On 17th July 2019, the U.S. Senate approved the 2019 Protocol to amend the Switzerland USA Double Taxation Agreement.
Formally, the protocol will enter into force on the date the instruments of ratification are exchanged.
The core element of the protocol of amendment is the exchange of information.
The protocol provides for the following changes:
This milestone in the Switzerland and USA tax relationship is likely to make Switzerland far more appealing to U.S. multinationals.
If you have recently moved to the UK and intend selling your home in Ireland, please be aware that even if you qualify for Principal Private Residence Relief under Section 604 TCA 1997 in Ireland you may not qualify for UK Private Residence Relief.
This article is aimed at individuals who have become UK resident and who are in the process of selling their Irish principal private residence.
In general, you do not pay Capital Gains Tax when you sell or ‘dispose of’ your home if all the following conditions apply:
If all the above conditions apply you will automatically get a tax relief called Private Residence Relief.
Your period of ownership begins on the date you first acquired the dwelling house or on 31st March 1982 if that is the later date. It ends when you dispose of or sell the property.
The final 18 months of your period of ownership will always qualify for Private Residence Relief regardless of how you use the property during that time but providing the property has been your only or main residence at some point.
The following periods of absence are treated as periods of occupation for the purposes of calculating Private Residence Relief:
In order for these periods of absence to qualify as “deemed occupation” there must be a time both before and after the absence when the dwelling house is the individual’s sole or main residence. It is important to keep in mind that absences due to the conditions of an employment will qualify for the Relief even if the individual does not return to the dwelling house afterwards provided the reason for not their returning is due to their contract of employment requiring them to live somewhere else.
Any period of absence which requires the individual to live in job/work related accommodation will qualify for Private Residence Relief if there is an intention to occupy the dwelling as a main residence at some point.
HMRC will, by concession, allow a period of up to one year before the individual begins to occupy the property as his/her principal private residence to be treated as a period of occupation provided the property is then occupied as his/her only or main residence. In exceptional cases, HMRC may extend this period to two years.
From April 2015, the PRR rules were amended so that a property may only be treated as an individual’s main or sole residence for a tax year where that person or his/her spouse/legally registered partner has either:
(a) been tax resident in the same country as the property for the tax year in question (For further information on residence rules please follows this link: https://www.gov.uk/government/publications/residence-domicile-and-remittance-basis-rules-uk-tax-liability/guidance-note-for-residence-domicile-and-the-remittance-basis-rdr1) or
(b) has stayed overnight in the property at least 90 times in that UK tax year. Time spent in another property owned in the same jurisdiction/country can also be included in the ninety day count so that the total number of days in all properties in the territory in question are added together.
The new rules apply equally to a UK resident individual disposing of an overseas home as well as to a non-UK resident disposing of a home in the United Kingdom.
Finally, Lettings Relief may be available in circumstances where Principal Residence Relief is restricted because all or part of a property has been rented out.
This Relief is particularly important for individuals who, due to the current economic climate, experience difficulty selling their former home and, as a result, find they need to rent it out while they’re trying to sell it.
A maximum gain of £40,000 per owner is exempt from Capital Gains Tax provided that property has at some time been the main or only residence of the owner.
From 6th April 2020 there will be a change to this Relief whereby Lettings Relief will only be available in situations where the owner shares occupancy with the tenant.
Traders (including farmers), professionals and other persons carrying on a business, as well as non-trading or non-profit making organisations and bodies of persons (including charitable organisations and statutory bodies) are required to file Forms 46G annually containing details of payments made by them to third parties for services provided.
For individuals / persons (other than companies) the return should include payments made
The Form 46G must be filed on or before 31st October of the following year.
For companies, the Form 46G should cover all relevant payments in an accounting period and be submitted no later than 9 months following the end of the relevant accounting period.
A non-compliant taxpayer (i.e. where a taxpayer fails to deliver a true and correct return) may be liable to a penalty of €3,000. In addition to which a tax clearance certificate may not be granted and tax refunds may be withheld.
Details of payments must be returned where the total amount paid to one individual or company in the year exceeds €6,000.
Relevant payments include:
Revenue provides a list of services that must be specifically disclosed. This list should be reviewed prior to filing a Form 46G on an annual basis.
The following categories of services were recently added:
Certain payments are not required to be disclosed such as:
For further details, please follow the link:
If the answer is “yes” then you should begin preparing your ‘EVR’ refund claim.
As you’re aware, if you are an Irish VAT registered business who has incurred VAT in another E.U. state, you can’t reclaim this VAT in your Irish VAT 3 Form. Instead, you must submit an online claim through the Electronic VAT Refund (EVR) service.
This EVR claim is made via the tax authorities’ portal in the trader’s own country. In other words, an Irish VAT registered business must submit its application to the Irish Revenue Authorities via ROS.
It is the responsibility of the Irish Revenue Authorities to then forward the EVR claim to the E.U. state in question to process the refund.
The EVR application must include the following:
The EVR application must be filed on or before 30th September 2019 in relation to VAT incurred between 1st January and 31st December 2018.
The refund payment will be made by electronic funds transfer (EFT) to the bank details provided in the claim.
A maximum of five applications can be made via the EVR in a calendar year. The refund period can’t be greater than one calendar year (i.e. 1st January to 31st December) and it can’t be less than three calendar months except in circumstances where the application is in relation to the last quarter of the year.
It is not possible to amend a claim to increase a VAT refund.
Please be aware that EVR reclaims are governed by the VAT recovery rules of the E.U. member state to which the claim relates. In other words, if you are an Irish VAT registered business making an EVR reclaim in, say, France then you must comply with the French VAT rules and not the Irish rules.
If, however, you are registered or have an obligation to register for VAT in a particular EU member state then, any reclaim of VAT incurred there must be made directly to the tax authorities of that particular E.U. jurisdiction.
For further information, please click on to the link: