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• Pension changes X
Principle:
No change
Income Levy
• Rates doubled
• Entry points reduced
Income Levy
Current Position Yesterdays Budget
€0 to €100,100 1% €0 - €75,036 2%
€100,100 - €250,120 2% €75,037 - €174,980 4%
€250,120 + 3% €174,980 + 6%
I n c
a nd
Ire l
Business Taxation
• 12.5% corporation tax rate unchanged
Reminder:
Yesterdays Budget
• Increase to 25%
• Effective 8 April ‘09
Capital Acquisitions Tax
• Rate increased from 22% to 25%
• Effective from midnight 7 April
• Thresholds
Pre 8 April 8 April
– (Parent to Child) €542,544 €434,000
– (Relations) €54,254 €43,400
– (Strangers) €27,127 €21,700
Property
Dealing in Residential
Development Land
• Special 20% rate abolished
• Taxable at marginal rate for individual -
2009
• Taxable at 25% for company - accounting
periods from 1 January 2009
• Trading losses set off restricted –
maximum value 20%
– If not claimed by 7 April ‘09
Stamp Duty
• “Trade-In” Scheme
• No stamp duty payable on “traded in”
property
– As payment / part payment
– In exchange for new house / apartment
• Stamp duty due when “swapped” house
sold
Property - Commercial
Current Position
• Stamp Duty rate still 6%
• Stamp duty deferral for “resting on contract” still
available
VAT & Other
VAT Rates
No changes
Car Dealers
• VAT Margin Scheme
• Second Hand Cars Acquired from 1st July
– VAT on Margin
• Second Hand Cars Acquired before 1st July
– Taxed on resale price
– Spread Payments if resold before 31st December
Excise
• 25 cent increase on cigarettes
• 5 cent increase on diesel
Future Tax Cuts to be Reviewed
• Rock concerts!
• Existing companies?
Opportunties with Reduction in
Asset Values
• Take assets out of company
• Re-organise company structure
• Transfer assets to children – “Inheritance
Brats”
Opportunities for Family
Businesses / Companies
• Low valuations – opportunities to transfer
assets
• CAT threshold for children €433k
• Significant tax reliefs remain
• Retirement Relief: extract €1.5m cash tax
free (if husband & wife qualify)
Company Pension Schemes
• Significant pension fund can be built for
company directors (5% shareholding)
• Cap on employer contributions
– Currently based only on size of fund needed to
provide for directors retirement
– Based on age, years of work and salary
• Salary cap to be introduced?
• 25% tax free lump-sum likely to be reduced
Conclusion
• Act before next budget
• Tax certainty for now
• Claim tax reliefs applicable
• Maximise savings and manage cashflow
Contact Details
Jackie Masterson
Taxation Partner
jmasterson@rbk.ie
090 6480600
Fiona Molloy
Taxation Director
fmolloy@rbk.ie
090 6480600