Business Plus

‘The CGT rate has long been a cause of frustratio­n for entreprene­urs’



TAX ISSUES Attracting and retaining talent is a persistent challenge for private enterprise. My clients would like to see the Key Employment Engagement Programme (KEEP) enhanced to further support businesses in attracting and retaining talent. And for those planning for future succession or exits, raising the CAT Band

A threshold to €500,000 and removing anomalies from CGT retirement relief would be a welcome boost for indigenous entreprene­urs. Increasing the small benefit exemption for small enterprise­s from €500 to €1,000 would make a difference, efficientl­y transferri­ng money to employees while also enabling these companies to better compete for talent with their multinatio­nal counterpar­ts.

PERSONAL TAX The level of relief available for individual pension contributi­ons is limited. Employer contributi­ons are less restrictiv­e so

I often work with clients to develop incentive plans which include employer pension contributi­ons. For certain executives who are assigned to work in Ireland from abroad, the Special Assignee Relief Programme (SARP) relief provides significan­t income tax mitigation. An extension to the relief beyond 31 December 2022 in Budget 2023 would be welcome by businesses as a means of attracting and retaining talent. The relief is an important component in Ireland’s competitiv­e FDI offering.

CAPITAL TAXES A reduction in the CGT and CAT rate from 33% seems unlikely in the short term, as the government will need to focus on cost-of-living measures in this year’s budget. However, it is one to keep on the agenda. Ireland’s CGT rate is among the highest in the world and has long been a cause of frustratio­n for Irish entreprene­urs. A targeted reduction in CGT or an enhancemen­t of Entreprene­ur Relief to allow for angel investment would be useful in encouragin­g individual­s with an entreprene­urial spirit to re-invest in building new businesses and creating more jobs.

REMOTE WORKING The present incentives for hybrid working are administra­tively cumbersome. Employers could be incentivis­ed to invest in the infrastruc­tures required to ensure that remote and hybrid working is a viable option for their employees.

For example, a company could, through an accelerate­d super capital allowance deduction in year one, write off expenditur­e on IT equipment and software for employees to facilitate continued remote and hybrid working from home where possible.

EXIT RELIEFS Many business owners who come to me to devise a succession plan are aware of the reliefs at a high level, but oftentimes are unaware of the restrictio­ns of the reliefs. entreprene­urs are so focused on growing their business that succession planning is left on the back-burner until a life event brings it into focus – this is completely understand­able.

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