Read our update on key developments in this area since June 2022. HMRC has also made several administrative changes to the Double Taxation Treaty Passport Scheme (“DTTPS”) which is widely used by overseas lenders to ensure UK withholding tax is deducted at the correct rate under the relevant double taxation treaty.  The tax treaties and related documents between the UK and the following countries have been updated:- Czech Republic; Slovak Republic; Cyprus; Chile; Kyrgyzstan; Guernsey; Germany; Luxembourg; India; Isle of Man; Ukraine; and San Marino. Other specific developments of note are set out below:- Use updated form DTTP1 to apply for or renew a Double Taxation Treaty passport; A new UK-Luxembourg Double Tax Treaty was signed in June 2022 and has not yet entered into force; In June 2022, HMRC published a policy paper setting out its change of view on the interpretation of the residence articles in 16 double taxation agreements; Use updated form Canada/Individual to apply for relief at source or claim a repayment of UK Income Tax; Use updated form US-Individual 2002 to apply for relief at source or to claim repayment of UK Income Tax; The UK and Brazil signed a Double Taxation Agreement in November 2022 which has not yet entered into force; and Use updated form DTTP2 to tell HMRC about a 'passported' loan. Changes to the Double Taxation Treaty Passport Scheme (“DTTPS”) HMRC has updated the contact details (both postal and email) for the DTTPS. A number of changes have also been made to the scheme’s terms, conditions and guidance document. HMRC is no longer be reminding passport holders that a passport is due to expire. Previously HMRC guidance  set out that HMRC would write to existing passport holders three months before the passport was due to expire to request completion of a DTTP1 renewal application form. From 20 October 2023 the guidance was updated and now says that HMRC does not issue reminders when a treaty passport is due to expire. The following guidance has therefore been updated accordingly:- Claiming Double Taxation Relief for companies and other concerns; and Double Taxation Treaty Passport Scheme: terms, conditions and guidance.

In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit. The latest Trader Support Service bulletin is also available in addition to the most recent Cabinet Office Borders bulletin which has returned from a break. The Minister of State has also written to the Chair of the House of Lords Protocol Sub-Committee providing an update the on the implementation of the Windsor Framework. Miscellaneous updated guidance etc. The following updated guidance, and publications relevant to EU exit are available:- Authorised Consignee Temporary Storage (ACTS) location codes for Data Element 5/23 of the Customs Declaration Service; Remote internal temporary storage facilities codes for Data Element 5/23 of the Customs Declaration Service; Importing bananas you have to pay duty on into the UK; Authorisation type codes for Data Element 3/39 of the Customs Declaration Service; Additional Information (AI) Statement Codes for Data Element 2/2 of the Customs Declaration Service (CDS); Upload documents and get messages for the Customs Declaration Service; Customs Declaration Completion Requirements for The Northern Ireland Protocol; Internal temporary storage facilities (ITSFs) codes for Data Element 5/23 of the Customs Declaration Service; Transit newsletters — HMRC updates; Locations which need a pre-lodged declaration; List of ports using the Goods Vehicle Movement Service; and EM on Windsor Framework customs arrangements.

This week we bring you news about HMRC letters to agents about a potential discrepancy on 2021/22 self-assessment returns, and HMRC has moved the Check Employment Status for Tax tool on to a new platform. The guidance on how remove a taxpayer from the self-assessment regime has been enhanced with two new videos and it is now possible to apply online to join the VAT flat rate scheme. The latest News and Information Bulletin from HMRC is also available which includes a reminder about the planned outages from 6-9 November because of IT upgrades, which we told you about last week. Potential 2021/22 self-assessment discrepancies project We are aware that from early October 2023, HMRC began sending letters to agents about potential discrepancies between their clients 2021/22 self-assessment return when compared to the P11D and P14 forms submitted by employers or child benefit information held by HMRC. The letter does not mention specific clients but advise the agent that HMRC will be in touch within three weeks (unless the agent contacts HMRC first) to share details of the clients where there are potential discrepancies.  According to the letter, if there are any discrepancies, as long as an amendment is made by 31 January 2024, HMRC will not charge a penalty. However, if no voluntary amendment is made by then, HMRC will review and consider making a discovery assessment and charging a penalty. Where an amendment results in an underpayment of tax, interest will apply from the original due date. A late payment penalty may also be payable. HMRC’s aim is to resolve these cases in advance of the 31 January 2024 online filing deadline for 2022/23 self-assessment returns. Check Employment Status for Tax HMRC recently moved its Check Employment Status for Tax (“CEST”) tool to a new platform. The move has not resulted in any changes to the questions asked however users of the tool can now review the answers to their questions after each section. In addition, guidance from HMRC’s employment status manual is now embedded in CEST. Removing a taxpayer from self-assessment HMRC has recently launched two new YouTube videos explaining the online process for taxpayers to stop self-assessment:- How to go online and stop self assessment if you're self employed; and How to go online and stop self assessment if you're not self employed. If a taxpayer believes they no longer need to complete a self-assessment return for 2022/23, it is important that they take action before the 2022/23 online filing deadline of 31 January 2024 in order to avoid being charged a penalty. Apply online to join VAT flat rate scheme HMRC recently launched a new online form which should be used by businesses to apply to join the VAT flat rate scheme (a scheme that simplifies VAT accounting for businesses with an annual turnover of no more than £150,000). Applications can still be made by post.

We recently advised that from mid-November 2023, HMRC will no longer be providing paper VAT1 registration forms on GOV.UK. This will only be available on request from the VAT helpline in exemption cases and certain limited scenarios where online registration is not currently possible. Businesses who are exempt from applying online will still be able to apply by post using a paper VAT1 form. Essentially the exemption from applying online mirrors that available under Making Tax Digital for VAT. HMRC has now confirmed that Monday 13 November 2023 is the date from which VAT registration applications must be made online in the majority of scenarios using the VAT registration service (“VRS”). It has been confirmed that those who cannot apply online are not required to apply for an exemption in advance. However, when calling the VAT helpline, HMRC will ask why a paper VAT registration form is being requested.  It should also be noted that there are several specific types of VAT registration that cannot use the VRS which includes entities (except for UK partnerships or non-established taxable persons) without a unique taxpayer reference. A full list of these is not currently available. Such businesses should call the VAT helpline to request a paper VAT1 registration form. However, HMRC is aiming to add those businesses to the VRS in future, which means that the paper VAT1 form will no longer be available once online registration via the VRS is introduced.   HMRC has also confirmed that should a digitally excluded taxpayer use the services of an agent then the application should be a digital one via the VRS. Work is ongoing to update HMRC’s guidance pages to remove the downloadable VAT1 form, and direct taxpayers to the VRS digital route. This includes letting them know what evidence will be required to be provided in advance of starting an application, including ID verification requirements. At a recent Joint VAT Consultative Committee Meeting, which Chartered Accountants Ireland participates in, external stakeholders asked about the move to more digital routes and if HMRC had tested this with external users, particularly for large organisations with diverse teams over a number of offices. This was particularly raised in the context of submitting online for the first time where it may not be clear what information is going to be needed to start the online form. Forms sometimes disappear after 28 days which can be an issue in larger organisations where it may take longer than this to complete the form. It is also the case that when submitting a form online, all that an employee needs to do is enter the organisation’s email address and tax reference. However, there is no scope to confirm that the submission has been made by the authorised signatory or that the authorised signatory has authorised the submission to be made on their behalf. HMRC’s response to this is set out below. “Prior to HMRC moving to the new VAT Registration Service extensive user research was conducted over a 3-year period with a range of users including agents. The feedback from user research was that the data being requested was reasonable and would be able to be sourced within the timescales provided. HMRC introduced the ability to ‘Save and Return’ an application. This enabling the user the time to gather relevant data if required, without the need to restart their journey again.   The length of time the application remains available is 28 days from the last log in activity, so by using the Save and Return function the length of time to complete the application will extend beyond the 28 days.  On 15 June we updated Register for VAT: How to register for VAT - GOV.UK (www.gov.uk) to include more information on what is required by someone submitting an application for VAT registration. The VRS journey mirrors the VAT1 form and the VAT 1 completion guidance can be used to prepare applications ahead of logging into VRS. VRS asks for the person completing the form to declare the capacity in which they are doing so. Part of the HMRC Charter is that we trust the information being provided to us unless we have good reason not to.   At the point of registration, we will trust that the person submitting the form is an appropriate person to do so, though we do have validation and verification processes in place to inform that decision.   There is no long-standing relationship created by someone applying on behalf of someone else, to do so the appropriate authorisations would need to be completed.”

Revenue has published updated guidance regarding Revenue Online Service (ROS), the Return Preparation Facility (RPF) and ROS Pay and File tips in advance of the personal tax extended deadline of Wednesday 15 November 2023. The extended deadline applies to taxpayers who both file their 2022 Form 11 return and pay the appropriate taxes using ROS. The extension does not apply where only one of these actions is completed through ROS. As previously advised, the RPF has replaced the ROS Offline Application for preparing Form 11s offline.  Specific updates include information regarding taxpayers inputting/amending bank account details, refunds in ROS and confirmation that the use of commercial credit cards is no longer accepted for payments. Phased Payment Arrangement notices are noted as priority messages in ROS inboxes.   The guidance is also updated for the use of the Iris chatbot and the development of the RPF to replace ROS Offline. The updated guidance warns about using commas, dots or other symbols when naming and saving files in the RPF. 

Revenue has issued a press release to remind residential property owners about their Vacant Homes Tax (VHT) and Local Property Tax (LPT) obligations. Readers are reminded that tomorrow, Tuesday 7 November 2023, is the return filing date for the VHT. Property owners are also reminded that, where a residential property was newly built or has become occupied or suitable for use as a dwelling between 2 November 2022 and 1 November 2023, it is liable for LPT in 2024.  The VHT is due on residential properties that are liable to LPT and are occupied for less than 30 days in the year ending 1 November 2023. Further information is available on the Revenue website.   VHT returns can be submitted via Revenue’s myAccount, ROS or the LPT Portal. The system will guide property owners through the three-step process to review their details, submit their return and make a payment if necessary.   Revenue is writing to 800,000 property owners to remind them to set up their LPT payment option for 2024. The LPT on a residential property for 2024 is based on the valuation of the property at 1 November 2021.   Where a residential property has been newly built, or it has been refurbished and has become occupied, or suitable for use as a dwelling, between 02 November 2022 and 01 November 2023, the property is newly liable for LPT in 2024 as of 1 November 2023. A taxpayer who owns a property which is newly liable for LPT is required to value their property as at 1 November 2021. Guidance on conducting this valuation is accessible here with further information on LPT available on Revenue’s dedicated LPT webpage. 

The October Exchequer figures show that tax revenues of €66.5 billion were €2.5 billion ahead of the same period last year, primarily driven by income tax and VAT. However, an Exchequer deficit of €0.9 billion was a recorded to end-October, €8.2 billion down on the same period last year. Cumulative corporation tax receipts of €15.7 billion in the first ten months of the year are €0.4 billion, or 2.7 percent, below their level in the same period last year. This reflects the weakening of exports over the past year and, in particular, the decline in pharmaceutical exports.  The Department of Finance press release on the publication of the October Exchequer figures, notes that corporation tax receipts declined for the third consecutive month year-on-year. October 2023 corporation tax receipts of €1.3 billion were down €1 billion on October 2022.  Commenting on the figures, the Minister for Finance, Michael McGrath T.D. said:  “The end-October Exchequer returns present a mixed picture of our public finances. While income tax and VAT remain steady, demonstrating the underlying strength of our economy, we have now seen corporation tax decline for a third consecutive month.  A fundamental building block of the Government’s fiscal strategy is the assumption that a large part of the increase in corporation tax receipts in recent years is windfall in nature.  This is why it is so important that permanent fiscal commitments are not made on the basis of windfall revenues; instead, running a budgetary surplus is the correct approach.  It is also why, in Budget 2024, I announced the establishment of two new long-term investment funds – the Future Ireland Fund and the Infrastructure Climate and Nature Fund – that will allow us to invest temporary ‘windfall’ corporation tax receipts to provide resources for known future fiscal challenges and ensure that these receipts do not become part of the permanent expenditure base.  I am working with my officials to progress the necessary legislation and this is a key priority for the Government in the year ahead.” 

Revenue has updated the Pensions Tax and Duty Manual which provides contact information for pensions governance authorities. The useful contacts document has been updated to include the new address for Revenue's Large Cases - High Wealth Individuals Division Pensions Branch, situate at Castle View, South Great George's Street, Dublin 2. 

Platform operators must register with Revenue for the purpose of the Council Directive (EU) 2021/514 (DAC7) by 30 November 2023. Irish based platform operators should register via ROS. Non-EU based platform operators, carrying out relevant activities, or relevant activities involving immoveable property located in a member state, should register using the non-resident registration portal which opened on 1 November 2023.   Revenue expects the DAC7 reporting portal to be available from 1 January 2024. Further information is available on Revenue’s dedicated DAC7 webpage. 

A recent survey conducted by Chartered Accountants Ireland has shed light on the significant challenges facing parents seeking childcare in Northern Ireland. The survey, which gathered responses from Chartered Accountants across Northern Ireland, highlights the crucial issues of cost barriers and their impact on career progression, while calling for increased childcare support and parity with initiatives in England. An overwhelming 75% of those surveyed cited cost as the biggest obstacle when securing appropriate childcare in Northern Ireland. For many, the financial burden of childcare is staggering, with two-thirds of respondents currently paying up to £1,000 each month per child. One-third of those surveyed are grappling with even higher costs, paying between £1,000 and £2,000 per month, per child. The survey also unveils the extent to which childcare responsibilities l impacts on career progression. A striking 93% of respondents acknowledged that their careers or working patterns had been affected. The survey found that 22% of respondents had been forced to reduce their working hours, while 29% had requested flexible hours to manage their childcare needs. An additional one-third are contemplating making adjustments to their working hours, underlining the magnitude of this challenge. In a call for improved childcare support, a significant majority of those surveyed expressed their desire to see parity with the enhanced childcare provisions announced in England, such as the commitment to providing 30 hours of free childcare for all children under five by 2025. Parents in Northern Ireland are looking for similar support to alleviate the financial burden and enhance their career opportunities. Commenting on the survey results, Zara Duffy, Head of Northern Ireland, Chartered Accountants Ireland said, "The findings of this survey make it clear that Northern Ireland must address the critical issue of childcare costs and its impact on parents' careers as a matter of priority. “We would like to see the Government taking urgent action to support parents. This includes exploring the possibility of providing more affordable childcare options and considering initiatives that aligns Northern Ireland with the childcare provisions being offered in England." “These survey results serve as a stark reminder of the challenges faced by parents in Northern Ireland and the urgent need for accessible, affordable, and high-quality childcare services. Chartered Accountants Ireland is committed to advocating for changes that will ease this burden and help parents balance their work and family responsibilities.”

Donal Bourke began his career as an ACA, and now works in FinOps in Leeds, UK. He has also launched a YouTube channel advising others who might be considering a move into FinOps. Did you fall into finops or was it by design the you moved into the area. A keen interest in IT perhaps? My path to FinOps was a combination of luck and design. While working as an accountant, I enjoyed the people engagement side but was frustrated by the fact that we were often reporting figures after the fact – closing the gate after the horse had bolted so to speak. This prompted my first career pivot into analytics. My accounting qualification gave me a great understanding of how businesses work and a comfort with numbers. I took this base and built on it through acquiring skills manipulating large data volumes (ETL – Extract transform and Load) and developing data visualisation skills. These skills lead to my first career pivot into sourcing analytics. In this role I built data workflows to allow sourcing managers make better buying decisions based on what we had purchased in the past and planned to purchase in the future.  One of the categories I supported was IT Infrastructure with our largest spend being on public cloud. Given the size of the spend, this area began to focus more and more of my time. The more I learned about the public cloud the more opportunity I saw for someone who can wrangle large data sets, make sense of numbers, and communicate these to the business. I gained my FinOps certification and was approached about a FinOps consulting role in another company which is where I am now. What skills, intrinsic to an ACA, make you an effective proponent in the FinOps area? Growth mindset and continuing professional development is a key characteristic when working in the FinOps area. The cloud providers offerings are changing constantly as well as customers' IT infrastructure. All these changes need to be considered and appropriate actions taken to deliver the greatest value to our customers. What additional training did you have to do? If I was starting on the learning journey again the key steps I would take are as follows: Understand the basic concepts of cloud computing. I found this podcast (Cloudcast Basics) very useful AWS provide some free training material which would bring you through the various services in more detail Understand the kind of activities FinOps involves and get used to some terminology. Another podcast I found useful was Cloud Cost Optimization Take the FinOps certification course and exam to get accredited (the course is about $600 and the exam is about $300) Once certified you will have access to the FinOps community to show how to apply what you have learned. What is your take on the growing convergence between IT and finance/accounting? The rise of cloud raises a new challenge for finance. Previously, companies had on-premises data centres (private clouds) for which they would raise a Capex request which would go through the various levels of approval before the purchase is made. In the world of cloud, engineers are creating cloud resources with every line of code they write. The developer's priority is to make the system run while cost may be lower down their list. All these charges build on each other in opex leading to a growing cloud bill which may contain a rising level of technical debt. This is where FinOps comes in: to bridge the gap between the technical architecture and financial accountability. What advantage or differing insights do you have versus your IT professional counterparts in your current team? Being able to layer business context to the numbers and architecture is a major advantage. For example if a customer's cloud bill jumps all of a sudden, this may be due to a sale or promotion being run by the business. By understanding this context we can make better decisions. How do you see the area of FinOps evolving in the years ahead ? Is AI a threat to it or a boost? FinOps as a discipline has only been around since 2019 with earlier incarnations of cloud cost management only being a few years earlier. Given the early stages, the growth and foundational frameworks are still being put in place so it’s very hard to see where it will end. Given the volume of data being generated from cloud providers, data literacy will become more and more important. I can see AI having two major impacts in the FinOps space: AI being used a s a co-pilot to sift through vast data sets to find the anomalies that require action and optimisation All these AI models run on the cloud, guess who needs to monitor the efficiency of these cloud environments?… FinOps practitioners! I would liken it to being a shovel salesperson in California during the gold rush. A FinOps practitioner may not necessarily build the models, but they will be needed now more than ever. What does a typical month or quarter look like in the FinOps space? Daily monitoring of the customer's environment to optimise their cloud commitment mix to maximise savings Building data models to improve data points to allow better decisions be made for the above commitments Monthly/quarterly customer meetings where architecture changes are discussed to understand future optimisation opportunities No month end!! What career "stepping stones" would you recommend to a newly qualified ACA keen to get into this area? Much like my own additional learning I mentioned earlier, I'd try to grasp and learn the basic concepts involved in cloud computing; things like the Cloudcast Basics podcasts were helpful to me; The AWS training material can help boost knowledge of the services in a more detailed way; get your head around the terminology and get certified. That's really the key, as it can give you greater access to the community and opportunities within the industry. Donal Bourke is a Cloud Optimisation Consultant with NetApp Donal's YouTube channel, FinOps for Finance, gives an overview of FinOps, how it relates to finance, and how to pivot into a career in the growing space of cloud optimization.                                                 

The finance function has a key role to play in embedding AI into a company’s operations now and in the future, writes Katie Burns With financial data underpinning most business operations, how an organisation’s finance team embraces artificial intelligence (AI) will be central to how that business develops and grows. With their domain knowledge and controls-based mindset, the finance function is well placed to be an agent of change, embedding artificial intelligence into the operations of the wider company. The CFO The realisation that data is an asset means organisations will look to finance to prioritise business partnering as a way of sifting through this information and driving better strategic decisions. At the heart of this will be the Chief Financial Officer (CFO), whose role has undergone rapid change in recent years.  In the EY survey ‘DNA of the CFO: Is the future of finance new technology or new people?’, 69 percent of global finance leaders acknowledged this change and pointed to the automation of key finance tasks as the main factor driving the trend. The same report also indicated that 90 percent of companies worldwide are prioritising capital investment in digital transformation. While traditional financial responsibilities such as bookkeeping, financial planning, risk management and reporting are still central to the role, CFOs are now also accountable for the strategic direction of the company. Advances in technology mean they need to be on top of all developments in data analytics and related AI technology to manage forecasting and predictive insights. The use of integrated (internal and external) data models can provide real-time insights and predictive scenario-based analytics, which will enable more agile planning. As external operating conditions evolve, CFOs will also be better placed to deliver on the business need for more financial and non-financial information.   For the CFO to successfully implement new technology, they will need to drive a robust and sustained change management programme – in particular, successfully managing a workforce that may be apprehensive. To build confidence within finance teams, CFOs should consider strategies for upskilling and training, focusing on tasks that add value, and, most importantly, addressing concerns through open and transparent communication. On the other hand, when it comes to attracting talent, AI will be a selling point. Many early-stage accounting professionals now expect data-led technology to be the norm, so companies that are not investing in connected, data-driven and efficient systems will struggle. Leveraging technology to reduce manual tasks also means building a more insight-driven, client-focused finance team. The finance function  Perhaps no part of any enterprise has as many repetitive and routine tasks as a finance department. Inputting invoices, tracking receivables and logging payment transactions are high-cost, low-return activities. Using AI to transform these processes can significantly reduce manual effort while increasing data quality and accuracy, freeing up employees to work on value-add strategic work. Releasing the finance team from such tasks not only helps them to save time, it also means they are able to drive greater impact by employing their knowledge in other areas. Accountants’ expertise, for example in controls awareness and understanding data biases, can be used to design fraud and risk detection. By using machine learning to suggest risk rules based on a company’s own specific transaction and fraud data, suggestions can be made for fine-tuning the system and the rules used to flag potentially fraudulent activity. This innate capability can also be used to serve other departments across the organisation as they seek to embrace AI. Ultimately, for finance teams, understanding the collaborative power of AI is key, enabling them to leverage its usefulness so they can carry out more strategic work. While AI can process vast amounts of data at a rapid pace, it does not have the same critical thinking and decision-making capabilities as people. People have the ability to identify and address bias in data and core skills. They know the right questions to ask to help understand a client’s requirements, and which data will serve that client best. This means financial professionals have an important role to play in technological transformation. The future It’s not just through these current opportunities that AI has the potential to shape the finance function in the future, however. From automated report generation and improved forecasting to handling compliance matters through validation of disclosures for statutory reporting, the ability to interact with tools powered by AI will change how finance teams access and analyse data, driving better insights and potentially enabling them to identify more business growth opportunities. In the future, next-generation finance centres of excellence will leverage AI and emerging technologies to deliver faster and better integrated finance analytics and insights. Potential advancements here include:  More accurate forecasting drawing on both enterprise data and sources, such as customer behaviour and competitor activities; a greater understanding of strategic risk and resilience, including data-driven early warning systems; and more connected financial reporting, driving KPIs, stakeholder management and communication across multiple channels. When it comes to the more challenging aspects of developing a clear AI strategy and ensuring that organisations have the necessary capability, technology and stakeholder buy-in, the CFO will play a central role by empowering the finance team to make even better data-driven decisions and, in turn, positioning them as key drivers of the overall business strategy. Katie Burns is a Consulting Partner at EY Ireland