There have been many enhancements to Ireland’s taxation offering over the last number of years but it is important for companies to remember the age-old reliable reliefs that are still available. Here we give a short overview of the research and development credit rules as they currently stand.
Gone are the days of having to compute a company’s R&D credit by reference to a base year. Qualifying research and development expenditure qualifies for a 25% tax credit. This is in addition to the corporation tax deduction of 12.5% that the expenditure also attracts.
The credit, once calculated, can shelter any corporation tax arising in the year in which the expenditure is incurred. Any unutilised credit also be claimed against the prior year corporation tax liability.
If the company still has any remaining credits which have not been used, a portion of these can be refunded to the company by way of a cash refund. The level of cash refund available is dependent on the company’s prior year corporation tax liabilities and Paye liabilities.
Companies should note that R&D work which is contracted out to a university or to an unconnected subcontractor can also qualify for the relief subject to certain restrictions. Likewise capital expenditure incurred on a building or structure used for qualifying R&D activities may qualify for relief where the activities are carried on in the building for a period of over 4 years and the R&D activity represents at least 35% of all activities carried on in the building.
It is important to note that claims for R&D must be made within 12 months from the end of the year in which the expenditure is incurred. Any expenditure financed by way of a grant received by the company should not be included as part of the claim.
Companies should continue to review the nature of their operations to see if R&D activity is being carried on. This should be completed on an annual basis as the time limits to submit claims are quite tight.
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As first-time buyers struggle to get on the property ladder all potential first-time buyers should note that the Help to Buy Scheme introduced in 2016 is due to expire on the 31st of December 2019.
The scheme was set up to help first time buyers receive a rebate of income tax which could be used as part of a deposit on the purchase of a new home.
In order to qualify for the scheme, the individual must be a first time buyer and is required to either enter into a contract with a qualifying contractor to acquire a qualifying residence or draw down the first tranche of a loan used to fund the building of a qualifying residence by the 31st of December 2019.
A qualifying residence is a new residence which will be occupied as the purchaser’s sole or main residence. The price of the residence cannot exceed €500,000. The purchaser must also take out a mortgage of at least 70% of the purchase price of the property.
Where the conditions are satisfied the purchaser will be entitled to a rebate of income tax equal to the lower of:
If the purchaser receives approval in respect of the scheme the tax rebate will be paid to the builder.
Beware though. Revenue are entitled to clawback the rebate where the property is not the purchaser’s main residence for a period of 5 years.
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The rules and regulations around health and safety in the workplace can be complicated, but they are there for a good reason, too, as we found out when we recently attended a very important CPD course, you might find the following of interest.
If one of your employees, or a member of the public get hurt on your premises and it turns out that you have not fully complied with your Health and Safety responsibilities, the consequences can be very serious.
Amongst other things employers should consider, the following are the key points in relation to Health and Safety Legislation and good practice to avoid prosecution by enforcing authorities
1: The preparation of a General Health and Safety Policy Document:
2: The preparation of a Health and Safety Policy and Procedures Handbook:
3: Maintenance of Safety Records:
4: Employee Safety:
For more information please see www.hsa.ie
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