On 11 December the Ulster Society hosted a new webinar in the Inspiring Excellence Series with Danske Bank. In this webinar, Internationally Acclaimed Leadership Speaker and Wall Street Journal Bestselling Author Drew Dudley gives some practical tips on how to encourage a growth mindset, display courage in decision making and ensure that you look after yourself to ensure that you can continue to give your best. A recording of this webinar is available to view, for free and on demand, HERE

Following lengthy consultations and outreach the International Auditing and Assurance Standards Board (IAASB) has finalised and published the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities. This new standard, known as the ISA for LCE, is a global auditing standard designed specifically for smaller and less complex businesses. The ISA for LCE builds on foundation of the International Standards on Auditing (ISAs) and audits performed using this standard provide the same level of assurance for eligible audits: reasonable assurance. The IAASB have also published their Basis for Conclusions, which details feedback from the public consultation, a high-level fact sheet, and a frequently asked questions document. Additional materials to help jurisdictions facilitate adoption will be issued in 2024, Where it is adopted or permitted it is effective for audits beginning on or after December 15, 2025.  Chartered Accountants Ireland responded to both consultations on this standard. In January 2022 and May 2023. We will update members on any local developments. 

  Tensions rose at COP28, the UN climate summit in Dubai, with the publication of a new draft agreement, announced at 2pm GMT. The draft was published after COP President, Sultan Al Jaber, had been meeting with all countries in a format called ‘the Majlis’. An Arabic term, ‘Majlis’ are used to refer to a council or a special gathering, typically bringing together a community of elders. Ireland’s Environment Minister, Eamon Ryan, represented the EU in a Majlis of climate ministers, who were encouraged by Sultan Al Jaber to sit in a circle and speak “heart to heart”, to break the deadlock in phasing out fossil fuels. Earlier, the head of the United Nations, António Guterres, had called on world leaders to “end the fossil fuel age” as he returned to COP28 for the final days of the summit. According to the draft agreement, fuel production and consumption will be reduced by 2050 in line with scientific advice. It proposes an approach that “could” include “reducing both consumption and production of fossil fuels, in a just, orderly and equitable manner so as to achieve net zero by, before, or around 2050 in keeping with the science”. While the current text of the agreement avoids the contentious terms ‘phase out’ and ‘phase down’, the wording still requires countries to reduce their fossil fuel production; however, the text has been criticized for being “grossly insufficient.” “We can’t accept the text,” Minister Eamon Ryan reportedly said, adding: “That ‘could’ kills everything”. Other news made headlines from the negotiations at the climate summit: The High-Level Champions and the Marrakech Partnership have released a report called '2030 Climate Solutions: An Implementation Roadmap.' It contains a set of solutions on measures that must be scaled up and replicated in order to halve global emissions, address adaptation gaps and increase climate resilience. Next year’s COP – COP29 – is to take place in Baku, Azerbaijan. Article COP28 draft agreement drops phaseout of fossil fuels (Financial Times) Elements of new Cop28 text are ‘fully unacceptable’, say EU climate chiefs (The Guardian) ‘We can’t accept this’ – Eamon Ryan says proposed Cop28 agreement needs to be ‘radically’ improved (Irish Independent) Podcast In the second of two special episodes from ICAEW, Insights In Focus shares news and views from COP28 in Dubai. guest host Mark Rowland is joined by Sarah Reay, ICEAW Climate Change Manager, ICAEW; Jessica Fries, Executive Chair, A4S; and Mardi McBrien, Chief of Strategic Affairs and Capacity Building, IFRS Foundation.  Counter The Climate Action Commitment Counter, published today by COP organisers, has provided a breakdown of financial pledges and contributions so far: Loss and Damage:$726 million Green Climate Fund:$3.5 billion (up to $12.8 billion) Adaptation Fund:$134 million Least Developed Countries Fund:$129.3 million Special Climate Change Fund (SCCF):$31 million Renewable Energy:$5 billion Cooling:$57 million Clean Cooking:$30 million Technology:$568 million Methane:$1.2 billion Climate Finance:$30 billion from UAE, $200 million in Special Drawing Rights, and $31.6 billion from Multilateral Development Banks (MDBs) Food:$3.1 billion Nature:$2.5 billion Health:$2.9 billion Water:$150 million Gender:$2.8 million Relief, Recovery and Peace:$1.2 billion Local Climate Action:$467 million   Find more news on the global climate summit our our COP28 page on Chartered Accountants Ireland's sustainability centre. 

  Saturday at COP28 focused on nature, land use, and oceans, while Sunday was the first-ever COP day dedicated entirely to food, agriculture and water. Despite food generating one-third of global greenhouse gas emissions, agriculture has attracted very little climate finance. However, since the beginning of this COP, over $3 billion in climate finance has been pledged for food and agriculture. The Dubai climate summit in which “when food came of age as a central means of responding to the climate emergency”, according to Edward Davey, partnerships director at the Food and Land Use Coalition, also saw another first: the publication by the UN Food & Agriculture Organisation (FAO) of a global food systems’ roadmap. The roadmap aims to ensure the world keeps to with 1.5 degrees of temperature rise and transform the world’s agrifood system from a ‘net emitter’ to a ‘carbon sink’ by 2050. The FOA identified 10 priority areas – such as livestock, soil and water, crops, diets and fisheries – where the roadmap can help push the world closer to achieving ‘Zero Hunger’, the second of the 17 Sustainable Development Goals (SDGs). COP28 in numbers $3.8 trillion: value of crops and livestock production lost due to disasters, including floods and droughts, over the past three decades. $3+ billion: amount of climate finance pledged for food and agriculture since the start of COP28. 134: number of countries to have signed Emirates Declaration on Sustainable Agriculture, Resilient Food Systems, and Climate Action, committing to integrate food into their climate plans by 2025. 70: the percentage of the world’s land that the above countries cover. $200 million: amount of investment pledged for programmes to low-methane animals and develop less potent feed additives (Bezos Earth Fund is also investing in wearable sensors that measure how much cows emit). $200 million: amount pledged by the Gates foundation and the United Arab Emirates to help smallholders in sub-Saharan Africa and South Asia adapt to climate change. 47: the percentage by which global greenhouse gas emissions from livestock will grow by 2050 from 2015 levels if no action is taken. 18: countries which announced that they would align their national climate and biodiversity planning frameworks under the COP28 Joint Statement on Climate, Nature and People. Articles The world’s top five meat companies’ emissions are estimated to be significantly larger than those of the oil firms Shell and BP. The dairy industry’s 3.4 per cent contribution to global human-induced emissions is a higher share than aviation (The Guardian) Ireland is committed to continuing sustainable food production and becoming climate neutral as fast as possible, says Minister for Agriculture Charlie McConalogue (Irish Times)   Find more news on the global climate summit our our COP28 page on Chartered Accountants Ireland's sustainability centre.   

  After a rest day on Thursday, COP28 resumed on Friday 8 December for Week 2 of the global climate summit in Dubai. The second week is the critical week for COPs as it is when government officials negotiate the text of the final agreement. All eyes will be on what the agreement will say about fossil fuels, whether ‘phased out’ or ‘phased down’. Today at COP28 was dedicated to “youth, children, education and skills”. Negotiations will continue over the weekend, focussing on nature on Saturday and on food, agriculture and water on Sunday.   COP28 in numbers $57 billion: The number of financial pledges made so far at this COP. 50: the percentage by which Dubai plans to cut carbon emissions by the end of this decade, compared with 2018 levels. 118: the number of governments that have now pledged to triple the world’s renewable energy capacity by 2030 as part of the Global Pledge on Renewables and Energy Efficiency (China and India did not join). 9: the number of new countries now signed up to the Powering Past Coal Alliance, the group of nations pledging to phase out “unabated” coal power first founded at COP26 in Glasgow. 4: the number of new countries – including Spain, Kenya, Samoa and Columbia – to have joined the Beyond Oil and Gas Alliance group pledging to phase out all fossil fuels. Definitions Unabated  - “doing nothing to remove carbon dioxide and other greenhouse gases from oil, natural gas and coal emissions.” (New York Times). This word will appear with increasing frequency during the negotiations this week, with some commentators saying it could ‘determine the world's future’. Youth-washing  - Similar to greenwashing, this term describes the practice of showboating young voices but not paying attention to them. Watch or listen The Zero podcast from Bloomberg with Akshat Rathi who interviewed Al Gore on how to break the stranglehold petrostates have over COP. Gore also explains why big emitters can no longer hide. Find more news on the global climate summit our our COP28 page on Chartered Accountants Ireland's sustainability centre.   

Revenue has updated the Tax and Duty Manual that provides guidance for fund administrators regarding the calculation of tax due on income and gains from investments in domestic investment undertakings and the completion of prescribed declaration forms.  The manual has been updated to make reference to the Pan-European Pension Product (PEPP) provisions introduced by section 21 Finance Act 2022. References to Approved Minimum Retirement Funds (AMRFs) have been removed, reflecting Finance Act 2021 amendments.  Other updates include:  updated contact information for Large Corporates Division; and  clarification that section 189 relief does not extend to the estate of an individual upon death, who during their lifetime was entitled to section 189 relief.  Further information is available in eBrief no.255/23. 

The Department of Enterprise, Trade and Employment has published the new national minimum wage rates that come into effect on 1 January 2024. The hourly rate for employees aged 20 and above will be €12.70. Further details on rates and conditions are available here. 

In the lead up to the 2022/23 online self-assessment (“SA”) filing deadline next month on 31 January 2024, HMRC are introducing restrictions which begin today on their SA and Agent Dedicated Line (“ADL”) helplines. Chartered Accountants Ireland has been discussing this with HMRC and would welcome your feedback on the operation and impact of these restrictions which come after similar restrictions in the lead up to the 2021/22 SA filing deadline, and restrictions to both the self-assessment helpline and the ADL earlier this year.   More information on the current restrictions are available in an email from HMRC which also sets out details of a change implemented from 7 December in respect of how repayments are notified.   Helpline restrictions  Between 11‌‌‌ ‌‌December 2023 and 31‌‌‌ ‌‌January 2024, HMRC are prioritising resource “to support self-assessment peak period”. The restrictions aim to direct anyone with a query which can be dealt with online to the relevant online service.   For agents, ADL advisers will only take calls about SA filing, payments or repayments and will be redirecting agents to use online tools for simple queries, wherever possible. This also means that agents with queries on other topics, including PAYE queries will need to use other contact channels for assistance. Agents can continue to use the SA digital assistant for all SA queries throughout this period.   Agents who call the ADL and whose queries are not specifically related to SA filing, payments, or repayments, including agents with multiple client queries, will be redirected to alternative channels, or asked to call back in February. During SA peak, the ADL will not be dealing with any PAYE-related calls, however such queries may still be directed to the Employer Helpline, where relevant.  Repayment notifications  From 7 December HMRC changed the process for notification of electronic SA repayments. There is no change to the repayment process itself, hence taxpayers will still receive any refund via their bank account. However, HMRC will no longer send a letter informing the taxpayer or their agent of the repayment as often these letters arrive after the repayment has been made, leading to confusion and increased contact.  HMRC is currently working on improvements to its IT systems in relation to SA repayment notifications and as a result has temporarily paused SA repayment digital notifications from 7 December 2023 while this is completed. HMRC will confirm when these are reinstated. 

With November being the most important month of the year for tax receipts, the Minister for Finance noted that the recent November Exchequer figures indicate “fiscal performance broadly in line with expectations to end-November, corporation tax recovers in key month”. The Exchequer surplus stood at €5.4 billion, to end-November, a decline of almost €7 billion in comparison with the same period last year. The decline reflects the transfer of €4 billion to the National Reserve Fund and increases in public expenditure.   November is a VAT-due month, it is the deadline for self-employed income tax payments, and the month in which the largest payments are made for corporation tax. Total tax receipts for the month of November amounted to €15.6 billion, €2 billion higher than November 2022.  Corporation tax receipts in November amounted to €6.3 billion, which is €1.3 billion, or almost 27 percent higher than November last year. This is broadly in line with expectations.  Income tax receipts were €2.1 billion, or 7.3 percent, ahead of their end-November 2022 position and reflect continued strength in the labour market.  VAT receipts to end-November are €1.6 billion, or 8.6 percent, up on the same period last year.  Commenting on the figures, the Minister for Finance, Michael McGrath T.D. said:  “The end-November Exchequer returns confirm that we are, broadly speaking, where we expected to be at this point in the year. The growth in income tax and VAT receipts we have seen over the course of the year points to the fundamental resilience of our economy despite all the external challenges we are facing.  The stand-out feature of the November performance is, of course, corporation tax: after three months of decline, a large increase in receipts this month means this revenue stream is once again comfortably ahead of last year.  However, it is crucial to place this in context. While corporation tax is now 4 per cent ahead of 2022, it is clear that the era of persistent over-performances is coming to an end.  The volatility in this revenue stream highlights the importance of ensuring that permanent fiscal commitments are not made on the basis of temporary receipts. Instead, the establishment of the two new long-term savings vehicles (the Future Ireland Fund and the Infrastructure, Climate and Nature Fund) will use these windfall corporation tax to help finance known future fiscal challenges, such as an ageing population, climate change and digital transition.” 

As a result of the changes to Making Tax Digital (“MTD”) for income tax, details of which were published at the 2023 Autumn Statement, HMRC has published draft regulations (and associated notices) for consultation. The consultation is open until 12 January 2024. By way of reminder, MTD for income tax will be mandated from 6 April 2026 for unincorporated businesses and landlords with turnover over £50,000, whilst those with turnover over £30,000 are mandated from 6 April 2027. The turnover between £10,000 and £30,000 population are not currently mandated, however HMRC has advised that the position in relation to these smaller businesses and landlords is still under review.  The draft regulations amend the Income Tax (Digital Requirements) Regulations 2021 which provide the statutory legislative framework for MTD for income tax.   Amendments included in the draft regulations and notices reflect recent government decisions included within the outcome of the MTD small business review. They also reflect the government announcement in December 2022 on the introduction of the phased mandation schedule for MTD for income tax.  The following specific changes are reflected in the draft regulations:-  the revised MTD mandation dates and thresholds announced in December 2022;  changes which aim to improve the design of quarterly updates;  the removal of end of period statements;  easements for landlords with jointly owned property; and  exemptions for specific groups.  This a technical consultation, focused on ensuring that the draft regulations and notices achieve their intended policy purpose. Please contact makingtaxdigitalconsultations@hmrc.gov.uk if you have any questions on the draft regulations and notices. Responses to the consultation should also be submitted to the same e-mail address.  Last week HMRC also published a media article on MTD for income tax which aims to raise awareness across a broad audience. The article is a part of the Guardian newspaper’s ‘Business Transformation’ pull-out. In addition, a new video was also launched featuring MTD’s new Programme Director, Craig Ogilvie.  

This week we bring you news of the government’s response to the Treasury Committee’s report which outlined the need for a review of tax reliefs and it's response to the same Committee’s report into venture capital tax reliefs is also available. We also update you on the removal of the functionality to copy existing VAT clients across to the Agent Services Account (“ASA”) and HMRC has issued an important reminder in its Company Tax Return Guide about the procedures to follow when making loss carry-back claims in corporation tax returns. And finally, guidance has now been published on the digital DIY Housebuilders Scheme which launched on Tuesday 5 December and which we told you about in last week’s Miscellaneous updates.  Update - removal of functionality to copy existing VAT clients to the ASA   In our Miscellaneous updates of 11 September, we advised that from October 2023 HMRC intended to remove the functionality that allowed agents to copy existing VAT clients to their ASA. We have now been advised that this change has not yet taken place and has been delayed to an unspecified date. We understand that this is due to technical complexities.  In the interim, agents are still encouraged to prepare for the removal of this functionality in due course by ensuring that existing VAT clients are copied across as soon as possible. Once this functionality is removed, VAT clients will need to be authorised using the digital handshake authorisation route available in the ASA.   Reminder: corporation tax loss carry-back claims in corporation tax returns  HMRC has issued an important reminder to companies and agents about the procedures to follow when making loss carry-back claims in corporation tax returns (“CT600”).   If the CT600 includes a loss carry back claim, you must tick box 45 to show that a repayment for an earlier or prior accounting period is due and you must supply a breakdown of the claim in your computations showing how losses are to be used. Failure to do so will result in HMRC being unable to process the claim.  The reminder includes confirmation that such claims do not of themselves require an amended return for the period in which the losses are utilised. Therefore, if making a loss carry back claim, you should not:-  submit an amended CT600 tax return for the same accounting period that does not include new information; or  submit an amended CT600 tax return for the period in which the losses are being used; or  submit an original CT600 tax return by post — all returns should be submitted online through the Government Gateway portal.  However, the above does not apply if an amended return covers other matters and is not solely in relation to the loss carry back claim, or if the loss carry back claim itself requires amending.  Resubmitting the original loss carry-back claim will also increase the time taken for HMRC to review and process this.  Further information on completing the CT600 tax return is available in the Company Tax Return guide. 

Recent media reports, Oireachtas debate and public commentary have highlighted concerns regarding misuse of the planning appeals system. Revenue has issued a press release to draw attention to the potentially serious consequences for any individual or business in receipt of payments of the nature described in these reports, where such payments have not been included in the appropriate tax return.  Taxpayers are reminded that there are a range of opportunities available to taxpayers to regularise their tax affairs, including self-review, self-correction and making an unprompted qualifying disclosure, as set out in Revenue’s Code of Practice for Revenue Compliance Interventions.  Revenue is encouraging those with information regarding the payment or exchange of funds or other consideration, which have ultimately influenced the planning process to pass the details on to Revenue for the appropriate follow up. Where an individual encountered such information within a work-related context, this information can be reported to Revenue under the framework of the Protected Disclosures Act 2014 (as amended),using Revenue’s online protected disclosures reporting form. Individuals who have acquired such information outside a work-related context can report the details to Revenue, in confidence, by completing and submitting Revenue’s online tax evasion report form.  Revenue welcomes all information about potential wrongdoing related to taxes, duties or customs controls, and treats all such reports seriously and with utmost confidentiality. Revenue follows up rigorously on all available information that suggests there may be a risk of non-compliance with tax and duty related obligations.