This month’s tidbits cover an updated HMRC organisation chart and the latest fuel advisory rates. HM Revenue and Customs' organisation chart;  Advisory fuel rates;  Check genuine HMRC contact that uses more than one communication method;  Set up as a sole trader: step by step;  List of approved professional organisations and learned societies (List 3);  Disability, mental health and wellbeing at HM Revenue and Customs;  Compliance checks: Corresponding with HMRC electronically — CC/FS83;  Authorise a tax agent (64-8);  Apply for a refund of Class 2 National Insurance contributions (CA8480);  Updating your tax agent contact details with HMRC;  Register your limited company as a subcontractor or apply for gross payment status, or both;  Complaints from External Customers about the Conduct of HMRC staff Guidance;  Claim a refund of Income Tax deducted from savings and investments (R40);  Tell HMRC your company is dormant for Corporation Tax;  Named tax avoidance schemes, promoters, enablers, and suppliers;  Tell HMRC about your Employment Related Securities schemes;  Give temporary authorisation to allow HMRC to deal with your tax adviser (COMP1);  Claim to reduce payments on account;  Apply for a certificate confirming you will pay UK National Insurance when working temporarily abroad (CA3822);  Construction Industry Scheme: CIS 340;  Double Taxation Treaty Passport Scheme register;  Completing your Company Tax Return;  National Minimum Wage information for employers;  Tax-free savings newsletter 11; and  Employment Related Securities Bulletin 54 (February 2024). 

Effective dialogue between stakeholders enables informed and evidence-based policy-making. The Platform for Tax Good Governance was established in 2013 to bring together non-government and government stakeholders to tackle issues arising in the field of taxation, such as cross-border taxation, aggressive tax planning, double taxation, and double non-taxation. The Commission has decided to establish a new expert group to continue the work of the Platform for Tax Good Governance.

Revenue has updated the Tax and Duty Manual which provides guidance on the particulars to be supplied by new companies. The guidance has been updated in paragraph 1 to include information on the National Registrations Unit (formerly the National Companies Unit).

Section 124 SDCA 1999 provides for a charge to stamp duty on credit cards and charge cards. Revenue has updated the Stamp Duty Manual to provide further guidance on charge cards, specifically on company charge cards (paragraph 4.3).

Section 83DA SDCA 1999 provides for a full repayment of stamp duty paid on the acquisition of a residential property where, within 12 months of acquiring the property, the accountable person sells it to an eligible applicant within the meaning of the Affordable Housing Act 2021. Revenue has updated the Stamp Duty Manual which provides guidance on how to make a repayment claim under section 83DA SDCA 1999. The guidance has been updated to clarify that: Only those persons that are directly involved in the provision of affordable housing are eligible to claim a repayment under section 83DA Eligibility for a repayment will only arise if the sale of the property to an eligible applicant is charged to stamp duty under the CONVEYANCE or TRANSFER on sale head of charge. 

Section 837 TCA 1997 entitles a member of the clergy or a minister of any religious denomination to claim certain deductions against any profits, fees or emoluments arising from their profession. Revenue has updated the Tax and Duty Manual regarding the Representative Church Body Cost of Living Accommodation Allowance to include the allowance for 2023, with updated examples.

Revenue has updated the Tax and Duty Manual which provides guidance on the Rent-a-room Relief. Section 216A TCA 1997 exempts certain sums arising to an individual in respect of letting rooms, for residential purposes, and the provision of meals or other services in connection with the letting. The guidance, including relevant examples, has been updated to: Clarify when relief is not available between family members Detail how the Rent Tax Credit interacts with the rent-a-room relief (section 7.2) Confirm that the Mortgage Interest Tax Credit does not affect entitlement to rent-a-room relief (section 7.3).

Revenue has update the Tax and Duty Manual which provides guidance on the tax treatment of the reimbursement of expenses of travel and subsistence to office holders and employees, as follows: Guidance regarding the mandatory reporting by employers under Enhanced Reporting Requirements (ERR) as the payment of travel and subsistence expenses free of tax comes within the scope of the ERR (paragraph 1.4) Increased Civil Service subsistence rates applicable from 14 December 2023 (appendix 1).

Revenue has updated the Tax and Duty Manual regarding payments made without deduction of income tax to reflect the change in tax bands introduced by Finance (No. 2) Act 2023, with updated examples where relevant. The updated guidance also clarifies that re-grossing will apply by reference to the applicable income tax rate only, i.e., Universal Social Charge (USC) and PRSI will not be included for the purposes of calculating the re-grossed amount. Where an employer makes payments without the deduction of income tax which fall within the provisions of section 986A TCA 1997, the employer is liable to pay the amount of tax due in respect of the re-grossed amount of the payment.  Re-grossing applies where either there is total non-operation of PAYE in respect of emoluments to an employee or an employer disguises the payment of emoluments.

The Central Statistics Office has published the Quarterly National Accounts for the first quarter of 2024. Modified Domestic Demand (MDD), a broad measure of underlying domestic activity that covers personal, government, and investment spending, went up by 1.4 percent in Q1 2024. The globalised industry (excl. construction) sector contracted by 6.5 percent in Q1 2024 as compared with Q4 2023, reflecting the volatility of production in the multinational sectors. While there was a mixed picture for sectors focused on the domestic market, overall there was growth of 1.7 percent for the sectors combined. Commenting on the figures, Minister for Finance, Michael McGrath T.D., said: “While GDP was up in the first quarter, I recognise that GDP continued to fall on an annual basis at the start of this year. As is widely acknowledged, GDP is not a useful measure in assessing the living standards of domestic residents, given the outsized role the multinational sector plays in our economy. The annual decline reflects the volatile nature of multinational production, which can swing significantly from one quarter to another. In terms of the domestic economy, I am encouraged to see that Modified Domestic Demand – my preferred metric – grew strongly in the first quarter of this year. Importantly, consumer spending meaningfully contributed to this growth, increasing by 0.6 per cent over the quarter. Clearly this a reflection of the continued strength of the labour market, with almost three quarters of the working age population now in work. Additionally, the significant easing in inflation over recent months has come as welcome relief for households and businesses alike. The strength of investment by firms over the quarter has also been a positive development. This investment, primarily by the multinational sector, will boost the productive capacity in our economy and will bring with it increased employment and exports in the years ahead. I also expect housing supply to continue to grow solidly in the year ahead, with over 50,000 new units commenced in the twelve months to April 2024. Looking ahead, inflationary pressures are now returning to more normal levels and this should bring with it a boost to household real disposable incomes. As the year progresses, the increase in real incomes should further support growth in our domestic economy. That said, we are nevertheless living through a time fraught with uncertainty, geopolitical tensions and a changing economic landscape. Against this backdrop, Government remains committed to careful budgetary management. We will continue to strike the right balance, ensuring that spending is both sufficient and sustainable, meeting the needs of today without compromising the future needs of our people in the years to come.”

The Department of Finance and the Department of Public Expenditure, NDP Delivery and Reform have published the Fiscal Monitor for May 2024. This month’s report shows an increase in tax revenue to end-May of €1.2 billion (up 6.2 percent). The increase was driven by strong VAT receipts, up €0.4 billion (12.2 percent) on the same period last year. Income tax receipts increased by €0.9 billion (6.7 percent) when compared with the same period in 2023. Corporation tax receipts showed a recovery from the decline in quarter 1 and are now on a par with the same period last year. Commenting on the figures, the Minister for Finance, Michael McGrath T.D. said: “May is an important month for tax revenues in the exchequer calendar and the positive performance is a welcome indicator of the strength of our economy, most clearly reflected in the healthy growth in income tax and VAT revenues. With a record 2.71 million now at work in Ireland and incomes rising faster than the rate of inflation, living standards are improving again and consumer activity in our economy is being supported. Of course, the most notable feature of the May tax outturn is the spike in corporation tax receipts. As a result, overall corporate tax revenues have recovered after a sharp drop in the first quarter of the year and are now level with the same period last year. I would caution, however, that the significant volatility, in both directions, we have seen from month-to-month in this revenue stream is yet more evidence of the unreliability of these highly concentrated receipts, and the associated risks this brings to our public finances. The fact that we are highly dependent for a large portion of our corporate tax receipts on a very small number of companies requires a decisive policy response to ensure our public finances are sustainable into the future. We cannot necessarily rely on some of these receipts into the future. That is why the setting up of the Future Ireland Fund, and the Infrastructure, Climate and Nature Fund is a landmark and necessary policy development and one I am determined to deliver on. This vulnerability underscores the importance of continuing to pursue a balanced and sustainable budgetary policy. With this in mind, Government will set out the fiscal parameters for Budget 2025 in the Summer Economic Statement in the coming weeks.”

Last week Revenue published a detailed statistical report on the Debt Warehouse Scheme. Over 93 percent of the €3.2 billion debt warehoused at its peak in January 2022 has been either paid in full, secured under a phased payment arrangement (PPA) (or in the process of being secured), or is awaiting approval to offset the debt. In May, €100 million of warehoused debt was collected. At the time of writing, 12,747 businesses have agreed PPAs totalling almost €1.2 billion. Revenue will continue to monitor compliance with the terms of PPAs. All current returns and liabilities should be submitted and paid on time for businesses availing of PPAs to continue availing of the 0 percent interest rate. Where businesses encounter difficulties paying current taxes, they should engage with Revenue so that a mutually acceptable solution can be found. Demands were issued to 11,724 businesses with warehoused debt that had not engaged with Revenue by the 1 May 2024 deadline. Forty percent of those businesses have since engaged. With a total debt of €100 million, the remaining 7,024 businesses have been removed from the warehouse. This debt is now subject to normal collection and enforcement proceedings and is subject to interest at the standard rate of 8 – 10 percent as appropriate. Further information is available in Revenue’s press release. Commenting on the scheme, Minister McGrath stated: “I wish to acknowledge the work of the Collector General’s Division in Revenue and the success of the Tax Debt Warehousing scheme in supporting viable businesses and employments during an unprecedented and exceptionally difficult trading environment. Thanks to their efforts, the scheme successfully offered valuable and practical liquidity support to businesses by assisting with their cash-flow, thereby preventing business failure. I also wish to acknowledge the significant levels of engagement to date by taxpayers and their agents in agreeing realistic payment plans tailored to their particular circumstances. As a result of their engagement, the amount of warehoused tax debt has reduced by a substantial €284 million since January of this year. For those customers who have agreed PPAs, it is important to note that in order to retain the 0 per cent interest rate, it remains a key condition that current taxes are filed and paid as they fall due, and that all monthly payments are honoured as agreed. It is important to highlight that any taxpayer experiencing temporary cashflow difficulties which impact on their ability to meet their tax obligations on a timely basis should engage with Revenue at the earliest opportunity. Revenue will work with viable businesses in a fair and pragmatic way to agree mutually acceptable payment solutions. On a case-by-case basis this may include options such as a payment deferral or a payment break, rather than deploying debt collection and enforcement options.”