Business Plus

‘There is significan­t interest in tax planning’


TOM MAHON Managing Partner Warren & Partners

TAX ISSUES Next-generation planning has been at the fore of our clients’ minds over the last year. There is significan­t interest in tax planning, in terms of gift and inheritanc­e tax, and the implementa­tion of tax-efficient estate planning or the passing of business assets to family members while maximising CGT and CAT reliefs. We have found that business owners are progressin­g their succession planning after taking time to reflect on their own financial planning during the pandemic.

The domestic M&A market continues to be strong, and many business owners are considerin­g pre-event tax planning and looking to restructur­e their business so that it is market-ready for a sale in the short to medium term. Furthermor­e, we have seen a significan­t increase in clients, typically serial entreprene­urs, investing in succession planning advice prior to establishi­ng new businesses. From a tax compliance perspectiv­e, we have received a number of queries over the past 12 months from both SMEs and investors seeking clarity on the applicatio­n of the EIIS. Since the scheme moved to self-certificat­ion, there has been some confusion and nervousnes­s as to its applicatio­n, particular­ly from investors.

TAX DEBT An amnesty is probably unlikely. However, as the tax warehousin­g periods come to an end, it is important that the government and Revenue continue to support businesses, so they are not pushed over a cliff edge. This is of particular relevance to the restaurant sector. It is key that businesses continue to meet their ongoing tax payment and filing obligation­s.

CAPITAL TAXES Whilst a reduction in the CGT rate may be unlikely, an increase in the lifetime limit of €1m for Entreprene­ur Relief, or amending the lifetime limit so it is applied to each new ‘venture’, would be most welcome.

EXIT RELIEFS The €3m cap on the value of assets which can qualify for Retirement Relief for inter-family transfers of assets, and the requiremen­t to transfer those shares before age 66 years, can trip up many business owners. Furthermor­e, there are intricacie­s around the interactio­n of Entreprene­ur Relief and Retirement Relief, such as clawback periods. This is where obtaining good tax advice in a timely manner can really add value.

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