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Posts Tagged ‘taxation’

Special Assignee Relief programme (SARP)

A SARP return must be made by an employer of
employees who availed of relief under the Special
Assignee Relief Programme (SARP) during the year
ended 31 December 2012 on or before 15 February
2013.
Under the SARP program 30% of basic salary (to a
maximum of €127,500) is excluded from the charge to
Income Tax for employees who take up full time
employment in Ireland. Qualifying employees must have
been a full time employee with a Company incorporated
and resident in a Treaty State for the 12 months prior to
arriving within the State. The individual must also be
resident in Ireland to qualify for the relief. The relief
does not apply to Universal Social Charge or PRSI. An
Employer will also be able to bear the cost of certain
items for a relevant employee on a tax free basis to
include the cost of a return trip for the employee and
family to an overseas country to which they are
connected plus primary and or post primary school fees
up to €5,000 per annum per child where the school is
approved by the Minister of Education.
The SARP return is available on the Revenue website
and requests:
• details of the Employer and Employee registration
numbers
• employee name
• amount of income, profits or gains in respect of
which no tax was deducted
• costs associated with an annual return trip to the
country of residence or nationality for self and/or
family
• costs of school fees for children paid to an approved
school in the state
• increase in number of employees as a result of the
operation of the relief or number of employees
retained by the company as a result of the operation
of the relief
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Tax implications of Civil Partnership & Co-habitation

The Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 (Act) was signed into law on 19 July 2011. The purpose of the legislation is to extend to registered civil partners the same tax treatment as is currently provided to married couples under the Tax Acts. It was anticipated that the Act would extend a similar tax treatment to cohabitants however the rights of cohabitants with regard to tax legislation have not been significantly increased in this Act.

Civil Partnership

A civil partnership is defined as a same sex relationship similar to a marriage where both parties have entered into a legal agreement under the Act. The Civil Partnership is required to register with the relevant Registrar in order to qualify for favourable tax treatment. Following the registration of the Civil Partnership, civil partners must notify their local Revenue office of the date of registration.

Thereafter the civil partners will be entitled to broadly the same tax treatment as is currently in place for married couples. To that end they will be entitled to the ‘married tax band’ and credits for Income Tax purposes. They will be entitled to transfer assets to each other without triggering Capital Gains Tax and Stamp Duty. Likewise any gift or inheritances made between civil partners will be exempt from Capital Acquisitions Tax.

In the year of registration, both partners will continue to be taxed on a single assessment basis. In subsequent years, the civil partners can elect for joint assessment, separate assessment or separate treatment as appropriate. Where a civil partnership is legally dissolved, Revenue will record the dissolution and each party will be treated as individuals for tax purposes from the date of dissolution.

Cohabitants
A qualifying cohabitant is defined as a person who has lived with another for 2 years or more in the case where they have one or more dependant children and 5 years or more in any other case. As noted above, the Act does not extend the tax treatment of married couples to cohabitants. However under the legislation, a qualifying cohabitant will have the right to seek redress from the courts similar to married couples. For example where a relationship has ended and a qualifying cohabitant can demonstrate that he/she was financial dependant on the other cohabitant the court may order:

1. That property be transferred from one party to another
2. That maintenance be paid
3. That a pension adjustment order be granted
4. That a cohabitant be provided for from the estate of a deceased cohabitant

Those wishing to avoid the effects of the new Act will need to enter into a cohabitants’ agreement.

If you wish to discuss the implications of civil partnership or cohabitation on your personal tax position, do not hesitate to contact Anthony Casey at 01 6766 476 or by email at acasey@noonecasey.ie

Revenue & the Sheriff

The Collector General & the Revenue Commissioners have carried out almost 32,000 enforcement proceedures during 2012 recovering €210m.
The most common enforcement type was the appointment of County & City Sheriffs to collect debt amounting to almost €150m. This occurred on over 22,000 occasions.
Sheriffs fees can be in the region of 2% of the debt – resulting in an additional €3m in fees paid by the hard pressed tax payers.
Not bad work if you can get it!

Report of Comptroller and Auditor General Published

The report of the Comptroller and Auditor General for 2011 has been published. In relation to tax and Revenue it includes a number of interesting points:
• Income tax receipts increased by a net €2.5 billion (bn) in 2011 when compared with 2010, reflecting the introduction of the Universal Social Charge (USC) and the reduction in tax bands and credits.
• Tax forecasting has been made more difficult with the emergence of significant corporation tax losses. The utilisation of losses in 2010 is estimated to have reduced potential corporation tax receipts by €2.75bn.
• A new debt analysis tool was introduced on a pilot basis in February to allow Revenue case workers prioritise the recovery of debt by reference to the age of the debt. It also allows them to determine the type and timing of interventions to maximise recovery.
• Total tax outstanding at the end of March 2012 was just under €2bn. The two largest categories of debt outstanding are income tax and VAT. Overall, about one third of the debt outstanding was under appeal.
• 3 economic sectors accounted for 59% of the total tax written off in 2011; construction, wholesale and retail trade and accommodation and food services. The majority of these write offs arose due to liquidations and the trade ceasing with insufficient liquid assets
Thanks to the Institute of Tax for the above summary.

New Collector-General appointed

Revenue has announced that they have appointed Michael Gladney as the new Collector-General. Mr Gladney headed up Revenue’s Limerick Tax District & South West Region’s Large Enterprise Audit Unit, prior to his appointment as Collector-General.

The previous Collector-General, Gerry Harrahill has been assigned as head of Revenue’s Corporate Affairs and Customs Division

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