxpayers holding a current ROS certificate can avail of this new facility. You will be able to apply for a PPA through ROS and agree terms.

If you have a PPA already in place with Revenue, you must register for ROS in order to manage and view this arrangement. Revenue have advised those currently availing of this arrangement to register for ROS.

Should you wish your tax agent to have authorisation to access or deal with Revenue regarding your PPA on your behalf, signed authorisation will be required from you

Have a query? Contact us on 01 539 7999
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Types of Companies in Ireland

If you set up your business as a limited company it is a separate legal entity from shareholders and directors.  The assets of the company are the property of the company and not the shareholders.  Therefore, any debts of the company are the responsibility of the company and not the shareholders.

The Companies Act 2014 introduced a number of different types of Companies in Ireland;
  1. Company Limited by Shares (LTD)
  2. Designated Activity Company (DAC)
  3. Company Limited by Guarantee (CLG)
  4. Public Limited Company (PLC)
  5. Unlimited Company
Company Limited by Shares (LTD)

LTD’s are the most popular type of companies incorporated in Ireland. This is a company limited by shares.  This company type does not have an objective clause in it’s constitution so can trade in any type of activity.  LTD’s can have only one director but they must have a separate company secretary.

Designated Activity Company (DAC)

DAC’s are companies incorporated to complete a specific purpose and therefore wish to restrict the activities they can carry out.  They may also carry out specific trades that fall under regulation.  This company type must have a minimum of two directors.

Company Limited by Guarantee (CLG)

CLG’s are usually non profit making companies such as Charities, Trade Unions or Clubs.  They have no shareholders or share capital.  They must have a minimum of two directors and one member.  This member must agree to contribute a minimum of €1 to the company in the event of it winding up with debt.

Public Limited Company (PLC)

PLC’s are companies listed on the stock exchange.  The must have a minimum of two directors and a minimum issued share capital of €25,000.

Unlimited Company

Unlimited Companies are the least popular type of company incorporated in Ireland.  They are companies with no limited liability.  They must have at least two directors and one member.

Should you wish to contact us regarding your business, call us on 01 539 7999 or email