In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit. Read the Institute’s submission to the House of Lords inquiry into the Windsor Framework and The Retained EU Law Bill is proceeding through the final stages in the House of Lords. The latest Trader Support Service and Borders Weekly Stakeholder Bulletins are also available and we bring you news of an enhancement to the Goods Vehicle Movements Service (“GVMS”). Enhancement to the GVMS. From 16 May 2023, HMRC introduced an enhancement to the GVMS which means that taxpayers can now upload up to 2,500 Import Movement Reference Numbers for EU to Great Britain movements. Retained EU law bill Report stage of Retained EU Law (Revocation and Reform) Bill took place last week on 15 and 16 May in the House of Lords. Peers in the House proposed amendments to the Bill, with the Government defeated on several occasions. One significant amendment was made for changes to the Bill to be subject to greater parliamentary scrutiny via referral to a Joint Committee of both Houses of Parliament.   Miscellaneous updated guidance etc. The latest guidance updates, and publications relevant to EU exit are as follows:- Schedule of Retained EU law; Pay no import duties or VAT on importing goods for testing; Pay no import duty and VAT on importing commercial samples; Pay no import duty or VAT on donated medical equipment; Pay no Customs Duty or VAT on blood grouping, tissue typing and therapeutic substances; and Pay no import duty or VAT when importing animals for scientific research.

Viet Nam recently deposited its instrument of ratification for the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). The MLI will enter into force in Viet Nam from 1 September 2023.

Following a review by Revenue, the decision has been made to decommission seldom-used regional telephone numbers. Instead, taxpayers and their agents seeking service in relation to business taxes can reach Revenue by dialling 01-7383630 (or 01-7383697 to bypass prompts). The decommissioned regional numbers are: BMW01-7383611    DUB01-7383612    ESE01-7383613    SW01-7383614    If callers try to reach these numbers after the effective date, they will receive a message indicating the relevant line is no longer in service.

Revenue has amended its Tax and Duty Manual 'Agent's Guide to the Collector General's Division' to reflect the latest operational processes and current due dates. The updates include: Local Property Tax (LPT) payments can be made by direct debit by accessing the LPT portal on the Revenue website.   An Agent Link for each property is required in respect of LPT.   Direction that agents should not provide their own address as business address of their client.  Clarification that final demands will issue to the business or official address of the taxpayer.   Information regarding the Small Company Administrative Rescue Process (SCARP).   Large Corporates Division (LCD) now deals with Tax Relief at Source (TRS) for qualifying medical insurance premiums.   Information has been inserted in relation to changes to preliminary tax rules for corporate non-resident landlords and the introduction of the interest limitation rule (ILR). Further information is available in eBrief no.123/23.

The Department of Finance has published the responses it has received to its recent feedback statement on Pillar Two Minimum Tax Rate implementation The Institute, under the auspices of the CCAB-I, responded to the feedback statement earlier this month.

Revenue has updated examples in its Tax and Duty Manual regarding the recoupment of overpayments of salary by an employer from an employee to reflect changes to the value of the standard rate tax band and personal tax credits introduced in Budget 2023.

Revenue has updated its Tax and Duty Manual regarding the treatment of employer reimbursed remote working expenses to clarify conditions relating to the €3.20 per diem payment.

Revenue has updated its Tax and Duty Manual regarding capital acquisitions tax collection and enforcement guidelines for payments in non-statutory instalments. The amended guidelines state that such payments are applied against tax first, then interest.

Changes to the Stamp Duties Consolidation Act 1999 introduced in section 68 Finance Act 2022 shall come into operation from 1 June 2023 per S.I. no.240 of 2023. The new sections - section 83DA and section 83DB SDCA 1999 - provide for repayment of stamp duty in certain circumstances. Sections 83E and 83F SDCA 1999 have been repealed.

On 18 May 2023, the Institute responded to the International Ethics Standards Board (IESBA) invitation for comments on their “Proposed Revisions to the Code Addressing Tax Planning and Related Services”. The proposals to amend the Code of Ethics for Professional Accountants are based on recommendations following extensive stakeholder engagement and review by the IESBA since 2019. The review was in response to increased public attention on the topic of tax avoidance, revelations arising from the “Paradise Papers” and the “Pandora Papers”, and global focus on the legality of tax mitigation schemes. The proposals define ‘Tax Planning and Related Activities’ as “a broad range of services designed to assist a client, whether an individual or an entity, in structuring the client’s affairs in a tax-efficient manner”. The IESBA builds upon the principles-based framework of the Code of Ethics and outlines the responsibilities of all professional accountants in respect of these services. Further requirements and guidance are included for Professional Accountants in Public Practice (PAPPs) and Professional Accountants in Business (PAIBs). The key IESBA proposals include: Outlining professional accountants’ public interest role in relation to tax planning services; Requirements in respect of any anti-avoidance legislation court or tax authority rulings, and addressing non-compliance with laws and regulations; Requirements for establishing a credible basis for tax planning advice and carrying out a ‘stand back test’ that considers “the reputational, commercial and wider economic consequences that could arise from the way stakeholders might view” the tax planning arrangement; Examples of ethical threats that can arise from providing tax planning advice, including potential steps professional accountants can take to either eliminate or safeguard against these; Requirements for communicating with clients or employers, including steps to take in the event of disagreement in respect of tax planning; and Requirements in relation to obtaining second opinions, referring or recommending third-party tax planning solutions or advisors. Some of the key points in the Institute’s response to the IESBA proposals focused on: The current size of the Code of Ethics and the opportunity to embed some of the proposals into existing requirements of the Code, including the Conceptual Framework; Concerns regarding the broad definition of ’tax planning’ and the necessity to include ‘related services’, which are typically more closely associated with routine compliance, such as the filing of tax returns and representing clients on compliance issues using tax authorities’ dispute-resolution mechanisms; Requesting further guidance on ‘credible basis’ and ‘stand-back’ tests, and positioning of these as part of the Conceptual Framework alongside other professional judgement requirements. Highlighting the important role of professional accountants in reducing the risk of unexpected tax costs for all taxpayers and ensuring higher compliance rates and collection of tax by assisting clients and employing organisations navigate complex local and global tax requirements; To consider the primacy and responsibility of local tax authorities in the enforcement of tax compliance, the policing of appropriate tax planning and their independent mechanisms to be first arbitrator in making a ruling rather than a court of law or a professional body; Highlighting the issue of competitiveness in the accountancy profession, the capacity of the profession to police and enforce new standards, and the need for a level playing field that ensures tax advisors who are not professional accountants are also accountable to high standards of ethical behaviour; and Providing suggestions in areas such as identifying threats and implementing adequate safeguards, the consideration of multiple uncertainties, and further considerations of the context and role of Professional Accountants in Business in respect of tax planning. The Chartered Accountants Ireland response to the IESBA is available here. The IESBA proposals are available on their website here. Níall Fitzgerald, Head of Ethics and Governance, Chartered Accountants Ireland  

In Irish news, Revenue issues a key clarification on the Code of Practice for Revenue Compliance Interventions and a new TDM has been published on foreign entity classification. In UK news, we want to hear your views on two consultations, and the 2022/23 P60 deadline is approaching. In International news, the European Commission has published its summary report on the recent BEFIT consultation.  Ireland Revenue is updating its policy around the “self-correction without penalty” provision within Chapter 2 of the Code of Practice for Revenue Compliance Interventions with immediate effect. Revenue has published a new Tax and Duty Manual on the classification of foreign entities for Irish tax purposes. UK The Institute is considering making submissions to HMRC on two consultations which are currently open and would welcome your views by 1pm on Monday 29 May 2023. The 2022/23 P60 deadline is approaching. International BEFIT summary report is published by the European Commission.   Keep up to date with all the latest Irish, UK, and international tax developments through Chartered Accountants Ireland’s Tax Newsletter. Subscribe to the Tax News by updating your preferences in MyAccount.  

Revenue has informed us that it is updating its policy around the “self-correction without penalty” provision within Chapter 2 of the Code of Practice for Revenue Compliance Interventions. This change is effective immediately. The code currently states that: “In line with Revenue’s role in supporting voluntary compliance, taxpayers may avail of self-correction without penalty provided that the following conditions are met: The taxpayer notifies Revenue, within the applicable time limit, (either in writing or in ROS) of the adjustments being made (Note: submitting an amended return on ROS does not constitute notification to Revenue – written notification is required), The taxpayer provides a computation of the correct tax and statutory interest payable, and Payment, in full, accompanies the submission.” The code contained a specific provision whereby bi-monthly, quarterly or half-yearly remitters of VAT, who are self-correcting a net underpayment of less than €6,000, may include the amount of tax as an adjustment on the next corresponding VAT return following the one in which the error was made. In such cases, there is no requirement to notify Revenue and interest is not charged. In September 2022, Revenue issued the Tax and Duty Manual (TDM) for Revenue Compliance Interventions - Operation of Payroll Taxes (Income Tax, PRSI, USC) by Employers. This guidance deals with cases where it is determined that the updating of an employee’s payroll record is required due to the incorrect operation of the Pay As You Earn (PAYE) system by an employer as a result of error or carelessness. This TDM applies to any self-correction or qualifying disclosure received and/or Revenue compliance intervention initiated following the publication of the TDM. This TDM states that for current year cases, employers are permitted to treat untaxed emoluments (arising from incorrect operation) as being paid at the time they are identified, using the latest Revenue Payroll Notification available to calculate the correct liability in accordance with Regulation 11. In such cases, the liability due will be corrected through the next payroll submission (within the current tax year) rather than over multiple submissions. In these type of cases, where any additional emoluments are treated as paid at the next pay date, no interest arises. In such cases, there is no longer a requirement to also notify Revenue in writing of the correction being made. For all other tax heads (other than those outlined above), taxpayers must continue to notify Revenue in writing or through ROS to avail of “self-correction” without penalty. This is necessary to ensure such amounts including statutory interest are brought to account correctly. Revenue are working to remove the notification requirement for all tax heads and will update TALC Audit Sub-Committee as the matter progresses. The Code of Practice for Revenue Compliance Interventions will be updated shortly.