Susan Rossney, Public Policy Officer, writes: It seems that everyone is talking about sustainability nowadays. Accountants in SMPs are watching the news and listening to the debate. You may well be asking questions like: “What can I do in the face of a global issue?” “How will this affect my practice and my clients’ businesses?” “What questions will my clients ask me next?” “ What expertise should I be developing now?” “How will sustainability work for me?” The sense of urgency to address climate change across the world is intensifying. Droughts, floods and wildfires are increasing, ecosystems are collapsing, and in response people are calling for change. But climate change is part of a broader sustainability challenge – one that can be summed up as ‘environment, social and governance’, or ESG. The responsibility to meet this challenge falls on all businesses and firms, including small ones. As ESG continues its rise up the political and corporate agenda, smaller businesses now more than ever need to meet certain ESG criteria so they can access finance, win contracts or be part of larger companies’ value chains. Clients and consumers also expect businesses to have a positive impact on the environment and to be doing their part to contribute to change. Companies that want to prosper in the future will have little choice but to become sustainable. Small businesses have a crucial role in the transition to more sustainable economies and societies. Accountants are key financial advisors for those businesses, but also need to understand and implement sustainability practices for their own businesses. This article discusses the opportunities for small businesses – and their advisors – in embracing sustainability. “Practices who want to engage particularly with the next generation of staff and clients need to be able to take sustainability seriously and need to be able to demonstrate that” Conal Kennedy, Head of Practice Consulting, Chartered Accountants Ireland Environmental, social and economic issues present huge risks for businesses. Examples include: losing out to competitors; having reduced access to capital; developing weaknesses in supply chains; developing succession risks; and failing to meet the requirements of stakeholders, including consumers, clients, banks, business partners, staff and regulators. Accountants can identify and quantify these risks for their own practices, and develop policies for themselves and their clients to address them. But managing risks against ESG factors can also benefit businesses directly. As this article will show, if properly addressed, it impacts employee welfare, improving employee experience and leading to greater output; it affects ability to access finance; it enhances an organisation’s reputation, helping to attract new business and staff; and it can help companies comply with supply chain requirements of their larger clients. Preparers and auditors of financial statements will also need to consider these issues going forward. Generating new business Many accountants are now adding “sustainability consulting” to their services to clients. As trusted advisors, they can play a key role in helping SME clients think about their potential sustainability risks, and leverage opportunities offered by the sustainable transition. For example - Accountants can help clients to: assess sustainability impact and risks improve efficiencies reduce costs avail of grants acquire finance identify opportunities to expand their range navigate the changes Sustainability is also an increasingly important factor in tendering for contracts with larger organisations which have stricter sustainability goals. Some of these large organisations perform assessments of potential suppliers. Others also carry out regular risk screenings of existing supply-chain suppliers, and/or conduct internal audits and onsite supplier audits to verify that their supply chain suppliers are conforming to their policies. Accountants have a huge role to play in helping companies prepare this information, and in doing so themselves if they are part of these supply chains or are tendering for contracts. Accessing Finance Embracing sustainability is working towards ensuring the financial future of accountants’ businesses or their clients’ businesses. Investors are actively looking to invest in sustainable projects, and are screening out certain sectors or companies (like those heavily reliant on fossil fuels, for example). Businesses seeking this investment benefit from being able to collect and report on their sustainability-related activities against a recognised standard. Many banks are also adopting sustainability criteria and may require proof of sustainable practices from companies looking to avail of finance. There are also business grants as well as support schemes and tax incentives available for organisations looking to transition to more sustainable practices. Again, accountants have a huge role to play in guiding clients through this. Savings Operating in a sustainable manner saves costs. While there may be short-term costs associated with transitioning to a sustainable business model, businesses can recoup the investment they make and can also reduce their business costs by introducing more sustainable ways of working. According to the Sustainable Energy Authority of Ireland (SEAI), the average SME can save up to 30% on its energy bill by becoming more energy efficient. A business with an engaged and motivated team is also less likely to experience high employee-turnover and associated costs. In a drive to decarbonise Ireland’s economy, the rate of carbon tax increased by €7.50 in October 2020 from €26 to €33.50 per tonne/CO2. Reducing your carbon emissions will reduce your cost. Ultimately, though, any costs associated must be reframed as the cost of compliance or risk management. The greater costs are the costs of not being sustainable. Reputation With social media increasing access to companies, there are very few places to hide for organisations which are falling short of sustainability-related expectations. Staff expect it, and customers demand it. Companies not being transparent about their sustainability achievements, or their goals, will be called out by their customers and staff. Likewise, there is little patience for companies that are ‘green-washing’, i.e. presenting a false or misleading green public image. “64 percent of customers are ‘belief-driven buyers’ who will choose, switch, avoid or boycott a brand based on its stand on societal issues.” 2019 Edelman Trust Barometer Special Report: In Brands We Trust? Mobile Survey Attracting clients On the flip side, though, organisations that do embrace sustainability are in a strong position to attract clients. They can do this by becoming more visible in their community. Supporting local literacy or numeracy projects, participating in local charities or sports clubs, or engaging in local-tree planting initiatives not only increases brand awareness of a firm or business: it builds trust with a community. Remember – not everyone may be doing this, so you will have a first-mover advantage if you do. As a greater number of large companies are either required to or decide to report on human rights, diversity and climate-related policies, a greater number of local businesses supplying those companies will also be obliged to disclose their own sustainability practices, and will need help from a financial advisor to do so. Accountants who are experienced in offering clients this support may attract more clients looking to comply with the sustainability requirements of large organisations. Attracting & retaining talent Candidates are actively seeking jobs in companies with strong ESG credentials and are rejecting jobs in those companies not aligned with their own values. What was identified by McKinsey in 1997 as the ‘war for talent’ is as fierce as ever within the professional services sector, and organisations are going to great lengths to recruit talent. These same companies are now including their commitment to ESG values as a competitive differentiation. This is a trend seen by Karin Lanigan, Head of Member Experience in Chartered Accountants Ireland: “I have worked in recruitment for more than 20 years and in recent years, I have noticed a growing trend whereby candidates have become more and more discerning about types of organisations they’ll work for. They are not just considering salary and package; they are looking at the sector, at the reputation of an organisation, and asking themselves ‘will I feel proud if I’m out with my friends on a Friday night to say that I work with whatever the organisation is or whatever the sector is that they are in?’ They want to have sense of pride in their place of work.” Remember: a commitment to ESG does not have to mean having a large sustainability department or running an eco-business. It can also mean being a firm or company that looks after its employees, provides good training and promotion opportunities, and is active in its local community. “With ‘measurements’ everyone thinks of ‘carbon footprint’. But it doesn’t have to be. You can measure staff satisfaction through surveys. You can measure employee-turnover and retention or absenteeism. Encourage staff to measure the number of hours they spend giving back to others in the community.” Teresa Campbell, PKF FKM Impact on Financial Statements Preparers and auditors of financial statements should consider the impact on sustainability and climate change on every entity. Quoted companies, and some categories of larger companies have defined obligations to report on the impact of environmental matters on the companies’ businesses. These specific reporting requirements do not apply to private limited companies reporting under FRS 102. However, climate change and sustainability are major and developing issues that cannot be ignored by anyone. Both IAASA and the FRC have recently commented on matters that they expect to see considered in financial statements. Whilst their comments were largely made in the context of the IFRS framework, much of what they have said is directly applicable to financial statements prepared under FRS 102. Accountants should consider and report on how climate change has impacted on the assets and liabilities of the company, what additional risks have emerged and whether new or increased provisions are necessary. How has climate change impacted on the estimates and judgements applied, and do these need to be disclosed? Consider such matters as the useful lives of property, plant and equipment. Consider also the impact on impairment assumptions. Does the entity have an obligation to remediate environmental damage caused by any of its activities? Have any of its contracts become onerous, or are they likely to? The financial statements, taken as a whole, should contain sufficient information to be useful to stakeholders, and preparers should avoid the use of non-specific boilerplate. See IAASA’s recent observations on published financial statements. The Institute will cover these areas in more detail in future issues of Practice Matters, broadcasts of Practice News, and CPD courses. Some member resources Find more on the Institute’s Sustainability Hub with resources from articles, podcasts and webinars to a glossary explaining the acronyms and terms. You can also find tips in the Institute’s guide on Sustainability for Accountants. This free guide for accountants describes what to do – and where to start – to operate sustainably, successfully and cost-effectively.  

Has a friend ever said "my life is just worthless"? You may be strong and grounded and able to cope, and you may be able to offer support to others. You may have a friend, a client, a relative or a colleague who tells you that s/he is considering suicide. Let us consider this and how you might response to such a disclosure. How do you respond? Take the disclosure very seriously. Do not try to cheer them up and ‘take them out of themselves’. Ask the direct question if s/he even obliquely mentions suicide, saying something like: “My life is just worthless", "Sometimes I think that I just cannot go on”, “My family would be better without me". The direct question you should ask is “Are you thinking of taking your own life?” If the answer is “No”, then you should listen empathetically to how s/he is feeling and notice and name the feelings s/he seems to be describing. Do not deny how s/he feels. For example, if s/he tells you s/he feels worthless and useless, do not tell them that s/he should not feel like that with their beautiful family, fantastic job, and gorgeous house. Accept that s/he feels like that and let them stay with those feelings and talk about them. You just listen. If the answer is “Yes, I have thought of suicide”. You should accept this calmly and hear the depth of the dark place s/he is in. You should then ask if s/he has a plan and let him talk about it if they have a plan. Again, you should give time and listen empathetically. It is important to respect how s/he feels and not to provide your own experience or answers. Having given time and space to allow for the discloser’s feelings to be unpacked, ask what options s/he thinks are available to him. Do not produce your own solutions – listen to the potential ways forward and encourage development of those ideas. However, it is important that someone who is suicidal seeks professional help and you should guide them to that conclusion if it is not emerging. Tell them you will support them as s/he moves along the journey to recovery. Make sure that you stay connected and arrange for your next meeting /conversation to support them as s/he takes the journey they have outlined. Contact them if you have not heard within the time you have agreed. Make sure you are supported yourself, as this kind of disclosure can be difficult for you. CA Support has a confidential listening service. Feel free to get in touch if you need support during this time. We can be contacted by email at casupport@charteredaccountants.ie or call us on (353) 86 024 3294. Article written for CA Support by Prof. Patricia Barker, Dip. Couns., MPhil, PhD, FCA

In Irish tax developments, Business Resumption Support Scheme guidelines are now available. On the UK front, HMRC provides an update in response to issues with the 30-day CGT reporting service for residential property disposals. While in international news, the European Commission has extended the scope of certain aid measures under the General Block Exemption Regulation. Ireland Revenue recently published guidelines for the Business Resumption Support Scheme which will support businesses significantly impacted throughout the COVID-19 pandemic, even during periods when restrictions were eased.  A copy of the CG50A certificate is now available in the ROS inbox of the filer of the CG50 applications. UK              HMRC has published further details of the temporary solution to issues with the 30-day residential property disposal service. HMRC has issued a reminder that individuals can claim working from home expenses quickly and easily online.   International   The European Commission has extended the scope of the General Block Exemption Regulation which will allow Member States to implement certain aid measures without prior Commission scrutiny.   Keep up to date with all the latest Irish, UK, and international tax developments through Chartered Accountants Ireland’s Tax Newsletter.

The MyEnquiries tracking of enquiries function has been enhanced to provide an indication of enquiry status.  The enquiry status visible on the Enquiries Record is one of the following:  Received, In Progress, Completed, Awaiting Customer Feedback or Revenue Initiated.  See eBrief No. 149/21 for full details.

The Import One Stop Shop (IOSS) Tax and Duty Manual is updated to clarify the registration procedure (paragraph 5) and reporting obligations (paragraph 9) for intermediaries under the new VAT eCommerce rules introduced on 1 July 2021 which extends the VAT Mini One Stop Shop to a One Stop Shop, deems online marketplaces and platforms as suppliers for certain transactions, introduces a new Import One Stop Shop (IOSS) and special arrangements for certain imports of goods. Non-EU suppliers need to appoint an EU established intermediary to avail of the IOSS.  The role of the intermediary is to fulfil the obligations of the IOSS on behalf of the supplier. The intermediary is responsible for the declaration and payment of the VAT due on the importation of goods with an intrinsic value not exceeding €150. An intermediary will be jointly and severally liable with the supplier they represent where the Revenue deems it necessary.   In such cases, a notice will issue to both parties from the Revenue Commissioners to notify them that joint and several liability applies. This will apply on a prospective basis. See Revenue’s  IOSS guide and eBrief No. 143/21 for more details. 

Tax and Duty Manual Part 41A-05-04 - Full Self-Assessment: Time limits for making enquiries and raising assessments - is amended in Paragraph 4 to clarify the circumstances  where assessments can be amended and to confirm that assessments can be made or amended outside the four-year  timeframe on conclusion of a Mutual Agreement Procedure, as provided for in section 959AA(2A) TCA 1997.  Revenue cannot make or amend an assessment on a chargeable person who delivered a full and true return later than 4 years after the end of the chargeable period in which the return is filed, meaning that no additional tax can be payable and no tax can be repayable after this time.   However, at any time, Revenue can amend an assessment: where the return was not a full and true disclosure to give effect to the determination of an appeal to reflect an event which happened after the return is filed to correct a calculation error in the assessment to correct any mistake of fact which was disclosed by the taxpayer and not correctly reflected in the assessment or to give effect to bilateral Mutual Agreement Procedures reached between Revenue and a competent authority in another jurisdiction with which Ireland has a Double Taxation Agreement. See eBrief No. 145/21 for more details. 

Tax and Duty Manuals Part 15-01-30 (Seafarer Allowance) and Part 15-01-45 (Fisher Tax Credit) have been amended as a consequence of the Withdrawal of the United Kingdom from the European Union (Consequential Provisions) Act 2020 coming into operation. The changes ensure that following Brexit the status quo regarding eligibility for the allowance/tax credit is retained.  See Revenue’s website for further details. 

A copy of the CG50A certificate is now available in the ROS inbox of the filer of the CG50 applications.  The Tax and Duty Manual Part 42-03-01a eCG50: Guide for Applicants - has been updated at paragraph 4.7 to reflect this fact.  The online CG50 application processing system was launched in June 2020 which allows online filing by vendors applying for an eCG50A certificate, and purchasers filing an eCG50B form. See eBrief No. 146/21 for more details.   

Revenue recently published guidelines for the Business Resumption Support Scheme (BRSS).  BRSS will support businesses significantly impacted throughout the COVID-19 pandemic, even during periods when restrictions were eased.  To qualify, the business must demonstrate a significant reduction in trade during the period 1 September 2020 to 31 August 2021.  Eligible businesses can claim an Advance Credit for Trading Expenses.  The portal for registering and making a claim for the BRSS will open in early September. Revenue will publish details on how to register and details on the claim portal closer to the registration date. See Revenue’s BRSS webpage and guidelines for more details. 

Revenue extended the deadline for the completion and submission of the EWSS Eligibility Review Form in respect of June 2021 to 15 August 2021. The eligibility review form in respect of July 2021 is also due to be submitted on the same date.   The CCAB-I made a submission to Revenue on foot of representations from members to call for an extended EWSS Review Form deadline.  In a letter in response to the CCAB-I’s submission, Revenue set out that in so far as monthly turnover figures cannot be readily accessed for the purpose of completing the EWSS Eligibility Review Form, businesses may use the average turnover as derived from their bi-monthly (or other periodic) VAT return data to calculate the monthly turnover value for the review form.  The deadline extension is also noted in Revenue’s press release reminding businesses of key supports available as the economy continues to reopen.

HMRC has issued a reminder that individuals can claim for working from home expenses quickly and easily online. “Your clients or their employees may be able to claim tax relief for additional household costs if they have to work at home on a regular basis, either for all or part of the week. Additional costs include heating, metered water bills or business calls that have been incurred wholly, exclusively and necessarily as a direct result of working from home. They don’t include costs that would stay the same whether employees are working at home or in an office. Your clients or their employees can apply quickly and easily using the HMRC online service, which is now open for claims covering periods up to 5 April 2022. For more information go to GOV.UK and search ‘tax relief job expenses. Employees who have to complete a Self-Assessment tax return will need to claim working from home expenses via the employment income pages of their tax return instead of the digital service. For further information, please find the recent press release on P87 WFH expenses here: Working from home? Customers may be eligible to claim tax relief in 2021 to 2022 - GOV.UK (www.gov.uk)”

SEISS grant 5, upcoming CJRS deadlines, a reminder of the changes to the CJRS from 1 July, and the statutory sick pay rebate scheme all feature this week. SEISS grant 5 Eligible taxpayers are now able to make claims for SEISS grant 5. From mid-July, HMRC has been contacting taxpayers who may be eligible to let them know their earliest personal claim date and to ensure they are aware of the need to calculate turnover for most claimants. Find out if a claim is possible by checking all criteria in stages 1, 2 and 3 are met including the turnover test which will be required to be met by most taxpayers. This test considers how much turnover has gone down by in the 2020/21 tax year due to the pandemic. The guidance on the turnover test has been updated recently. Taxpayers who were not eligible for SEISS grant 4 will not be eligible for SEISS grant 5 as HMRC is using the same tax returns to determine eligibility for both grants. HMRC are stressing that taxpayers do not need to submit their 2020/21 Self-Assessment tax return at this time, even though the taxpayer is being asked for their 2020/21 turnover. Once again, agents will not be able to apply for SEISS grant 5 on behalf of their clients. HMRC has also been contacting some taxpayers who may be eligible for SEISS grant 5, if they started trading in 2019/20, to verify their identity. HMRC is asking taxpayers for one form of identity and three months’ worth of bank statements from the 2019/20 tax year. To confirm the contact is genuine, taxpayers can go to HMRC trusted contacts on GOV.UK. Get ready for the invitations to claim 5th SEISS Grant HMRC says claiming online is the quickest and easiest way for customers to get their grant. To get started, customers can search ‘SEISS’ on GOV.UK anytime from their personal claim date until 30 September 2021.   To confirm their eligibility and make their claim, customers will need their:  Turnover figure for a 12-month period from April 2020 to April 2021 Turnover figure for 2019/20 or 2018/19 if required. National Insurance number: customers can find this on the HMRC app, their online Personal Tax Account (PTA) or by asking their tax agent if they have one. Self-Assessment Unique Taxpayer Reference (UTR) number: customers can find this on their Self-Assessment papers, in their PTA or by asking their tax agent. Government Gateway user ID and password: To avoid delays, customers should check that they can log in to the Government Gateway before their personal claim date. If customers don’t have an account, or have forgotten their details, they can follow the instructions on GOV.UK by searching ‘HMRC services: sign in or register’. Customers should also check that their contact details are correct in their Government Gateway account. Bank account number and sort code: For a building society account, customers should include the roll number if they have one. The CJRS The deadline to submit  CJRS claims for periods in July 2021 is Monday‌‌ ‌16‌ August 2021, unless reasonable excuse is available for late submission. Amendments to July 2021 CJRS claims must be made by Tuesday 31 August 2021. Changes from 1 July 2021 From Thursday 1 July 2021, CJRS grants cover 70 percent of employees' usual wages for the hours not worked, up to a cap of £2,187.50. In August 2021 and September 2021, this will then reduce to 60 percent of employees' usual wages up to a cap of £1,875. Employers will need to pay the 10 percent difference in July (20 percent in August and September), so that they can continue to pay their furloughed employees at least 80 percent of their usual wages for the hours they do not work during this time, up to a cap of £2,500 per month. Employers continue to be required to pay the associated employee tax and National Insurance contributions to HMRC in these months. The employer contribution is a condition of applying for the grant; not paying this means the employer will need to repay the whole of the CJRS grant and they may not be able to claim for future CJRS grants. For the hours not worked employers can continue to choose to top up their employees' wages above the 80 percent level or cap for each month, at their own expense. Furloughing flexibly Employers don’t need to place all their employees on full furlough. They can use the CJRS flexibly to bring their employees back to work for some of their usual hours. Employers can claim for a portion of their usual wage costs for the hours spent on furlough. Statutory Sick Pay Rebate Scheme    The statutory sick pay (“SSP”) rebate scheme continues to provide financial support to small and medium-sized employers. Employers with fewer than 250 employees who have paid SSP to employees for COVID-19 related sickness absence may be eligible for support. Any repayment of SSP covers up to two weeks of the applicable rate of SSP. For more information on eligibility and how to make a claim, check the guidance.