An additional €1.37 billion in funding for childcare provision and extended mortgage interest tax relief for a further year were the main features. The 9 percent rate of VAT on gas and electricity will continue until April 2025.  Childcare provision  This additional funding will support the continued implementation of the National Childcare Scheme (NCS) subsidy, the Early Childhood Care and Education (ECCE) programme as well providing additional allocations toward Core Funding to support employers in meeting further increases in minimum rates of pay for those working in the sector.   In addition, two double payments of Child Benefit will be made to all qualifying households before the end of the year.  Mortgage interest tax relief  Mortgage interest tax relief, which was introduced on a temporary basis in Budget 2024, is being extended by one further year. Qualifying homeowners will be eligible for the relief in respect of the increased interest paid on their mortgage in the calendar year 2024 over the calendar year 2022 at the standard rate of income tax (20 percent), capped at €1,250 per property.   There is no change to the qualifying criteria for the relief, including that qualifying homeowners must have an outstanding mortgage balance on their principal private residence of between € 80,000 and €500,000 on 31 December 2022.  9 percent VAT for gas and electricity  It is proposed to extend the 9 percent VAT rate from 1 November 2024 to 30 April 2025 to address cost of living pressures associated with the price of gas and electricity. 

The key changes announced in Budget 2025 are: Increases to tax credits and bands as well as a 1 percent reduction in the USC,  An increase in the rental tax credit to €1,000, including a retrospective increase to its level in 2024,  The first increases in the CAT group tax free thresholds since 2019,  Enhancements to some business and investor reliefs, including a change to the proposed €10 million cap on retirement relief for family transfers of businesses, The small gift exemption which allows an employer to reward employees has been enhanced to allow five non-cash gifts up to a value of €1,500 per year,  Revenue will conduct a range of targeted compliance management activities in 2025, and  Confirmation that the participation exemption for foreign sourced dividends will commence as expected from 1 January 2025.  The Institute has a webpage dedicated to Budget 2025 where you can find further information. 

Budget 2025 saw the announcement of a series of tax measures to benefit both prospective buyers in addition to renters, alongside the announcement of €1.25 billion in additional funding to accelerate the building of new homes by the Land Development Agency. Stamp duty rates were also increased for higher value residential properties and bulk purchases, effective from today.   Rent tax credit   The rent tax credit is being amended to increase the amount that can be claimed from €750 to €1,000 (or €2,000 in the case of a jointly assessed tax-payer unit). This increase will apply in respect of the 2025 year of assessment.  In addition, the Minister also announced in his speech that in recognition of the cost-of-living pressures facing many renters right now, the credit will also be increased in 2024 to €1,000 and €2,000 respectively.  Help To Buy scheme   The Help to Buy scheme is an income tax measure intended to assist first-time buyers with the deposit required to purchase or self-build a new house or apartment to live in as their home. The scheme will be extended for a further four years, from the end of 2025 to the end of 2029.  Vacant Homes Tax  The rate of the Vacant Homes Tax is being increased from five times to seven times a property’s existing base Local Property Tax liability. This increase will take effect from the next chargeable period, commencing 1 November 2024.  Stamp duty changes   A third rate of Stamp Duty on higher value residential properties is to apply where the value/acquisition price involved exceeds €1.5 million. A new rate of 6 percent will now apply to the element of the value above €1.5 million. This change has immediate effect with normal transitional arrangements applying to transactions in process.  The existing 1 percent rate on residential properties valued up to and including €1 million, and 2 percent on any value above €1 million but below €1.5 million will continue to apply.   In addition, the Stamp Duty rate applied where 10 or more houses are acquired in any 12-month period is being increased from 10 percent to 15 percent, again with effect from Budget night. Transitional arrangements will also apply.   Pre-letting expenses  A deduction (capped at €10,000 per premises) from rental income for certain pre-letting expenditure is already available. This relief will be extended for a further three years to 31 December 2027.  Residential Zoned Land Tax (RZLT)  The RZLT is a new tax on land both zoned for residential development, and which has the necessary services in place to develop housing. The tax is designed primarily as a behaviour changing measure and not to be a significant revenue raising measure. RZLT is an annual tax, to be calculated at 3 percent of the market value of the land in scope.   Provision was made in the Finance Act 2021 for the RZLT. Amendments to the RZLT legislation will feature in Finance Bill 2024 which will provide for a further opportunity for RZLT landowners to seek a change in zoning in 2025 to a zoning which reflects the economic activity they undertake on the land.   Legislation will also be introduced to allow for 12-month deferral of RZLT liability between the grant of planning and commencement of development, exemption during Judicial Review  Proceedings brought by a third party as well as technical amendments.   To ensure local authorities appropriately consider requests the Minister for Housing, Local Government and Heritage will issue guidelines to local authorities indicating that they should consider and accommodate rezoning requests where landowners seek to continue undertaking existing economic activity.   

The main measures announced were the now usual annual Budgetary increases in excise duty for tobacco products, and the expected announcement of a new duty on e-cigarettes and vaping.  The bank levy was also extended to 2025  Tobacco excise  Excise duty on tobacco products is being increased by €1, inclusive of VAT, on a pack of 20 cigarettes in the most popular price category, with pro rata increases being made on other tobacco products.   Normally such a change would take effect from midnight tonight however the Budget 2025 Financial Resolutions which would confirm this have not yet been published.  E-cigarettes  Budget 2024 set out the Government’s intention to introduce a domestic tax on e-cigarettes and vaping in this year’s Budget. The Budget confirmed today that excise duty on e-cigarettes is being introduced and will apply to all e-liquids at a rate of 50 cents per ml of e-liquid. According to the Minister for Finance’s speech, a typical disposable vape contains 2ml of e-liquid, and costs in the region of €8. This new tax will bring the price of such a product to €9.23 including VAT.   Stressing once again the operational and administrative challenges associated with this new tax, it will not commence until mid-2025 and therefore will be subject to a commencement order.  Small producers of cider and perry  The excise relief for independent small producers of cider and perry is being extended to cover what is known as other fermented beverages, which includes products such as mead and wines other than grape wine such as elderberry wine, strawberry wine etc., as well as to higher strength cider and perry.  Bank levy  A revised bank levy was introduced for 2024, and this is now being extended for one further year to apply in 2025. This applies to those banks that received financial assistance from the State during the banking crisis, (AIB, EBS, Bank of Ireland and PTSB). It is expected that estimate revenue of €200 million will be collected in 2025.  Compliance  Revenue will conduct a range of targeted compliance management activities in 2025. It is expected that additional Exchequer receipts will arise from increased taxpayer compliance in a range of economic areas. The yield form this is estimated to be €70 million. 

The Minister announced the first increases to the capital acquisitions tax (CAT) group thresholds since October 2019. In addition, a range of changes and enhancements are being made to retirement relief, the new angel investor capital gains tax (CGT) relief, and the reliefs for investments in corporate trades, whilst the active farmer test for CAT agricultural relief is being extended to the disponer.  CAT thresholds  Increases to the three group thresholds for gifts or inheritances will apply as follows:  Group A from €335,000 to €400,000,  Group B from €32,500 to €40,000, and  Group C from €16,250 to €20,000.  For CAT purposes, the relationship between the person giving a gift/inheritance (the disponer) and the person who receives it (the beneficiary) determines the maximum amount (the “group threshold”) below which CAT does not arise. The standard rate of CAT remains unchanged at 33% in respect of gifts and inheritances taken on or after 6 December 2012.   CAT agricultural relief (AR)  The six-year active farmer test for the purposes of CAT agricultural relief is extended to the disponer and requires the donor to meet the six-year active farmer test in order for the beneficiary to benefit from AR. This narrows the relief to benefit farmers and safeguard AR for the genuine active farmer and the next generation of farmers. No date has been given for this change.  CGT retirement relief  Finance Act 2023 increased the age parameters (the upper age limit was extended from aged 65 until 70 and the reduced relief available on disposals from age 66 onwards was increased to age 70). It also introduced a cap on retirement relief of €10 million on the relief available up to age 70 for disposals to a child which is expected to take effect from 1 January 2025.  Finance Act 2024 will retain the increased upper age limit and introduce a clawback period of 12 years for the relief available on disposals over €10 million, after which the CGT will be abated.   These changes aim to ensure that the intergenerational transfer of Irish family businesses continues to be supported by the tax system. According to the Budget publications, this is estimated to cost €15 million in a full year.  CGT angel investor relief  This relief was announced in Budget 2024 and is targeted at encouraging business angel investment in innovative start-ups by offering a reduced CGT rate of 16 percent/18 percent for individuals and partnerships. The relief is due to commence “shortly” according to the Budget publications. However, it is now proposed to increase the lifetime limit on gains, on which the reduced rate of Capital Gains Tax applies, from the €3 million originally announced in Budget 2024 to €10 million.  This new relief will be available to an individual who invests in an innovative start-up small and medium enterprise (SME) for a period of at least 3 years. The investment by the individual must be in the form of fully paid-up newly issued shares costing at least €10,000 and constituting between 5 percent and 49 percent of the ordinary issued share capital of the company.  The scheme will include a certification process, which will be conducted by Enterprise Ireland to ensure the relief is targeted at innovative SMEs that can demonstrate financial viability and compliance with the requirements of the EU General Block Exemption Regulation.  Qualifying investors will be able to avail of an effective reduced rate of CGT of 16 percent (or 18 percent if through a partnership), on a gain up to twice the value of their initial investment.  There will now be an increased lifetime limit of €10 million on gains to which the reduced rate of CGT will apply.  Relief for investment in corporate trades  Following a tax expenditure review, the Employment Investment Incentive (EII), Start-Up Relief for Entrepreneurs (SURE) and the Start-Up Capital Incentive (SCI) are to be extended for a further two years to 31 December 2025.   The limit on the amount that an investor can claim relief on for EII investments will be increased from €500,000 to €1,000,000. And it is proposed to increase the relief available to a maximum of €140,000 per year (€980,000 over 7 years) for SURE investments. 

Enhancements to the research and development (R&D) tax credit, and start-up relief for companies were the main features. A new corporation tax relief is to be introduced for expenses incurred on an initial stock market listing. And, as expected, the new participation exemption for foreign sourced dividends will commence from 1 January 2025.   R&D tax credit  The R&D tax credit remains an important feature of the corporation tax (CT) system and provides a 30 percent tax credit for qualifying R&D expenditure. The regime’s primary policy objective is to increase business R&D in Ireland, as R&D contributes to higher innovation and productivity. More broadly, the tax credit forms part of Ireland’s CT offering and is aimed at attracting FDI and building an innovation-driven domestic enterprise sector. The credit enables Ireland to remain competitive in attracting quality employment and investment in R&D.  Given its importance, it is proposed to increase the first-year payment threshold from €50,000 to €75,000. This threshold is the amount up to which a claim can be paid in full in the first year, rather than being paid in instalments over three years. The increase should therefore provide valuable cash-flow support to companies undertaking smaller R&D projects or engaging with the credit for the first time.   It is estimated, based on 2022 claims (the latest data available), that increasing the payment threshold to €75,000 will increase, to circa 44 percent, the proportion of claimant companies qualifying for payment of the credit in full in the first year.  Section 486C start up relief  Section 486C start up relief currently provides a CT relief for new small companies in the first five years of trading with an annual CT liability of less than €40,000. Marginal relief is available to Companies with a CT liability of between €40,000 and €60,000 to ensure companies with a liability just over €40,000 do not lose the full value of the relief. Section 486C allows relief of up to €40,000 per year against CT liabilities, which may be carried forward where not fully used in the five years. The relief is currently calculated by reference to employer PRSI paid of up to €5,000 per employee. This does not encompass PRSI paid by owner-directors.   This measure proposes to extend the qualifying criteria to allow up to €1,000 of Class S PRSI per individual to count toward this cap and aims to provide much needed support for small, owner-managed start-up companies.  Participation exemption  As noted earlier, the participation exemption for foreign dividends which will provide for a significant simplification of double tax relief for Irish companies with foreign subsidiaries will commence from 1 January 2025 as expected. Further details of this measure are set out in in Chapter 8 of the Budget 2025 Tax Policy changes publication.   Relief for listing expenses  A new measure is to be introduced which will provide relief for expenses incurred on an initial stock market listing. This measure aims to support businesses in the scale-up phase of their growth and development and should also encourage more stock exchange listings, whilst also providing wider positive benefits for the Irish economy.   The deduction will be available for expenses incurred wholly and exclusively on a first listing (IPO) on a recognised stock exchange in Ireland or the EU/EEA area. The relief will be available to investment companies as an expense of management, or to trading companies as a trading deduction.  An overall cap of €1 million of expenses per listing will apply, with the relief being claimable by a company in the year of first successful listing. Expenses wholly and exclusively incurred for the purposes of the listing, both in the year of listing and the previous three years, will be allowable, subject to the overall €1 million cap. The measure will apply for successful listings completed on or after 1 January 2025.   

To further combat the ongoing pressures on household budgets, the Minister for Finance announced the expected €2,000 increase in the standard rate cut off band for all taxpayers, in addition to a range of increases in various tax credits. The middle rate of USC will be reduced from 4 percent to 3 percent. The now usual change in the USC bands to ensure that the increased minimum wage remains outside the middle rate of the USC also featured. These changes will take effect from 1 January 2025.   Changes to the small benefit exemption, an issue on which the Institute has extensively lobbied on, also featured with the value limit to increase to €1,500 and the number of benefits that an employer can give to increase from two to five per year.   Rate bands and tax credits changes from 1 January 2025  The income tax standard rate cut off bands will increase as follows:   Single, widowed or surviving civil partner from €42,000 to €44,000,  Single, widowed or surviving civil partners, qualifying for the Single Person Child Carer Credit from €46,000 to €48,000,  Married couples or civil partners (one income) from €51,000 to €53,000, and  Married couples or civil partners (two incomes) from €51,000 to €53,000 (with a maximum increase of €35,000).  The personal tax credit, employee tax credit, and earned income tax credit will all increase from €1,875 to €2,000.   The home carer tax credit will increase from €1,800 to €1,950  The single person child carer credit will increase from €1,750 to €1,900.   The incapacitated child tax credit will increase by €300 from €3,500 to €3,800   The blind persons tax credit will increase by €300 from €1,650 to €1,950.   The dependant relative tax credit is to increase €60 from €245 to €305.  The estimated total cost of these measures is €1.12 billion in the first year and €1.29 billion on a full year basis.  USC  The 4 percent rate of USC will reduce to 3 percent. To ensure that the salary of a full-time worker on the minimum wage will remain outside the new 3 percent rate of USC when the minimum wage increases from €12.70 to €13.50 from 1 January 2025, the ceiling of the 2 percent USC rate band will increase by €1,622 from €25,760 to €27,382.    As a result, the USC rates and bands from 1 January 2025 will be:  €0 – €12,012 - 0.5% (no change);  €12,013 – €27,382 - 2%;    €27,383 – €70,044 – 3%    €70,045+ - 8% (no change); and  Self-employed income over €100,000 - 3% surcharge (no change).  Incomes of less than €13,000 remain exempt from USC.  According to the Minister for Finance’s speech, these changes means that a full-time worker on the minimum wage will see an increase in their net take home pay of approximately €1,424 on an annual basis and a single person earning €20,000 or less in 2025 will now be outside of the income tax net.  The estimated cost of the changes in USC is €470 million in 2025 and €540 million per annum thereafter.   Sea-going naval personnel tax credit  The sea-going naval personnel tax credit will not end on 31 December 2024 and has been extended for a further five years to 31 December 2029. This tax credit is €1,500 per annum for permanent members of the Irish Naval Service who have spent at least 80 days at sea in the previous year performing the duties of his/her employment. The cost of retaining this credit is estimated to be €500,000 per annum.  Small benefit exemption  The limit of the “Small Benefit Exemption” will increase to €1,500 and the number of benefits that an employer can give will also increase from two to five per year so that the cumulative total of the first five benefits in a year shall not exceed €1,500. This is an issue that the Institute has lobbied upon extensively on behalf of members. No date was given for when these increases will take effect.  Pensions auto enrolment  Finance Bill 2024 will provide for the taxation of the Automatic Enrolment Retirement Savings Scheme (referred to as AE). It is expected that AE will be introduced in September 2025. The Institute has long supported the introduction of AE but has asked requested that it be introduced at an appropriate time, being mindful of the cost pressures SMEs in particular are under.    According to the Budget publications, the tax treatment “aligns as much as possible with that of Personal Retirement Savings Accounts (PRSAs), other than for employee contributions.”   Employer contributions will be tax relieved, the growth in the AE funds will be exempt from tax and the AE funds will be taxed on draw down, other than the 25 percent tax free lump sum.   The lump sum will be able to be taken tax free up to €200,000, will be taxed at 20 percent between €200,000 and €500,000 and taxed at 40 percent above €500,000.   As the State will be making a direct contribution for employees within the AE scheme, no tax relief will be provided for employee contributions to AE.  Vehicle benefits in kind  The temporary universal relief of €10,000 applied to the Original Market Value of a vehicle (including vans) for vehicles in Category A-D and the amendment to the lower limit of the highest mileage band is being extended to 31 December 2025. 

Reacting to today’s Budget speeches, Chartered Accountants Ireland has noted that while generous steps have been outlined to support individual taxpayers, the package of supports for business falls short of what is needed to materially reduce the cost burdens facing Ireland’s SMEs. Chartered Accountants Ireland, the largest professional body on the island of Ireland, representing over 38,400 members highlighted the persistent pressure that businesses, in particular SMEs are experiencing, despite supports already committed to by government during 2024. Commenting, Director of Public Affairs, Cróna Clohisey said “While today’s budget announcement featured several positive changes to the business tax landscape including an expansion of the R&D tax credit and extensions to certain investor reliefs, measures of this nature, although welcome, will arguably do little to mitigate the everyday overheads facing many small businesses. “With the higher rate of employers’ PRSI rising to 11.15% with effect from today, alongside a further uptick in labour costs brought about by the rise in the minimum wage and the introduction of pensions auto-enrolment next year, many small businesses may feel that Budget 2025 did little to reduce their overall labour costs which is a real missed opportunity.” The Institute welcomed the Government’s commitment to invest €3 billion to support the development and expansion of water, electricity, and housing infrastructure. Clohisey continued “Now is the time to accelerate investment in the State’s infrastructure if we are to remain attractive as an FDI destination, and competitive in the global race for inward investment. It is vital however that the Government takes meaningful steps to ensure that infrastructural projects of this scale are delivered on time, on budget, and achieve the value for money that taxpayers expect. “On childcare, today’s announcement of an additional €1.37 billion in funding for the sector is a positive development in what is a key tenet of the State’s essential economic infrastructure. Today’s announcement will hopefully go some way towards improving capacity in the sector making it easier for working parents to secure a childcare place for their child”. ENDS

From the Professional Accountancy team The Minister for Finance has signed a statutory instrument commencing further provisions of the Credit Union (Amendment) Act 2023 (2023 Act) on 30 September 2024.On that date the following provisions have now been fully commenced: - the provisions in the 2023 Act whereby a credit union can agree to participate in a loan to a member of another credit union -the provisions regarding referral of members of one credit union to another credit union (where the rules permit) -the obligations which heretofore were annual, to approve, review, and update plans policies and procedures are now to be carried out every three years. Also, environmental social and governance policy is now included as a policy for the board to approve, review and update at least every 3 years Some provisions of the 2023 Act remain to be enacted such as the provisions regarding corporate credit unions introduced in the 2023 Act. Readers are reminded that there is a resource page on credit unions on the Institute’s Technical Hub where you will find further information on these new provisions and other useful information on credit unions including auditing and Central Bank information . 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.            

In advance of the extended filing date of Thursday 14 November 2024 for filing income tax and CAT returns via ROS, Revenue has announced a range of supports. Read on for more information. The ROS technical helpdesk will help filers who experience technical difficulties accessing ROS and can be contacted via chatbot, My Enquiries, email (roshhelp@revenue.ie), or telephone (01 738 3699), The ROS payment support unit can be accessed via My Enquiries, or the Collector General’s Division (01 738 3663), and For help filing an Income tax Form 11, queries can be directed to My Enquiries, or the Businesses Taxes helpline can be reached on 01 738 3630. Full details of the above supports, in addition to the extended support opening hours, can be found in Revenue’s eBrief No. 248/24.

Part 11 of Revenue’s Capital Acquisitions Tax Manual has been revised and refreshed with the aim of providing clearer and more comprehensive guidance on agricultural relief. In addition to the manual being updated for Finance (No.2) Act 2023 amendments, the main changes include: The concessional treatment which allowed the active farming requirements to commence from the date of the inheritance has been removed, and The Q&As that were provided in Appendix 1 have been removed and the contents instead have been incorporated into the main body of the guidance. Further details can be found in Revenue eBrief No 246/24.

Revenue has updated its guidance in the rent tax credit manual to reflect the increase in the rent tax credit for the 2024 and 2025 tax years. In addition, the following changes introduced by Finance (No. 2) Act 2023 are also reflected: The change in respect of eligibility where a parent is paying rent for a child (Paragraph 5.3 and Appendix 1), Out of year and in year claims (Paragraph 7.3), The inclusion of more examples, and Income tax returns for 2022 and 2023 can be used where taxpayers are seeking to claim the rent tax credit in respect of payments made for digs or rent-a-room type arrangements to facilitate a child’s attendance at an approved course. This change applies retrospectively to 2022 and 2023.

The Institute’s Advocacy and Voice Department is hiring a new Tax Manager. The Department is responsible for the tax and public policy agenda of Chartered Accountants Ireland. We collaborate with expert colleagues drawn from practice and industry, developing, and advocating on policy matters relating to tax, financial reporting, audit and assurance, ethics and governance, and business law. The department numbers over twenty professionals. The successful candidate will report into the Institute's Tax Leader (Head of Tax). You can find more information at the above link. If you are interested in applying, send your CV and a cover letter to hr@charteredaccountants.ie.  

At last week’s Labour Party conference, the Chancellor of the Exchequer’s speech (see from 11.47 on) unveiled a package of tax and other measures which aim to deliver on the agenda of the new government, one of which includes e-invoicing. A press release published after the Chancellor’s speech also provides some more details on the Government’s plans for tax administration and HMRC. The announcements essentially build on proposals set out by the Government before the election in their ‘Closing the Tax Gap’ document and in summary are as follows: HMRC will launch a consultation on electronic invoicing (e-invoicing) which will “gather input from businesses on how HMRC can support investment in and encourage e-invoicing uptake”. This suggests that there is no intention to make e-invoicing mandatory however the consultation will provide more information and is likely to be published on Budget Day on 30 October, By Spring 2025, a Digital Transformation Roadmap will be published which will set out “HMRC’s vision to be a digital first organisation underpinned by customer insight”. This “will include measures to ensure digital inclusion and support for customers who cannot yet interact digitally”, An additional two hundred offer letters have been sent out to new recruits to join HMRC’s training programme in November as part of plans to recruit an additional 5,000 compliance staff to help close the tax gap (with no mention made of recruitment to improve HMRC’s services), and The Exchequer Secretary to the Treasury (XST) has become the Chair of the HMRC Board. This aims to help the XST oversee the implementation of his three strategic priorities for HMRC: closing the tax gap, modernising, and reforming, and improving customer service. The Press Release also mentioned the planned development of an Industrial Strategy to be published in Spring 2025 following consultation with business. A green paper is expected beforehand “around Budget in October”. During his speech to the Labour Party Conference, the Prime Minister restated the Labour Party’s manifesto commitment to replace the apprenticeship levy with a new growth and skills levy. According to a press release accompanying the speech, in England this will include new ‘foundation apprenticeships’ and will allow funding for shorter apprenticeships than currently possible under the apprenticeship levy. Employers will also be asked to rebalance their funding towards younger workers. Further information on how the new levy will operate, and implications for funding training in Northern Ireland, Scotland, and Wales (where apprenticeship training is devolved) is likely to be announced at the Budget. The e-invoicing consultation announced last week is of particular interest. HMRC, under the auspices of the Joint Vat Consultative Committee which the Institute participates in, has already begun engaging with stakeholders for their views on this in order to “inform the planned consultation and ensure that we deliver a regime which supports businesses by reducing administrative burdens, speeding up payments and making tax compliance easier.” Chartered Accountants Ireland has already highlighted the significance of this change to HMRC. Ireland has recently been consulting on the modernisation of its VAT regime including e-invoicing which the Institute responded to in January this year highlighting the challenges that SME businesses in particular will face. In a broader context, should this proposal proceed in the UK, the timetable for its introduction will need to be very carefully considered as many SMEs are facing significant change in other areas of the UK tax system in the future; the payrolling of benefits in kind from April 2026 and the mandation of Making Tax Digital for income tax from the same date to name but two.

A few weeks ago we issued a request for support from companies who would like to see a lower rate of corporation tax in Northern Ireland as the Institute kicks off a revived campaign. There is still time to participate in this campaign. Does your Northern Ireland based company or client support a lower rate of corporation tax for the region? If so, read on for how you can participate in our campaign to reignite the path to a lower rate of corporation tax for the region.  The Corporation Tax (Northern Ireland) Act 2015 contains the legislation for how a lower rate of corporation tax would work practically in Northern Ireland. However, this is subject to rate-setting arrangements which mean that this rate-setting power may not be exercised unless Treasury regulations have been made. These Treasury regulations are subject to very specific conditions specifically the continued commitment of the NI executive to “take all the actions necessary to demonstrate that its finances are on a sustainable footing for the long term”. The support of the Institute’s members for a lower rate of corporation tax in Northern Ireland has not waned in recent years with a recent Ulster Society survey showing that approximately two thirds of our members continue to support this initiative. On foot of this ongoing support combined with the restoration of the Northern Ireland Assembly and a new government in Westminster, Chartered Accountants Ireland is embarking on a new campaign to engage with and equip policy makers with the information and tools necessary to pursue a lower rate of corporation tax for the region as one of a range of economic levers to drive growth and employment.  We are seeking companies in Northern Ireland who support this campaign and who are prepared to tell us why they support a lower rate and what it would mean for them and the region. These quotes will be included in a position paper which is expected to be launched before the end of 2024. Contact tax@charteredaccountants.ie to participate.    

Last week we reminded you that the 2023/24 self-assessment registration deadline is approaching. It is now just six days’ away on Saturday 5 October 2024 in order to avoid a failure to notify penalty. Those required to register for self-assessment include anyone who is: self-employed or a sole trader in a business which commenced in 2023/24, ·not self-employed but who had a new source of income or a gain in 2023/24, or became a partner in a partnership or any new partnership which commenced in business in 2023/24. 

Following public consultation IAASA has adopted ISAE (Ireland) 3000, Assurance Engagements Other Than Audits or Reviews of Historical Financial Information – Assurance of Sustainability Reporting in Ireland as the standard to be applied by auditors performing sustainability assurance engagements required by the European Corporate Sustainability Reporting Directive (CSRD). The Irish standard is based on ISAE 3000 (Revised) issued by the International Auditing and Assurance Standards Board (IAASB) with limited amendments. Chartered Accountants Ireland responded to the consultation in April. Updates to ISQM (Ireland) 1 ISAE (Ireland) 3000 requires auditors to comply with ISQM (Ireland) 1, Quality Management for Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related Services Engagements. IAASA has updated ISQM (Ireland) 1 to reflect the requirements of the CSRD as transposed in Ireland. Additional minor amendments were made to ISQM (Ireland) 1 to make conforming amendments for ISA (Ireland) 600, which was revised in February 2023 and is effective for financial periods starting on or after 15 December 2023. The remaining ISA (Ireland) 600 conforming amendments will be published on IAASA’s website in October. Additional information IAASA’s Statement on Scope and Authority of Audit and Assurance Pronouncements has also been updated to reflect the adoption of ISAE (Ireland) 3000. An explanatory video is available here on IAASA’s YouTube Channel. IAASA published feedback on the Consultation in June. Effective date ISAE (Ireland) 3000 applies to assurance reports issued on or after 15 December 2024. Amendments to firms’ systems of quality management related to the assurance of sustainability reporting must be designed and implemented by 15 December 2024. An evaluation of the updated system of quality management must be performed within one year of this date. Engagement letters for CSRD engagements TA 02/2024 - Sample Engagement Letter Terms in respect to the provision of Limited Assurance under the Corporate Sustainability Reporting Directive (“CSRD’’) was issued in June 2024. These sample engagement letter terms were prepared to assist members in drafting engagement letters in respect of limited assurance engagements under the CSRD prior to its implementation. Therefore, they may be useful to implement a contract with the entity but following transposition of the CSRD they are currently being reviewed for any required amendments. Please monitor the Institute’s regular news channels for any updates to this TA. 

In this week’s miscellaneous updates, we bring you news of a new role for the Office of Budget Responsibility (OBR) and the latest HMRC performance data has been published. HMRC’s bank details have changed in respect of paying several taxes and the letter sent to taxpayers when they authorise an agent to act on their behalf via the online agent authorisation service has been updated. And finally, the latest HMRC Stakeholder Digest has been published. New role for OBR The Budget Responsibility Act 2024 received Royal Assent earlier this month on 10 September 2024. The aim of this legislation is to ensure that “future fiscal announcements making significant, permanent tax and spend changes” will be “subject to an independent assessment by the OBR”. More information on what this means is set out in the Press Release published in July when the original Bill was introduced to Parliament. HMRC bank details changed Agent Update 123 highlights that HMRC has changed its bank accounts for payment of the following taxes: the customs declaration service, plastic packaging tax, fuel duty, economic crime levy, soft drinks industry levy, and the trust registration service penalty. Taxpayers who make payments via Faster Payments, BACS or CHAPS should use the new details. Anyone paying by direct debit is not required to take any action. Updated agent authorisation letters In another story from Agent Update 123, HMRC has updated the letter which is sent to taxpayers when an agent is authorised to act on their behalf via the online agent authorisation service. According to HMRC, the changes are intended to clarify the role of the agent and in particular, reinforces that the taxpayer retains responsibility for their own tax affairs.

In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit. The most recent Trader Support Service bulletin is also available as is the latest Brexit and Beyond newsletter from the Northern Ireland Assembly EU Affairs Team. We also bring news of changes to excise goods legislation for Northern Ireland which take effect from 1 October 2024 and remind you that the next changes in the Windsor Framework do not commence from 30 September 2024 and have been delayed to 31 March 2025. Changes to excise goods legislation for Northern Ireland Legislation takes effect from 1 October 2024 which makes several changes to the holding and movement of excise goods in Northern Ireland. The purpose of this legislation is to make “technical fixes to the statute book to better implement the EU excise provisions applicable in Northern Ireland under the Windsor Framework of the EU Withdrawal Agreement”. More information is available at the following links: Excise Duties (Northern Ireland Miscellaneous Modifications and Amendments) (EU Exit) (Amendment) Regulations 2024, SI 2024/941, and Policy paper. Miscellaneous updates to guidance and publications CDS Declaration Completion Instructions for Exports, Appendix 1: DE 1/10: Requested and Previous Procedure Codes of the Customs Declaration Service (CDS), Additional Information (AI) Statement Codes for Data Element 2/2 of the Customs Declaration Service (CDS), CDS Declaration Completion Instructions for Imports, 4-digit to 3-digit procedure to additional procedure code correlation matrix for imports, Tax types for Data Element 4/3 of the Customs Declaration Service, Data Element 2/3: Documents and Other Reference Codes (Union) of the Customs Declaration Service, CDS Customs Clearance Request Completion Instructions for Inventory Exports, Appendix 2: DE 1/11: Additional Procedure Codes of the Customs Declaration Service (CDS), CDS BIRDS Declarations and Customs Clearance Request completion instructions, National additional codes to declare with Data Element 6/17 of the Customs Declaration Service, Appendix 23 Imports: Declaration Category Data Sets, Upload documents and get messages for the Customs Declaration Service, Moving goods between Great Britain and the UK Continental Shelf, Trade Specialised Committee on Administrative Co-operation in VAT and Recovery of Taxes and Duties, Report a problem using the Customs Declaration Service.

We have compiled the latest updates to various VAT legislation, publications, briefs, and guidance. HMRC has also contacted us to advise that several Revenue and Customs Briefs have been removed from gov.uk and guidance has been updated where applicable. Register for VAT by post, VAT Personal exports - tax-free sales of new motor vehicles for use before export, Charity funded equipment certificates (VAT Notice 701/6 supplement), VAT Assessments and Error Correction, Who should register for VAT (VAT Notice 700/1), VAT domestic reverse charge technical guide, Help with VAT compliance controls — Guidelines for Compliance GfC8, and Value Added Tax (Caravans) Order 2024, SI 2024/910 and policy paper.