Kim Doyle, Tax Director with Grant Thornton is joined by Jarlath O’Keefe, Tax Partner, with Grant Thornton.

In this edition of Tax Time Kim discusses the latest in tax, including the Covid-19 support schemes which continue to dominate the updates and our discussions with clients.  Jarlath discuss Brexit and the latest developments in VAT and answers specific questions on the impacts for business and consumers.

Temporary Wage Subsidy Scheme (TWSS)

While the TWSS is no longer in operation the scheme continues to be a significant part of the workload of tax advisors and also employers.

• Stage 2 reconciliation

Stage two of the reconciliation process for the TWSS will begin over the weekend of 20 March and output will be sent to employers via ROS from 22 March. Employers will have until 30 June 2021 to review and accept the reconciliation amounts.

• Letters

Revenue are contacting 3,212 employers reminding them that they must provide the correct subsidy paid data in advance of reconciliation.  

• Employees’ tax liabilities

Over recent weeks we have been discussing with many clients the facility for employers to pay employees’ TWSS tax liabilities and avail of the current Revenue BIK exemption concession. Many practical and technical queries arise, primarily related to quantifying the amount of tax related to the TWSS, in particular, in self-assessed cases and in cases of jointly assessed couples. Revenue has said that further guidance will be published by the end of March.

Debt warehousing

The debt warehousing scheme continues to be available.  We understand from the Collector General that there is a significant level of non-filing for a large cohort of taxpayers currently in the scheme.  The advice from the Collector General is that such taxpayers need to bring their returns up to date to continue avail of scheme and to also qualify for tax clearance.

Other tax news

Away from Covid-19 supports schemes, other news in tax is:

• Grant Thornton responded to the Department of Finance’s public consultation on the Employment and Investment Incentive scheme. Covid-19 has had a devastating impact on most Irish businesses and industries, it is more important than ever to make meaningful efforts to restore private investor confidence in Irish companies. The creation and maintenance of employment and fostering innovation will be critical in ensuring Ireland’s economic recovery for which the EII scheme is well placed to facilitate this objective.
• The Collector General has noted that compliance with return filing and payment deadlines has slipped by businesses in sectors not directly impact by Covid-19. We understand that contact will be made by the Collector General with such taxpayers.
• Revenue published a number of updated guidance manual in recent weeks covering:
  • What constitutes a trade;
  • CGT revised entrepreneur relief;
  • CGT withholding tax and the online eCG50 system;
  • Tax relief for start up companies; and
  • Transfer pricing guidance.

Brexit

The EU-UK Trade and Cooperation Agreement has given us some answers to address the impacts of Brexit on VAT, customs, tax systems and related matters, however, there are other matters not addressed or some of the answers give rise to further questions.  Jarlath discusses:

• Tariffs on goods imported from UK;
• Rules of origin – What are they?;
• Significant changes to VAT legislation following Brexit;
• Impact on trade with Northern Ireland; and
• Impact on consumers buying goods online for personal use.

See our VAT offering      See our Brexit offering