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Friday 8 th December 2006 The Marketing Suite O’Flynn Construction Eastgate Little Island

BUDGET 2007. Friday 8 th December 2006 The Marketing Suite O’Flynn Construction Eastgate Little Island Co. Cork PRESENTED BY: Brendan Twohig Tax Consultant of Chartered Accountants < > Business Advisors. BUDGET 2007. INCOME TAX And PRSI & Levies. BUDGET 2007. Tax Credits:.

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Friday 8 th December 2006 The Marketing Suite O’Flynn Construction Eastgate Little Island

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  1. BUDGET 2007 Friday 8th December 2006 The Marketing Suite O’Flynn Construction Eastgate Little Island Co. Cork PRESENTED BY: Brendan Twohig Tax Consultant of Chartered Accountants<>Business Advisors O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  2. BUDGET 2007 INCOME TAX And PRSI & Levies O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  3. BUDGET 2007 Tax Credits: O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  4. BUDGET 2007 Standard Rate Cut-Off Point: O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  5. BUDGET 2007 Tax Rates: Marginal rate reduced from 42% to 41% Intention to to reduce to 40% next budget No change to 20% standard rate Bonus paid in 2007 – 2006 accounts – PRSI? O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  6. BUDGET 2007 Mortgage Interest: Annual ceiling on the amount of mortgage interest which qualifies for tax relief has been increased: 20062007 First Time Buyer – Single€4,000 €8,000 First Time Buyers – Married€8,000 €16,000 Others –Single €2,540 €3,000 Others – Married €5,080 €6,000 O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  7. BUDGET 2007 Business Expansion Scheme: Was to expire on 31/12/2006, now extended to 31/12/2013 Company can now raise €2m (was €1m) but max of €1½m in any one period Investment Cap of €31,750pa increased to €150,000pa Investments prior to 31/1/2007 can be claimed in 2006 Tax-efficient Cash Extraction method? (Funds? DI? DIY?) (Similar Changes to Seed Capital Investment Scheme) O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  8. BUDGET 2007 Rent-a-Room Scheme: => To be restricted in cases where tenant is a ‘connected person’ and is claiming Rent Relief Preferential Loans / BIK: Base rates for BIK purposes to increase from 3½% to 4½% for home loans, and from 11% to 12% for other loans. (12% too high? / Close Companies). Car Value (Capital Allowances/Leasing): => The threshold for business cars is to increase from €23,000 to €24,000 for 2007 – (relevant re. restriction for leasing deductions or capital allowances) O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  9. BUDGET 2007 PRSI & Levies: Levies exemption Limit to increase from €440pw to €480pw Weekly PRSI threshold to increase from €300pw to €339pw Employee’s PRSI ceiling to increase from €46,600pa to €48,800pa New Levies Rate of 2½% on income in excess of €1,925pw, or €100,100pa. Additional ½% on excess only Is it per week?per annum? Both? - Wait to see legislation Don’t forget the anomilies within the PRSI system Another new class(es)? Simplification? O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  10. BUDGET 2007 Various Other Changes: Turnover cap for “the Childminder’s Exemption” to increase to €15,000 Progressive changes to administration procedures to provide automatic tax relief, e.g. medial expenses, VHI paid by employer, Trade Union subscriptions, OAPs to be able to open DIRT-free Accounts, etc. Various changes re. Farmers Systematic short-term workers scheme extended O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  11. BUDGET 2007 CORPORATION TAX O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  12. BUDGET 2007 Preliminary Tax Payments: “Small companies” can base preliminary tax payment on either 90% of the previous period’s liability, or 100% of the current period’s liability. In a start-up situation, “small companies” will no longer have to make a preliminary tax payment for the first accounting period, and instead the full tax due must be paid at the same time as the submission of the CT1 ( almost 9 months after the year end). (Watch for Cash=flow problems as 2 years of tax paid within 9 weeks) The ‘CT liability threshold’ which determines what is a ‘small company’ is to be increased from €50,000 to €150,000. All of the above apply with immediate effect. O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  13. BUDGET 2007 Other Corporation Tax issues: ‘R & D Tax Credit Scheme’ is being enhanced The tax relief scheme for investment in renewable energy generation is to be extended, subject to EU approval. See above re. car value increase for capital allowances and leasing charges O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  14. BUDGET 2007 CAT & CGT O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  15. BUDGET 2007 CGT: Increase in Retirement Relief threshold from €500,000 to €750,000 (Start planning for this from 45 onwards) Retirement Relief may be available to farmers even after letting of land – conditions apply _________________________________________________ CAT: FB 2007 will include measures to allow beneficiaries to set mortgage against value of ‘off-farm’ home for purposes of ’80% farmer test’ for Agricultural Relief purposes. O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  16. BUDGET 2007 VAT O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  17. BUDGET 2007 Main VAT Changes: =>Turnover registration limits to increase (from 1/3/07): - Services €35,000(from €27,500) - Goods €70,000(from €55,000) =>Administration changes from July 2007 to allow ‘small businesses’ to submit Returns on a half-yearly basis (if annual VAT bill < €3,001) or on a quarterly basis (if annual VAT bill is >€3,000 but < €14,401). O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  18. BUDGET 2007 Other VAT Changes: Flat rate form farmers to increase from 4.8% to 5.2% but not for businesses involved in livestock etc Children’s car seats to be reduced from 21% to 13½% in May 2007 Turnover for ‘cash receipts basis’ to increase from €635k to €1m from March 2007 VAT on accommodation may be deductible if linked to conference – FB 2007 will have details VAT on Property – Review on-going – maybe next year? O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  19. BUDGET 2007 Sundry Other Changes O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  20. BUDGET 2007 Miscellaneous: No significant changes to stamp duty (apart from minor changes to stamp duty of mortgage deeds, and new relief for land purchased by sporting bodies). Cigarettes + 50c per 20 (10’s to be abolished?) No increase in Petrol & Diesel VRT changes – ‘eco-friendly cars’ Enhanced Maternity Leave Various Social Welfare Changes – Appendix 2 O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  21. BUDGET 2007 What did not Happen? (& What may happen in the future) O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  22. BUDGET 2007 No ‘VAT on Property’ changes No major changes to Stamp Duty No changes to CGT / CAT / CT rates No change to 20% ‘residential property rate’ No Change to 15-year tax life (Creche, Nursing Home, etc) O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  23. BUDGET 2007 No increase in CGT and/or CAT Annual Exemptions Employee v Sub-contractor issues not addressed No Changes re. Close Company Surcharges No changes to Pensions system ‘Subject to EU approval’ / Green issues / Property O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  24. BUDGET 2007 Summary & Reminders O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  25. BUDGET 2007 A “classic pre-election budget”? Don’t forget impact of previous changes Chargeable persons – non-PAYE income €250k cap of Reliefs Watch for other changes in legislation, rules, interpretation and practice, etc: Finance Bill Finance Act Revenue Statements etc(VAT on Property in Tax Briefing) O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

  26. BUDGET 2007 QUESTIONS? O’Connell Court, 64 O’Connell Street,Waterford. Tel:051 872039 / Fax: 051 - 874504 E-mail:brendantwohig@mkbrazil.com

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