Today saw leaders from over 160 countries attend the opening of the 28th Conference of Parties, ‘COP’ in Dubai. The United Nation’s COP, or ‘Conference of the Parties’, is the most significant event on the global climate calendar. Attended by the 197 countries that signed the United Nations' Framework Convention on Climate Change (UNFCCC), the summit aims to monitor the world’s action to combat dangerous climate change. While the conference can come in for criticism as ‘talking shops’, previous COPs have led to momentous agreements. The most significant of those was the Paris Agreement in 2015.  This Agreement challenged the world to keep dangerous global warming to a level of 1.5° above pre-industrial levels. In 2021, at the Glasgow COP, the International Sustainability Standards Boards was announced. Under the auspices of the International Federation of Reporting Standards this board is now creating global standards for the reporting of comparable sustainability information by companies. 2021 also saw the formation of the Glasgow Financial Alliance for Net Zero (GFANZ), a global coalition of leading financial institutions committed to accelerating the decarbonization of the economy. Last year, at COP27 in Egypt, a new loss and damage fund was set up for those countries most severely impacted by the effects of climate change (floods, drought, desertification, and land loss due to rising sea-levels). This year’s COP – COP28 – will take place over two weeks from 30 November. It begins with two days of talks among global leaders, followed by negotiations between representatives from over 190 countries.  It is the year of the ‘global stocktake’, required under the Paris Agreement to assess progress made since 2015 and show what needs to be done to address gaps by 2030. And the need for an effective COP has never been greater.  2023 saw record temperature rises, a worsening of extreme weather events and unprecedented global emissions. However, the hosting of COP in Dubia this year has led to controversy. Dubia’s economy is heavily dependent on the exploitation of fossil fuels. The President of this COP, Sultan Al Jaber, is also chief executive of Abu Dhabi National Oil Company (ADNOC), the world’s 12th largest oil company by production. Reports have emerged of fossil fuel companies and lobbyists planning to use the event to agree side deals about increasing fossil fuel production. This COP is also taking place against the backdrop of both the Israel-Gaza conflict and the ongoing invasion of Ukraine. What to expect at COP this year COPs generally open with a ceremonial meeting, followed by a leaders’ summit.  This year the opening address will be given by King Charles in place of Pope Francis, who can no longer attend due to illness. Following this, will be days of world leaders speaking about either their experiences of climate change and/or their planned or intended actions. The world’s biggest emitters, the US and China, will be represented by their climate envoys: the US by John Kerry and China by Xie Zhenhua. Ireland is also sending a large delegation, including Taoiseach Leo Varadkar, Tánaiste Micheál Martin, and Minister for the Environment, Climate and Communications, Eamon Ryan. Following the leaders’ summit, two weeks of negotiations will begin, culminating in the signing of the final agreement on how the world will collectively tackle the climate crisis. Each day of negotiations has a theme, including one day devoted to finance. New promises, pledges, coalitions, and projects are announced at those days. (Events Schedule for this year’s COP.) At this year’s COP, a strong focus will be on food production in a world where hunger levels have risen back up to 2005 level. Also discussed will be the management of methane emissions – an extremely polluting greenhouse gas - and a phasing down of the use of fossil fuels. Climate finance will feature, according to Minister Ryan, who is quoted as saying that “Radical reform of the global financial system will be needed if we are to provide the necessary climate finance for mitigation, adaptation, capacity building and loss and damage”. Chartered Accountants Ireland will keep members informed of all relevant updates from COP. There will be a daily update on the Sustainability News page, and a weekly round-up as part of the Sustainability Bulletin in Chartered Accountants Ireland’s weekly enews to members. Members will also find useful resources on climate – including Climate Essentials for Accountants - in the Sustainability Centre Resource page.

On 27 November the Ulster Society hosted a webinar delving into the transformative power of social entrepreneurship, exploring how businesses can create meaningful impact while achieving financial success.  Our expert speakers, Diane Hill of the NOW Group and Phelim Sharvin of Community Finance Ireland shared practical insights highlighting how social enterprise can drive positive change in the business world and create a more socially conscious business future. A recording of this webinar is available to view on demand HERE A copy of Diane's slides is available to view HERE A copy of Phelim's slides is available to view HERE

This report provides information on how the various UK bodies have met their regulatory obligations, including those relating to education. Click here to read the report.

In Irish news, the Government announces increases to PRSI and the Minister for Finance commences various amendments to the KEEP scheme. In UK news, read our more in depth coverage of the 2023 Autumn Statement from a personal and business taxes perspective. In International news, the OECD publishes research which shows that companies in high-tax jurisdictions make up a significant proportion of companies with low effective tax rates.   Ireland  1.   The Government has agreed to increase PRSI for employers, employees and the self-employed from October 2024. 2.   The Minister for Finance, has commenced the four amendments to the Key Employee Engagement Programme (KEEP) as introduced in Finance Act 2022, following receipt of approval of State aid from the European Commission.  UK 3.   Read about the personal taxes elements of the 2023 Autumn Statement. 4.   There were also various business taxes announcements which you can read about in more detail.  International 5.   OECD paper suggests high-tax jurisdictions produce over half of low-taxed companies    Keep up to date with all the latest Irish, UK, and international tax developments through Chartered Accountants Ireland’s Tax Newsletter. Subscribe to the Tax News by updating your preferences in MyAccount.  

More private sector organisations in scope ofobligations Readers may recall that the provisions of the Protected Disclosures (Amendment) Act 2022 came into force in January 2023.One of the effects of the Act was to expand beyond public bodies, the legal obligation on organisations to have internal reporting channels and procedures for the making of protected disclosures. Private sector organisations which have between 50 and 249 employees will be in scope for these new obligations from 17 December 2023. You can read about these obligations and much more on the Institute's webpages on protected disclosures. New statutory guidance On 20 November 2023 the Minister for Public Expenditure, NDP Delivery and Reform issued statutory guidance for public bodies on the Protected Disclosures Act 2014. Click here for the press release when the guidance was issued. It supersedes the Interim guidance issued in 2022.The Minister also issued two templates. One is for internal and one is for external protected disclosures policies. They are for use by public bodies and prescribed persons. The templates are available at the end of the webpage of the Department of Public Expenditure, NDP Delivery and Reform “Protected Disclosures Act: Information for Citizens and Public Bodies” which has been updated as of 20 November 2023. The Minister in his press release on the guidance said that while it is targeted at the public sector, much of the content is also applicable to the private sector and he expressed the hope that private sector organisations would also find the guidance useful. This information is provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.

The Minister for Finance, Michael McGrath TD, has welcomed the publication by the European Commission of its Opinion on Ireland’s Draft Budgetary Plan (DBP), finding it to be in line with the recommendations adopted by the Council in July.  Minister McGrath said:  “I welcome the Commission’s opinion that Ireland’s Draft Budgetary Plan is in line with the fiscal guidance provided by the European Council in July’s Country-Specific Recommendations.  The Commission’s findings underline that budgetary policy must not lose sight of the importance of a prudent approach over the medium-term - we must ensure fiscal sustainability so that we are best placed to react to the highly uncertain and evolving environment.  We face significant challenges through the requirement to decarbonise our economy and the need to manage the digital transition. At the same time, publications by my Department have shown that the growth rate is set to slow over the medium- and longer-term, driven by demographic changes.  Such developments show the importance of planning for the future now. With this in mind, the Government announced the establishment of the Future Ireland Fund and the Infrastructure, Climate and Nature Fund as part of last month’s Budget. These important policy instruments will help current and future generations address the fundamental structural challenges we face and work is intensifying on bringing these initiatives to fruition.” 

Revenue has updated the Tax and Duty Manual regarding Professional Services Withholding Tax (PSWT) to include guidance in relation to payments made to medical practitioners under the General Medical Services (GMS) Scheme. The updated manual also clarifies the position where professional services are provided by a partnership, and provides a link to more detailed information on the tax treatment of GMS payments to medical practitioners.  

Revenue has issued a press release to remind online shoppers to check whether the advertised price of online goods includes all tax and duty costs due before deciding to buy. Additional charges, including VAT and Customs Duty, can apply to goods bought online from non-EU countries (including Great Britain) once the goods arrive in Ireland. Revenue also cautioned online shoppers to be wary of goods advertised online at attractively low prices, as the goods may be counterfeit.  Speaking about the additional charges which may arise when buying goods online from non-EU countries Ms. Maureen Dalton, Head of Revenue’s South East Frontier Management Branch, advised:  “All goods will be liable to VAT, whilst goods with a customs value of more than €150 will be liable to both Customs Duty and VAT. This means, for example, that an item of clothing bought online from the US or UK, at an equivalent cost of €250, could cost in the region of €97 extra for Customs Duty, VAT, insurance, and handling fees.  Before deciding to buy goods online, shoppers should therefore check whether the advertised price includes any taxes, duties or administrative fees applicable. This will ensure that they are not faced with unexpected charges on delivery.  Consumers should also be aware that a ‘.ie’ domain name does not necessarily mean that the seller is based in Ireland. Shoppers can check where a business is based by reading through the ‘About’, ‘Contact us’ and ‘Terms and Conditions’ sections of its website.”  Revenue seize counterfeit goods at the point of importation. Counterfeit goods worth almost €5.8 million were seized in 2022.  Commenting on the risks associated with counterfeit goods, Ms. Dalton cautioned:  “Imitation brand clothing, runners, handbags and mobile devices are among the counterfeit goods most commonly seized by Revenue. Some of these goods are not subject to regulation in the country where they are made and are often of a poor quality, which fails to conform with accepted safety standards.  Shoppers should therefore take care when purchasing goods online, both from a health and safety perspective, and from the perspective of making sure that they don’t suffer a financial loss when the goods they purchase are seized because they are counterfeit.”  Summarising her advice to consumers, Ms Dalton concluded:  “When shopping online, shoppers should be mindful that some deals are too good to be true, and what looks like a good decision to buy can ultimately be an expensive, or even dangerous one.”   Information on tax and duty charges that may arise on goods bought online for personal use can be found on the Revenue website.  Persons with information regarding the smuggling or sale of counterfeit goods can contact Revenue in confidence on free phone number 1800 295 295.  

Readers are reminded that Irish based platform operators should use ROS to register for DAC7 reporting obligations by this coming Thursday 30 November 2023.   Following a recent meeting of the Tax Administration Liaison Committee (TALC) BEPS DAC7 subgroup Revenue provided some updates and clarifications in relation to the filing of returns.   Addressing practitioner concerns regarding encryption of the interface (API), Revenue notes that the API is as secure as using ROS to upload a file. For that reason, filers should not be concerned about the security of unencrypted data uploaded using the API.   The group was informed that files submitted via API go on to the same queue used for files submitted via the ROS website. Revenue has explained that the reason it may take longer for those filing via API to receive status notifications is because where a Platform Operator submits a very large number of files in sequence, they get backed up in the queue. However, even in very busy periods, Revenue expects filers to receive a status notification to their ROS inbox within the hour.   Readers are reminded that a unique email address is required to register each Foreign Platform Operator. This may be of note for where there is one responsible officer across a group with multiple platform operators. As previously reported, platform operators and their agents can contact the Automatic Exchange Of Information (AEOI) helpdesk with any technical issues with registration or reporting.    Revenue has made relevant technical available on its software developers page. The File Test Facility will be open on 4 December 2023. We will continue to keep members updated via Tax News. 

The Department of Finance has published preliminary figures on 2023 Vacant Homes Tax (VHT) from the returns that were due by 7 November 2023. With over 50,000 properties reported on through Revenue’s VHT portal, as of 20 November, approximately 5,000 of these properties were declared as vacant, with 45,000 declared as occupied. Approximately 2,000 of the properties that were declared vacant have claimed an exemption from VHT, resulting in circa 3,000 properties with a liability to VHT.  Property owners are reminded that they are obliged to self-assess their liability to VHT and submit a return where relevant, even if they do not receive correspondence from Revenue. Revenue may contact further property owners at a later date following further data analysis.  Budget 2024 included an increase in the rate of VHT to five times the property’s base Local Property Tax (LPT) charge. 

Against the backdrop of the Government meeting its own target to reduce inflation below 5 percent in the final three months of 2023, and a more optimistic economic outlook from the Office for Budget Responsibility, last Wednesday Chancellor Jeremy Hunt delivered his second Autumn Statement. With one eye squarely on the General Election expected to take place in 2024, the main focus was on announcing some tax cuts via reductions in national insurance contributions and confirmation that full expensing for companies, which provides 100 relief for new investments in plant and machinery, is being made permanent. Mr Hunt also further reformed the UK’s R&D tax relief regimes which will be merged into one scheme from 1 April 2024. It was also confirmed that, for now, the turnover exemption limit for Making Tax Digital for income tax will not be reduced below £30,000. The need to increase the exemption limit from its original level of £10,000 has been a long-standing recommendation of Chartered Accountants Ireland since 2016.  But will taxpayers be fooled by the tax cuts announced last week? Fiscal drag created in recent years by the freezing of numerous tax allowances and thresholds means that for many taxpayers, the cash benefit of any NICs reduction is likely to have already been outweighed by the additional tax that they are already paying because of frozen allowances/thresholds. However, a cut to income tax in the Spring 2024 Budget has not been ruled out.   After the closure of the Office of Tax Simplification, the Government also provided details of its four main objectives in this area (see page 77 of the main Autumn Statement publication) and will set out progress on these metrics before the end of 2023/24. Several specific announcements were also made which aim to make it easier for small businesses to set up and grow – more detail of these is contained in the business taxes story.  Read the Institute’s Press Release reacting to the Autumn Statement. The analysis herein is based on the publications of HMRC and HM Treasury and various emails and bulletins received by the Institute last week.   Next Monday’s Chartered Accountants Tax News will feature our final stories on the 2023 Autumn Statement and will cover an update on Pillar Two, proposals to tackle the tax gap and a range of other miscellaneous measures, including a number of VAT changes. 

Following publication and debate of Finance (No.2) Bill 2023 Report Stage amendments last week, the Bill has been published, completing the final stage, and now moves to Seanad Éireann for further review and discussion. Report Stage amendments include legislation to address the tax treatment of General Medical Service (GMS) payments of certain medical practitioners (GPs) and removes operating leases from the scope of Section 38, for now.   The Report Stage amendment of the tax treatment of GMS payments of GPs provides that where GMS services are provided in the conduct of a partnership with other individual GPs, that income can be treated for income tax purposes as income of the partnership. The amendment also provides that the relevant partnerships may claim any professional services withholding tax (PSWT) credit attaching to the GMS payments of the partners. A joint election to treat the GMS payments as income of the partnership must be made by the relevant GP and the medical partnership. The contracted GP will provide the HSE with the tax reference number of the medical practice for the purpose of operating PSWT. The Institute welcomes the amendment as it has lobbied extensively on the matter, under the auspices of the CCAB-I.     The taxation of leases in Section 38 of Finance (No.2) Bill 2023 sees the substitution of the term ‘finance lease’ for ‘lease’ and addresses a number of other issues raised by stakeholders, including the CCAB-I, following the initial publication of the Bill. The effect of the amendment is to remove operating leases from the scope of section 38, for now. Operating lessors will continue to be taxed in line with the existing rules.  We will continue to keep readers informed of the progress of the Bill via Tax News.