Month: February 2020

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Brexit –UK Resident Directors of Irish Companies

Under the Companies Act 2014, all Irish Companies directors must be resident in the European Economic Area (EEA).

As the UK left the EU on January 31st with certain provisions until 31st December 2020, the UK’s trading relationship with the EU remains the same and the UK will follow EU rules. All EU regulations will apply to the UK during this time.

Therefore, this year, Irish Companies with UK resident directors can operate as normal without the requirement to have an EEA-resident Director.

However, if after 31st December 2020, there is no agreement in place, UK resident Directors of Irish Companies will need to adhere to Section 137 Companies Act 2014  and appoint an EEA resident director or apply for a Non-Resident Director Bond in order to comply with the Companies Act 2014

A Non-Resident Director Bond covers the company for €25,000 and acts like an insurance policy for the government to cover unpaid taxes or fines. It is valid for 2 years and covers the following;

  • Company fines imposed by late filing of accounts or returns
  • Revenue fines
  • Penalties imposed under the Taxes Consolidation Act 1997
  • Expenses incurred in recovering above fines and penalties

A Non-Resident Director Bond needs to be put in place at company incorporation stage or on the removal of an EEA resident director from the company, it allows the company to operate without an EEA resident director in place. After 2 years, the company must either renew the bond or appoint an EEA director.

It is a criminal offence to not have at least one EEA-resident director of an Irish registered company.


If a company has someone managing the business from Ireland or trades in the State, they may be eligible to apply for a ‘real and continuous link’. An application can be made to Revenue to confirm a link exists (trading must already be in place to be approved). Once approved by Revenue, a B67 form is required to be completed and submitted to the Registrar of Companies to confirm the link.

If approved, there is no requirement for a company to purchase a non-resident bond or appoint an EEA director.

Why not read our previous blog regarding the legal and tax implications for Director’s loans here

Should you have any queries on this issue, please contact us on 01 5397999 or

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Research & Development (R&D) Relief for employees


Companies can claim a tax credit from Revenue if undertaking R&D activities. A company has the decision to surrender all or part of this tax credit and therefore an employee of the company may be entitled to claim this credit if working in R&D activities.

Am I eligible?

To apply for this credit, you as an employee;

  • Must never have been or are a director of the company or associate company
  • Are not connected to a director of the company or associate company
  • Do not have any material interest in the company or associate company
  • Not connected to anyone who has a material interest in the company or associate company (i.e owns more than 5% share)
  • You must have performed 50% of your duties in conception or creation of new knowledge, products, processes, methods or systems
  • Your employer must be entitled to claim at least 50% of the cost of your wages as R&D expenditure

R&D Relief Limit

Income tax payable in the year of claiming must be at least 23%. See our example below;


Unused Credit

If the full credit amount is not used in 1 year, it can be carried forward to reduce further years.

🤔 Have a query on this or need to include in your tax return, contact us today to discuss on 01 5397999

👀 While you are here catch up on the Latest News on our website

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Minimum Wage Increase 2020

As of 1st February, as set out in the National Minimum Wage Order 2020, Ireland’s minimum wage has increased to €10.10 per hour or part thereof, based on age of employee.


Calculating hourly rate

As stated in the National Minimum Wage Order 2020, the basic calculation is the gross pay is divided by the total number of hours worked.  Your Gross pay should include;

  • Shift premium
  • Bonus
  • Service Charge
  • Board (if applicable, 0.90c per hour worked)
  • Lodgings (if applicable, €23.86 per week or €3.42 per day)

As per the National Minimum Wage Order 2020, it must be clear what pay is taken into account, working hours and the period it covers. Hours worked should take into account overtime, travel (where this is part of the job) and training

The following do not count as pay and cannot be included when calculating the minimum wage;

  • Overtime premium
  • Call-out premium
  • Service pay (tips paid directly to you)
  • Unsocial hours premium
  • Tips which are placed in a central fund managed by the employer and paid as part of your wages
  • Premiums for working public holidays, Saturdays or Sundays
  • Allowances for special or additional duties
  • On-call or standby allowances
  • Certain payments you receive when absent from work, for example sick pay, holiday pay or pay during health and safety leave
  • Payment connected with leaving the employment, including on retirement
  • Contributions paid by the employer into any occupational pension scheme available to you
  • Redundancy payments
  • An advance payment of, for example, salary: the amount involved will be taken into account for the period when you would normally have received it
  • Payment in kind or benefit in kind, other than board or lodgings
  • Payment not connected with your employment
  • Compensation for injury or loss of tools
  • Award as part of a staff suggestion scheme
  • Loan by the employer to you


You are not entitled to the national minimum wage if;

  • Employed by a close relative (i.e spouse, parent) or
  • In a statutory apprenticeship or
  • Under 20 (this Act only guarantees you a reduced or sub-minimum rate of the national wage, as per table above)

While you are here; why not catch up on our other recent blogs

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Short Term Rental & Airbnb Review

Revenue have issued a review in regard to short term leasing from January 2020. Revenue have now defined that;

Income for providing short term accommodation for occasional visitors such as through an online accommodation booking system is not considered rental income (Case V) and is taxable as “other income” (Case IV) if occasional income or as “trading income” (Case I) if operated as a trade such as a guesthouse.

Therefore, in summary, Airbnb rentals and similar short-term rentals are no longer considered rental income and are to be declared as ‘other or trade income’.

What does this mean for my return?

Capital allowances (expenses subject to wear and tear) are not allowable against the profits of income under Case IV. However, expenses incurred to provide such accommodation are an allowable deduction such as ; commission fees, cleaning fees, reasonable cost of light and heat. Annual costs such as insurance, tv licence and general repairs and maintenance are no longer an allowable expense against profits under Case IV.


Now that this income is considered ‘other income’, You must register for VAT if your income is likely to exceed €37,500 per year. The VAT rate for short term accommodation is at a reduced rate of 9% and applies to;

  • Letting of a room(s) in a hotel or guesthouse.
  • Short term lettings of all or part of a house, apartment or similar building.
  • Letting of a part of a caravan park or similar place.
  • Letting of a part of a camping site or similar place.
  • Provision of any other holiday accommodation.

However, the provision of student accommodation is exempt from VAT.

A VAT registered business providing taxable short-term accommodation may reclaim Value-Added Tax (VAT) incurred on their business costs under the normal VAT rules.

Should you have any queries on this issue, please contact us on 01 5397999 or request our application here