1 / 54

Budget 2010

Budget 2010. October 2008. April 2009. December 2009. Budget Strategy . Objective Rebuild Nations Self Confidence Restore International Reputation How Bold – Decisive – Innovative Steps Conclusion Worst is Over Return to Growth in 6 – 9 Months. €4 Billion Question ?.

porter-barrera
Download Presentation

Budget 2010

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Budget 2010

  2. October 2008

  3. April 2009

  4. December 2009

  5. Budget Strategy • Objective • Rebuild Nations Self Confidence • Restore International Reputation • How • Bold – Decisive – Innovative Steps • Conclusion • Worst is Over • Return to Growth in 6 – 9 Months

  6. €4 Billion Question ?

  7. Signalled Changes • Taxation of child benefit X • Introduction of carbon tax  • Introduction of property tax 2010 • Review taxation exempt income / reliefs  • CAT/CGT Business Reliefs X • Pension Contributions / Lump Sums ? • Reduce VAT/Excise  • Car Scrappage 

  8. Personal Tax

  9. Income Tax Rates • No Changes • Reminder • Income Tax • PRSI • Health Levy • Income Levy

  10. Simplify and Reform Tax System • Reform and Fairness • Social Contribution • Low Rate • Broad Base • Income Tax • Progressive Rates • 2011

  11. IT, PRSI, Health Levy & Income Levy Employee >€75k €75k-€175k €175k+ Income Tax 41 41 41 PRSI 4 - - Health Levy 4 5 5 Income Levy 246 51%50%52%

  12. IT, PRSI, Health Levy & Income Levy Self-Employed >€75k €75k-€175k €175k+ IT 41 41 41 PRSI 3 3 3 Health Levy 4 5 5 Income Levy 246 50%53%55%

  13. International Comparisons: Overall marginal tax rates for employees on €80,000

  14. Why No Tax Increase? • Reached Limit of Taxation • Heaviest Burden on Higher Earners • Income Levy : Gross • High Earners Cap

  15. High Earners Cap • Introduced 2007 • Restricted Specified Reliefs • Aim - Effective Rate 20%

  16. How It Worked 2009 • 20% Effective Rate • Restricted Relief to Higher of: • €250,000 OR • 50% of Income 2010 • Now 30% Effective Rate • Entry Point €125,000 • Full Restriction if Income > €400,000 • Finance Bill Clarification

  17. High Earners Cap - Example 2009 2010 €’000€;000 Income 600 600 Specified Reliefs 400 400 Allowed 300 150 Restricted 100 250 Taxable 300 450 Tax @ 41% 123 185 Effective Rate 2009 20% 30%

  18. Tax Exiles

  19. New Irish Domicile Levy • Non Resident Domiciled Individuals • Worldwide Income > €1m • Irish Located Capital > €5m • Annual Levy €200,000 • Details in Finance Bill

  20. Mortgage Interest Relief • Budget 2009 • Relief to cease for loans over 7 years • Interest Relief now until 2017 • Home Owners in Negative Equity • New Loans before 1/7/2011 • Loans from 1/7/2011 to 31/12/2012 (Restricted)

  21. Residential Rental Property • Reminder – current position • Tax deduction for interest reduced to 75%

  22. Investments/Savings • Existing 25%/28% Tax • New National Savings Product • National Solidarity Bond • 5/7 Years • 2010 • Details to be announced

  23. Pension • Overhaul Imminent • No Immediate Change • Frame Work Policy to Review • Likely Outcome • Max Tax Tree Lump Sum €200k • Excess Taxable? • SSIA Type Scheme • No Tax Relief

  24. Child Benefits • Children’s Allowance • 10% cut to allowance • Future Taxation / Means Test ? • Incentive in 2009 • Preschool – Free Year • Effective 1/1/10

  25. Business Taxation Ireland Inc

  26. Business Taxation • Corporation Tax • 12.5% tax rate unchanged • International Brand • Employers • Employers PRSI unchanged (8.5 – 10 ¾ %) • Employer Job Incentive Scheme • Details to be announced

  27. New Company Set Up • Introduced 2009 • Profits < €320k per annum • 3 Year Period • Extended set up’s in 2010.

  28. Smart Economy • Irish Economic Focus • Research & Development tax credits • Qualifying R & D • 25% cash refund • Intellectual Property • Awaiting Innovation Taskforce Report

  29. Support Motor Industry • Car Scrappage Scheme • Car over 10 years old • €1,500 off VRT • Emissions band A or B • Environmentally Friendly • Extension of VRT Relief to 2012 • VAT Margin Scheme

  30. Supporting Retail Sector • VAT Rate • Reduced from 21½% to 21% from 1/1/10 • Excise Reduction on Alcohol

  31. Supporting Agriculture • Waste Management Capital Allowances • No Income Levy • Forestry & Bio Energy

  32. Supporting Other Industries • Construction • Retrofit • Tourism • Railway Scheme • Other • Energy Efficient • Extends to Catering/Hospitality

  33. Supporting Financial Services • Incentives to develop International Funds Industry Hub • Changes expected in Finance Bill

  34. Incentives to Protect Employment • Training Fund • Food Industry • Employment Job Incentive Scheme

  35. Employment Subsidy Scheme • Enterprise stabilisation fund • Assist Irish export companies in difficulty • Second round now open • Eligibility extended Non Export • Minimum of 10 full time employees • Jobs at risk / Commit to retain jobs • Tight Deadline/ Immediate Application

  36. Getting Credit Flowing • Review Committee NAMA • External Review Process • Review Banking Policies • Particular Focus on Retail, Car, Tourism & Agriculture

  37. New and Other Taxes

  38. Carbon Tax • €15 per Tonne on Fossil Fuels • Effective Midnight 9/12/2009 • Petrol 3.5% Increase • Diesel 4.6% Increase • Effective 1/5/2010 • Home Heating …. 8.7% • Commencement Order • Coal & Briquettes

  39. Other Taxes • Site Valuation Tax • Residential Property • Establishing Ownership Register • Valuation Database • Water Charges • Based on Usage

  40. Capital Gains Tax (CGT)& Capital Acquisitions Tax (“CAT”) • No changes currently • Rate 25% • Finance Bill?

  41. Stamp Duty • No changes currently

  42. Anti Avoidance • Clearly Signalled • Tax Avoidance Schemes • Strengthening Revenue Power

  43. Conclusion

  44. Tax Planning in the Current Environment

  45. Current Environment • Existing Legislation • Finance Bill / Finance Act • Maximise available remaining tax reliefs • Secure tax savings • Improve cashflow • Window of Opportunity

  46. Cashflow Saving Tax Tips • Preliminary Tax • If profits decreasing – base on current year • Move to a cash receipts basis for VAT • Review direct debits for PAYE / VAT • Directors loan v Salary • Use of a Redundancy Rebate

  47. Losses • Ability to Use Losses • Losses arising • Land write downs / restricted • Capital allowances claims – obsolete assets • Stock / Bad Debt provisions • Inter group loans – write off / down • Use • Carried back to prior year (company) • Offset against other Income (Personal)

  48. Tax Based Funding/Reliefs • Pensions • Seed Capital Relief • Start ups • Tax relief on investments up to €600k • Set against Income Tax bill in prior 6 years • Refund of income tax • Business Expansion Scheme • Tax relief of €150,000 pa for individuals • Qualifying company can secure €2m • Lack of other tax incentives for individuals

  49. Opportunities with Reduction in Asset Values • Take assets out of company • Re-organise company structure • Transfer assets to children

More Related