JOHN FITZGER­ALD

Business Plus - - BP SURVEY -

Part­ner McIn­er­ney Saun­ders

“The prac­tice is cur­rently re­cruit­ing for its tax de­part­ment and look­ing for­ward to a busy tax-fil­ing sea­son,” says part­ner John Fitzger­ald. “Tax and pay­roll sup­port ser­vices are ex­tremely im­por­tant parts of our prac­tice and pro­vid­ing quick re­sponses has greatly as­sisted our clients with their de­ci­sion mak­ing,” he adds.

WAGE SUB­SI­DIES Many em­ploy­ees will po­ten­tially be fac­ing a tax bill on the sub­sidy amounts re­ceived through TWSS, and in gen­eral it will not be pos­si­ble to quan­tify the tax li­a­bil­ity un­til af­ter the end of the year. It re­mains to be seen if gov­ern­ment will pro­vide spe­cific re­lief for em­ploy­ees by either ex­empt­ing the amounts re­ceived or per­haps in­tro­duc­ing a sort of ‘TWSS Tax Credit’ that could off­set some or all of the li­a­bil­ity.

Rev­enue placed all em­ploy­ees on a ‘Week 1’ ba­sis from 21 June 2020. Where em­ploy­ees have a bal­ance of tax to pay aris­ing from TWSS, Rev­enue has in­di­cated that they will spread the col­lec­tion of this

by ad­just­ing the em­ployee’s tax cred­its over a num­ber of years, which is in line with nor­mal prac­tice.

Pan­demic Un­em­ploy­ment Pay­ment in­come will also be sub­ject to tax.

WARE­HOUS­ING TAX DEBT Tax debt ware­hous­ing is re­ally help­ful for busi­nesses that have fallen be­hind in their VAT/PAYE pay­ments. The ware­housed tax debt will ef­fec­tively be a 12-month in­ter­est-free loan, af­ter which point in­ter­est of 3% will be charged. The 3% in­ter­est rate can also ap­ply to tax debts that had built up prior to the on­set of Covid-19, where busi­nesses en­ter into a Phased Pay­ment Ar­range­ment (PPA) with Rev­enue, and this can re­sult in a sig­nif­i­cant ben­e­fit.

The ware­hous­ing fa­cil­ity au­to­mat­i­cally ap­plies to cer­tain busi­nesses, with other larger busi­nesses need­ing to con­tact Rev­enue di­rectly to be in­cluded. Busi­nesses will need to en­sure that all tax re­turns are up to date, so that the amount of tax to be ware­housed can be quan­ti­fied.

And dur­ing the course of the ar­range­ment, busi­nesses will need to en­sure that cur­rent tax re­turns and pay­ments are up to date. Tax clear­ance will be un­af­fected by the ‘ware­hous­ing’ ar­range­ments and Rev­enue has in­di­cated that any re­funds or re­pay­ments due to the busi­ness will be re­leased i.e. they will not be au­to­mat­i­cally off­set against the out­stand­ing VAT/PAYE li­a­bil­i­ties un­less re­quested.

We are ad­vis­ing clients to come and talk to us if they need as­sis­tance in get­ting out­stand­ing re­turns filed, or in agree­ing ar­range­ments with Rev­enue.

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