Tax Facts 2019 - PwC

Tax Facts

2019

pwc.ie/taxfacts

Index

Tax Facts 2019 - Introduction

Tax Facts 2019 - Editor's page

Tax Policy Developments Policy OECD BEPS EU Domestic changes

Business taxation Corporation tax Corporation tax rates Losses Branch income Capital Gains Company residence R&D credit Intellectual property tax deduction Knowledge Development Box Tax depreciation Leasing Ireland as a holding company location Closely held companies Start-up companies Corporate ? Tax administration

Transfer Pricing Overview Transfer Pricing Compliance Review Country-by-Country Reporting Advance Pricing Agreements Mutual Agreement Procedure (MAP) Coffey Report Recommendations

Tax Facts 2019

1 Financial services

19 Relevant contracts tax (RCT)

34

Banking and treasury

19 Wide scope of RCT

34

2 Insurance Aircraft leasing

19 Operation of RCT

34

20

Aviation Sector Capital allowances for aviation services 3

20 Interest

36

Section 110 companies 3

20 Interest paid/payable

36

3

Real Estate Investment Trusts (REIT)

21 Loans to finance corporate acquisitions / investment

36

3

Asset management

22 Loans to acquire Interest in a Partnership

36

3

Irish Real Estate Funds

23 Deposit interest retention tax (DIRT)

37

Global Information Reporting (FATCA & CRS)

23 DIRT & First Time Buyers

37

Islamic Finance

24

5

5

Local Property Tax

38

5 Corporate - withholding taxes (WHT)

26 LPT Rates

38

5

Dividend WHT

26 Returns

39

5

Interest WHT

26 Late Payment/Non-Compliance

39

5

Royalties WHT

26

7

WHT on capital gains

7

Professional services withholding tax (PSWT)

8

WHT rate reductions and exemptions

26 27 Income tax

27 Main personal tax credits and reliefs

Main tax allowances

40 40 41

9

Income tax exemption limits

41

10 Tax treaties

28 Income tax rates

41

11 Multilateral Instrument

28 Maternity Benefit

42

12

Alimony/maintenance payments

42

13 Value added tax (VAT)

29 Personal Insolvency

42

13 General

29 Remittance basis of taxation (RBT)

42

13 Accounting for VAT

29 Domicile levy

43

Rates

29 Special assignment relief programme (SARP)

43

16 Exempt activities

30 Cross border workers

43

16 Property

30 Foreign earnings deduction (FED)

44

16 Section 56 Authorisation (formerly Section 13A)

30 Employment & Investment Incentive / Startup Refunds for

16 Withdrawal of VAT credit for bills not paid within six months

30 Entrepreneurs (SURE) / SCI

44

16

R&D tax credit

45

17 Stamp duty

32 Relief for mortgage interest payments

45

17 Rates

32 Rent relief for private accommodation

46

Transfer/purchase of residential property

32 Rent a room scheme

46

Transfer/purchase of other property

32 Rental income

46

Exemptions and reliefs

33 Help To Buy Incentive (HTB)

46

ii

Index

Home Renovation Incentive (HRI)

46 Universal Social Charge

58 Local taxes

69

Living City Initiative

47 The Universal Social Charge (USC)

58 Environmental Taxes

69

High Earner's Restriction

48

Employment of a carer

48 Pension schemes

59

Customs and excise

70

Childcare Services Relief

48 Pension contribution rules ? for employers

59 Customs

70

Self assessment - payment and returns

48 Pension contribution rules ? for individuals, the earnings limits

59 Excise

70

Pension contribution rules ? for individuals, the age related limits

59

Employee taxation Termination payments Benefits-in-kind (BIKs) - general BIK on company cars BIK on preferential loans BIK on professional subscriptions

Pension changes for public servants

60

50 Pension distribution rules occupational pension schemes ?

Tax contacts

72

50 the maximum pension allowed

60

50 Pension distribution rules ? occupational pension schemes ?

Appendix 1

74

50 the maximum lump sum allowed

60

51 Pension distribution rules ? PRSA and personal pensions

Withholding tax on payments from Ireland 61

74

51 Pension distribution rules ? Approved Retirement Funds (ARFs)

Withholding tax on payments from Ireland (continued) 61

75

BIK on travel passes and small benefits

51 Treatment of ARF Distributions for Double Taxation Agreements

62

Travel and subsistence

51 Limited access rules for Additional Voluntary Contributions (AVCs)

62 Appendix 2

76

Motor travel rates

52

Withholding tax on payments to Ireland

76

Subsistence rates - within Ireland

52 Capital gains tax

63 Withholding tax on payments to Ireland (continued)

77

Travel and subsistence expenses for Non-Executive

Rates

63

Directors (NEDs)

52

Losses

64

Exemptions and reliefs

64

Employee share schemes

52 Impact of debt write-off

66

Unapproved employee share schemes

53 Self-assessment ? payment and returns

66

Revenue approved employee share schemes

53

Employer reporting requirements

54

Capital acquisitions tax

67

Tax treatment of loans from employee benefit schemes

54

General

67

PRSI Rates Employee/Employer PRSI (Class A) Self-employed PRSI (Class S) PRSI classification of working directors

Calculation of CAT

67

56 Self-assessment ? payment and returns

67

56 Main exemptions

67

56 Main reliefs

68

56 Discretionary trust

68

57

Tax Facts 2019

iii

Index

Introduction

Welcome

Tax Policy Developments

Business taxation

Transfer Pricing

Financial Services

Corporate - withholding taxes (WHT)

Tax treaties

Value added tax (VAT)

Stamp duty

Relevant contracts tax (RCT)

Interest

Local Property Tax

Income tax

Employee taxation

Employee share schemes

PRSI

Universal Social Charge

Pension schemes

Capital gains tax

Capital acquisitions tax

Local taxes

Customs and excise

Tax contacts Appendix 1 Appendix 2

Tax Facts 2019

Withholding tax on payments from Ireland

Withholding tax on payments to Ireland

Tax Facts 2019 - The essential guide to Irish tax

Introduction This publication is a practical and easy-to follow guide to the Irish tax system. It provides a summary of Irish tax rates as well as an outline of the main areas of Irish taxation. A list of PwC contacts is provided within each tax area and at the back of this guide should you require more detailed advice or assistance tailored to your specific needs.

Joe Tynan Tax and Legal Services Leader

1

Index

Introduction

Welcome

Tax Policy Developments

Business taxation

Transfer Pricing

Financial Services

Corporate - withholding taxes (WHT)

Tax treaties

Value added tax (VAT)

Stamp duty

Relevant contracts tax (RCT)

Interest

Local Property Tax

Income tax

Employee taxation

Employee share schemes

PRSI

Universal Social Charge

Pension schemes

Capital gains tax

Capital acquisitions tax

Local taxes

Customs and excise

Tax contacts Appendix 1 Appendix 2

Tax Facts 2019

Withholding tax on payments from Ireland

Withholding tax on payments to Ireland

Tax Facts 2019 ? Editor's page

Welcome to the latest edition of Tax Facts which has been updated for amendments brought about by Finance Act 2018 which was signed into law on 19 December 2018.

From a personal tax perspective, Finance Act 2018 has made a number of adjustments to the tax bands, tax credits and USC rates which provide modest income tax savings for individuals. From an employer perspective, the next phased increase to the employer PRSI charge from 10.85% in 2018 to 10.95% is effective from 1 January 2019. This will further increase to 11.05% in 2020.

The Finance Act has made a number of amendments to the Employment and Investment Incentive (EII) scheme, which provides income tax relief for investment in certain corporate trades. The amendments should encourage take-up of the scheme and simplify the Revenue approval process. The Act also introduces a new Start-Up Capital Incentive ("SCI") which is targeted at early stage micro-companies.

From a VAT perspective, a number of goods and services which were previously subject to VAT at 9% are subject to VAT at 13.5% (with certain exceptions) with effect from 1 January 2019. Goods and services impacted by this change include restaurants, hotels, holiday accommodation and admissions to cinema, theatre or other cultural events. The 9% VAT rate has also been extended to the supply of electronic publications.

Finance Act 2018 introduces accelerated wear and tear allowances for gas vehicles and refuelling equipment used for trading purposes. Amendments are also made to the new accelerated capital

allowances regime which was proposed in Finance Act 2017 to grant employers capital allowance relief on the capital cost of constructing and equipping qualifying fitness or childcare facilities provided for use by employees of the employer. The amended regime commenced on 1 January 2019. The regime governing wear and tear allowances for certain energy efficient equipment has also been streamlined in order to make it more administratively effective.

Finance Act 2018 also contains a number of provisions which give effect to internationally agreed measures under the EU's Anti-Tax Avoidance Directive ("ATAD").

Controlled Foreign Company ("CFC") rules are introduced into Irish tax law for the first time and apply for accounting periods beginning on or after 1 January 2019. Subject to certain exemptions, the CFC rules tax an Irish group entity on the amount of undistributed profits of a CFC which can reasonably be attributable to certain activities that are carried on by that entity in Ireland.

A new exit tax regime became effective for transactions on or after 10 October 2018, replacing in full the existing exit tax provisions. The new exit tax rules are broader than before. Subject to certain anti-avoidance provisions, the tax rate applicable to any chargeable gain arising is 12.5%.

The Irish Government also ratified Ireland's choices under the Multilateral Instrument ("MLI") as part of Finance Act 2018. The MLI will come into effect in Ireland from 1 May 2019.

For more information contact:

Fiona Carney Director t: +353 (0)1 792 6095 e: fiona.carney@

Fiona Carney Director Tax Solutions Centre

2

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download