Framed by “New Politics”, Brexit concerns and demands for more support for the SME and start-up sector, Michael Noonan and Pascal Donohoe have delivered Budget 2017.
The general consensus is that the Budget is positive for most sectors but has taken few risks.
The SME sector has expressed disappointment that greater support has not been given to the 1 million people employed by SMEs in Ireland. However, the startup community will appreciate the revised Capital Gains Tax Entrepreneur Relief reducing the effective CGT rate to 10% from January 2017.
Finance Bill 2016 to be published on Thursday, 20 October
As you may know the Budget is being published next Tuesday 11 October. The Department of Finance has this week confirmed that Finance Bill 2016 will be published on Thursday, 20 October. The full dates for the Finance Bill process (subject to sign-off from the Business Planning Committee) are set out below.
Microfinance Ireland (MFI) is a Government initiative to provide funding to both start-up and existing micro-enterprises that are having difficulty accessing credit through traditional lending channels.
Businesses that have less than 10 employees and turnover of less than €2million annually are eligible to apply for loan
The Departments of Finance and Social Protection issued a Consultation paper on what they term Intermediary-type Structures ie Contractors with a call for submissions closing on 31 March 2016.
We have reviewed the Consultation Paper and are disappointed it does not engage with the reality of the world of professional contracting and is more narrowly focussed on perceived losses of revenue to the Exchequer.
References to zero hours contracts appear as emotive headline grabbing comments but have little or no reality to Intermediary-type contracts.
The Irish economy generates foreign exchange (FX) flows of approximately €200Billion every year from the import and export of goods and services in addition to financial flows. Volatility in the FX markets is an ever present challenge to financial managers who are trying to minimise the impact that movements in foreign exchange rates can have on their core business. Adopting a proactive approach to managing FX risk will ensure that unforeseen developments in the financial markets do not erode trading margins or create negative surprises that can have a detrimental impact on the company’s performance. When it comes to managing FX risk it is not about beating the market or rolling the dice, it is about mitigating what is a very significant risk to your bottom line.
If we look at the EURUSD exchange rate over the last 18 months, we can see that an Irish company importing goods and paying for them in US dollars would have been doing so at a rate of €/$1.40 in May 2014. As recently as a few weeks ago, that same company would have been buying those same goods at a rate of €/$1.05, a move that represents a 25% increase in costs. Nobody knows where FX rates will be in the future but companies can take steps to manage or avoid these negative surprises or disadvantageous moves in the FX market.
Better FX rates mean that you will pay less for your foreign currency purchases or will generate more income from your foreign currency sales, these savings go straight to your bottom line.
Talk to Noone Casey to identify how best to manage your FX exposure.