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TAX PLANNING & COMPLIANCE
Tax Planning & Compliance
– RoI, UK & Cross- Border
At MLMG our dedicated tax department, staffed by experienced tax advisors, provide comprehensive personal, business and cross-border tax compliance and tax planning services to clients in both the Republic of Ireland and the UK.
We are a border based practice and approved as Brexit advisory partners with InterTrade Ireland. The partners have almost 60 years combined experience addressing cross border trading and operational issues for clients on both sides of the border.
Our tax planning and compliance department includes qualified tax consultants with extensive exposure to UK, ROI and cross border tax issues. We are currently assisting a number of our clients in planning for Brexit, including advising on registering their business in the UK or ROI as appropriate.
We can help you review your business and create a Brexit contingency plan.
Many family businesses grow and develop with the ideas and input of the next generation. However, the success and long-term survival of many family businesses is dependent on an agreed and well-constructed business succession plan. Without such a plan key lifetime events can have devastating effects on a family business.
We offer expert advice on all aspects of succession, tax and estate planning. This may include tax advice on extracting cash/assets from your business, or transferring wealth to the next generation during your lifetime or on death.
The RoI and UK tax systems have a lot of similarities. However, inheritance tax is one that differs greatly in the two jurisdictions.
- The UK taxes the estate itself, not the beneficiaries.
- In RoI the estate itself is not taxed, instead it is the beneficiaries or recipients that are subject to inheritance tax (Capital Acquisitions Tax – CAT), and it not may not surprise you that Ireland has one of the highest rates in the world.
The two differing systems have obvious complications for cross-border estates. Many families don’t plan adequately for passing assets to the next generation and this can be a very costly mistake for those left behind, with countless examples of assets having to be sold to meet the tax liabilities arising.
With careful inheritance tax planning, it is possible to minimise or potentially even eliminate the amount tax payable.
Corporation tax is paid by companies on their trading profits, income and most of their gains. In RoI corporation tax is levied at 12.5% for active trading income and 25% for other sources of income such as foreign profits and passive income, e.g. rent or deposit interest. Most companies fall into the first category, but in certain circumstances those providing professional services may also be liable for a surcharge on undistributed income. This is a relatively low rate of corporation tax in Eurozone terms and it is one of the cornerstones of Ireland’s tax policy.
In the UK, the normal rate of corporation tax is 19% for the year beginning 1 April 2017. It is proposed that this rate will fall to 17% for the year beginning 1 April 2020.
MLMG provides a full range of RoI and UK corporation tax services including advice on locations and structures, and the preparation and submission of tax computations and returns.
Tax compliance dates, rates and rules change from time to time and the late payment of tax or late filing of returns can result in interest and penalties. We advise on tax payment due dates, amount to pay, and whether there is scope to reduce the corporation tax liability through the use of tax reliefs and exemptions.
Capital Gains Tax
Capital Gains Tax (CGT) is payable on any gains made from the sale, gift or exchange of an asset including land, buildings, shares and other assets. There are a number of reliefs and exemptions available for Capital Gains Tax:
- In RoI there is an annual exemption, principal private residence, inter-spousal transfers, retirement relief, entrepreneur’s relief etc.
- The UK also has annual exemptions, roll-over, hold-over, entrepreneur and private residence reliefs etc.
Certain conditions must be met in order to qualify for these reliefs. Cross border transactions give rise to additional complications. We have extensive experience dealing with CGT in both RoI and the UK making maximum use of the available reliefs and exemptions.
Income Tax Returns
If you are in receipt of income from sources that are not taxed under the PAYE system, then you will need to complete and file a self-assessment income tax return. Examples include trading/contracting as sole trade or partnerships, landlords, those in receipt of investment income, those in receipt of overseas income, company directors, members of employee share schemes etc.
Filing income tax returns can be a confusing and time consuming process. We have extensive experience in preparing and filing income tax returns in both ROI and UK, as well as dealing with cross border workers and non-resident landlords.
As the name implies, under self-assessment, the onus is on the taxpayer to ensure that they are compliant, so it’s important to take the appropriate advice and get it right. Failure to do so could result in expensive penalties and interest.
Our aim is simple – ensure that you are tax compliant whilst claiming all relevant reliefs and allowances to minimise your tax liability.
If you receive income from rental properties or holiday homes at home or abroad, then you must declare these properties and file an income tax return. This applies to former private residences and to those who may have become “accidental landlords” through changes in circumstances. If you have overseas rental properties then the likelihood is that you will have tax filing obligations in those countries as well the requirement to file at home. The onus is on you the taxpayer to ensure you make the appropriate returns.
We have a wealth of experience in filing tax returns in RoI and the UK for both resident and non-resident landlords.
We can help you with this process, ensuring you are tax compliant, claim all the deductions and reliefs available, and minimise your exposure to tax.
We assist clients with all aspects of VAT, including reviews, planning and updates on any changes that may affect your business sector. We also offer advice on the best way to treat new areas of trade as your business grows. VAT planning is very important, especially when the activity involves the more complex VAT areas, such as:
- Partially exempt businesses
- Property construction, sale or rental
- Grant supported activities
- Import/export businesses
- Trade with Europe
Relevant Contracts Tax (RCT)
RCT is a withholding tax which the Revenue in RoI requires principal contractors operating in the construction, forestry and meat processing sectors to withhold from sub-contractors engaged in contracts to carry out works on their behalf. Withholding can be 0%, 20% or 35% as advised by Revenue and there are stiff penalties for non-compliance.
We have extensive experience administering RCT and can provide all the necessary advice and assistance you require to operate comply with the requirements of the scheme.
Construction Industry Scheme
Under the Construction Industry Scheme (CIS), UK contractors deduct money from a subcontractor’s payments and pass it to HMRC (similar to RCT in RoI). Contractors must register for the scheme. Subcontractors don’t have to register, but deductions are taken from their payments at a higher rate if they’re not registered. The deductions count as advance payments towards the subcontractor’s tax and National Insurance.
We can help you administer your CIS obligations and have extensive experience helping RoI subcontractors working in the UK.