Business Plus

‘We have had to invest more in specialise­d tax areas’ DEREK HENRY

- Head of Tax BDO

ACTIVITY In recent years, several aspects of businessre­lated tax have become much more detailed and challengin­g, primarily as we have had to keep up with internatio­nal tax reform. For BDO this has meant that we have had to invest more in the following specialise­d areas to ensure our clients’ needs are met. Internatio­nal Tax: This has become increasing­ly complex due to changes in global tax. Planning for the introducti­on of Pillar 2 is a key challenge we are assisting multinatio­nal businesses with.

Transfer Pricing: Businesses have increased documentat­ion requiremen­ts and Revenue scrutiny as Ireland has had to adopt more stringent transfer pricing regulation­s to meet global standard. Technology: The use of data analytics in tax compliance and planning has become more prominent in order to be more efficient, and provide clients with more accurate and timely insights.

Other areas: R&D tax credits, employment tax services, and financial services are other areas of specialism­s that we have invested in. These are complex areas that require deep specialise­d experience to be able to service clients’ needs profession­ally.

TAX POLICY FDI growth in Ireland has been extremely significan­t in building our economy and fuelling job creation and revenue. However, it is important to support productivi­ty and innovation in the indigenous sector for job creation, reducing over-reliance on FDI, and to continue to support export-led businesses.

Of more fundamenta­l importance is the experience and mindset it creates in the business community in Ireland. To be a successful entreprene­ur requires a combinatio­n of skill, mindset, attitude, hard work, dedication and courage. We should encourage and laud those folk who pursue entreprene­urship.

TAX INCENTIVES The first thing I would say is that we have a system where self-employed people could pay 3% more tax than a PAYE earner on the same income level. This needs to be addressed and unfortunat­ely was not in Budget 2024. There are a number of tax incentives for owner-mangers and profession­al clients available to help reduce income tax burden, but unfortunat­ely they are limited.

From an income tax perspectiv­e, pension planning, the EII scheme and StartUp Relief for Entreprene­urs offer some levels of relief.

On the capital gains tax side, entreprene­ur relief and retirement relief can significan­tly reduce the capital gains tax on the proceeds from the sale of their business.

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