Critical skills visas
ACCA with the Consultative Committee of Accountancy Bodies-Ireland (CCAB-I) made a joint submission on proposals put forward by the Department of Enterprise, Trade and Employment to revise the list of skills that qualify for the critical skills visa. Our submission noted the pivotal role our profession has in delivering vital professional services and advice to all sectors of the Irish economy.
We identified a critical shortage of accountants in professional accounting firms of all sizes, financial services and industry. We singled out audit, sustainability and anti-money laundering skills as being particularly in demand.
For employers needing to fill an accounting-type vacancy, European Economic Area, UK or Ukrainian accountants can work without needing to apply for a visa, but other candidates can also be considered using the critical skills visa process.
Trade sanctions
It has been reported that parts of some Russian military equipment appear to have been manufactured in Ireland or made to look like they were manufactured in Ireland.
Reporting the details of expense payments made to employees to Revenue will commence on 1 January 2024
The EU sanctions regime includes a prohibition on the export to Russia directly or indirectly of certain military or dual-use machinery or parts. However, importers will do their best to circumvent or undermine those sanctions and, for example, the true end users of sanctioned goods are unlikely to attach their name to the order.
The UK Department of Trade has published a useful guide to the due diligence a manufacturer or supplier should undertake, and the risk indicators for which a supplier and their advisers should look.
Expenses payments
Reporting the details of expense payments made to employees to Revenue will commence on 1 January 2024. Employers will need to report to Revenue on any small benefit exemption (typically up to €1,000 vouchers), any remote working allowance, and all travel and subsistence payments.
The return/submission must be made by the employer on or before the payment date to the employee. This will require substantial systems upgrades for most employers to both capture the data and to report that data to Revenue prior to payment.
Tax matters
ACCA members bring matters of taxation that are causing difficulty to the attention of advisory services directly, and the practitioners panel has a role in identifying issues, while the local networks for members in practice will also raise issues.
Depending on the matter raised and the number of people involved, it may either be referred to our representatives on Tax Administration Liaison Committee (TALC) to raise directly with Revenue or brought to the attention of the Taxation Committee to deal with in a broader context.
The administrative burden of the tax system needs to be less onerous as it is a deterrent to entrepreneurism
ACCA also participates in industry-wide responses to government consultations, including:
1. Personal tax system
We identified a number of issues in the consultation document, including the early entry into marginal rate taxation at a threshold which is currently below the average industrial wage; the need to index income tax rates and bands as part of future tax policy; the 3% rate of Universal Social Charge (USC) on self-employed incomes over €100,000, which is inequitable and should be abolished; and that tax policy must adapt to modern working arrangements, including hybrid and remote working.
We asked that the Special Assignee Relief Programme (SARP) and Rent Tax Credit should be permanent, and the Rent-a-Room threshold should be increased, and the ‘cliff-edge’ be removed. We also identified the anomaly whereby corporate landlords receive more favourable tax treatment than individuals.
A move to a territorial system of taxation will enhance Ireland’s position in the global economy
Finally, we re-emphasised that the administrative burden of the tax system needs to be less onerous as it is a deterrent to entrepreneurism, and this includes the merger of USC and Pay Related Social Insurance (PRSI). The full response is here.
2. Consultation on a territorial system of taxation
The consultation discussed how Controlled Foreign Company (CFC) rules, transfer pricing, anti-hybrid rules, the Interest Limitation Rule (ILR), the tax treaty network, and domestic tax reliefs would interact with a territorial basis of taxation. The CCAB-I submission suggests that a move to a territorial system of taxation will enhance Ireland’s position in the global economy as many of our international trade partners operate such a system. See here for the full submission.
3. Feedback statement on Pillar Two.
The profession’s response to the consultation focused on administrative aspects of Pillar Two implementation. Our response highlighted: the Finance Act should reference OECD guidance materials specifying the relevant version that is applicable at a point in time; the legislator needs to ensure that amounts payable under US Global Intangible Low Tax Income (GILTI) rules are creditable for the purposes of calculating the Qualified Domestic Top-up Tax (QDTT); a separate form should be provided for Pillar Two returns and Pillar Two corporate taxes should not be included in a company’s Irish preliminary tax obligations.
The joint and several liability of Pillar Two corporate taxes could have unforeseen consequences
At the same time, domestic corporate tax overpayments should be available for offset against Pillar Two corporate tax liabilities’ group filing and registration should be offered.
We objected to the joint and several liability of Pillar Two corporate taxes, as this could have unforeseen consequences; for example, in the context of due diligence processes, financial liabilities, commercial contracts, etc.
Finally, we also advocated for the development of broad and robust safe harbours. We continue to advocate for the above throughout the Pillar Two implementation process via the TALC BEPS Sub-Committee.
