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MAIN
PERSONAL TAX CREDITS
|
| |
| |
2007
€
|
2008
€ |
| Personal
Tax Credit |
|
|
| Single
Person |
1,760 |
1,830 |
| Married
Couple/Single Parent |
3,520
|
3,660 |
| Widow(er)
with dependent child
after 1st
year of bereavement (1) |
3,750
|
4,000 |
| Additional Widow(er) |
550
|
600 |
| Employee
(PAYE) (2) |
1,760
|
1,830 |
| Incapacitated
Child |
3,000 |
3,660 |
| |
|
|
| (1)
Additional credits due for
Widow(er) with dependent children
for first 5 years after
bereavement |
|
|
| (2)
Not available to proprietory
Directors and the self employed |
|
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| |
|
| Age
Credit |
|
|
| Single/Widowed
Person |
275
|
325 |
| Married |
550
|
650 |
|
|
|
|
| Blind
Persons Credit |
|
|
| Married
(both spouses blind) |
3,520
|
3,660 |
| Single
or married (one spouse blind) |
1,760
|
1,830 |
| |
|
|
| Home
Loans – Standard Rate |
|
|
| *First-Time
Buyer |
|
|
| Single
Max |
1,600
|
2,000 |
| Married
Max |
3,200
|
4,000 |
| Widow(er)
Max |
3,200
|
4,000 |
| *
Now available for 7 years,
previously 5 years |
|
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| |
|
|
| Non-First
Time Buyer |
|
|
| Single
Max |
600
|
600 |
| Married
Max |
1,200
|
1,200 |
| Widow(er)
Max |
1,200
|
1,200 |
| |
|
|
| Rent
Relief |
|
|
| Under
55 - Single |
360 |
400 |
| Under
55 - Married/Widow(er) |
720 |
800 |
| Over
55 - Single |
720 |
800 |
| Over
55 - Married/Widow(er) |
1,440 |
1,600 |
| |
|
|
| One
income Family Credit |
|
|
| Spouse
caring for children, the aged or
handicapped |
770
|
900 |
| |
|
|
|
Tax Credit on Trade Union
Subscriptions |
60 |
70 |
| Dependent
Relative |
80 |
80 |
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|
INCOME
TAX RATES |
Return
to top |
| |
|
|
|
Single & Widowed Persons: No
Dependent Children |
2007
€ |
2008
€ |
| 20%
on first |
34,000 |
35,400 |
| 41%
on balance |
|
|
| |
|
|
| Single
& Widowed Persons: Dependent
Children |
|
|
| 20%
on first |
38,000 |
39,400 |
| 41%
on balance |
|
|
| |
|
|
| Married
Couples: One Income |
|
|
| 20%
on first |
43,000 |
44,400 |
| 41%
on balance |
|
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| |
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| Married
Couples: Two Incomes* |
|
|
| 20%
on first |
68,00 |
70,800 |
| 41%
on balance |
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| |
|
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| *
Excess over € 44,400 non
transferable between spouses |
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| |
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|
| Tax
Allowance |
|
|
| Cost
of employing carer for
incapacitated individual allowed
at marginal rate of tax |
50,000 |
50,000 |
|
Rent-a-Room Relief
(private
residence) |
7,620 |
10,000 |
|
Film Investment |
25,400 |
25,400 |
|
BES
Scheme (Business Expansion Scheme)
(max relief) |
150,000 |
150,000 |
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|
BENEFIT-IN-KIND
|
Return
to top |
| |
Cars
Cash equivalent – 30% of original market
value. BIK is calculated on 30% of the open
market value of the car with a deduction for
amounts borne by the employee in respect of the
car costs.
The percentage which is now applied to the open market value of the company car will be determined based only on business mileage as follows:
|
| Business
Mileage |
%
of OMV |
| |
|
| 15,000
or less |
30.0% |
| |
|
| 15,001-20,000 |
24.0% |
| |
|
| 20,001-25,000 |
18.0% |
| |
|
| 25,001-30,000 |
12.0% |
| |
|
| Over
30,000 |
6% |
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|
Private
Use of Employer Van
The charge to
BIK for the private use of an employer’s van
is calculated at 5% of the ‘original market
value’ of the van with effect from 1 January
2004. |
| |
|
| Preferential
Loans |
|
| |
|
| Specified rate for home loans |
5.3% |
| Specified rate for other loans |
13% |
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|
From
1 January 2004 employers are obliged to
operate PAYE on non cash benefits provided to
employees. These benefits are also liable to
PRSI and Health Levy.
The
main areas of benefit involved are as follows:
• Company
cars.
• Company
loans.
• Tax paid
vouchers.
• Expense
payments on behalf of employees/directors.
Small
Benefits in Kind
An employer can
provide an employee with a small benefit to a
value not exceeding €250 without applying
PAYE and PRSI to that benefit.
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PRSI |
Return
to top |
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Contribution
Rate
|
Earnings
Ceiling 2008 €
|
Earnings
Ceiling 2007 €
|
| Social
Insurance |
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Employer
|
Class
A1 |
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|
| Employer Contribution (including training fund
levy) |
10.75%
(1)
|
No
Ceiling
|
No
Ceiling
|
Employee
Earning
over € 356 per week or
equivalent) |
Class A1 |
|
|
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| PRSI
(First
€127 of weekly earnings
exempt)
|
4%
|
50,700
|
48,800
|
| Health
Contribution |
2%
(2)(4)
|
No
Ceiling
|
No
Ceiling
|
| Total
for Employee |
6%
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|
As from 1 January 2008, the
employee weekly threshold for liability to PRSI
will increase from €339 to €352. |
| |
|
Self
Employed Contributions |
|
|
|
| PRSI |
3%(3)
|
No
Ceiling
|
No
Ceiling |
| Health
Contribution |
2%
(2)(4)
|
No
Ceiling
|
No
Ceiling |
| Total |
5%
|
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| |
(1) 8.5% where weekly earnings are less than
€356
(2) Does not apply where aggregate earnings
are less than €500 per week
(3) Rate
increases to 2.5% for earners where income
exceeds €1,925 per week.
(4) 3% subject to minimum payment of €254 |
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CORPORATION
TAX |
Return
to top |
| |
|
| Standard
Rate on Trading Income* |
12.5%
from 1 January 2003 |
| Investment/Rental
Income |
25% |
| Manufacturing
Rate |
10%
(only for established qualifying
companies) |
| *Special
rates apply to dealings in land |
|
The payment date for preliminary tax,
which must be at least 90% of the final
liability, has been brought forward, to one month before the end of the accounting
period. Preliminary tax is based on the
current year’s liability. However, small
companies can base the preliminary tax payment
on the previous year’s liability.
A small
company is a company with a Corporation Tax
liability of less than €200,000 in the
preceding year. The first instalment is
due one month before the end of the accounting
period as follows:
|
| Accounting
Periods Ending on or after |
%
of current liability |
%
of previous year's liability
(Small Company)* |
| 1
January 2007 and after |
90 |
100 |
The final
balance of tax (10%) is payable
nine months after the end of the
accounting period.
*With
effect from 6 December 2006 a small company is a
company with a corporation tax liability of less
than €150,000 in the preceding year.
New or start up companies with a corporation tax
liability of less than €200,000 in their first
accounting period will not be required to pay
preliminary corporation tax. The liability is
paid when the return is filed. |
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CAPITAL
GAINS TAX |
Return
to top |
|
| Per
Individual |
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| |
|
| Annual
exemption |
€1,270 |
| |
|
| Rate |
20% |
| |
|
| Retirement
Relief exemption limit |
€750,000 |
| The
due date for payments of Capital Gains Tax for
disposals of 1 January and 30 September
is 31 October in the same tax year. Where the
disposal is between 1 October and 31 December
the due date for payment is 31 January in the
following tax year. |
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CAPITAL
ALLOWANCES |
Return
to top |
| |
| |
Motor
Vehicles(1) |
Plant
& Machinery(1) |
Industrial
Buildings |
Hotels(2)
|
| |
Year
1 – 8 |
Year
1 - 8 |
|
|
| Writing
Down Allowance |
12.5
% per annum |
12.5
% per annum |
4%
per annum |
4%
p.a
|
Note 1
These allowances apply to
expenditure incurred on or after
4 December 2002, except where a
written contract is in place
before that date and the
expenditure is incurred by 31
January 2003.
Note 2
The special regime of capital
allowances of 15% per annum over 7 years was
terminated as and from 4 December 2002.
Transitional provisions provide for the
continued availability of the special regime
where an application for planning permission
in respect of building work has been made to
the local authority on or before 31 December
2004 and the expenditure is incurred by 31
July 2006.
|
| |
| Motor
Vehicles |
| Maximum
allowable capital cost for new
and second hand private cars, purchased on or
after 1 January, 2007, is €24,000. |
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RESEARCH & DEVELOPMENT |
Return
to top |
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|
A credit of up to 20% of a
company’s expenditure on qualifying research
and development activity can be offset
against a company’s corporation tax
liability.
The method of calculating the
relief is an incremental one using a base
year to determine the level of incremental
expenditure.
The base year is fixed at
2003.
The Budget extends the scheme
for a further 4 years to 2013.
Partial relief is also
available to companies for the cost of
sub-contracting research and development work
to unconnected parties.
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PENSIONS
|
Return
to top |
| |
| Contribution
level deductible for tax purposes
as follows: |
|
| Age
|
% |
| Up
to 30 |
15 |
| 30
to 39 |
20 |
| 40
to 49 |
25 |
| 50
and Over |
30 |
| 60
and Over |
40 |
30% also applies to individuals
with limited earnings span e.g.
athletes, entertainers.
|
|
There is a cap of €254,000
per annum on the amount of earnings on which
tax relief may be obtained for contributions
by individuals to Retirement Annuity Contracts
and Personal
Retirement Savings Account.
This cap also applies for employee
contributions to occupational pensions
schemes. The contribution level limits will be
adjusted annually from the tax year 2007 in
line with an earnings index.
There is a cap on the
allowable pension fund limit of €5m or, if
higher, the value of the fund on the 7
December 2005. Both sums will be adjusted
annually from the tax year 2007 in line with
an earnings index. |
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VAT |
>Return
to top |
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| VAT
Registration Thresholds: |
|
€ |
|
Supply
of taxable goods in Ireland.(1) (90%
of turnover must be from the sale
goods for this threshold to
apply)
|
|
€75,000 ( €70,000 up to 1 May
2008) |
|
Provision
of taxable services in Ireland
(1) |
|
€37,500 ( €35,500 up to 1 May
2008) |
Note
1.
These thresholds do not apply
to traders established outside
Ireland who must register
irrespective of turnover.
Note 2.
A registration threshold of
€41,000 also applies to
certain persons acquiring goods
in Ireland from other EU member
states (other than new means of
transport or goods subject to a
duty of excise).
Note 3.
A registration threshold of
€ 35,000 applies in relation
to "Distance Selling"
– i.e. persons supplying
certain goods to
non-taxable persons in Ireland
from other EU member
states.
Note 4.
A registration threshold of €nil
also applies to certain persons acquiring
certain services in Ireland from abroad.
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| VAT
rates: |
|
|
21%
|
This
standard rate applies to all
supplies not chargeable at other
rates.
|
Examples
- Cars, Petrol / Diesel,
Telephone services, soft drinks
and alcohol, computers and
software, consultancy services. |
13½%
|
With
effect from 1st January 2003 |
Heating fuel, electricity,
restaurant services, newspapers, hotel and B&B
lettings, property and Child Car Seats (with
effect from 1 May 2007, please see below) |
0%
|
|
Examples
- Exports, certain food and
drink, oral human medicine,
books, children's clothing and
footwear. |
| 5.2% |
|
Examples
- Livestock, live greyhounds ,
hire of horses and the "Flat
Rate Addition" . |
| VAT
Exempt Services |
|
Examples
- Financial, insurance,
educational, training, medical,
optical, and dental and passenger
transport services. |
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GIFT/INHERITANCE
TAX |
Return
to top |
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| |
2008€ |
2007
€ |
| |
|
|
| Threshold
amount |
Nil |
Nil |
| Excess |
20%
for gifts and inheritances
|
20%
for gifts and inheritances
|
| Thresholds |
|
|
| Parents
to child or minor child of a
deceased child/Child to parent* |
€496,824** |
€478,155** |
| Blood
relative |
€49,682** |
€47,815** |
| Others |
€24,841** |
€23,908** |
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|
*
Applies only to inheritances
taken on the date of death.
** Threshold amount for 2008 will
be increased in line with
inflation. The relevant details
will not be available from January 2008. |
| No
gift/inheritance tax is payable
between spouses.
Annual
gift exemption €3,000
per
individual. The base
date for aggregation is 5 December 1991.
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|
&n | | | |
