Tax RoI

The CCAB-I needs your views and experiences to inform important representations on the tax treatment of TWSS related matters, the Tax Debt Warehousing Scheme, and the impact of COVID-19 on an individual’s ability to travel in and out of Ireland so far in 2021 and the implications on tax residency.  The survey will close next Monday 1 March. Please complete the survey now. 

Feb 22, 2021

Patricia Barker outlines red flags for audit and risk committees as they continue to navigate the coronavirus pandemic and the fallout from Brexit. It’s hard to imagine audit and risk committee members as frontline workers in the face of the COVID-19 pandemic. However, time will undoubtedly show that the guidance of a good, active audit and risk committee was a pivotal oxygen tank for companies as they stumbled through these difficult times. In providing effective oversight, the audit and risk committee’s contribution must be responsive to the additional risks and uncertainties arising from COVID-19 and Brexit. The radar is picking up new bleeps, which include the following. New risks on the risk register It is vital to identify new risks, the appetite for those risks, and mitigations that can be put in place. These risks include, but are not limited to, failure of suppliers or customers due to economic pressures; invocation of force majeure clauses to avoid performance of contracts; reputational damage caused by a failure of staff to comply with Government guidance; a cluster outbreak of COVID-19 among staff; insufficient funding; and health and safety failure on the premises. Going concern All audit and risk committees will have to conduct a deep dive into the appropriateness of using the going concern concept for the 2020 financial statements. This work must be completed in advance of the arrival of the external auditors. Business continuity plan Audit committees should be very familiar with the robustness of the business continuity plan. They should also be satisfied that it has been rigorously tested to cope with the potential crashes that may result from the black swan event that is the COVID-19 pandemic. Procurement There are high risks associated with rushed procurement practices, which were necessary due to the emergency nature of the pandemic. Audit and risk committees should create a schedule of any instances where management had to speed up or bypass procurement practices due to the need to procure for the pandemic. They will need to be satisfied that all material exemptions from procurement regulations have been appropriately applied and authorised. The exemptions provided for in legislation include situations of extreme urgency, where there is a genuine emergency due to events that could not have been foreseen in situations that were not controlled by the company. It would seem that the pandemic (although not Brexit) complies with these conditions, which would permit the procurement of goods or services in a fast-tracked way outside the standard procurement policy. However, the current question for audit and risk committees is how long it can reasonably be assumed that COVID-19 is an emergency that could not have been foreseen. Control of government supports There are high risks associated with the very rapid deployment of government resources to a vast range of beneficiaries. To the extent that such resources have been claimed by the company or on behalf of staff, the audit and risk committee should be happy that appropriate controls were put in place to ensure that the claim was made in accordance with the terms of issue, that the funding was applied as stipulated, and that anti-fraud measures were appropriately applied. The external auditors will likely examine the transparency and governance associated with benefits drawn down, such as: Grants; Subsidies; Liquidity loans; Credit guarantees; Short-term compensations; Payroll support; Tax alleviation; Additional human resources deployed; and Tax losses carried back. Economic fraud and cybersecurity robustness There have been significant incidences of cybersecurity and IT failures due to opportunistic frauds arising from COVID-19 such as email compromise, investment scams, and phishing scams. In an Economic Crimes Survey conducted by PwC in 2020, 18% of organisations surveyed reported that they had incurred losses due to fraud in excess of €800,000 and 13% said they had incurred losses in excess of €5 million. These costs do not account for the losses arising from remediation, fines, brand damage and reputational damage. Economic crime dealt with by the European Commission Crime Bureau includes the following: Cybercrime; Customer fraud; Asset misappropriation; Money laundering; HR/employee fraud; Deceptive business practice; Intellectual property theft; and Accounting fraud. Audit and risk committees must seek evidence that economic risks were explicitly addressed and closed off by the company, including assurance that such risks are adequately insured. Third-party risks Focusing on internal risks is only part of the challenge; the risks associated with outsourced goods and services also need attention. These risks are elevated as our direct controls change due to virtual working. The risk attack field related to external service providers is as varied as stationery, security, catering and HR, resulting in additional risks of fraud and cyberattack. According to PwC’s Global Economic Crime and Fraud Survey 2020, one in five respondents identified vendors and suppliers as the source of their most disruptive external fraud. Half of the respondents lacked a mature third-party risk management programme, and 21% had none at all. Audit and risk committees should address this issue with the leadership team to ascertain the extent of the vulnerability and the potential need to seek professional assistance. Remote working Audit and risk committees must be proactive in implementing robust health and safety and human resource protection policies to safeguard employees working from home and safeguard the company’s assets. Issues raised should include health and safety mechanisms to ensure that staff have suitable stress management supports; good ergonomic working conditions; and reasonable boundary control over working hours. Furthermore, where company assets such as docking stations, laptops and other equipment have been taken home, mechanisms should be in place to control those assets and to appraise valuations and impairments. Appropriate protocols should also be in place to ensure that employees are fulfilling their contracts. GDPR policies will need to be stress-tested to assure the audit and risk committee that there have been no breaches of the regulations. The audit and risk committee will also need to confirm that the company’s insurance policies cover the changed working theatre. Risk of redundancies If it seems likely that squeezed resources will lead to redundancies, the audit and risk committee will want to see an assessment of this risk, the mitigations in terms of spreading the load, the policy on the redundancy payment matrix, and budgetary planning. Provision of ad hoc board support During the emergency, the audit and risk committee should be willing to convene to conduct deep dives, specific investigations, or advisory analysis as may arise due to unforeseen issues relating to the COVID-19 pandemic or Brexit. All in all, this is a busy time for audit and risk committees, and we will likely look back on this period and determine that committee members provided a highly professional, emotionally intelligent, and effective service to boards. It is unlikely that citizens will stand on their doorsteps and applaud them, but at least they will know that they did a good job.   Patricia Barker chairs the audit committees of the Marine Institute and Tallaght Hospital and is a member of the Ethics and Governance Committee at Chartered Accountants Ireland.

Feb 09, 2021

In our latest edition of Brexit Digest, we focus on customs and trade. A recent survey carried out by the Institute revealed that customs paperwork is causing headaches for traders across the island with calls for better practical guidance from government. In this edition, we look at common errors made when preparing customs declarations as well as tips to avoid these pitfalls.  We have also assembled some of the relevant Irish and UK government guidance. You can read all previous issues of Brexit Digest here.

Feb 04, 2021
Tax RoI

A list of employers who received payments under the Employment Wage Subsidy Scheme (EWSS) in 2020 was published by Revenue. The list includes 39,800 eligible employers who received over €1.4 billion in respect of 443,100 employees. The amount paid to each employer has not been published, in line with the legislative requirements under which the list must be published. The EWSS was introduced through the July Jobs Stimulus package, replacing the Temporary Wage Subsidy Scheme (TWSS) on 1 September. The EWSS was initially expected to support around 350,000 jobs into the beginning of 2021, at an estimated cost of €1.9 billion. With the growing prevalence of the coronavirus in Ireland since July, the subsidy available per employee per week under the scheme was increased from a maximum of €203 to €350, in October. The latest COVID-19 support schemes statistics show that there are 45,900 employers registered for the EWSS and €331 million subsidy payments were paid in January. Read the Revenue press release for more information on the publication of the 2020 EWSS employers list.

Feb 01, 2021

It's hard not to feel gloomy about 2021's economic outlook, what with tight restrictions in place and a slow vaccine roll-out. Andrew Park encourages us not to lose hope, however, as estimates indicate that GDP will grow despite the setbacks. 2021 was the year we had all hoped would allow us to return to some ‘normality’ following the COVID-19 pandemic, thanks to the development and roll-out of multiple vaccines. However, with infection rates rising at a rapid rate prior to Christmas, the Irish Government introduced tougher Level 5 restrictions. Under these restrictions, the Irish Government enacted a de facto national lockdown, reinforcing the work from home message, restricting non-essential travel, as well as the closure of schools and a move to remote learning in addition to the closure of ‘non-essential’ retail. Each round of ‘stop-go’ that easing and raising restrictions delivers is worsening the economic damage. These current Level 5 restrictions, which may ease in early March, will have a profound impact on the economy. Where optimism was emerging, as evidenced via sentiment surveys, restrictions caused that to ebb away. Q1 2021’s outlook is seeming more downbeat than previously expected. The immediate impact will be felt through the labour market and, more specifically, the live register. Using data from December 2020, when the introduction of the Level 5 restrictions began, we can see the initial introduction caused the COVID-19 adjusted unemployment rate – which includes both the live register and Pandemic Unemployment Payment (PUP) recipients – to reach 20.4%, up from 15.9% in September 2020 prior to the Level 5 introduction. A similar trend can be seen through the number of PUP recipients. 219,913 people were in receipt of PUP for the week ending 6 September. Following the introduction of increased restrictions, the number of PUP recipients increased to 335,599 PUP for the week ending the 3 January, representing 13.6% of the total labour force. These adverse labour market impacts, in conjunction with business restrictions, will result in a lower level of economic growth in Q1 2021. Although, estimates for Q1 2021 economic growth have yet to be published, we can say with some certainty that it will be significantly down on the bounce back growth Ireland was seeing at the back-end of last year when Q3 2020 recorded growth of 11.1%. While the immediate economic outlook looks ‘gloomy’, the outlook for 2021 as a whole looks more promising, with the roll-out of the COVID-19 vaccine and agreement on a free-trade deal between the UK and EU impacting on prospects. Initial estimates, produced by the ESRI’s Quarterly Economic Commentary, suggest GDP will grow by 4.9% in 2021, underpinned by a free-trade deal between the EU and UK as well as Level 5 lockdown lasting only six weeks. Although restrictions and slower than hoped vaccine roll-out is hampering the economy now, the overriding sense is one of hope. If we can navigate the next few months successfully, there is significant pent-up demand ready to be unleashed into the economy. Andrew Park is a Manager in the Economic Advisory team at Grant Thornton.

Jan 29, 2021

Following the launch of the new CRO portal last month, there were a number of concerns raised by members both in terms of system glitches and regarding the introduction of new processes. We communicated your issues in a letter to the CRO on behalf of the CCAB-I. Whilst some of these issues may be temporary in nature, others are structural in nature and we were keen to engage proactively to determine if solutions can be found. The CRO have responded and provided an update on progress made to date. The Institute supports the move towards a fully online process and compliance is important to all members but the system needs to work efficiently to support users in being compliant. We are listening to your issues and concerns and we will continue to liaise with the CRO on your behalf and keep you updated on progress.   Updates are available on the CRO and on their twitter account which is updated more frequently.

Jan 26, 2021

Chartered Accountants Ireland is a global organisation, with members living and working all around the world. Our network of very active District Societies are a way for members to network professionally and personally. They are a great way to offer and give support, as well as for those living overseas to keep in touch with us here in Ireland. This week, Tuesday 26 January is Australia Day so we are taking the opportunity to reach out to our 1,037 members who call Australia home. So, where is everyone?   State Number of members  New South Wales  617  Victoria  227  Western Australia  91  Queensland  49  South Australia  6  Northern Territory  3  Capital Territory  3  Tasmania  2  Not stated  39 Australia Day is a national holiday, so we hope our members are enjoying a day off. We invite members to Tweet and tell us what you are doing to mark the day this week, using the hashtag #CharteredAustralia We'd love to hear from you! And don't forget that if you are a member living in Australia, your District Society would welcome you getting in touch. The Society Executive is Cathy McDermott, and she can keep you updated on events and activities the Society arrange.

Jan 26, 2021

"Ah, sure, it'll be grand" is an expression widely use in Ireland. Sometimes, however, your staff really do need help. Damian McCourt emphasises the importance of listening to your employees and offering support when they need it. “This is ridiculous,” I said, staring at the influx of work in dismay. “I’m never going to get through all this.” It was 2013, and I was a project manager with far more work than was good for me. I was feeling panicked. My manager looked across at me, shrugged his shoulders in a what-can-you-do sort of way, and announced, “it is what it is”. I put my head down, kept my mouth shut, and proceeded to work myself into a burnout. I didn’t realise it at the time, but I had just been ‘minimised’. Talking about our mental health is never easy. Even if your workplace encourages open discussion on mental health, the desire to appear capable, competent and – above all – strong can be a severe deterrent to asking for help. As a result, it often falls to the manager to ask if someone is okay. This is difficult even at the best of times. It requires planning, privacy and a careful, non-judgmental approach. Try doing this over Zoom with your locked-down kids, and you have a genuine challenge. The good news is that if you’re a careful listener, you won’t even need to initiate this conversation. People ask for help all the time – they just don’t make it obvious. Seemingly off-the-cuff comments on energy levels, mood and workload sometimes hide a call for help, and you can respond in one of three ways: Shift the conversation to you “Oh, I’m up to my eyes too! Wait ‘till I tell you what I had to deal with last week…” Shifting the conversation back to you isn’t helpful but it’s an easy mistake to make as a manager, especially if you’re feeling slightly stressed yourself. Do it often enough, and people will stop talking to you. Minimise the situation “Ah, it’ll be grand. We’re all in the same boat. That’s just the job. Man up and get into it.” Minimise is a put down, pure and simple. Everyone else is OK so you should be too. Pipe down and get on with it. For someone who is already worrying about their ability to cope, you’re doubling their anxiety by dismissing their concerns. Not only are you being supremely unhelpful, you’re giving yourself a harder conversation later on. Offer support “Are things really bad? Anything I can do to help?” We would all like to think that we’d be the one to offer support, and yet we all live with our own concerns and priorities. It’s easy to miss an opportunity to help. Remote working tools can actually make monitoring the health and wellbeing of your staff easier. Keep an eye on your Teams chat and watch for clues in email conversations. It’s easier to ask if someone needs help than if they are okay, and your offer of support might make all the difference. Damian McCourt is a freelance trainer and consultant specialising in workplace resilience, productivity and sensible leadership.

Jan 22, 2021
Press release

31 January self-assessment filing deadline comes as further severe COVID-19 restrictions are implemented across UK A one-off, one-month extension to deadline would help industry to cope in these emergency times – Institute  7 January 2021 – Chartered Accountants Ireland has written to Chancellor of the Exchequer, The Rt. Hon Rishi Sunak MP, requesting that the government responds to the deteriorating COVID-19 situation by extending the tax deadline approaching for businesses at the end of the month. Chartered Accountants Ireland has over 4,500 members across Northern Ireland, and circa 2,500 members in GB who continue to be at the forefront of helping businesses navigate Government supports introduced as a result of COVID-19.  The pandemic has put increasing pressure on businesses in meeting regulatory and reporting obligations due to workplace health and safety requirements, staff resourcing, illness and childcare/caring constraints and the challenges of social distancing.  Chartered Accountants Ireland has been engaging with HMRC officials since last September, to highlight the difficulties businesses and accountants are experiencing in meeting the forthcoming self-assessment filing deadline of 31 January. Commenting, President of Chartered Accountants Ireland, Paul Henry said “The rampant nature of the virus in recent weeks necessitating a further severe lockdown in all regions of the UK introduces insurmountable obstacles to self-assessed businesses and individuals in their efforts to meet the forthcoming 2019/20 self-assessment filing deadline on 31 January 2021. “Since the outbreak of the pandemic, the swift implementation of the Government’s practical COVID-19 support measures has provided considerable support to businesses and taxpayers. It is crucial that businesses continue to be supported now that the situation has evolved so considerably in recent days and weeks.”  Chartered Accountants Ireland highlighted to the Chancellor that the regulatory workload of businesses is already at least two months behind normal schedules due to the national lockdown in 2020 and further restrictions across the various regions introduced from October onwards.  Henry continued “Although accountants will make every effort to ensure that as many tax returns as possible are filed on time for businesses, due to the extraordinary circumstances of the pandemic, there will be instances where it is just not practically possible to make the deadline.  “A short once-off extension of one month to the self-assessment deadline would help ease the pressures on businesses who have the necessary information for the preparation of their return but cannot safely provide this to their accountant due to the ongoing public health restrictions.”  ENDS

Jan 07, 2021

About Irina Irina Yotova started out with a degree in Hospitality Management, and worked for several years in senior operations roles in a number of large hotels. Budgets and numbers became a part of these roles and a part she really loved. She trained as an Accounting Technician while working, and soon decided she wouldn't stop there. Irina has recently become our 29,000th member and is delighted with her career choice. We recently chatted with her to find out more about her journey and her advice for others considering making a change. Background and journey I completed a degree in Hospitality Management and spent over 10 years in various roles in hospitality operations and senior management. This gave me the opportunity to engage with finance, including setting annual budgets,  weekly forecasts and analysing and managing actual results. These financial areas became important parts of my daily duties which I have to admit I really enjoyed! I have always had a keen interest and love for numbers, having excelled at maths in high school. So with this passion and my growing experience at work, I joined the cluster finance team which at that time was responsible for the finance and accounting of five hotels.  Production of monthly management and financial set of accounts and cost control were only a fraction of my duties, at which point I felt that pursuing a career in accounting is what I wanted to do. Thanks to exemptions granted from elements within my primary degree, I became an Accounting Technician within a year and at that stage, I knew that becoming a Chartered Accountant was my next goal, so embarked on the Flexible Route. I chose the Flexible Route as it suited my personal and professional life as a mature student. My job involved travel within the island, which prevented me from attending lectures at times. The online materials, the support available to all students and the professional network I created helped me achieve my goal – becoming a Chartered accountant.   What the next years may hold  I currently work as an Auditor at the Office of the Comptroller and Auditor General, responsible for carrying out value for money examinations of various government departments and offices and report the results in annual chapters and special reports.  I joined the Office when I commenced studying for my Chartered Accountancy qualification.  Given the fact that the world is changing at such a rapid pace nowadays, who knows where I will be in the next five years.  A lesson learnt from the pandemic is that now, more than ever, we need to be adaptable, to embrace change and to think and act quickly. I see myself continuing to progress my career in the OCAG and I am enjoying the endless opportunities the Chartered Accountancy qualification presents me with. I would like to study again at some stage in the future.  What advice would you give to someone considering accountancy? I won’t lie. It was not easy – but no one said it would be… The rewards and opportunities that go with the Chartered qualification are endless. If I had to do it again, I would not think twice.  It’s worth the effort. What are your top tips on studying and exams that you would give to future students? Take your time and do not stress. Try to stay on top of all subjects. It's easy to focus on the subjects we like most, so be careful not to neglect others. Good preparation and planning are the keys to success. Make sure to find time to enjoy yourself and do not give up on your hobbies while you are studying. Keep your eye on the prize! As Sills once said “There are no shortcuts to any place worth going". What skills from your former qualification and experience have helped you along the way? My hospitality management roles and qualification taught me organisational skills, leadership, open-mindedness, prioritisation and delivery of results. These are all fundamental in accountancy too, of course, so I feel lucky to have taken the journey I did.  Every type of experience is always an asset.  I think having worked with such a wide variety of people allowed me to gain a broad spectrum of experience in many aspects and broadened my business acumen. 

Jan 06, 2021
Careers Development

The annual “Chartered Star” prize has been jointly awarded to two entrants from Co. Donegal and Co. Down by Chartered Accountants Ireland. The decision reflected the high calibre of entrants this year, and both winners will now go on to represent the Irish chartered accountancy profession at the ‘One Young World’ conference in Munich next July. The winners are Aisling McCaffrey, Associate Director with Grant Thornton and Dr Caroline McGroary, Assistant Professor of Accounting in Dublin City University (DCU).  The ‘Chartered Star’ award recognises exceptional achievement amongst young and trainee accountants around the island of Ireland. Each year, it is awarded to someone who will lead, motivate, and inspire as they build their career. In 2020, entrants were challenged to demonstrate to the judging panel the ways in which they are making a difference and working towards, or supporting, the 17 UN Sustainable Development Goals (SDGs).  Paul Henry, President, Chartered Accountants Ireland said “My heartiest congratulations to both winners. It is in all our hands to create a strong and sustainable accountancy profession into the future and Aisling and Caroline’s achievements at a still relatively early stage in their careers are to be commended. I look forward to following their achievements in the coming years, and on behalf of the Institute I wish them success in their engagements in Munich in July. We are fortunate as a profession to be so ably represented on a global stage.” Aisling McCaffrey, Associate Director with Grant Thornton is originally from Holywood, Co. Down and works in Dublin. A member of the FinBiz2030 Irish taskforce, she is also a NextGen committee member for 100 Women in Finance, a global network of professionals in finance working together to empower women at every stage of their career. Sport also plays a huge role in her life. A tag rugby player, she has represented Ireland in two World Cups and is a World Cup silver medal winner.  Her work to support the Sustainable Development Goals is focused on achieving gender equality (SDG 5) and empowering women and girls, as well as climate action (SDG 13). She currently acts as project manager for the team responsible for the creation of the Green Team Network – a forum for connection and empowering change towards a sustainable environment within the Irish Funds Industry. In Grant Thornton, she sits on an internal ESG working group through which she promotes sustainable activity across the firm. Aisling commented “I feel really proud and humbled to have been awarded Chartered Star for 2020/21 by Chartered Accountants Ireland. My qualification has provided me with technical knowledge and skills that I have been able to utilise in all aspects of my life and I am delighted to be representing the profession on an international stage at the One Young World Summit. I am really excited to collaborate with other young leaders at the summit who are passionate about making a social impact and finding effective solutions to global issues.” Fellow winner, Caroline McGroary, originally from Donegal, is an Assistant Professor of Accounting with DCU. Before joining DCU she trained as a Chartered Accountant with Deloitte. Over the last seven years she has worked between Ireland and Saudi Arabia through a partnership between DCU and Princess Norah University (PNU), the largest female only university in the world. Caroline particularly impressed the judging panel with an initiative she developed to help women at risk of financial exclusion in Saudi Arabia. The initiative, which was supported at governmental level, had a social media campaign which reached over 1 million users, was nominated for a number of awards and was presented at international conferences. Her work to support the UN SDGs is focused on SDG 4 Quality Education and SDG 5 Gender Equality by improving the financial literacy levels of students; educating students about the UN SDGs; empowering them to help achieve the goals through community engagement; while her PhD research is centered around professional education. In addition, Caroline promotes the UN SDGs in the business community in Saudi Arabia and Ireland, and was a founding member of the Irish Business Network - Saudi Arabia. Caroline commented “This is an award that I am immensely proud to hold and I look forward to representing the profession at the One Young World Summit in Munich, in 2021. I hope to use this summit as a platform to meet with leaders and activists from all over the world, and to identify ways in which we can work together to achieve impact. I'm also looking forward to working with the FinBiz2030 taskforce, whose aim is to mobilise the finance and business community globally to help achieve the UN SDGs.” ENDS  About Chartered Accountants Ireland Chartered Accountants Ireland is Ireland’s leading professional accountancy body, representing 28,500 influential members around the world and educating 7,000 students. The Institute aims to create opportunities for members and students, and ethical, sustainable prosperity for society. An all-island body, Chartered Accountants Ireland was established by Royal Charter in 1888 and now has members in more than 90 countries. It is a founding member of Chartered Accountants Worldwide, the international network of over one million chartered accountants. It also plays key roles in the Global Accounting Alliance, Accountancy Europe and the International Federation of Accountants.  About One Young World: One Young World is an international conference that brings together inspiring young people from 190+ countries that are committed to making a difference. The summit will take place in Munich in July 2021. One Young World provides a platform for young leaders to speak alongside Presidents, Nobel Prize Winners, Global business leaders and other inspiring global leaders. Delegates are an international cohort, sharing their impactful work, personal experiences, views and opinions with around 1,300 Summit attendees and an audience watching around the world.

Dec 22, 2020
Tax UK

Chartered Accountants Ireland recently wrote to Minister for Finance, Paschal Donohoe, TD, highlighting the need to simplify tax compliance on current and future wage supports.  The Institute noted the continued importance to businesses of wage supports in 2021 but called for the associated compliance on the supports to be simplified given the fact that rigorous eligibility criteria and checks are already in place.  The Institute’s letter sets out that tax compliance attaching to wage supports requires a substantial amount of time and management by businesses and their accountants. This is in addition to all other tax compliance obligations of a business operating in difficult circumstances due to the disruption caused by COVID-19.   The recent changes to the eligibility test for the EWSS will be challenging for businesses and the Institute called for a transitional measure to be put in place to help businesses with a legitimate expectation that they qualified for the support up to March 2021. 

Dec 21, 2020

Commenting Cróna Clohisey, Public Policy Lead, Chartered Accountants Ireland said “While it is positive to see the EU-UK Joint Committee reach an agreement in principle, the promise of the adoption and implementation of this agreement before the end of the Brexit transition period could be a “red herring” for businesses. The absence of an implementation mechanism does not give businesses adequate time to understand and prepare for the changes before they come into effect on 1 January 2021.    “This will make matters more complicated for traders and businesses, particularly those depending on the finer technical details of the agreement, and their practical application.    “These technical details need to be made available as soon as possible. We are still facing the prospect of a no deal Brexit, but technical detail on today’s agreement would go a long way to providing some reassurance to businesses.”  ENDS For more information Jill Farrelly MPRII Tel: 087 738 6608 PR and Communications Manager

Dec 09, 2020

We were delighted to catch up with Marie-Claire McDonnell, who is now based in Toronto with her family. As you will read, it wasn’t a smooth start but she has some really good, practical advice for new arrivals or those thinking of making the move. In 2019, we launched a Chapter Network Group for members in Toronto, which Marie-Claire heads up, so anyone in the area should certainly reach out!  Tell us about your journey as a Chartered Accountant and how you ended up settling in Toronto?  I trained in EY Dublin in the ICT department (Industrial, Commercial and Technology) and qualified in 2008.  Similar to many in my intake, I took a year out to travel mostly Asia, Australia and New Zealand. I came back to Ireland in the latter part of 2009 worked for three years as Associate Director, Finance in Depfa Bank. It was at Depfa I met my now husband, Cormac, and we decided to move to Canada. At the time it was easy to get a one year working holiday visa, and we chose to live in Toronto as we both had financial services experience and Toronto is a Financial Services hub.  I found it hard to settle in Toronto if I am completely honest, it did take me about a year. We came in September 2012, when the bad weather starts. We knew no one here and I really had to put myself out there to make friends. It takes a few months to get work here also, so I took on temp admin roles to keep myself occupied at the start. I remember asking myself a few times as I was doing data entry for eight hours a day: “did we make a huge mistake?” But we hung tight and both secured great roles by December 2012. I took a maternity cover contract in a pension fund called OMERS ($109 billion in net investment assets in 2019), where I was Senior Financial Analyst in Finance for Venture and Strategic investments. Once I was there four months, they made me permanent and I stayed for three and a half years before I made the move to recruitment. I now recruit qualified accountants in non-financial services industries with Robert Walters Canada, and have a special soft spot for helping the Irish ACAs who have just arrived in Toronto.  What have been the advantages of being an ACA in Toronto? The Irish ACA designation is very well respected in Toronto, and Irish ACAs have a reputation for being extremely hard workers. Employers like the training Irish ACAs get in Ireland. A lot of the time the ACAs from practice have had exposure to audit of large multinationals and are technically strong as a result.  The ACA designation opens so many doors here. Another huge benefit of the ACA designation is that it is a profession which you are almost guaranteed to secure permanent residency with. What advice would you give to members going to Toronto today? Be prepared to have to wait to get a good role and have savings to keep you going for three to four months. Toronto is an expensive city and sometimes it can take a while to get a good role. As you have no credit history in Canada, you might need to pay a few months rent up front. It is important to be prepared for this. I would also encourage people to be open. Contract work is your friend in Toronto, it is a foot in the door of a good company, or it is Canadian experience to secure your next role. Look at contract work with an open mind: what experience will I have after this role to open doors for me? Be confident and put yourself out there. Toronto is a city built on networks. Be prepared to cold message people (maybe Irish ACAs here) and ask them for a chat/coffee/Zoom call. I know so many people here who have secured work by networking. Irish people do try to help each other in Toronto as much as possible which is fantastic. How has lockdown been in Toronto for you? I am sure like everyone, I can say it has been very challenging. We had a difficult few months in that we welcomed our second daughter, Isla, in May in the middle of lockdown. Isla unfortunately was born critically ill with meningitis. Our family were all in Ireland and they were so worried about us over here. Managing their worry on top of our own was difficult. My husband and I did not see Isla together until she was discharged from hospital a month later as only one caregiver could be in the hospital at a time. Daycare was closed so we had to find care for our two-year-old daughter Aoibhinn. COVID just made a terrible situation 10 times worse if that was possible! However, in the midst of the difficulty, the kindness and selflessness of our friends was unbelievable. Our close circle of friends here rallied around, staying overnight with us, minding our eldest daughter, taking our dog, cooking for us, driving us to the hospital and back, cleaning and just being here for a shoulder to cry on when you technically cannot touch people outside your family.  They put themselves at risk being with us as we were in hospital every day.  Lockdown was probably one of the worst times of my life but we really learned how amazing and supportive our friends are here. Thankfully little Isla is a trooper and has made a full recovery.   What will Christmas mean for you this year?   We are actually travelling to Ireland for Christmas for five weeks. We are very lucky to have a house to quarantine in Killarney. My brother is getting married at the end of December and we wanted to take our little miracle baby Isla home to meet her family in Ireland. It will not be the same as years before, but we are content to just be at home with our families. I am also very excited for some grandparent babysitting so I can hopefully squeeze in a few shopping trips! Marie-Claire McDonnell is a Finance and Recruiting Specialist with Robert Walters and also is a point of contact for the Toronto Chapter and would love to hear from any members in the Toronto area. Similarly, members looking to reach out can contact Gillian Duffy - District and Global Member Manager.

Dec 02, 2020

With international tax reform progressing at unprecedented speed, Susan Kilty explains why Irish businesses must continue to participate actively in the discussion. With all the global uncertainty that Ireland is facing due to COVID-19 and Brexit, there is a risk that the OECD global tax reforms – the other major threat to Irish business and the economy – will be pushed further down the corporate agenda. But to do so would be very risky. Ireland must engage with this process now, at both the political and corporate level. The world of international tax is in a state of extreme flux as governments grapple with changes in the way multinationals do business. It is worth reiterating that Ireland has attracted healthy levels of foreign direct investment (FDI) over the past 30 years, and the multinational community has contributed significantly to our economic success. According to the OECD, Ireland received more foreign direct investment in the first half of this year than any other country. Along with Ireland’s near-iconic 12.5% tax rate, a crucial element in our continuing ability to attract international investment is the stability and transparency of the corporate tax regime here. Investors from abroad who establish activities in Ireland tend to be quite sensitive to changes in the taxation system. They like certainty and stability in a tax code, which is why Ireland presents such an attractive proposition. Ireland cannot afford to lose FDI as a result of turbulence in the global tax landscape at this time. As corporation tax accounts for almost 18% of Ireland’s total tax take, any change to the regime threatens to seriously undermine the attractiveness of our FDI model and negatively impact our revenue-raising ability. The crux of the matter is that we, and many other countries, apply 20th century tax systems to 21st century e-commerce business models. Businesses have an increasingly digital presence, and many no longer trade out of brick and mortar locations. This is not limited to so-called technology companies, but can be seen across industries and in businesses of all sizes. Businesses sell freely across borders without ever needing to set up operations abroad. This new digital way of trading is not always captured in our analogue tax rules, and the rules must be realigned with the reality of modern e-commerce. However, to tax a multinational business, you need a multinational set of rules. This is where the OECD comes in, but the uncertain shape that the new rules might take brings more uncertainty for businesses at a time when it is least needed. Many clients cite the changing international tax environment as one of the top threats to potential revenue growth. And although countries now face enormous bills for COVID-19, one sure thing is that BEPS, OECD and tax reform will not go away. International corporate tax reform is happening, and it will impact many businesses and our economy. Companies need to stay on top of these changes and prioritise the issues that will affect them. OECD proposals The OECD proposals offer a two-pillar solution: one pillar to re-allocate taxing rights and ensure that profits are recorded where sales take place, and a second pillar to ensure that a minimum tax rate is paid. At the time of writing, a public consultation is open for stakeholders to share their views with the OECD on the proposals that were recently summarised by way of two “blueprint” documents, one for each pillar. Pillar One seeks to give market jurisdictions increased taxing rights (and, therefore, increased taxable income and revenues). It aims to attribute a portion of the profits of certain multinational groups to the jurisdictions in which their customers are based. It does this by introducing a new formulaic allocation mechanism for profits while ensuring that limited risk distributors take a fair share of profits. Several questions remain as to how the Pillar One proposals, which constitute a significant change from the current rules, will be applied. Pillar Two, on the other hand, seeks to impose a floor for minimum tax rates across the globe. This proposal is very complicated. It is much more than a case of setting a minimum rate of tax. It is made up partially of a system that requires shareholders of companies that pay low or no tax to “tax back” the profits to ensure that they are subject to a minimum rate. At the same time, rules will apply to ensure that payments made to related parties in low-tax-paying or no-tax-paying countries are subject to a withholding tax. Finally, it can alter the application of double tax treaty relief for companies in low-tax-paying or no-tax-paying countries. Agreeing on the application and implementation of this pillar will be incredibly difficult from a global consensus point of view. Several supposed “safety nets” in Pillar Two are also likely to be of limited application. For example, assuming that the minimum tax rate is set at 12.5%, this does not mean that businesses subject to tax in Ireland will escape further tax. Similarly, assuming that the US GILTI (global intangible low-taxed income) rules are grandfathered in the OECD’s proposal, this does not mean that the US GILTI tax applies as a tax-in-kind tax for Pillar Two purposes. Pillar Two poses a significant threat to Ireland, as it reduces the competitiveness of our 12.5% rate to attract FDI and, coupled with the Pillar One profit re-allocations, could reduce our corporate tax take. The OECD estimates that once one or both of the pillars are introduced, companies will pay more tax overall at a global level, but where this tax falls is up for negotiation – and this is why early engagement by all stakeholders is critical. While the new proposals will undoubtedly have an impact, it is not certain that Ireland’s corporation tax receipts will fall off a cliff. Ireland has already gained significantly in terms of investment from the first phase of OECD tax reform, and this has helped to drive a significant increase in corporate tax revenue. But the risks must nevertheless be addressed. There is, of course, the risk that the redistribution of tax under the rules directly under Pillar One and indirectly via Pillar Two will impact our corporate tax take. But even if the rules have no impact on a company’s tax bill, they could still impose a considerable burden from an administrative perspective, and the complexity of the rules cannot be overestimated. At a time when businesses are grappling with other tax changes, led by the EU and domestic policy changes, this would be a substantial additional burden on the business community. The OECD is progressing the rules at unprecedented speed in terms of international tax reform. The momentum behind the process comes from a political desire for a fair tax system that works for modern business. However, does this rapidity risk the international political process marching ahead of the technical tax work? This is where Ireland, both government and corporate, needs to play a vital role. While the consultation period on both pillars is open, the focus for stakeholders should be on consulting with the OECD on the technical elements of its plan. Considering the OECD’s stated objective to have a political consensus by mid-2021, this could be one of the last opportunities for stakeholders to have a say in writing the rules. The interplay between the OECD and the US Treasury cannot be ignored when considering the OECD’s ability to get the proposals over the line. The US Treasury decided to step away from the consultation process with the OECD for a period in mid-2020. This, of course, raised questions around whether the OECD proposals could generate a solution that countries would be willing to implement. Added to this, the OECD has always positioned Pillar One and Pillar Two as an overall package of measures and has stressed that one pillar would not be able to move forward without the other. The “nothing is decided until everything is decided” basis of moving forward is a risky move, but the OECD recently rowed back on this stance. If the OECD fails to reach a political consensus by 2021, we could very well see the EU act ‘en bloc’ to introduce a tax on companies with “digital” activities. This could result in differing rules within, and outside of, the EU. It would also increase global trade tensions, all of which would not be good for our competitiveness. As a small open economy, Ireland will always be susceptible to any barriers to global trade. A multilateral deal brokered by the OECD therefore remains the best option – the last thing we want to see is the EU accelerating its own tax reform or, worse still, countries taking unilateral action. For the Irish Government, providing certainty where possible about the future direction of tax is critical. Where we have a lead is in how we provide that stability and guidance where we can. The upcoming Corporate Tax Roadmap from the Department of Finance will be an opportunity to give assurances in these uncertain times. Next steps for business The public consultation will be critical for businesses to have their say in shaping the rules. Ireland Inc. must continue to engage constructively with the OECD to try to shape the outcome so that we maintain a corporate tax system that is fit for purpose, is at the forefront of global standards, and works for businesses located here. Doing so would ensure that we articulate the position of small open economies like our own. Each impacted business must take the opportunity to comment on the proposals, as this may be the last chance to have a say. Indeed, what comes out of the consultation period may be the architecture of the rules for the future. We know that difficult decisions must be made at home and abroad in terms of the new tax landscape, and made with additional pressures we could not have foreseen 12 months ago. Although it may seem that much is out of our control, Irish businesses must continue to participate actively in the discussions and ensure that their concerns are heard. The game may be in the final quarter, but the ball is in our hands. Susan Kilty is a Partner at PwC Ireland and leads the firm’s tax practice. Point of view: Fergal O'Brien Since the start of the BEPS process in 2013, Irish business has recognised the importance of the work to our business model and the country’s future prosperity. At its core, BEPS has seen a further alignment of business substance and tax structures at a global level. This has resulted in an often under-appreciated surge in business investment, quality job creation and, ultimately, higher tax revenue for the Irish State. With its strong history as a successful location for foreign direct investment, and substance in world-class manufacturing and international services, Ireland was well-placed to benefit from the new global order. The boom in business investment, which last year reached over €3 billion every week, and increase in the corporate tax yield from €4 billion in 2013 to €11 billion in 2019, are evidence of the further embedding of business substance in the Irish economy. The current round of BEPS negotiations will have further significant implications for the Irish economy, and particularly for the rapidly growing digital economy. Ibec is working directly with the OECD to ensure that any further changes to corporation tax recognise the central role of business substance and locations of real value creation. Fergal O’Brien is Director of Policy and Public Affairs at Ibec.  Point of view: Norah Collender The OECD’s proposals to address the challenges of the digitalised economy will have a disproportionate negative impact on small, open exporter economies like Ireland. Earlier consultation papers issued by the OECD on taxing the digitalised economy suggested that smaller economies could benefit from international tax reform emanating from the OECD. However, the OECD now openly admits that bigger countries stand to benefit from its proposals more than smaller countries, and the carrot has turned into the stick in terms of what will happen if smaller countries do not support the OECD. Ireland is acutely aware of the dangers ahead if countries take unilateral action to achieve their vision of international tax reform. But that does not mean that countries like Ireland should be rushed into accepting international tax rules that fundamentally hamstring Irish taxing rights. Genuine consensus must be reached to ensure that international tax reform is sustainable in the long-term. Likewise, the new tax rules must be manageable from the multinational’s perspective and from the perspective of the tax authority tasked with administrating the rules. A rushed outcome to the important work of the OECD will make for tax laws that participating countries, tax authorities, and the all-important taxpayer may not be able to withstand in the long-term. Norah Collender is Professional Tax Leader at Chartered Accountants Ireland. Point of view: Seamus Coffey How Pillar One and Pillar Two of the OECD BEPS Project will ultimately impact Ireland is uncertain. One sure thing, however, is that there will be changes to tax payments. This will be a combination of a change in the location of where taxes are paid and perhaps also an increase in tax payments in some instances. But there will likely be both winners and losers. From an Irish perspective, there might have been some comfort in that the loser could have been the residual claimant – the country at the end of the chain that gets to claim taxing rights on the profits left after other countries have made their claim. As US companies are the largest source of Irish corporation tax revenue, it might have been felt that most of the losses would fall on the US. However, significant amounts of intellectual property have been on-shored here. Ireland, therefore, has become a residual claimant for the taxing rights to some of the profits of these companies. At present, Ireland is not collecting significant taxes from these profits as capital allowances are claimed. If BEPS results in a significant reallocation of these profits, we might never collect much tax on them. Seamus Coffey is a lecturer in the Department of Economics in University College Cork and former Chair of the Irish Fiscal Advisory Council.

Dec 01, 2020

The government has recently announced details of a new support scheme for businesses, but it has limitations that need to be addressed. Paul Dillon outlines the role Chartered Accountants must play to raise awareness of these limitations. Details of the COVID Restrictions Support Scheme (CRSS), announced as part of Budget 2021, were recently published by Revenue and registration for the scheme has officially opened. By offering a support of up to €5,000 per week, the scheme will be very valuable to businesses impacted by Government health and safety restrictions. However, the biggest hurdle for businesses will be meeting the many terms and conditions necessary to qualify. To begin with, the guidance issued by Revenue is over 45 pages long. While detailed guidance is always helpful, the length of the guidance speaks volumes about the complexity of the scheme. Further, it piles more paperwork on businesses already struggling to stay on top of the demands of operating under lockdown conditions. These same businesses continue to grapple with paperwork for the Temporary Wage Subsidy Scheme (TWSS) by having to respond to compliance check letters and reconciliations for Revenue, which all 66,000 employers who benefited from the scheme must prepare. The CRSS is only available to businesses operating from premises that restricts customers from access due to COVID-19 restrictions. This means that the scheme benefits retailers, restaurants, pubs and entertainment venues, but it cannot be accessed by the many suppliers of these businesses, even though these suppliers are equally impacted by the negative effects of the Government’s COVID-19 restrictions. For example, wholesalers supplying to restaurants, pubs and hotels do not qualify for the CRSS under the current terms of the scheme. Sound engineers who supply their services to the live entertainment sector do not qualify for this subsidy, and all the businesses who provide services to theatres and shows are also excluded from CRSS. Mobile businesses not tied to a fixed premise are also precluded from accessing the scheme. This includes taxis and businesses operated from stalls, such as markets or trade fairs. It is puzzling why the Government has chosen to exclude these businesses from qualifying for the CRSS, especially given the fact that on Budget Day, Minister Donohoe said, “The scheme is designed to assist those businesses whose trade has been significantly impacted or temporarily closed as a result of the restrictions as set out in the Government’s ‘Living with Covid-19’ Plan.” This messaging gave hope to many businesses; however, those hopes were dashed when further details revealed the condition that only businesses operating from a fixed premises with restricted customer access could benefit from the scheme. As Government restrictions to control the spread of COVID-19 are likely to be a feature of life in Ireland in 2021, it is essential that proper supports are in place to help all businesses impacted by the restrictions, like the wholesalers and businesses supplying services to restaurants and hotels. The CRSS will be a lifeline to many businesses and its only fair that the scheme should apply to all businesses impacted. While Government has demonstrated a willingness to revise and refine supports, like the TWSS, it is only when the issues are brought into the public domain by informed commentary. That is why, as Chartered Accountants, we have a role to play in raising awareness of the limitations of the CRSS and lobbying for change. Paul Dillon is Deputy Chair of the Tax Committee South of the CCAB-I and Taxation Partner in Duignan Carthy O'Neill.

Nov 20, 2020

How can we make sense of a seemingly random event like the COVID-19 pandemic? Tom Armstrong talks about coping and the critical role of human support and interaction in helping us navigate the road to recovery. We are now close to one year on from the initial outbreak of COVID-19 in Asia, and the negative impact of this random event is more evident than ever. People feel less safe, less in control, more vulnerable, less confident, and more anxious than before. Those suffering most may be asking why now, and why me? A recent read of Ronnie Janoff-Bulman’s book, Shattered Assumptions, compelled me to fully consider the impact of random events like COVID-19, where so much of the immediate impact is negative. It is difficult to say where this pandemic lies on the trauma scale. Many people have had little impact on physical health, work, and mental wellbeing. However, many others have been affected through the loss of loved ones, loss of livelihood, having to put life progression on hold, and general anxiety about the state of the world. How can those who have suffered cope? I think we can divide coping into some broad areas. Self-help Create a routine, eat well, take regular exercise, maintain a journal, spend time in nature, spend less time looking at mobile devices, watch a good movie, meditate, sing, start a new hobby or make a simple daily plan. These things are within our control and are good for our wellbeing, regardless of the degree to which COVID-19 has impacted us. Interpretation of events Our interpretation of life events is shaped by our life experience and tends to be the result of unconscious processes. However, over time and through reflection, we can work on the meaning of events. While not deluding ourselves, we can reframe events. This work enables us to incorporate, and make meaning of, what has happened in our world. For example, maybe this crisis has given us time to spend more time with family, really listen to the opinions of those we differ with, hear the birds sing, or appreciate the flowers in full bloom. Maybe, because of this pandemic, we’re learning to be more considerate, appreciate the simple things in life, and be grateful for what we have. Take action Taking our own actions is important to give ourselves a sense of control and the feeling of agency over our lives. While our ability to take specific actions may be restricted right now, there are still many areas of our lives where we can make our own choices – calling a friend, getting up early, going for a walk/run and so on. In time, our feeling of freedom to take more action will return. Support This is a two-way street where we can both receive and give support. It is a dynamic process. What does this support look like? It can be material support, such as money or services, or it can be information support – tools and advice about resources that are available to help a person in need. Equally, it can simply take the form of listening, empathising, accepting, and valuing another person. Because we are fundamentally social beings, social support is critical for our sense of self-worth. Social support is positively associated with psychological wellbeing and mental health. We all can offer support and a supportive environment to those who need it. The road ahead There will be a return to more ‘normal’ times when social restrictions are lifted. In the meantime, we all have the choice to support and help each other as we navigate the current challenges and seek to reach the other side safely. We may get bruised along the way, but when it’s over, we will have survived and through our actions and experience, we can be wiser, stronger and more human. Tom Armstrong is an Executive Coach, Facilitator, Mentor and Chartered Accountant.

Nov 13, 2020
Press release

80 per cent of accountants do not feel fully equipped yet to deal with sustainability as a business case  74 per cent of accountants feel a responsibility in relation to sustainability Sustainability “Hub” launched alongside practical guide at Climate Finance Week event Friday 6 November 2020 – Chartered Accountants Ireland has today launched a guide to help accountants upskill to deal with sustainability as a business case. 80 per cent of accountants surveyed by the Institute report that they are not yet fully equipped with the skills to drive sustainability in their own organisation or to advise clients as to their requirements. Encouragingly, however, 60 per cent say that sustainability forms a key part of their organisation's business strategy. The Institute’s new guide, “Sustainability for Accountants” is accompanied by a dedicated sustainability “Hub” on its website, with resources to equip accountants. These resources were launched at an event today as part of Climate Finance Week. Commenting, Susan Rossney, sustainability expert at Chartered Accountants Ireland said “Sustainability has transformed from “nice to have” to become a key pillar of the business case for companies. Businesses can no longer avoid adopting a long-term sustainable strategy, particularly as government and policymakers have started a pioneering legislative push towards a more sustainable economy. Colleagues working in other areas of business, such as HR have long embraced sustainability in all its forms, and this laser focus is now also required in finance and accounting functions. “Accountants are uniquely placed to drive sustainability from within organisations as advisers. They make critical financial decisions daily about purchasing, procurement and many other things and the information they provide is vital to wider decision-making. From this position of influence comes opportunity and responsibility. The guide, “Sustainability for Accountants” details the risks and opportunities presented by sustainability, and details steps that need to be taken to address the challenges. It also shares best practice examples of success and describes how organisations can transition to operating sustainably, successfully and cost-effectively. The Sustainability Hub provides practical information, guidance and supports to help members. The Institute has previously used this ‘hub’ approach to gathering resources to support members to significant effect in relation to both Brexit and the COVID-19 pandemic. Rossney continued “Our objective today in the publication of this guide and the launch of our Sustainability Hub is to empower accountants in all sectors of industry to lead change, by giving them practical, easily accessible resources. It is evident from engaging with accountants that there is concern about the risks presented by ESG issues for their business and the businesses they advise, and our objective is to help them to meet this challenge. “Sustainability is already in the DNA of our student body, as it is part of our education syllabus, but for those who have already moved further along their career path, these resources and those that will follow in due course represent an opportunity to upskill.” To download the guide, click here Sustainability for Accountants ENDS  About Chartered Accountants Ireland Chartered Accountants Ireland is Ireland’s leading professional accountancy body, representing 28,500 influential members around the world and educating 7,000 students. The Institute aims to create opportunities for members and students, and ethical, sustainable prosperity for society. An all-island body, Chartered Accountants Ireland was established by Royal Charter in 1888 and now has members in more than 90 countries. It is a founding member of Chartered Accountants Worldwide, the international network of over one million chartered accountants. It also plays key roles in the Global Accounting Alliance, Accountancy Europe and the International Federation of Accountants.

Nov 06, 2020

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