finance no 2 act 2008 n.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Finance (No.2) Act 2008 PowerPoint Presentation
Download Presentation
Finance (No.2) Act 2008

Loading in 2 Seconds...

play fullscreen
1 / 48

Finance (No.2) Act 2008 - PowerPoint PPT Presentation


  • 133 Views
  • Uploaded on

Finance (No.2) Act 2008. Conor Kennedy Law Library Four Courts Dublin 7. Income Levy. Applies to all income Except Deposit interest Credit Union Dividends Certain Life Policies Investment undertakings Certain offshore funds Certain social welfare payments. Income Levy. Calculation

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Finance (No.2) Act 2008' - dai


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
finance no 2 act 2008

Finance (No.2) Act 2008

Conor Kennedy

Law Library

Four Courts

Dublin 7.

income levy
Income Levy
  • Applies to all income
  • Except
    • Deposit interest
    • Credit Union Dividends
    • Certain Life Policies
    • Investment undertakings
    • Certain offshore funds
    • Certain social welfare payments
income levy1
Income Levy

Calculation

    • 1% up to €100,100
    • 2% on excess over €100,100 but not exceeding €250,120
    • 3% thereafter
  • Not applicable to
    • Over 65’s
      • Single income less than €20,000
      • Double income less than €40,000
    • Under 65
      • Exemption threshold = €18,304
      • Medical card
income levy2
Income Levy

No Allowance

  • Double rent relief
  • S.23
  • Donations
  • Capital allowances
  • Pension contributions

Effective from 1st January

Preliminary tax payments

car parking levy
Car Parking Levy
  • Difficult to implement
  • Applies to certain urban areas
  • Ministerial order
  • Rate

Default = €200

Possible = €100

  • Reductions
    • 10 or more employees
    • Not used fully in year
    • Job sharing
    • Maternity
  • Collected by employers through PAYE system
standard rate bands
Standard Rate Bands

Tax Year 2008 Tax Year 2009 and Subsequent Years

€ €

Single Person 35,400 36,400

Widowed/single parent 39,400 40,400

Married couple

One earner 44,400 45,400

Two earners 70,800 72,800

benefit in kind
Benefit in kind
  • Pref loans

Home loans - 5%

Other  - 12.5%

  • Bikes

€1,000 expended by employer

Safety equip

Salary sacrifice

Once every 5 years

  • 1st January 2009
benefit in kind cars
Benefit in kind - Cars

Business mileage Business mileage Percentage of original

lower limit upper limit market value

(1) (2) (3)

kilometres kilometres per cent

24,000 32,000 24

32,000 40,000 18

40,000 48,000 12

48,000 — 6

benefit in kind cars1
Benefit in Kind - Cars

CO2 Emission Categories

Category CO2 Emissions (CO2g/km)

A 0g/km - 120g/km

B 120g/km - 140g/km

C 140g/km – 155g/km

D 155g/km – 170g/km

E 170g/km - 190g/km

F 190g/km - 225g/km

G More than 225g/km

motor vehicles
Motor Vehicles
  • Category A - Opel Corsa & Toyota Prius 1.5
  • Category B - Ford Focus
  • Category C - Audi A3
  • Category D - Ford Mondeo 2litre
  • Category E - BMW 330i
  • Category F - Jaguar XJ6
  • Category G - Range Rover
  • Ministerial Order
benefit in kind cars2
Benefit in kind - Cars

Business mileage

Vehicle Vehicle Vehicle

Categories Categories Categories

lower upper A, B and D and E F and G

C

(1) (2) (3) (4) (5)

km km % % %

— 24,000 30 35 40

24,000 32,000 24 28 32

32,000 40,000 18 21 24

40,000 48,000 12 14 16

48,000 — 6 7 8

finance no 2
Finance No.2
  • S. 8 - Health Expenses
    • 1st January 2009 – standard rate
    • Nursing home expenditure – unaffected
  • S.9 Share Schemes
    • Withdrawal of approval for failing to file returns
  • S.10 Share Schemes
    • Anti-avoidance regarding exchanges
    • Effected from 2oth November
  • S.11 Share Schemes
    • Penalties for failing to report
finance no 2 act
Finance No.2 Act
  • S.12 - Restricted & Forfeitable Shares
    • S.128D – Restricted shares
      • Tax reduced depending on retention period
      • Period 1 – 5 yrs
      • Abatement 10% - 60%
    • S.128F – Forfeited Shares
      • Shares acquired & assessed on MV
      • Subsequently forfeited
      • Repayment by Revenue
    • Effective from 20th November
remittance basis
Remittance Basis
  • Section 825B
  • relief to non Irish domiciled employees
  • employed and paid by the overseas employer
  • period of at least three years.
  • from a treaty country but outside the EEA
  • relief ensures tax in Ireland will be the greater of: 
    • total employment earnings remitted to Ireland; and
    • 1st €100,000 plus 50% of the earnings over this amount. 
  • repayment of taxes otherwise payable
  • overseas employer to operate PAYE/PRSI.
remittance basis1
Remittance Basis

S.13

Example

  • US assignee earned €300,000
  • Remitted €150,000

Taxes in Ireland on greater of

    • €150,000 or
    • €100,000 + €100,000 (50% of €200,000)
  • Year of assessment 2009
mortgage interest
Mortgage Interest
  • S.14
  • From 1 January 2009 the relief due to first-time buyers will be as follows— 
    • 25 % for years 1 and 2
    • 22.5 % for years 3, 4 and 5, and
    • 20% for years 6 and 7.
  • The rate of mortgage interest relief for non-first-time buyers will be reduced from 20% to 15%.
residency
Residency
  • S.15
  • 819 of the Taxes Consolidation Act 1997
  • in determining the number of days spent in the State
  • an individual shall be present in the State for a day if present in the State at any time during that day
pensions
Pensions
  • Section 16
  • amends the formula to determine the standard and personal fund thresholds to be indexed in line with an earnings adjustment factor in future years.
  • Formula in section 790A (2) relating to the determination of the annual earnings limit for tax relieved pension contributions. The amendments ensure that where no indexation is provided for, the thresholds and the annual earnings limit will remain at the previous year’s amounts.
  • Finally, the section restricts the annual earnings limit from €254,000 to €150,000 for 2009.
chapter 4
Chapter 4
  • S.17 – Farm pollution scheme – extends – 31/12/2010
  • S.18 - Farmers stock relief extended to 31/12/2010
  • S.19 - IBA allowances
    • 2 yrs after sale to claim full allows
    • Previously 1 yr
    • Reflects market trends
    • Effective from 14/10/2008
  • S.20 capital allowances palliative care units.
    • in-patient care beds being reduced from 20 to 8.
capital allowances
Capital Allowances
  • S.21 – EU Seveso Directive
    • Hinder regeneration of docklands
  • S.22 – Large hotel projects
    • No loss of allows due to delays
  • S.23 – Transfer pricing
    • Prohibited deductions
    • Connected parties
  • S.24 Re-insurance companies
  • S.25 Exemption for non residents
    • Debt instruments
  • S.26 Dirt increased to 23% - 1st Jan
chapter 41
Chapter 4
  • S.27 – Life policies & Investment Funds
    • Increase tax 23%
    • 1st January 2009
  • S.28 – Film relief
    • Increases investment to €50,000.
    • Also increase in tax relief available from 80% to 100%.
    • Ministerial Order
  • S.29 Business Expansion and Seed Capital Schemes
  • Extends by three months, the time by which a claim may be made in certain limited circumstances.
  • S.30 Allowance for Know how
    • Introduces anti-avoidance provisions
corporation tax
Corporation Tax
  • Start up companies – 14th October
  • Relief from CT for 3 yrs
  • Applies also to gains on disposal of trade assets
  • Trades excluded
    • Service companies
    • Mining companies etc liable @ 25%
    • Old trades/businesses
  • Relief where CT less than €40,000
  • Marginal relief up to €60,000
  • Minister to appoint commencement date
start up companies
Start up Companies

Marginal Relief

3 x (T – M) x A +B

T

Where

T = Total CT payable

M = Lower Relevant maximum limit

A = CT on trading income

B = CT on Gains on trade assets

marginal relief
Marginal Relief

Example

Tax on Trading income 43,000

Tax on trading gain 5,000

Total Tax 48,000

Tax Calculation

3 x (€48,000 – €40,000) x €43,000 + €5,000

€48,000

Tax Payable = €24,000

corporation tax1
Corporation Tax
  • S32 – Manufacturing relief technical adjustment
    • Ring fencing of deductions
  • S.33 Tax Treaties
    • Delay in ratification procedures
    • Treaty to be given effect from date of signing
  • S.34 – R&D
    • Base year 2003
    • Credit increased to 25%
    • Credit can be used in previous year
    • Can claim credit as repayment
corporation tax2
Corporation Tax
  • S.35 – R& D credit on buildings
    • 35% of expenditure for R&D
    • Activities for at least 4 years
    • Credit claimed in year incurred
    • 10 yr clawback
  • S.36 – Limitation of tax credits
  • S.37 – 100% Capital Allowances
    • Companies
    • Extended to
      • Information and Communications Technology,
      • Heating and Electricity Provision,
      • Ventilation and Air-conditioning (HVAC) Control Systems,
      • Electric and Alternative Fuel Vehicles
corporation tax3
Corporation Tax
  • S.38 – Large companies
    • CT of at least €200,000
    • 1st instalment due in mth 6 of current period
      • Lower of either 50% of current or 45% of previous
    • 2nd instalment due in mth 11 of current period
    • Aggregate payment must be 90%
    • Balance due on filing return
    • Provision for top up for chargeable gains
  • S.39 ensure that certain interest and royalty payments and employer paid medical insurance premiums paid in accordance with corporation tax rules.
  • S.40 -Amends Sch 4 exempts from tax Institute of Public Health in Ireland Limited and the Private Residential Tenancies Board
capital gains tax
Capital Gains Tax
  • Section 41 Tax treatment of certain venture fund managers.
    •  Investment held for at least six years, in the shares or securities of a private company which is:
      • Carrying on a business set-up and commenced on or after 1 January 2009,and
      • Carrying on a business of research, development or innovation activities;
    •  Profits arising from the investment taxed
      • 12.5% for companies and
      • 15% for partnerships
capital gains tax1
Capital Gains Tax
  • S.42 – Remittance basis for UK assets
  • S.43 – Anti-avoidance
    • Connected parties
    • Prevents artificial losses
    • 20 November 2008
  • S.44 CGT rate now 22%
    • 15th October 2008
  • S.45 Pharmaceutical Soc of Ireland
    • New body
value added tax
Value Added Tax
  • S.68 Technical amendment to S.3 dealing with immoveable goods
  • S.69 – amend S.7A
    • Opt to tax ceases where landlord occupies
  • S.70 amends S.7B
    • Waiver in VAT groups
  • S.71 – Travel Agents
    • Margin scheme
    • VAT on profit margin
    • Bought in services – no VAT entitlement
    • Effective from 1st January 2010
value added tax1
Value Added Tax
  • S.72 – Standard rate increased to 21.5%
    • Effective from 1st December 2008
  • S.73Amedment of S.12
  • S.74 Unjust enrichment
    • windfall gain if that tax is repaid.
    • Tax not borne by trader but passed on in the price charged for goods and services.
    •  Amendment
      • Revenue must refund unless refund result in the unjust enrichment.
      • a claim for refund of an overpaid amount must set out full details of the case and the claimant must furnish any relevant documentation requested by Revenue.
value added tax2
Value Added Tax
  • S.75 - regulations relating to the operation of the travel agent’s margin scheme.
  • S.76 amends 1st Sch by removing the exemption for agency services in the arrangement of passenger transport or accommodation with effect from 1 January 2010.
  • S.77 –
    • 0% to margin scheme services, for bought-in services are availed of by persons travelling outside the Community.
    • supply of tea and coffee in non drinkable form e.g. tea leaves, tea bags, ground coffee etc. is zerorated.
    • supply of tea and coffee in drinkable form is not zero-rated.
stamp duties
Stamp Duties
  • Section 79 - e-stamping of instruments for stamp duty
    • Major strategic development
    • Anticipated 90 per cent of cases.
    • Commencement Order.
  • Section 80 Amendment of section 5
    • Payment of stamp duty in bulk
  • Section 81 an incentive to encourage the presentation of instruments
    • Measure in anticipation of the introduction of e-stamping, to facilitate a smooth transition
stamp duties1
Stamp Duties
  • Section 82
    • Sub-sales
    • Resting in contract
    • Licences
    • Agreement for lease
    • Subject to a Commencement Order being made.
  • Section 83
    • Exchange of properties
  • Section 84
    • Young trained farmers
    • Land transfers
    • Exempt to 31/12/12
stamp duty
Stamp Duty
  • Section 85
    • Relief on sale on subsequent reinvestment
    • Period – 18 months
    • Extended to June 2011
  • Section 86 – ATM Cards

Description Old New

€ €

ATM cards 5 2.50

Debit cards 5 2.50

ATM/Debit cards 10 5

stamp duty1
Stamp Duty
  • S.87 – Amendment to Sch 1
    • Cheques – rate - €0.30 to €0.50
    • 15 October 2008.
    •  exemption on share transfer forms where the duty is €10 or less after the enactment of the Bill.
    • Non-Residential Property Rates

 Aggregate Consideration Rate of Duty

 Up to €10,000 Exempt

€10,001 to €20,000 1%

€20,001 to €30,000 2 %

€30,001 to €40,000 3 %

€40,001 to €70,000 4 %

€70,001 to €80,000 5 %

Over €80,000 6 % 

capital acquisitions tax
Capital Acquisitions Tax
  • Section 89 the relief will apply to agricultural land situated in a Member State of the European Union. It applies to gifts and inheritances taken on or after 20 November 2008.
  • Section 90 increases the rate of tax on gifts and inheritances from 20% to 22%. It applies to gifts and inheritances taken on or after 20 November 2008.
miscellaneous
Miscellaneous
  • Section 92
    • aligns the definition of ‘‘financial institution’’ to include financial institutions authorised in another Member State operating in Ireland under a passport arrangement.
    • concisely sets out parameters for disclosure of information and professional advices.
    •  Section 1002(1) is amended by replacing the existing definition of ‘‘financial institution’’ in order to align it with the same definition as it appears in other areas of the Principal Act.
miscellaneous1
Miscellaneous
  • Section 93
    • new section 896A
      • delivery of information by a third party where that party is concerned with the making of a trust and the settlor is resident in the State but the trustees are not resident in the State.
      • an authorised officer of the Revenue Commissioners may, by notice in writing, request a party to a settlement to provide details of the settlement.
  • Section 94
    • Relief available from 100% of the market value of the heritage items or heritage property donated to 80%
    • Restriction will apply on and from 1 January 2009
miscellaneous2
Miscellaneous
  • Section 95
    • Enable delegation to nominate authorised officer
    • Concerns protective notices under S.811
  • Section 96
    • Extension of return filing dates for ROS
    • 1st January 2009
    • 23rd of month
  • Section 97
    • Extends recovery proceedings for Collector General
miscellaneous3
Miscellaneous
  • S.98 – Revenue Penalties
    • Inserts
    • Chapter 3A
      • S.1077A
      • S.1077B
      • S.1077C
      • S.1077D
    • Chapter 3B
      • S.1077E
    • Applies to other Tax Heads
    • Fixed Penalties
penalties
Penalties
  • S.1077A
    • Definitions
    • Court jurisdictional limits
  • S.1077B
    • Absence of agreement regarding penalty
    • Revenue confirm in writing
    • No agreement within 30 days
    • Revenue petition court
    • Court determines whether taxpayers actions gives rise to a liability
penalties1
Penalties
  • S.1077C – Recovery
    • Court determination
    • Recovered as a tax
    • Provision applies to liability before on or after passing of Act
  • S.1077D – Proceedings against admin or estate
    • where the person either agreed in writing to pay the penalties or
    • a court has determined, before the person’s death, that the person was liable to the penalties.
penalties2
Penalties
  • S.1077E
    • Defines
      • Qualifying disclosure
      • Unprompted qualify disclosure
    • Category of penalty
      • Deliberately fails
      • Carelessly but not deliberately
      • Other careless behaviour
        • tax or duty underpaid is greater than 15% of the correct tax or duty payable for the relevant period.
    • Specific penalties for
      • VAT
      • CAT
      • Stamp Duty
disclosures
Disclosures
  • Qualifying disclosure
    • Complete information
    • All matters occasioning a penalty
    • Made in writing
  • Unprompted Qualifying Disclosure
    • Voluntary furnished
    • Before investigation started and
    • Before person is notified by Revenue
  • Prompted Qualifying Disclosure
    • Received notification of Revenue investigation
    • Report indiscretion before “investigation or inquiry starts”
penalty provisions
Penalty Provisions
  • Significant consequences
    • Where tax underpaid is greater than 15% of previously declared
  • Fraud & Neglect changed
  • Now –
    • Deliberate
    • Careless
miscellaneous4
Miscellaneous
  • S. 99 and Schedule 6 provide for technical amendments
  • S.100 - Capital Services Redemption Account
  • S101 – “care and management’’ of taxes and duties.