Revenue has updated the Tax and Duty Manual to reflect the increase in the earned income tax credit to €1,875 for 2024 (from €1,775 in 2023) as provided for in Finance Act 2023, together with a table to show the credit amount for prior years and refreshed examples. 

Revenue has published a new Tax and Duty Manual to provide guidance on the reporting obligations under section 895 TCA 1997 for Irish resident individuals and companies who open a foreign account. Guidance is also provided for agents or financial intermediaries who facilitate the opening of a foreign account by an Irish resident individual or company.   This manual incorporates information previously contained in Tax and Duty Manual regarding accounts liable to deposit interest retention tax, company, pension scheme and PEPP provider deposits, which has been updated accordingly. 

Readers are reminded that Thursday 21 March 2024 is Local Property Tax (LPT) deduction date for property owners that opted to pay their 2024 LPT liability by annual direct debit (ADI). 

Earlier today HMRC announced that a series of new and significant permanent changes will take effect on a range of its helplines from 8 April 2024. The announcement comes after previous restrictions to various helplines which first began in December 2022 and continued at various times in 2023 and into the early part of 2024. Members with specific queries are asked to contact us to discuss. The Institute are concerned about these changes, will be monitoring their impact, and welcomes your feedback at any time on HMRC services.  In summary, the changes are:  between 8 April 2024 and 30 September 2024, the Self-Assessment (“SA”) helpline will be closed – callers will instead be directed to use HMRC’s online services;  between 1 October 2024 and 31 March 2025 the SA helpline will be open “to deal with priority queries” – however callers with queries that can be “quickly and easily resolved online will be directed to HMRC’s online services”;  the VAT helpline will only be open for 5 days every month ahead of the deadline for filing VAT returns – outside of this time, callers will be directed to use HMRC’s online services; and  the PAYE helpline will no longer take calls about refunds – callers will be directed to use HMRC’s online services.  HMRC advisers will continue to be available during normal office opening hours to support those who cannot use online services or who have health or personal circumstances that mean they need extra support. HMRC has published a help card on how to access extra support. HMRC advisers will continue to be available during normal office opening hours to support those who cannot use online services or who have health or personal circumstances that mean they need extra support. HMRC has published a help card on how to access extra support. All other helplines will continue to operate as they do currently. At HMRC’s recent Annual Stakeholder Conference attendees heard from HMRC’s Chief Executive Jim Harra about “tough choices about resources” and how HMRC is forging ahead with plans to reduce traditional phone and post contact by moving more taxpayers to “self-serve online”. Mr Harra also confirmed that HMRC’s headcount will significantly reduce in 2024/25.  HMRC has also published an impact assessment in respect of the closures of the PAYE repayment helpline and the VAT helpline in 2023: -  PAYE repayment telephony lines closure  VAT lines telephony lines closure   

Revenue has provided the Institute with an update on R&D tax credit claims for 2022 and 2023 including some matters to be mindful of when completing the R&D panels in the 2023 Form CT1. Revenue is prioritising the finalisation of CT1 2022 claims and will progress to 2023 claims as soon as possible. The note includes a broad summary of the main errors identified regarding the completion of the R&D panels. Revenue advises agents and taxpayers to review their 2023 R&D claims submitted to date and to make any necessary corrections to the R&D panels within the 12-month time limit as the onus is on the taxpayer to ensure a valid claim is made within that time-limit.  Revenue also advises that it is to release an IT update to the Self-Assessment Notice to reflect the R&D cash refund at a later date. 

We recently issued a reminder that second hand vehicles moved from Great Britain (“GB”) to Northern Ireland (“NI”) prior to 1 May 2023 can continue to avail of the VAT margin scheme, but only until the extended deadline of 30 April 2024. HMRC has requested details of any such vehicles still in stock and unsold. Please contact us to provide this information by Friday 22 March 2024. Our thanks go to anyone who has already been in touch to provide this information.  The 30 April 2024 deadline means that any vehicles moved from GB to NI prior to 1 May 2023 but sold after 30 April 2024 will require output VAT to be charged on the full selling price, and not on the margin.   The six-month extension from the original deadline of 31 October 2023 followed extensive lobbying from Chartered Accountants Ireland in September and October 2023.

The Main Tax Administration Liaison Committee (“Main TALC”) convened its first meeting of the year earlier this month. The primary role of this committee is to hold general oversight of the various TALC sub-committees. Revenue reminded bodies of the 1 May 2024 deadline for the Debt Warehousing Scheme and provided an update of the ongoing work of the TALC Business Simplification Sub-Group, which is due to report later this year. There was also an update on the guidance on section 80 SDCA 1999, as we reported in last week’s Tax News. Minutes of the meeting will be available shortly.   Compliance rates for Enhanced Reporting Requirements for Employers  Revenue noted that it is satisfied with compliance rates so far in 2024. A subgroup, which includes the Institute, under the auspices of the CCAB-I, continues to meet and report into Main TALC. Practitioners raised concerns about the volume of queries reportedly being brought to the National Employers’ Helpline (NEH). Our own members have raised several issues with the upload facility, in particular returns not being accepted. Revenue will continue to work with taxpayers during this service for compliance period and we will continue to keep readers updated about developments via Tax News.  R&D Specified Returns for 2022 and 2023  Readers may be aware of the requirement to submit a ‘Specified Return’ when submitting R&D claims with the Form CT1 2023. This is due to the amendments made in Finance Act 2022 updating the administration of the credit, moving to a credit repayable over 3-years, in line with certain requirements of the EU Minimum Taxation Directive (“Pillar Two”). Practitioners noted that problems seem to be persisting when filing 2024 corporation tax returns using certain software systems.  Following the meeting, Revenue provided the group with a note  regarding R&D tax credit claims for 2022 and 2023 This is covered in more detail in the next story in Tax News. 

Last week saw the publication of the Spring Finance Bill 2024 (official title Finance (No. 2) Bill 2023-24). The Bill reflects many of the tax measures recently announced as part of the Spring Budget 2024. First reading of the Bill took place last week in the House of Commons. No date has yet been set for second reading.  The National Insurance Contributions (Reduction in Rates) (No. 2) Bill has also been introduced to Parliament. This Bill provides for the reductions in both Class 4 and Class 1 employee National Insurance Contributions as announced earlier in the month as part of the Spring Budget 2024.  

This week we bring you the latest list of employers, as published by the UK Government, for failing to pay the national minimum wage and the Public Accounts Committee has published its report into HMRC performance. HM Treasury has also confirmed that post office compensation payments will be tax free for overturned convictions and HMRC has set out the evidence which will be needed from 1 April 2024 when making a claim for a creative sector tax relief.  National minimum wage  Over 500 employers have been named in the UK Government’s annual report for failure to pay National Minimum Wage. The NMW is enforced in the UK by HMRC. Employers were ordered to repay workers nearly £16 million, plus an additional financial penalty, after breaches left over 172,000 workers out of pocket. The report also features a reminder that NMW is set to increase from 1 April 2024 as announced in the November 2023 Autumn Statement.  Report into HMRC performance  The Public Accounts Committee has published its report into HMRC performance in 2022-23. The report’s accompanying Press Release is titled “‘All-time low’: HMRC customer service deteriorates amid taxpayers’ exasperation” and says that HMRC is appearing to struggle to cope as taxpayer population and tax complexity rise. Although there has been a significant drop in criminal prosecutions, according to the report this sends the wrong message. The approach to IR35 rules is also deterring legitimate economic activity. Chartered Accountants Ireland regularly discusses HMRC performance at various forum meetings and welcomes your feedback at any time by email.  Post office compensation payments  In a written statement made to Parliament last week, the Financial Secretary to the Treasury Nigel Huddleston has confirmed that no income tax, capital gains tax, national insurance contributions, corporation tax or inheritance tax will be payable on compensation for postmasters whose convictions are overturned by upcoming legislation or those who receive the £75,000 fixed sum payment from the Horizon Shortfall Scheme. The Government will legislate via secondary legislation to exempt these payments in due course.  Guidance on creative sector claims  From 1 April 2024, a company claiming a creative industry tax relief will be required to provide supporting evidence for its claim. HMRC has now updated the relevant guidance to provide details of the supporting evidence required in order to make a valid claim for creative industry tax relief. If this mandatory information is not provided, HMRC will be able to amend the company’s tax return to remove the claim. 

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. We issue a reminder about the move of export declarations to the Customs Declarations Service (“CDS”) the deadline for which has now been extended and, from 1 March 2024, the EU has introduced a new digital system for union goods. News of how changes to the CDS which take effect from 24 March 2024 impact on goods moving into Northern Ireland also features.  Move to CDS for all export declarations delayed to June 2024  HMRC had previously announced that from 30 March 2024 all export declarations must be made using the CDS and not CHIEF. Recently HMRC issued a Press Release confirming that all businesses can now move their export declarations to the CDS. However, instead of requiring the CDS to be used for all exports from 30 March 2024, businesses who have yet to move their export declarations to CDS will have a transition period to move across until 4 June 2024. After this date, customs declarations will not be able to be submitted through the CHIEF service.   More information about moving to the Customs Declaration Service is available on GOV.UK. HMRC says that it will continue to provide help and support to businesses moving to CDS in the coming months and will continue to work closely with the border industry throughout this process.  Digital proof of status for EU goods  From 1 March 2024, the EU has introduced a new digital system for union goods (products made in the EU or imported with duties paid). Union goods avoid EU customs procedures but require digital “Proof of Union Status” when moving them between EU countries and Northern Ireland via a non-EU territory.   To use the new system, traders should email admin.uum@hmrc.gov.uk with their name, email, registration confirmation, NI business address, and XI EORI number. More information is available in a recent Agent Update.  Impact of CDS changes on goods moving into Northern Ireland  From 24 March 2024, HMRC changes to the CDS will affect how you make declarations into Northern Ireland. After this date, to use your UKIMS authorisation, you (or your agent or intermediary) will need to start using some new codes and your UK Internal Market Scheme authorisation (“UKIMS”) authorisation number.   These changes will apply to goods moving into Northern Ireland from Great Britain (GB-NI) and to goods moving into Northern Ireland from a country outside of both the UK and the EU (Rest of World-NI).  If you (or your agent or intermediary) have been using the ‘NIREM’ code to declare goods ‘not at risk’, you could be impacted by these changes if you haven’t already got a UKIMS authorisation. From 24 March 2024, if you use the ‘NIREM’ code without declaring a valid UKIMS authorisation, duties at the EU rate will be calculated and will be charged to you by CDS if duties are due.  Note that there will be additional considerations if you are:- moving goods that will be subject to processing in Northern Ireland;  moving goods subject to tariff-rate quotas, such as steel; or  seeking to waive duties under the customs duty waiver scheme.  Further guidance on these changes will be published on GOV.UK from 24 March 2024. In the meantime, HMRC has advised us that letters are being sent to affected traders to notify them in advance.  Miscellaneous updated guidance etc.   Recently updated guidance, and publications relevant to EU exit are set out below:-  Reference documents for The Customs (Reliefs from a Liability to Import Duty and Miscellaneous Amendments) (EU Exit) Regulations 2020;  Import, export and customs for businesses: detailed information;  Simplified Customs Declaration Process: notification of non monetary amendment;  Change or cancel a Simplified Frontier Declaration;  Moving qualifying goods from Northern Ireland to the rest of the UK;  Trading and moving goods in and out of Northern Ireland;  Search the register of customs agents and fast parcel operators; and  Customs Declaration Service. 

Background The Department of Children, Equality, Disability, Integration and Youth (the Department) has recently issued a document1 “Guidance Note for Core Funding Reporting Requirements Transitional Arrangements Year 1 and 2” (“the Department Guidance Note”) to entities providing childcare and early education services regarding the transitional arrangements for the application for funding under a new funding model called ‘Together for Better’.  These transitional arrangements will be in place for the next two reporting periods (years ended 31 August 2023 and 31 August 2024). Reporting regime This reporting regime includes a requirement that the childcare service providers (“client”) engage a professional accountant to submit a document called an ‘Income and Expenditure Template. CCAB-I have made the Department aware of the potential cost implications for an accountant providing this service to their client.  The following matters should be noted: The report is to cover expenses incurred on a cash basis for the year ended 31 August. The requirement is for expenditure incurred in the relevant period only, no accruals or prepayments. Income will be pre-populated in the online platform. Where your client has a different year end, time apportionment is not permitted. Important considerations for CCAB-I members CCAB-I has engaged with the Department over a number of months to discuss the nature and extent of work expected and the respective responsibilities of the client and the professional accountant and, in particular, the concerns regarding the request for the professional accountant to submit the report (as set out in the Department Guidance Note) on behalf of a client. There was positive engagement and much, but not all, of the feedback by CCAB-I on the process was reflected and incorporated into the final guidance. However, given the type of engagement, CCAB-I are making members aware of the potential issues and extant guidance which our members may consult. The Department Guidance Note sets out the responsibility for the data included in the report. See section 2 of the Guidance Note: “The Service Provider is responsible for fully complying with all financial transparency requirements in accordance with their Core Funding contractual obligations. The accountant relies on information provided by the Service Provider, who is responsible for disclosing all relevant information.” The Service Provider/client will make an online declaration on the platform provided by the Department that they have authorised a professional accountant2 to make the submission for them.  CCAB-I members are reminded of the relevant Code of Ethics issued by their professional body.  Independence The Department Guidance Note3 defines an accountant as someone who: "(a) has been admitted as, and is, a member of a prescriber accountancy body, (b) is currently practicing in the profession of accountant, (c) is not and never has been a principal officer or employee, or an owner or part owner, of the licensee in respect of whom he or she is preparing an accountant’s report, and (d) is maintaining such minimum level of professional indemnity insurance as is required by the prescribed accountancy body concerned." .Members should be cognisant of any conflicts with other engagements they may undertake for their clients.  When you are the Auditor  Where the accountant is the statutory auditor the Ethical Standard for Auditors (Ireland)4 applies and Section 5.129 prohibits the audit firm providing accounting services where the services would involve the firm undertaking part of the role of management or initiating transactions.  "S 1.24           In the case of a statutory audit, non-audit services shall not be provided that involve playing any part in management decision-taking of an entity relevant to an engagement. The firm shall not accept any engagement which includes the provision of services where it is probable that an objective, reasonable and informed third party would conclude that the firm or a covered person was playing a part in management decision-taking.  5.128          The provision of accounting services by the firm to an entity relevant to an engagement creates threats to the integrity, objectivity and independence of the firm and covered persons, principally self-review and management threats, the significance of which depends on the nature and extent of the accounting services in question and the level of public interest in the entity. 5.129            The firm shall not provide accounting services to an entity relevant to an engagement where: (a) the entity is a listed entity, relevant to an engagement by the firm, or a significant affiliate of such an entity; or (b) for any other entity: those accounting services would involve the firm undertaking part of the role of management, or initiating transactions; or the services are anything other than of a routine or mechanical nature, requiring little or no professional judgment.” When you are not the Auditor We recommend that members read the Department Guidance Note1 and that an appropriate letter of engagement and representation letter are in place where they undertake these engagements.  Members should refer to guidance documents issued by Chartered Accountants Ireland.  TA 06/2023 Grant Claims5 and the International Standard on Related Service ISRS 4400 (Revised) Agreed-Upon Procedures Engagements6 which give guidance on engagement acceptance and continuance and some general advice on agreeing the terms of engagement.  1 https://earlyyearshive.ncs.gov.ie/downloads/download-corefunding/   2 A professional accountant is defined as a member of a Prescribed Accountancy Body that comes within the supervisory remit of IAASA, •              Chartered Accountants Ireland. (CAI) •              Association of Chartered Certified Accountants (ACCA) •              CPA Ireland (CPA) •              Chartered Institute of Management Accountants (CIMA)  3 See Section of Guidance Note for Core Funding Reporting Requirements Transitional Arrangements Year 1 and 2. 4 https://iaasa.ie/wp-content/uploads/docs/media/IAASA/Documents/audit-standards/Ethical-Standard-Consultation/Ethical_Standard_Nov_2020_updated_June_3.pdf 5 https://www.charteredaccountants.ie/chariot/account/ta/TA06_2023.html 6 https://www.iaasb.org/publications/international-standard-related-services-isrs-4400-revised  

President Sinead Donovan, Deputy President Barry Doyle and Vice President Pamela McCreedy held a series of engagements this week in New York and Washington DC, with members and key stakeholders. With St Patrick’s Day approaching, this time of year provides an invaluable opportunity for the Institute to represent members and the interests of the profession at the highest levels with policy makers and business leaders from across the island of Ireland and the United States.     Against the backdrop of a new global minimum corporation tax rate from 2024, and stiff competition for investment, chartered accountants will continue to play a key role on both sides of the Atlantic driving and servicing the well-established, mutually beneficial two-way flow of investment for Ireland’s economies North and South. As part of that, at the Ireland Inc event, the Institute’s officers had the opportunity to brief US Special Envoy for Northern Ireland Joe Kennedy on the contribution of the profession and our commitment to supporting continued investment and prosperity.    The team also took the opportunity to discuss future collaboration with colleagues in our professional network, with whom strong and enduring relationships have been built over many years, including the International Federation of Accountants (IFAC), AICPA, and Chartered Accountants Worldwide (CAW). Topics discussed included the enhancement of mutual recognition of qualifications and the need to continue work to position members to lead on sustainability reporting. This collective voice is invaluable in continuing to help our profession to grow and further develop meaningful economic and societal impact.    The US remains a destination of choice for Irish ACAs and the officer group hosted a networking event at the Consulate General of Ireland, New York together with Deputy Consul General, Gareth Hargadon. Over 100 members and business leaders gathered: many thanks to Gareth and his team for their hospitality, and Gareth’s remarks on the important contribution of Ireland’s chartered accountants locally.   The insights gleaned on the trip will be put into action in the coming weeks and months, and we will update members further.