1. Budget - 2016
West Wicklow Business Network –
Wednesday 21 October 2015
MARTIN CRAUL & CO/ACAS CONSULTANCY
ASSURED EXPERTISE LOCALLY
Incorporated Public Accountants and Registered Auditors
2 Millbank, Blessington, County Wicklow. W91 W965
Telephone 045 891505 Fax 045 891507 E-mail mcraul@indigo.ie
Martin Craul AITI AIPA FAIA, dip. rural dev (UCD), dip. corporate law &
governance (Law Society)

2. Budget 2016 News
• Earned Income Tax Credit
• Home Carer Tax Credit
• Universal Social Charge Rate
Changes
• Home Renovation Incentive
Extension
• Employment & Investment
(EII) Changes
• Succession Farm Partnerships
• Agri-Tax Extensions
• LPT Valuation Delays
• Knowledge Development Box
• CT Start Up Extension
• Film Relief
• CGT Business Sale Relief
• CAT Category A change
• Relief for Micobreweries
• Cigarette Tax
• ATM Charge Changes
• Young Trained Farmer
Extension
• Commercial Motor Tax
• PRSI Tapered credit

3. Social Justice Ireland
• 375k people in constant
poverty
• 2015 – 1,400,000
experiencing deprivation
• 2008 – 614,000
experiencing deprivation
• One in six children/ one
in ten aged over 65 at risk
• Budget 2016 widens rich-
gap by €506 per year
• Minimum Wage 25%
below living wage €11.50
• While OAP increased by
€5 per week no Social
Protection increases for
those below poverty line
of €204.25 (Brian Harvey)

4. Income Tax Credits 2016
Credit Type
• Single Person Credit
• Married/Civil Partnership
• Employee Tax Credit
• Widowed Person/Civil P’ner
• Earned Income Tax Credit
• Earned Income Credit 2017?
• Earned Income Credit 2018?
Amount of Credit
• €1,650
• €3,300
• €1,650
• €2,190
• €550
• €1,100
• €1,650

5. Other Personal Tax Credits
Credit Type
• Incapacitated Child Credit
• Blind Person Individual
• Home Carer Credit 2015
• Home Carer Credit 2016
• H/C Income Threshold 2015
• H/C Income Threshold 2016
• Age Tax Credit
• Health Expenses
Amount of Credit
• €3,300
• €1,650
• €810
• €1,000
• €5,080
• €7,200
• €245/€490
• 20% Rate Allowed

6. EARNED INCOME T/C 2016
• COMPUTED AT 20% OF EARNED INCOME
• MAXIMUM TAX CREDIT €550
• INDIVIDUAL – PART TIME FIREMAN €7,000
• SELF EMPLOYED MECHANIC €25,000
• TAX CREDIT OF €1,400 ON THE JOB
• TAX CREDIT OF €250 FROM SELF EMPLOYED
• EITC + EMPLOYEE CREDIT NO MORE €1,650

7. UNIVERSAL SOCIAL CHARGE
2015
• Income to €12,012 – 1.50%
• Next €5,564 – 3.50%
• Next €52,468 – 7.00%
• Above €70,044 – 8.00%
• Non-Paye Earner – 3% extra
over €100,000 income
2016
• Income to €12,012 – 1.00%
• Next €6,656 – 3.00%
• Next €51,376 – 5.50%
• Above €70,044 – 8.00%
• Non-Paye Earner – 3% extra
over €100,000 income

8. Exempt/Reduced USC
2016
Individual not earning more
than €13,000
All Department of Social
Protection Payments
Income Already Subject to
Deposit Retention Tax
2015
Individual not earning more
than €12,012
Ditto
Ditto

9. THE TAX BANDS
Single/Widowed/Civil Partner
Surviving (No Child)
€33,800 @ lower 20% Rate
Remainder @ 40%
Single/Widowed/Civil Partner
Surviving (Qualifying Child)
€33,800 @ lower 20% Rate
Remainder @ 40%

10. THE TAX BANDS
Married/Civil P’ship One Income
€42,800 @ lower 20% Rate
Remainder @ 40%
Both with Incomes
€42,800 @ lower 20% Rate
€24,800 (max) @ 20%/Remainder
40%
Say main earner had €100k
and smaller earner had €15k,
€42,800 @ 20% + €15,000
@20%, remainer €42,200 @
40%

11. Earning €200,000/USC
Hospital Consultant at SVUH
Earning Salary
USC 1.00% Rate €120.12
USC 3% Rate €199.68
USC 5.50% €2,825.68
USC 8% €10,396.48
USC 3% S/C N/A
Effective USC 6.77%
Hospital Consultant at SVUH
Self Employed
USC 1.00% Rate €120.12
USC 3% Rate €199.68
USC 5.50% €2,825.68
USC 8% €10,396.48
USC 3% S/C €3,000.00
Effective USC 8.27%

12. MARGINAL RELIEF CLAIMS
• SELF EMPLOYED INCOME €125,000
• Married, spouse works at home
• Engages carer for mother-in-law, cost €55,000
• Will be relieved at higher rate 40%
• Worth €22,000 off tax

13. LOW INCOME EXEMPTION
Applies to Income Tax Only
Related to Age, being 65 or over – Tax
Exemption @ 65/Bus Pass @ 66
Single Person – Exempt on €18,000 of income
Married/Civil Partners – Exempt on €36,000
Child 1 - €575 extra/Child 2 - €575 extra
Child 3 - €380 extra/Child 4 - €380 and so on….
No Change in Budget 2016

14. MARRIED INCOME €50,000
Income, Tax, USC, PRSI
Case I €50,000
Basic Tax @20% €8,560.00
Marginal @ 40% €2,880.00
USC 1.5% Rate €180.18
USC 3.5% Rate €194.74
USC 7% Rate €2,269.68
USC 5.50%
USC 8%
USC 3% S/C
PRSI 4% €2,000.00
Summary - 2015
Case I €50,000
Tax, USC, PRSI €16,084.60
Married T/C €3,300.00
Earned Income T/C
Home Carer €810.00
Take Home €38,025.40
Effective Deduction 23.95%

15. MARRIED INCOME €50,000
Income, Tax, USC, PRSI
Case I €50,000
Basic Tax @20% €8,560.00
Marginal @ 40% €2,880.00
USC 1% Rate €120.12
USC 3% Rate €199.68
USC 5.50% €1,723.26
USC 8% €
USC 3% S/C €
PRSI 4% €2,000.00
Summary - 2016
Case I €50,000
Tax, USC, PRSI €15,483.06
Married T/C €3,300.00
Earned Income T/C €550.00
Home Carer €1,000.00
Take Home €39,366.94
Effective Deduction 21.27%

16. MARRIED INCOME €125,000
Income, Tax, USC, PRSI
Case I €125,000
Basic Tax @20% €8,560.00
Marginal @ 40% €32,880.00
USC 1.50% Rate €180.18
USC 3% Rate €194.74
USC 7% €3,672.76
USC 8% €4,396.48
USC 3% S/C €750.00
PRSI 4% €5,000.00
Summary - 2015
Case I €125,000
Tax, USC, PRSI €55.634.16
Married T/C €3,300.00
Earned Income T/C
Home Carer €810.00
Take Home €73,475.84
Effective Deduction 41.22%

17. Married income of €125,000
Income, Tax, USC, PRSI
Case I €125,000
Basic Tax @20% €8,560.00
Marginal @ 40% €32,880.00
USC 1% Rate €120.12
USC 3% Rate €199.68
USC 5.50% €2,825.68
USC 8% €4,396.48
USC 3% S/C €750.00
PRSI 4% €5,000.00
Summary - 2016
Case I €125,000
Tax, USC, PRSI €54,731.96
Married T/C €3,300.00
Earned Income T/C €550.00
Home Carer €1,000.00
Take Home €75,118.04
Effective Deduction 39.91%

18. Supporting Entrepreneurs
• CGT Relief
• CT –Three Year Start-Up
• R & D Tax Credit
• Micro Brewery Excise
• Frg Earnings Deduction
• EII (BES)
• SURE (Seed Capital)
• Home Renovations HRI
• Restricted Shares
• Share Based Pay PRSI
• Low Rate ER PRSI IRL
• Listed Shares transfer
• Vat cash receipts
• 9% Vat tourist related

19. Knowledge Development Box
A company which has engaged in Research
and Development in Ireland and which earns
profits from patents or copyrighted software
resulting from that R & D can avail of tax relief
under the K.D.B to be taxed effectively at
6.25%.
Company therefore may have 12.50% and 6.25%

20. Research and Development
Likely to Qualify
• Natural Sciences
• Engineering & Technology
• Medical
• Agricultural Sciences
• Maths, computer sciences,
software; physical/chemical
sciences; earth sciences;
biological
• Civil Engineering; Electrical;
systems analysis
• Basic Medicine; Clinical
Medicine; Health Sciences
• Agri, Fishery, Forestry,
Horticulture; Vet Medicine

21. Non Qualifying R & D
Exclusions
• Social Science Research
• Routine Testing Analysis
• Cosmetic Alterations Existing
• Corrective Breakdown Remedy
• Legal and Administrative
• Other activities
• Market Research
• Prospecting
• Commercial and Financial
• Admin and General Support
Specifically
• Economic , Business Mng, Arts
• Analysis Quality/Quantity Co
• Even where some
improvement
• During Commercial Production
• Application; Records; Litigation
• Not Wholly & Exclusively
• Markets tests; Surveys
• Looking for Minerals or Gas
• Marketing Commercial
• Transportation, Storage,
Cleaning

22. Research and Development
The Entity
• Must be a company
• Within charge to CT
• Qualifying R & D activities
• Deduction only in Ireland
Qualifying Activities
• Be systematic, investigative or
experimental
• In a field of science or
technology
• Involve either basic research;
applied research; or
experimental development
• Seek achieve scientific or tech
advancement
• Resolution of scientific or tech
uncertainty

23. CT START UP RELIEF
The Relief
• Companies Incorporated
ager 14 October 2008
• Applies to CT and CGT in
first three years trading
• Exempting Tax Payable up to
€40,000 per year
• Linked to Employment
Creation
• Applies to New Trades Only
Applies to most activities but:
• Professional Services
Companies
• Land Dealing
• Petroleum, coal or minerals
• Acqaculture or agriculture
• Road Freight or Export
Activities

24. TAX RELIEF START UP COMPANIES
Section 486C TCA 1997 Rules
• Company Incorporated on
or after 14 October 2008
• Set-up and commence a
qualifying trade between 1
September 2009 and (now)
31 December 2016, and
• Have Corporation Tax
Liabilities which do not
exceed the specified levels
• Since FA 2013 no longer on
“use it or lose it” basis
The Details
• Not an succession to trade
already set up
• Activities not previously
carried on
• Not available
dealing/developing/oils
• Professional Service
Companies not eligible
• Watch associated
operations

25. Minimum Relief Start Up
Profits 31/12/16 €160,000
• Employee 1 €18,605/ER
PRSI €2,000
• Employee 2 €18,605/ER
PRSI €2,000
• Employee 3 €102,500/ER
PRSI €6,000
PRSI Restriction and Caps
• Normal CT Bill €20,000
• Employer PRSI, €2,000 +
€2,000 + €6,000 = €11,000
• Qualifying PRSI paid in the
accounting period €2,000 +
€2,000 + €5,000 (capped) =
€9,000
• Relief Available €9,000
• CT Payable €11,000

26. CT START UP – PRSI AHEAD OF CT
The Payroll Analysis
• Worker 1 €37,209/PRSI €4,000
• Worker 2 €37,209/PRSI €4,000
• Worker 3 €46,500/PRSI €5,000
• Worker 4 €37,209/PRSI €4,000
• Worker 5 €37,209/PRSI €4,000
• Worker 6 – On Jobs Incentive
• Worker 7 €18,605/PRSI €2,000
• Worker 8 €18,605/PRSI €2,000
• Qualifying PRSI €25,000
Profits 31/12/16 €160,000
• Normal CT Bill €20,000
• Qualifying PRSI (ER) €25,000
• Relief S486C €20,000
• CT Payable €Nil
• Maximum Relief Granted

27. Statement from Brendan Howlin T.D.
From now on children will be eligible for free childcare from three years of age
up until they are five and a half, or until they start primary school. According to
James Reilly, Minister for Children “from now on” means 1 September 2016.