VIC ANGLEY
Partner Grant Thornton
Vic Angley says the firm’s tax team is very busy but is coping well. “As a firm we are working hard to support and stay close to our clients through these challenging times. We are working with them as they come to understand new Covid-related provisions as they arise,” he adds.
WAREHOUSING TAX DEBT Companies should be aware that the warehousing scheme applies only to VAT and PAYE liabilities and that SMEs (annual turnover under €3m) automatically qualify and do not need to apply. The periods for which debts can be warehoused are from 1 January 2020 for VAT, and 1 February 2020 for PAYE, to a period ending two months after the business returns to trade. Therefore, non-Covid-19 debts arising subsequent to this, do not qualify for warehousing. Our key advice is to remain tax complaint by filing all returns.
SELF-EMPLOYED TAX RELIEF I believe that projecting the anticipated losses is where complications may arise. My advice to individuals would be to stay mindful of the recurring use of the term ‘reasonable’ in the legislation governing the relief. Taxpayers availing of this provision should be prudent and base their anticipated losses on a solid rationale that can be supported if subsequently queried by the Revenue Commissioners.
CORPORATION TAX LOSS RELIEF As the legislation provides for an interest charge — where an excess claim is submitted and regarded as deliberate or carelessly quantified — preparing a robust model of expected losses, and determining whether initial loss projections need to be amended to ensure an over-claim doesn’t arise, will be critical in the short term.
BUDGET 2021 The summer 2020 ESRI quarterly report highlighted that half of 18-to-24-year-olds (twice the average) lost their job and were claiming the Pandemic Unemployment Payment. Unfortunately, there will be many others outside this group, who will also lose their roles, due to the Covid-19related downturn.
However, as with the last recession, many will use that as an opportunity to set up their own business. Incentivising and supporting those new enterprises, with some form of enhanced ‘super’ tax credit for hiring 18-to-24year-olds, would bring about a double benefit.