Id be intetested to see if the above is correct, and peoples experience, and the surcharge of
Professional services surcharge of 15% on 50% of my undistributed income (as I have a closed company) of 0.15*0.5*(1-.125) =6.56%.
Does that matter what type of company it is, i.e consulting, and then is there a lifetime restriction on the max relief on the CGT and is there a chance this could be closed off by Govts in the future, is it a risk?
Ok, I can see it was announced the limit was reduced from £10m to £1m in the UK's 2020 budget effective last March. Thanks for the info Gordon.The UK limit is no longer £10m, it’s €1m.
And, to be blunt, back when the UK limit was £10m I asked Pascal Donohue about the prospect of the Irish limit being increased and his response was that “entrepreneurs are doing fine”.
On that basis, I’d say the relief is more likely to be abolished than it is to be increased.
My accountant's view was that the Revenue are trying to exclude investment companies i.e. those whose primary source of income was from investments. They thought that if I invested any funds retained in the company (in a brokerage for example) but sold them before the liquidation event that it would not contravene the rules, and technically the relief is self-assessed.One thing that concerns me is the restriction:
Surely the €73k retained in a bank account is an investment?
- Relief does not apply to any assets held as investment.
Brendan
Kinda puzzled by this statement. No piece of paper is going to automatically confer a tax relief that otherwise mightn't be available. Always treat optimistic advice with extreme suspicion.... if your Accountant put it in writing then it's a viable option....
Bless. No professional advisor is going to underwrite any such guarantee.really tax advice should be received whether from an accountant or advisor so if revenue challenge and win you have someone to go after.
Begrudgery.Slightly off topic but what is the logic in professional services attracting a surcharge?
To stop doctors and similar professions incorporating to manage their tax outside of PAYE, thus reducing their tax payment.Slightly off topic but what is the logic in professional services attracting a surcharge?
It also seems an unusual approach to define a profession to pay more? Usually people are isolated for reduced rates/suppoorts, and people doing well are managed under progressive income tax?
Progressive tax is hard to manage for individuals who don't put their income through PAYE. The surcharge specifically taxes profits from being retained in companies from year to year for the purpose of reducing tax payments.Surely that should be managed as a progressive sort of tax then not picking out random professions with a wide earnings spectrum. I know a profession isn't a protected characteristic but nevertheless...
The irony is that an incorporated property developer can make millions in developing a site and will pay 12.5% on profits without any surcharge. An incorporated builder who builds on the site can likewise make millions on the project and likewise pay 12.5% without any surcharge. Meanwhile any incorporated engineers, accountants and solicitors who variously provide services to the development and construction projects will make only a tiny fraction of the above sums yet will be stiffed with a surcharge.Progressive tax is hard to manage for individuals who don't put their income through PAYE. The surcharge specifically taxes profits from being retained in companies from year to year for the purpose of reducing tax payments.
It doesn't even do that. The surcharge is payable only when the profits are earned. Those profits can sit in the company forever without further surcharge.The surcharge specifically taxes profits from being retained in companies from year to year for the purpose of reducing tax payments.
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