Earlier this week members from industry and practice met in the Titanic Hotel in Belfast to discuss the Institute’s ongoing campaign to lower the rate of corporation tax in Northern Ireland. In June 2025 the Institute launched its refreshed campaign for a lower rate after a survey of members showed ongoing and broad support for this campaign. The campaign kicked off again last year when the Institute published its position paper ‘Enhancing Our Competitiveness: The case for a reduced rate of corporation tax in Northern Ireland’.  The Institute believes that Northern Ireland needs a comprehensive industrial policy that attracts investment, encourages entrepreneurship and brings well paid, secure jobs to the Northern Ireland economy.  Coupled with dual access to both the EU and UK markets, reducing the rate of corporation tax in Northern Ireland would be transformative for the entire economy.  Since the summer, the Institute has met with a broad range of stakeholders, including many of the major political parties in Northern Ireland, to discuss this issue. This work will continue in 2026 with the ultimate aim of developing a plan to implement a lower rate in the longer term. The Institute’s ongoing campaign for a lower rate of corporation tax for NI was also highlighted in 2025 in submissions to HMRC, and HM Treasury. In addition, in November 2025, the Institute wrote specifically to the Exchequer Secretary to the Treasury on this issue highlighting that the ultimate aim of a lower rate is that it would become self-funding in the longer term but that it would necessitate a replacement loan at a low interest rate from HM Treasury to fund the necessary block grant reduction. Attendees at the event on Monday heard about the work to date and discussed the opportunities and challenges that a lower rate would present. Attendees continue to be supportive of pursuing a lower rate and shared ideas on how to take the campaign forward and how the issue of the block grant reduction could be mitigated. The discussion also heard about the importance of this issue to local businesses, sharing what a rate cut would mean for them and the importance of protecting the existing tax base of Northern Ireland. If you work in a local business and would like to participate in the Institute’s campaign by being a voice of support for a lower rate, contact us by email.

Introduction The present enthusiasm for AI is rational, writes Emmet Kelly, but it needs to be balanced with proper governance, legal compliance, risk management, and human responsibility. Irish businesses are embracing artificial intelligence (AI) with enthusiasm. Across sectors such as professional services, finance, retail, manufacturing, logistics, as well as the public sphere, there is a widespread perception that AI, in a general sense, is a decisive productivity tool, capable of accelerating analysis, improving decision-making, and reducing operational friction. Most companies do not ‘adopt AI’ as a single initiative. Instead, they accumulate multiple AI systems over time – some explicit, some embedded, some user-driven, each with distinct risk profiles, data dependencies, and governance requirements. AI is not a single tool, nor a discrete system that can be cleanly ‘adopted’ or ‘switched on’. It is now a pervasive layer embedded across the software stack, the internet, and a set of tools to be easily accessed and used daily in the world of work. The principal challenge for companies therefore is not technical capability, but coherence: understanding where AI is present, what role it plays in decision-making, and how accountability is maintained across this fragmented landscape. The enthusiasm for AI is rational. AI systems continually demonstrate an impressive ability to summarise complex information, generate plausible text, detect patterns at scale, and automate tasks that previously required substantial human effort. However, this enthusiasm and use frequently outpaces a realistic appreciation of the complexity, opacity, and governance challenges that accompany AI deployment. For the accounting profession in particular – for whom judgement, verification and accountability remain foundational – this imbalance presents material risks. This article explores how Irish businesses are encountering AI in practice, why its complexity is often underestimated, and what recent research conducted by Amárach reveals about readiness among SMEs. Effective governance will require not only regulatory compliance, but a clearer understanding of the optimum relationship between humans and machines, one that preserves responsibility rather than attempting to outsource it. The illusion of simplicity For many organisations, the first encounter with AI is through publicly accessible systems such as OpenAI’s ChatGPT, Claude by Anthropic, or Gemini from Google. These large language models (LLMs) present AI as conversational, accessible, and apparently intuitive. Users ask a question, using ‘prompts’, and receive a fluent, structured response, from what appears to be a single, confident synthesis of vast amounts of underlying information. This interaction, or ‘chat’, creates a powerful illusion of simplicity. The complexity of the system, the scale of its training data, the probabilistic nature of the outputs, the constraints imposed by prompts, and the absence of any true understanding remains largely invisible. AI doesn’t understand anything. It merely matches words, numbers and context of the chat that best fits the data the AI is referencing. What appears to be a dialogue is a statistical process that predicts likely continuations of text based on patterns in data. The capacity to understand and interpret the quality and value of the AI response, or output, remains the responsibility of the human user. For professionals accustomed to contextual awareness, critical analysis and judgement, this distinction matters. LLMs do not ‘know’ when nuance is missing, when assumptions are incorrect, or when an answer is incomplete. They summarise, average, and generalise. In doing so, they may lose minority positions, edge cases, and context-specific considerations that are often critical in accounting, audit, tax, and governance work. AI in office and productivity software Beyond these publicly visible systems, AI is now embedded in many workplace productivity tools. Platforms provided by Microsoft, Google, and Apple increasingly incorporate AI-driven features: document drafting, spreadsheet analysis, email prioritisation, meeting summarisation, and even predictions of where trends in numeric data are likely to lead over time. Because these capabilities are integrated into familiar software, they are often perceived as incremental enhancements rather than as AI systems per se. Yet the AI governance implications still apply. For example, automated summarisation of discussions may omit critical qualifications or nuances. Predictive suggestions may reinforce historical biases. Decision-support features may subtly shape professional judgement without being formally recognised as decision-making inputs. The risk here is not malicious intent, but unexamined reliance. When AI-generated outputs are treated as neutral or authoritative simply because they are embedded within trusted tools, accountability can become blurred. AI in enterprise systems AI’s influence extends further into enterprise systems that underpin organisational operations. Enterprise resource planning (ERP), customer relationship management (CRM), and accounting platforms from providers such as SAP, Salesforce and Sage, now deploy AI for forecasting, anomaly detection, credit assessment, inventory optimisation, and workflow prioritisation. In these contexts, AI outputs can directly influence financial reporting, risk classification, and operational decisions. Yet they are often treated as system features rather than as models with assumptions, limitations, and potential points of failure. For accountants and finance leaders, this raises critical questions: Who validates these models? How are errors detected? What documentation exists? And how does professional responsibility apply when an AI-driven recommendation is followed? In-house AI models Larger organisations increasingly develop AI models ‘in-house’, using proprietary data to support functions such as fraud detection, credit-risk assessment, demand forecasting, and operational optimisation. These systems may be customised, powerful, and bring competitive advantage, but they also bring concentrated risk. In-house AI models depend entirely on the quality, scope, and representativeness of the data used to train them. They may reflect historical practices that are no longer appropriate, or embedded organisational biases. Without robust governance, policies, procedures, documentation, and on-going monitoring, such systems can quickly drift away from legal compliance and ethical acceptability. Regulation: the EU AI Act in context The European Union (EU) has sought to address these risks through the EU AI Act, which introduces a risk-based framework for AI governance. The EU AI Act emphasises transparency, human oversight, data quality, and accountability, principles that align closely with professional standards in accounting, auditing and assurance. However, regulation alone cannot resolve the underlying issues, as AI is no longer confined to discrete, easily identifiable systems. It will pervade software, services, and information flows from within an organisation, and often beyond. Organisations may be using dozens of AI-enabled tools without explicitly recognising them as such. Compliance, therefore, cannot be treated as a one-off assessment; it must become an on-going capability. Are Irish businesses AI-ready? Recent AI-readiness research conducted by Amárach Research in collaboration with InstaComply provides a clear picture of this structural gap. While the findings indicate strong enthusiasm for AI adoption among Irish SMEs, many of which are deploying AI at speed, there are also significant weaknesses in governance readiness. While many companies are experimenting with and deploying AI, far fewer have established clear ownership, policies, controls, and governance structures required to manage these systems safely, transparently, and in compliance with existing and emerging regulation. For example, only 37% have appointed a policy owner responsible for AI and data governance, while just 32% maintain risk registers that include AI-related risks. More than one-third have none of the basic structures that the EU AI Act will expect businesses to maintain. These findings do not show a failure of intent, but a structural gap. Use of AI is moving from an experimental phase to the operational core, yet the governance mechanisms needed to control it remain underdeveloped. The EU AI Act is not simply another compliance obligation – it requires a fundamental shift in how organisations must design, monitor, and document their automated systems. Taking responsibility Arguably, and as can be seen from our research findings, Irish businesses are engaging in “conversations with machines”, most often using LLMs, without fully understanding the mechanisms underlying the ‘conversation’ or the operations and quality of the machine with which the user is conversing. LLMs respond blindly based on the level, quality, and structure of the data that informs them. They do not challenge objectives, interrogate ethical implications, or assume responsibility for outcomes. Where complexity is poorly understood, responses tend to polarise. Some users may become distrustful, focusing on AI’s errors and limitations and rejecting its utility. Others may move in the opposite direction, treating AI outputs as authoritative and implicitly transferring responsibility to the system. Both kinds of behaviour present problems and risk. AI does not absolve individuals or organisations of responsibility, nor should it be dismissed as inherently unreliable. A useful analogy is that of tools in the physical world. The saying, “a bad workman blames his tools”, holds true for the use of AI, and a driver should not blame their car for their negligent driving. The workman remains bad, the driver negligent, and the tools and machines, just that: tools and machines. Responsibility remains with the human agent and the organisation deploying the tools. A new RACI model for human–AI collaboration What is required is a new articulation of responsibility, effectively, a new ‘RACI’ model that clarifies who is responsible, accountable, consulted, and informed when AI systems are used. This approach reflects a broader shift: compliance must move from static documentation to dynamic, operational governance, which embeds EU AI Act requirements, such as data quality, traceability, and human oversight, directly into development and operational processes as code. Human-in-the-loop approaches are not merely a regulatory preference; they are a practical necessity for maintaining standards, managing risks and sustaining businesses on the frontiers of rapidly changing, brimming with possibilities AI landscape. Conclusion: learning to drive the machine AI represents an extraordinary technological advance, and Irish businesses are right to explore its potential. But power without understanding presents risks. The accountancy profession, with its long-standing emphasis on judgement, accountability, and assurance, is well placed to lead a more mature, responsible and strategy-led engagement with AI. The challenge is not to slow innovation, but to learn to ‘drive’ these machines responsibly – within the limits of the law, ethics, business sense and professional judgement. AI is a tool, not an actor. Recognising that distinction will be central to protecting customers, clients, organisations, and public trust in the years ahead. Emmet Kelly is an AI data governance and compliance expert, and CEO of InstaComply, which empowers organisations to navigate regulatory complexity with smart automation.

Earlier this week members from industry and practice met in the Titanic Hotel in Belfast to discuss the Institute’s ongoing campaign to lower the rate of corporation tax in Northern Ireland. In June 2025 the Institute launched its refreshed campaign for a lower rate after a survey of members showed ongoing and broad support for this campaign. The campaign kicked off again last year when the Institute published its position paper ‘Enhancing Our Competitiveness: The case for a reduced rate of corporation tax in Northern Ireland’. Since then, the Institute has met with a broad range of stakeholders, including many of the major political parties in Northern Ireland, to discuss this issue. This work will continue in 2026 with the ultimate aim of developing a plan to implement a lower rate in the longer term. The Institute’s ongoing campaign for a lower rate of corporation tax for NI was also highlighted in 2025 in submissions to HMRC, and HM Treasury. In addition, in November 2025, the Institute wrote specifically to the Exchequer Secretary to the Treasury on this issue highlighting that the ultimate aim of a lower rate is that it would become self-funding in the longer term but that it would necessitate a replacement loan at a low interest rate from HM Treasury to fund the necessary block grant reduction. Attendees at the event on Monday heard about the work to date and discussed the opportunities and challenges that a lower rate would present. Attendees continue to be supportive of pursuing a lower rate and shared ideas on how to take the campaign forward and how the issue of the block grant reduction could be mitigated. The discussion also heard about the importance of this issue to local businesses, sharing what a rate cut would mean for them and the importance of protecting the existing tax base of Northern Ireland. If you work in a local business and would like to participate in the Institute’s campaign by being a voice of support for a lower rate, contact us by email.

In UK news, after significant lobbying by this Institute and other key stakeholders the UK Government announced an increase in the 100 percent allowance for agricultural property relief and business property relief, while the Spring Statement – the next big UK economic and fiscal event – will take place on Tuesday 3 March 2026. In Irish news, Revenue has published preliminary results for 2025. Elsewhere, following a recommendation from the TALC Simplification working group, the guidance on reliefs for investments in corporate trades has been restructured by Revenue. In International news this week, the OECD has published a report on digital continuous transactional reporting for VAT. UK 1. Last month the UK Government announced an increase in the 100 percent allowance for agricultural property relief and business property relief with effect from 6 April 2026. 2. The Spring Statement will take place on Tuesday 3 March 2026. Ireland 3. Revenue has recently published its headline results for 2025. 4. Following our engagement in the Tax Administration Liaison Committee (TALC), Revenue has recently restructured its guidance on reliefs for investments in corporate trades. International 5. Read the report recently issued by the OECD on digital continuous transactional reporting for VAT. Keep up to date with all the latest Irish, UK, and international tax developments through Chartered Accountants Ireland’s Tax Newsletter. Subscribe to the Tax News by updating your preferences in MyAccount. You can also read this week’s Cross-border developments and trading corner here.  

The Investment Business Regulations have been revised to reflect the Institute’s policy to provide only the authorisation categories IA1, IA2 and IB1 to Institute firms.  The categories of IB2 and ID previously provided for in the Investment Business Regulations have been removed.  The categories of investment business activities for which the Institute provides authorisation under the Investment Business Regulations, pursuant to the Investment Intermediaries Act 1995 (the IIA) are summarised  at Schedule 1 to Chapter 1 of Investment Business Regulations.    It is a firm’s responsibility to ensure that the firm is properly authorised for any investment business activities which the firm provides to clients.  The revised Investment Business Regulations are effective from 19 January 2026. Note regarding registration by the Central Bank in certain circumstances The Institute does not authorise firms to carry out insurance related activities which fall under the European Union (Insurance Distribution) Regulations 2018 (the statutory instrument which transposed the EU Insurance Distribution Directive in Ireland).  Firms which undertake activities under the European Union (Insurance Distribution) Regulations 2018, such as advising on or arranging insurance products, including insurance-based life and pension products, must be registered for such activities directly by the Central Bank of Ireland.   A firm which carries out investment business activities under the IIA could also choose to seek registration from the Central Bank for those IIA activities instead of from the Institute.  It is appropriate for a firm to review its investment business activities and the related authorisation regularly to ensure that it holds the appropriate level of authorisation for the activities provided. 

Introduction  The job market for Chartered Accountants at all levels will be a combination of positivity, optimism and caution. While overall the sentiment is positive, recruitment in some areas is moderating in response to cost-efficiency pressures and business transformation. That said, overall, the demand for Chartered Accountants is predicted to remain strong. Some employer will continue their journey of adapting their approach to traditional hiring models, focussing on the acquisition of specialised skills and investing heavily in talent pipelines to secure the next generation of Chartered Accountants. For job seekers and employers alike, understanding these trends is essential to staying competitive in an evolving market.   There will continue to be uncertainty in relation to global economy and geopolitical conditions, however, to date employers continue to prioritise hiring experienced finance professionals capable of driving governance, transformation, and strategic financial performance. The job market for Chartered Accountants is proving to be resilient including at the newly and recently qualified level and the outlook overall is positive.  What sectors are recruiting  Professional services & corporates Large professional services firms and international practices are continuing to hire finance, accounting and advisory talent across all areas of their business in Dublin and regionally. Large corporates and multi-nationals are continuing to recruit after a brief hiatus related to the concerns in relation to the impact of potential tariffs.   SMEs and small medium sized practices  The outlook in these areas is positive also with sustained recruitment activity across practice and industry.  Where will the roles be located  Dublin  Dublin continues to be a central hub for options, particularly in Technology, Financial services, Shared Services, and Life Sciences and pharmaceuticals.  Regional growth  We expect to continue to see increased levels of hiring across practice and industry regionally during 2026 following a pick-up in 2025. This includes within the SME and indigenous sectors.  Northern Ireland  Belfast remains active, driven by professional services, manufacturing, public sector reform and continued growth in Tech and Fintech. Northern Ireland’s public sector continues to offer strong opportunities at senior finance levels due to ongoing transformation initiatives.  Global opportunities Irish Chartered Accountant continue to be highly sought after worldwide, with roles available in the UAE, Australia, Canada, the US, and the Cayman Islands  Salary trends  After years of inflation-driven increases, salary growth is likely to continue to stabilise in 2026, especially for entry to mid-level positions. This is the case in ROI and NI. However, experienced Chartered Accountants with specialist skills in the areas of financial planning & analytics, business transformation and automation will continue to command premium packages.  Bonus structures will remain attractive and will be aligned with company and personal performance in many instances. Comprehensive and flexible benefits packages will remain to attract and retain top talent.  It is worth noting that pay expectations will continue to be tempered by hybrid working flexibility rather than driven solely by base salary with candidates prioritising flexibility and work-life balance over financial considerations.  Hybrid & remote working  Hybrid models are now the norm with many qualified accountants expecting to work from home at least some of the time with most spending 2/3 days in the office. Despite the increased focus on a return to the office for the most part hybrid working remains the approach adopted by many organisations.    Skills in demand  Leadership capability continues to be one of the most sought‑after skillsets particularly for those seeking to advance their careers and who are managing and developing growing finance teams and businesses.  Communication and stakeholder engagement skills remain key differentiators for senior candidates.  Technical competence in audit, tax, governance, compliance and complex reporting remains essential in both practice and industry roles. Strong monthly and quarterly reporting discipline continue to be critical for organisations navigating uncertain conditions in 2026.   Data and digital skills including Power BI, automation tools, ERP expertise and system literacy are increasingly required due to the developments in IT, AI and automation.   Business transformation experience, especially in process optimisation or finance function redesign, is in high demand as is experience of managing projects in these areas.  Interview & recruitment trends  Interviews will continue to be a combination of virtual and in-person meetings with the initial screening process most likely to be conducted online followed by a more detailed in-person interview. AI is also being incorporated into recruitment processes including AI screening and structured assessments to help employers with their evaluation.  Competency based interviews are being used across organisations small and large and are pivotal in focusing on leadership behaviours and demonstrating impact.  Timeliness for interview processes have become more protracted in recent times with hiring managers being more discerning in terms of the selection process. This is a trend that is likely to persist in 2026.   Conclusion  The outlook for the jobs market for 2026 is positive with opportunities arising for Chartered Accountants at all career stages. To remain competitive members will need to remain up to date with market developments including recruitment trends and the skills requirements of employers which are evolving inline with market developments.  

From the Professional Accountancy team…... In December 2025 the European Commission announced planned changes to the list of high-risk jurisdictions .Russia was added to the list in order to strengthen the international fight against financial crime. In addition, updates were also announced for the high-risk jurisdictions list following the decisions taken at the FATF and its list of ‘Jurisdictions under Increased Monitoring’ (‘grey list’), following the FATF Plenaries of June and October 2025. The EU has added new third-country jurisdictions to the list (Bolivia and the British Virgin Islands) and delisted a number of others (Burkina Faso, Mali, Mozambique, Nigeria, South Africa and Tanzania). The changes will not enter into force until published in the Official Journal.  For further information regarding the planned changes to the list of high-risk jurisdictions, please refer to European Commission webpage on high risk third countries . This information is provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.

Revenue has updated various pension manuals providing clarifications and guidance relating to the transfer of pension benefits, deemed distributions from pension funds and the taxation of retirement lump sums. The guidance on the transfer of payments has been updated to clarify the treatment of benefits transfer from an occupational pension scheme to a Personal Retirement Savings Account (PRSA), to another occupational pension scheme or to an approved buy-out bond (BOB). The guidance on funding and investments has been revised to update the reference to the Revenue pensions branch and to provide details on deemed distributions from pension funds. The guidance on the taxation of retirement lump sums has been reorganised to provide relevant information including 

Finance Act 2025 was signed into law on 23 December 2025. We will notify our readers once our TaxSource resource has been updated to reflect the relevant changes.

Revenue has published a new chapter in the pensions manual to provide guidance on the Automatic Enrolment Retirement Saving System. The guidance provides details on contributions to the auto enrolment system by participants, employers and the State, and includes relevant taxation implications and related contact details. The layout of the guidance is as follows: Paragraph 1: Introductory section, Paragraph 2: Contributions by participants and repayments of contributions to a participant, Paragraph 3: Contributions by an employer and repayments of contributions to an employer, Paragraph 4: Contributions made by the State, Paragraph 5: Taxation of payments made from the Automatic Enrolment Retirement Savings System, Paragraph 6: Taxation of payments made following the death of a participant, Paragraph 7: Interaction of the Standard Fund Threshold with auto-enrolment savings, and Paragraph 8: Contact details for the National Automatic Enrolment Retirement Savings Authority and the Department of Social Protection.

The deadline for the completion of the Large Corporates Division (LCD) VAT modernisation and eInvoicing survey is 5pm on 16 January 2026. We encourage members working in VAT-registered businesses under the remit of LCD and those advising LCD VAT-registered businesses to share their insights with Revenue and to urge their clients to complete the survey. While the survey includes a box for the taxpayer’s number, this does not need to be included to complete the survey, and you can leave this box blank and still respond. Further details regarding the survey are included in our earlier newsletter items.

Revenue has advised that ROS services will be unavailable today for an hour from 18.00 to 19.00 due to essential maintenance. This will impact public facing services for Local Property Tax, Revenue Online Service for businesses, vehicle registration and myAccount. Direct Payroll reporting and AIS/AES Customs services will not be impacted.