This podcast was recorded on 20 July 2021.
David Moran, Tax Manager with Grant Thornton is joined by Jim Kelly, Tax Director with Grant Thornton.
David discusses the latest in tax. Jim shares his insights into the proposed changes being introduced to Revenue Audit and Intervention practices and the importance of being prepared to best mitigate against any potential penalties.
Tax developments
Consultation on the Implementation of new Interest Limitation Rules
The Minister for Finance, Paschal Donohoe TD has launched the ATAD Interest Limitation Rules feedback statement on the 2nd of July 2021 as part of the public consultation process on the implementation of these new rules, which are due to take effect from 1 January 2022.
The Department of Finance in conjunction with the Revenue Commissioners hosted a virtual discussion on the 19th of July, which was chaired by Deirdre Donaghy, Head of Business Tax in the Department of Finance to assist stakeholders in focusing their responses to the feedback statement.
During the discussion, officials from the Department of Finance and the Revenue Commissioners discussed the nine-step approach to implement these new rules whilst maintaining the operation of the current domestic rules on interest deductibility. Legacy loans, the definition of groups and the impact of losses were all addressed as part of this discussion.
The closing date for receipt of submissions is Monday the 16th August 2021.
G20/OECD International Tax Developments
The finance ministers of the G7 countries came to an agreement on the introduction of a new international minimum tax rate of 15% for multinationals and online tech companies at their meeting in London on the 5th of June.
On the 1st of July, the OECD/G20 issued a statement on the proposals and provided additional details on the Pillar One (re-allocation of taxing rights) and Pillar Two (global minimum tax rate) proposals.
See link below for commentary from our Peter Vale and Sasha Kerins on the above proposals:
The Minister for Finance, Paschal Donohoe, launched a public consultation on the Pillar One and Pillar Two proposals on the 20th of July, which will run to the 10th of September.
Cessation of Revenue concession on corporation tax filings
Revenue have ceased the concession on late filing surcharges and restriction on losses where the corporation tax return is filed late provided to tax payers for the accounting periods ending June 2019 to September 2020, which were due to be filed between 23 March 2020 and 23 June 2021. The concession will cease from 30 June 2021.
Further Covid Supports announced for businesses as the re-open
CRSS
Minister for Finance, Paschal Donohoe, has announced on the 30th of June 2021 that following the government's announcement that in-door dining will not return as planned, businesses who remain closed or significantly restricted under the public health restrictions may make a claim for additional CRSS support from 5th of July for two weeks. The Scheme will be amended to allow for a double week payment from the week commencing 5th of July for a period of two weeks' subject to the statutory cap of €5,000 per week.
BRSS
The Revenue Commissioners have released guidelines on the operation of the Business Resumption Support Scheme on the 7th of July 2021.
To avail of the relief, businesses will need to demonstrate a significant reduction in business activity during the period 1 September 2020 – 31 August 2021. Applications may be made between the 1st of September 2021 and the 30th of November 2021.
The relief is similar to the Covid Restriction Support Scheme and provides for a payment by Revenue in the form of an Advance Credit for Trading Expenses.
PUP
Minister for Social Protection, Heather Humphreys noted on the 29th of June 2021 that new applicants to the Pandemic Unemployment Payment would be extended to the 7th of July 2021 to reflect the government's announcement that indoor dining would not return on the 5thof July 2021 as originally envisaged.
EWSS
Revenue have confirmed in their press release on the 16th of July 2021 that the changes to the Employment Wage Subsidy Scheme as provided for in the Finance (Covid-19 and Miscellaneous Provisions) Bill 2021 will be operated on an administrative basis until such time as the bill is enacted. Revenue have also issued new guidance on the 9th of July 2021 with respect to EWSS eligibility from the 1st of July 2021 along with updating their main guidance notes.
The reference period for assessing the disruption that Covid-19 is having to the business i.e. the 30% reduction in turnover or customer orders, will alter for an employer seeking to claim the subsidy in Quarter 3 2021.
For employers currently claiming the subsidy and completing a month end review as at 30 June 2021, for entry in July 2021 or employers seeking to enter the scheme in July 2021, this will mean they will be required to compare turnover/customer orders for the full year 2021 against the full year 2019 in order to assess eligibility.
A new EWSS Eligibility Review Form will be required to be submitted to Revenue via ROS to ensure continued eligibility for the scheme. This Form will be available on ROS from the 21st of July 2021 and the Form must be submitted by the 30th of July with respect to the June 2021 month end EWSS eligibility review. Thereafter, this Form is required to be submitted on the 15th of every month in order to ensure that employers continue to qualify for EWSS, i.e. the form must be submitted on ROS by the 15th of August 2021 with respect to the July month end EWSS eligibility review.
Revenue have noted that the current EWSS subsidy rates will remain the same until the end of September 2021. It has also been confirmed that the 0.5% Employers PRSI rate will continue to apply for wages paid that are eligible for the EWSS payment. The scheme is legislated to remain in place until the 31st of December 2021; however, operational details for quarter 4 2021 will not be made available until September 2021.
Revenue Intervention considerations
Jim Kelly, Tax Director, discusses the proposed changes being introduced to Revenue Audit and Intervention practices, what this will mean for future Audits and Investigations and the importance of being prepared to mitigate against any potential penalties.
- The proposed new classification of Revenue Audits and Interventions due to come into effect in early 2022;
- Changes to the Code of Practice dealing with Revenue Audits and Interventions;
- How to stay prepared for Revenue Interventions particularly during Covid-19; and
- Particular areas of concern that businesses should be aware of.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
