Income Tax
Individuals, sole traders and partnerships are required to pay income tax on all income arising in the State during a calendar year. The tax year end is the 31st December and an income tax return must be submitted and any liability discharged by the following 31st October. On payment of their current year's liability each self assessed individual/sole trader/partnership is obliged to pay preliminary tax based on 100% of their previous year's liability. The current rates of tax are the standard rate of 20% and the marginal rate of 41%. Each individual receives a standard rate cut-off point and a tax credit based on their individual circumstances, which is utilised over the calendar year on an accumulative basis.
A proprietary director of a company ( owns min 15% of company share holding) is automatically obliged to submit an income tax return, regardless of whether or not they earn a salary through that company.
Failure to submit an income tax return and discharge a liability by the 31st October will result in an automatic 5% surcharge, increased to 10% if more than 2 months late. This surcharge is based on the final tax liability due.
Income Tax Rates
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Income Tax Credits
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Exemption Limits
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Interest on Overdue Tax
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Motor Vehicles
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Preferential Loans
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PRSI Rates and Levies
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Corporation Tax
Companies are obliged to pay corporation tax, at a rate of 12.5%, on their tax adjusted profits. The Revenue operate a Pay & File system whereby each company pays preliminary tax, based on a percentage of their taxable profits, one month before their year end. New guidelines apply for large companies which will involve 2 preliminary tax payments (see information attached). All companies must then submit their Corporation Tax Return 9 months after their year end with payment for the balancing liability.
Rates of Corporation Tax
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Corporation Tax Minimum First Instalment
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Capital Gains Tax
The standard rate of tax is now 22%, with the first EURO 1,270 of the taxable gain exempt, and allowable deductions for legal/professional expenses incurred on the purchase and sale of the asset in question. For disposals made from 2009 onwards if a gain arises between 1st January and 30th November the CGT must be discharged by the following 15th December, and if occurred during the period 1st December to 31st December the liability must be discharged by the 31st January in the following year. On top of this the CGT calculation must be submitted to the Revenue by the 31st of the following October or the usual 5%/10% surcharges for late submission applicable to Income Tax will also be applied whether the actual liability had been discharged in the previous year or not.
Capital Gains Tax Rates
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Indexation Factors
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Capital Acquisitions Tax
This is a tax on gifts and inheritance. There are three Group Thresholds which indicate how much an individual can receive before the balance is subject to a tax rate of 20%. The threshold applicable is based on the relationship between the disponer and the beneficiary.
Capital Acquisitions Tax Rates
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Capital Acquisitions Tax Class Thresholds
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VAT
Persons supplying taxable goods or services in the course of business are obliged to register for VAT if their turnover exceeds, or is likely to exceed, EURO 37,500 (from 1 May 2008), for persons supplying services, and EURO 75,000 (from 1 May 2008), for persons supplying goods, in a twelve month period. If their turnover does not exceed the above they can opt to register for VAT. When an individual is registered for VAT they must pay the VAT collected on their sales to the Revenue but can claim input credits against these payments on VAT they incurred on purchases made for the business, with a few exceptions. These exceptions are mainly motorcars, petrol, meals and entertainment expenses. VAT cannot be recovered on these expenses.
VAT registered individuals are usually obliged to submit bi-monthly VAT returns to the Revenue on the 19th of the following month, e.g. Jan/Feb return must be submitted and any liability discharged by the 19th of March. Exports and imports within the EU are zero rated once both parties are VAT registered in their own country. Exports outside the EU are relieved of VAT and imports from outside the EU are liable to VAT at the same rate applicable within Ireland at the point of importation into Ireland. The different VAT rates are 0%, 5.2%, 13.5% and 21%. A list of the rates applying to goods and services is available from the Revenue. Certain goods and services are exemption from VAT and they cannot recover any VAT suffered on their expenses, e.g. hospitals, schools, banking services, insurance services.
Since 1 July 2008, a new simplified system has applied to VAT on property transactions. The new rules apply to both residential and commercial property supplied in the course of business.
Since 1 September 2008, supplies made by a subcontractor to a principal contractor in the construction sector are subject to a reverse charge. This means that instead of the subcontractor charging VAT on his supply to a principal and accounting to Revenue for the VAT, the principal contractor must account to Revenue for the VAT.
The Standard Rate of VAT has decreased from 21.5% to 21% with effect from 1st January 2010.
Vat Thresholds
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Stamp Duty
This is a tax payable to the government for changing the documents that specify who owns a particlar property. A range of rates apply in Ireland to documents affecting the transference of property, depending on the type of property (residential or non-residential), the value of the property and the status of the purchaser. The attached schedule reflect recent changes to Stamp Duty for non residential property.
Rates of Stamp Duty
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