The following is a list of tax items that should be considered before the end of the year. With the budget now being held on the 15th October any person considering buying, selling or transferring a business should contact their tax advisor as soon as possible.
7 year CGT exemption ending on 31 December 2013
If you buy a property before 31 December 2013 and sell in 7 years time then you will pay no Capital Gains Tax on the gain in value. This is particularly attractive considering many economists believe we have already hit the bottom in terms of property values.
Retirement relief being restricted for persons over the age of 65 from 1 January 2014
When a person sells a business and are over the age of 55 they can claim relief from Capital Gains Tax on a portion of the proceeds. This is known as Retirement relief. This relief is restricted to €750,000 when selling to an unconnected person. There is no restriction if transferring the business to your son/daughter.
From 1 January 2014 the €750,000 restriction will be reduced to €500,000 for people over the age of 65 and a new €3 million restriction will apply for people over the age of 65 who are transferring their business to a child.
Budget 2014 is on Tuesday the 15th of October
There could be further changes to Capital Gains Tax and Capital Acquisitions Tax reliefs along with other taxes. Tax relief on pension payments potentially could be hit.
From 1 January 2014 all unearned income (includes rental income) will be subject to PRSI for everybody.
Up to now PRSI was only payable on unearned income by self-employed individuals.
The NPPR charge will cease from 1 January 2014
CGT Payment Dates
If you dispose of a chargeable asset between 1 January 2013 and 30 November 2013 then you are obliged to pay any Capital Gains Tax by 15 December 2013.
If you dispose of a chargeable asset in December 2013 you are obliged to pay any Capital Gains Tax on or before 31 January 2014
Contact the Tax team at Quintas on 021 4641400 and they will be delighted to assist you with your taxation queries.