The Northern Ireland Tax Committee is still accepting feedback on the consultation examining potential new tax incentives for occupational health. Get in touch by Friday 29 September. This consultation is open until 12 October 2023 and specifically seeks views on how expanding the existing benefit in kind exemption for medical benefits could help employers provide more services, essentially helping people back into work.

Revenue has advised, at a recent meeting of the TALC MyEnquiries subgroup that the size of individual files that can be uploaded as part of the eCG50 process is increased to 11 MB. Where files are greater than 11 MB they must be zipped into parts to facilitate the upload. Revenue will amend its Tax and Duty Manual to reflect this development and to provide guidance on the zipping process. 

As reported last week, Revenue is continuing to issue notices to employers’ ROS inboxes, inviting them to register for webinars on the new Enhanced Reporting Requirements (ERR) for employers. The notice will contain a link to Eventbrite where a free ticket can be booked to attend a webinar on a suitable date and time. These webinars are scheduled to take place over the next 8 weeks. A sample event invitation can be viewed here.  The Institute has emphasised to Revenue the need for detailed and timely guidance for employers to prepare for the new reporting requirements. We will continue to liaise with Revenue and inform members via Tax News.   

In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit. We also update you on recent developments in relation to the Windsor Framework and the latest Trader Support Service bulletin is available. The Institute was also in attendance last week at the latest UK Domestic Advisory Group meeting. Windsor Framework update The House of Lords Protocol Sub-Committee on the Protocol is holding a follow-up evidence session on the implementation of the Windsor Framework. The UK Government has also now responded to the Committee’s report published in July. Various pieces of secondary legislation (set out below) have recently been published to implement the Windsor Framework and specifically the new trade operating model including the green and red lanes for agri-food and retail scheme which are due to commence later this week from 1 October. The House of Commons Library has published a briefing on the new rules for trading with the EU. The secondary legislation published is as follows:- Windsor Framework (Retail Movement Scheme: Public Health, Marketing and Organic Product Standards and Miscellaneous Provisions) Regulations 2023; Windsor Framework (Enforcement etc.) Regulations 2023. Windsor Framework (Retail Movement Scheme) Regulations 2023; Windsor Framework (Plant Health) Regulations 2023; Customs (Northern Ireland) (EU Exit) (Amendment) Regulations 2023 Windsor Framework (Financial Assistance) (Marking of Retail Goods) Regulations 2023; and Postal Packets (Miscellaneous Amendments) Regulations 2023. UK Domestic Advisory Group meeting Last week, the Institute was represented at the latest Domestic Advisory Group (“DAG”) meeting. The UK DAG is a consultative body designed to enable the government to hear from those most affected by the operation of the UK-EU Trade and Cooperation Agreement (“TCA”). The DAG has now established five sub-groups as follows, each of which reports back to the DAG on key issues with implementation of the TCA:- Trade and Customs; Regulatory Co-operation and Level Playing Field; Business and Labour Mobility; Energy and Climate Change; and Nations and Regions. Chartered Accountants Ireland participates in the Nations and Regions sub-group and would welcome your feedback on any issues specific to Northern Ireland. Readers are advised to note that the Windsor Framework is outside the remit of the UK DAG. In November, a further DAG meeting is scheduled to be held in advance of the annual UK-EU Joint DAG which the Institute will be attending. Miscellaneous updated guidance etc. The following updated guidance, and publications relevant to EU exit are available:- External temporary storage facilities codes for Data Element 5/23 of the Customs Declaration Service; Smart watch straps, watch bands and watch bracelets (Tariff notice 11); Transit newsletters — HMRC updates; Register with the UK ID issuer if your business is involved in the supply of tobacco products; Simplified rates for bringing personal goods into the UK; and Moving goods out of Great Britain using transit: step by step. Search the register of customs agents and fast parcel operators Transit newsletters — HMRC updates Delaying declarations for goods brought into Great Britain List of goods imported into Great Britain from Ireland that are controlled Moving qualifying goods from Northern Ireland to the rest of the UK; and Apply to use simplified declarations for imports.  

Readers are reminded that the Temporary Business Energy Support Scheme (TBESS) claims deadline is 30 September 2023. As previously reported, claims cannot be made after this date. 

Tax news readers will be aware from previous news that the new non-resident landlord withholding tax (NLWT) system enables tenants or collection agents to make Rental Notifications (RN) when making payments to a non-resident landlord. Validation rules in the system require collection agents to enter the Tax Reference Number (TRN) of the non-resident landlord they represent while both tenants and collection agents are required to submit the local property tax (LPT) identifier of the property, depending on who is filing the RN.  Revenue is aware of validation issues arising in relation to the input of incorrect tax reference numbers or local property tax identifiers. Where an error message is returned, and following confirmation of the TRN/LPT details provided by the landlord, the tenant or collection agent should contact Revenue through MyEnquiries. Revenue has advised that the tenant or collection agent should also email the NLWT team directly at info_NLWT@revenue.ie quoting the Enquiry ID number. As this is not a secure channel, client data should not be included in the email.  

Last week, Institute representatives attended an information meeting hosted by the Department of Finance in conjunction with officials from Revenue. An update on the revised EU “Green Deal” General Block Exemption Regulation (GBER), which was adopted on 1 July 2023 and comes into effect from 1 January 2024, and its impact was provided.  GBER is a European Commission regulation that allows Member States to put certain State aid schemes into place without prior notification to the EU Commission, provided certain conditions are met. The Employment Investment Incentive (EII), the Start-Up Relief for Entrepreneurs (SURE) and the Start-Up Capital Incentive (SCI must comply with GBER for all shares issued on or after 13 October 2015.   A copy of the slides from the meeting are available here. 

Revenue has updated its process to automatically offset relevant contracts tax (RCT) credits against tax liabilities as they fall due and tax returns are filed. Upon receipt of the RCT deducted by a principal contractor from a sub-contractor Revenue will automatically credit the subcontractor’s tax record. Automatic RCT offsets apply to employer’s PAYE, income tax, corporation tax, preliminary tax and VAT liabilities.   All automatic system offsets happen no later than seven days from the date the liability becomes due following submission of the relevant tax return. The taxpayer will receive a statement of account to their ROS inbox confirming an offset has been made.   Automatic offset of RCT credits does not apply to liabilities covered by the debt warehousing scheme or a phased payment agreement. Such an offset must be requested via MyEnquiries.

Last week, the Institute, under the auspices of the CCAB-I, wrote to the Taoiseach, Leo Varadkar T.D., and the Minister for Finance, Michael McGrath T.D., to express our members’ concern about the tax treatment of General Medical Services (GMS) income of General Practitioners (GPs) which will change from 1 January 2024. The CCAB-I and other bodies have been discussing this matter with Revenue over the past two years through the Tax Administration Liaison Committee (TALC) forum.  As previously reported, GPs in a medical practice, be they principals, partners or employees, will be required to self-assess for tax purposes on the GMS income earned in their name, with a credit for the attaching professional services withholding tax (PSWT).    Our members are concerned that taxing the GMS income of GPs in this manner does not make provision for the practice-wide scope of the GMS contract and will result in complex administrative procedures for medical practices where income is allocated between GPs and the practice depending on who treats certain categories of patient.   In addition, certain GPs employed by medical practices, that previously were simply subject to PAYE on their salary, will now also be subject to self-assessment on their GMS income. They will be required to file income tax returns and pay preliminary tax, while at the same time continuing as an employee of the practice. They may also be exposed to the 3 percent USC surcharge as self-employed individuals.   In light of such practical difficulties, CCAB-I requested that the tax treatment of income earned under contract by individuals acting on behalf of a practice be assessed on the principal or partners of the practice.  Revenue has confirmed that it will publish an updated Tax and Duty Manual in the coming weeks, in relation to the tax treatment of GMS income of GPs. CCAB-I will continue to liaise with Revenue and will inform members via Tax News.  

Chartered Accountants Ireland Leinster Society has announced its shortlist for the 46th Annual Published Accounts Awards. The awards celebrate companies, on the Island of Ireland, for their excellence in corporate reporting. The Awards are sponsored by Euronext Dublin. This year’s shortlist includes a total of 28 public and private companies, and 10 not-for-profit organisations. The winners will be announced at a special gala event, taking place in The Shelbourne Hotel on Thursday 09 November 2023 commencing at 7.30pm, with special guest Colm O’Regan overseeing the proceedings. FINALISTS FOR THE 46th PUBLISHED ACCOUNTS AWARDS 2023 Euronext Growth Award Origin Enterprises Uniphar Euronext Dublin (SME <€1bn) Glenveagh Properties plc Irish Continental Group plc Cairn Homes plc Dalata Hotel Group plc Kenmare Resources plc IRES REIT FBD Holdings Euronext Dublin (Large Cap >€1bn) CRH plc Bank of Ireland Kerry Group Flutter Entertainment plc Company Listed on a Foreign Market Grafton Group C&C Group plc DCC plc Oneview Healthcare Statutory or Unquoted Entity (IFRS) An Post Eirgrid Northern Ireland  Water ESB Statutory or Unquoted Entity (Non-IFRS) CIÉ  Tusla Central Bank of Ireland Coillte CGA DAA Home Building Finance Ireland Irish Football Association Not for Profit - Large Barnardos Jigsaw Concern Kare Focus Ireland CLG Inspire Wellbeing CLG Not for Profit - Small / Medium The Care Trust The Wheel Dogs Trust Barretstown In addition to the category awards, there are also a number of other awards consisting of the: Overall Winner’s Award, Sustainability and ESG Reporting Awards, Branding, Communication and Digital Award, and the Diversity and Inclusion Awards. Dedicated PAA webpage: https://www.charteredaccountants.ie/Leinster/PAA Event details Thursday 09 November 2023 in The Shelbourne Hotel, 7:30pm. M.C. is critically acclaimed broadcaster, author and comedian, Colm O’Regan. Tickets are €130 per person / €1300 for a table of ten. Individual tickets and tables are available. To book or for more information please contact LeinsterSociety@charteredaccountants.ie. Dress: Business / Cocktail This event is sponsored by: 

Gemma O’Connor outlines practical tips for maintaining employee connections during illness-related absences Keeping in contact with an employee who is off work due to illness can be a delicate balancing act. On the one hand, you need to know when the employee will be fit to resume work. Conversely, you don’t want the employee to feel pressure to return to work before they’re better. If an employee is absent for an extended spell, they may feel out of touch and undervalued if you don’t reach out to see how they are recovering. As this can be a sensitive issue, here are some ground rules around contacting staff who are absent through illness. Making contact It is usually the responsibility of line managers to keep in regular contact with any of their staff who are absent. They typically know the individual best and are equipped to discuss sensitive issues. If it’s a minor illness likely to end within five days, contact is not usually necessary. No matter the duration of the absence, however, a return-to-work interview should be carried out to update people about the status of their work. This meeting also gives your employee a private opportunity to discuss concerns about their health or other matters affecting their performance or attendance. In the case of an employee’s sudden or traumatic illness, communicate your sympathies and use your discretion until a firm diagnosis is made. Call vs text Once you have a diagnosis and time has passed, you will want to contact the employee for further information about their health and return to work. All contact about an illness-related absence is typically by phone. Some employees might prefer to text. To give them time to prepare for a call, managers should send a message to set up a suitable time for a conversation that works for the employee. The discussion The call must focus only on the employee’s health and return to work. Before you pick up the phone, consider what organisational matters need to be in place before the employee returns to work (for example, if a temporary employee has been put in place, will a handover be required, etc.) or what support the employee might need to encourage a speedier return. It’s important not to make assumptions about the employee’s situation. Remember to listen and be flexible and consistent. Recovery times for the same condition can vary significantly from person to person. Do not mention the workload being taken on by other people or strained resources because of their absence. Once you get an absent employee on the phone, ask them how they are getting on and explain it’s a routine call to see how they are and when they will likely be well enough to return to work. If the employee makes it clear they don’t want to talk, remain polite and end the call. Keep records of conversations Keep a note of your conversation with the absent employee. If any subsequent claims arise from the employee’s absence, you must have a paper trail supporting your management of the situation. Ongoing assistance If the employee’s absence is stress-related, try to find out if it’s connected in any way to the employee’s job, conflict with a colleague or some other workplace concern and address any issues when the employee returns to work. Direct the employee to the Employee Assistance Programme if you think a confidential third-party discussion with a counsellor will help. Gemma O’Connor is Head of Service at Peninsula Ireland

With Budget Day approaching, Tom Woods outlines his recommendations for ensuring this year’s measures support social and economic progress With Budget 2024 just two weeks away, Ireland is experiencing mixed economic fortunes. On the positive side, near full employment and significant exchequer receipts would suggest that the Government has an unprecedented range of policy choices to consider. Nevertheless, the economy is also facing constraints. Inflation and interest rates offer limited room for manoeuvre, making selecting the right policy choices much more difficult. Housing KPMG suggests introducing a new low VAT rate on the sale of new builds to help with the affordability of purchasing a new home. We also support the reintroduction of mortgage interest relief to help homeowners with rising interest rates and growing mortgage repayments. We recommend that the taxation of professional landlords be reformed to put them on a similar footing to trading businesses. This would help to attract and retain more landlords and boost the supply of housing stock in the rental market. Reintroducing a controlled and targeted Section 23-type rented residential relief (tax relief applying to rented residential property in a tax incentive area) would also promote housing investment in less sought-after areas. The workforce As a small, open economy, our successful tax policy has helped make Ireland a location of choice for multinational business. As a country at close to full employment, we need an attractive personal tax regime to keep and grow mobile talent to support the growth of domestic and international businesses in Ireland. There is a range of budgetary measures that would help us in this regard, including the widening of the personal tax bands and credits, consideration of a new intermediate tax rate of, say, 30 percent, and the automatic indexation of credits and bands to help dampen the impact of inflation and protect the value of wages. The taxation of share-based remuneration could also be simplified, and we would like to see some improvements to the Special Assignee Relief Programme (SARP). Innovation and entrepreneurship The impact of foreign direct investment (FDI) on the Irish economy can’t be overstated. However, the ongoing changes to the international tax landscape emphasise the importance of having the most enticing regime within the new rules. As mentioned above, an inviting personal tax regime will become more critical, as will having an appealing research and development (R&D) regime to promote and foster more innovation. Several measures could be introduced to promote more innovation, including an upfront entitlement to cash refunds of R&D tax credits for smaller businesses. The R&D tax credit of 25 percent could be improved to either 30 percent or 35 percent to make it more attractive internationally. Moreover, the rules and the application process to qualify for this credit should be simplified. Other jurisdictions continue to refine and improve their R&D offering, so it has never been more important for Ireland’s regime to be as inviting as possible. International changes also underscore the need to support the growth of the domestic sector.  We have made several recommendations to support SMEs. These include introducing a new 20 percent capital gains tax (CGT) rate on the sale of shares in SMEs and some improvements to entrepreneurs’ relief to promote investment in SMEs. We advocate simplifying the rules underpinning the Employment Incentive Investment Scheme (EIIS) to make it more accessible and easier for businesses to raise capital. We also propose that the standard income tax rate of 20 percent be applied to dividends paid by SMEs. This should encourage promoters of SMEs to remain committed to growing their business and enable companies of scale to emerge from the domestic SME sector without the need to sell down equity. Climate Ireland’s ambitious climate goals will present challenges and opportunities for individuals and businesses. Several tax supports could be considered to help Ireland achieve its climate goals. These include measures to promote private finance for green investments via ESG bonds and pension funds. We also believe that tax measures could be introduced to help accelerate the move to electric and hybrid vehicles and support the agricultural sector in its transition to more sustainable practices. Inflation While the exchequer receipts are in rude health currently, this revenue may be vulnerable in the future, and a measured approach will be needed when deploying the available resources. While there is potential for some measures to impact inflation, the significant benefits of achieving policy objectives need to be weighed up against their inflationary impact. The measures unveiled in the forthcoming budget will signal the Government’s direction of travel across many issues. The good news is the resources are there to help sustain our social and economic progress. Tom Woods is Head of Tax at KPMG