Frequently Asked Questions

It may be in your best interest to hire an accountant if:

• • You have income arising from different sources.

or

• • You have capital gains from investments or from the sale of assets.

You may need an accountant if you're starting your business and do not have any experience with tax and finance issues. An accountant is an expert in this area and can advise you on the best practice for your business.

An accountant can help you with a number of decisions to be made about your business such as:

• • What type of entity and ownership structure to have when you first get started.
• • Design and set up your accounting system so that your year-end financial reporting will be easier.
• • Ensure that you pay the correct types of taxes in the correct amounts.
• • Advise you on deductions and how to separate your personal and business expenses.
• • Advise and guide you through a Revenue audit if you ever have one.
• • Advise you on specific transactions, such as whether it's better to lease or buy.
• • Compile your financial records for the past period.
• • Help you understand your financial statements. You should use your accountant's expertise to help you analyse your financial statements so you can understand what he or she is telling you. If you neglect to do this, you won't know as much as you should about how your company is doing.
• • You need an accountant to assist on things like whether it is necessary to register for VAT or PAYE and the procedures involved.
• • Help with budgeting and forecasting cashflow as well as credit control and just general financial advice.
• • They can offer you up-to-date information on any general or legal enquiries you may encounter as the business grows.

The cost of our services depends on the amount of time spent each year working for the client. We are more than happy to meet with you for a free initial consultation to discuss your circumstances and give a guide to fees expected depending on the range of work.

Changing accountants is an easy process. We can write out to your current or previous accountant seeking professional clearance or you can advise you previous accountant that you are moving to our firm. The outgoing accountant is obliged to pass on any information we require once professional clearance is given.

All new clients need to provide photographic ID and proof of address; we are obliged to take a copy of these for anti-money laundering purposes. Upon request we can provide you with a general check list of information we may need to file your return. This check list is not exhaustible and will be tailored to suit your individual requirements.

An individual who is resident, ordinarily resident and domiciled in the State is liable to income tax in respect of his/her total income wherever arising. He/she is entitled, however, to claim certain Tax Credits and deductions. An individual who is not resident in the State is normally liable to income tax in respect of income arising to him/her in the State. A partnership as such is not chargeable to income tax. Each partner is chargeable individually to the tax referable to his/her share of the partnership income. Income tax is normally chargeable on the entire income of an unincorporated body at the standard rate. Non-resident companies are liable to income tax in respect of any income arising in the State which is not charged to corporation tax.

You may be exempt from paying Income Tax subject to certain conditions of profits or income. The principal exemptions are as follows:

• • Incomes below certain thresholds.
• • Income derived from certain leasing of farm land.
• • Certain earnings of writers, composers and artists.
• • Interest on Savings Certificates, Savings Bonds and Instalments Savings Schemes, subject to certain upper limits on holdings.
• • The discount on certain non-interest-bearing Government securities, and the premium on certain others.
• • Investment income arising from the investment of compensation payments made by the Courts, or under an out-of-court settlement, in respect of personal injury claims where the individual is permanently and totally incapacitated from maintaining himself/herself as a result of the injury.

It is recommended by the Revenue Commissioners that you seek professional advice when making this decision. We can help you make this choice, taking into account your own individual circumstances. There are various things you will need to take into consideration when making this evaluation such as taxation issues, along with practical and legal matters.

You must register for Value Added Tax (VAT) if your annual turnover exceeds or is likely to exceed the following annual limits: €75,000 in respect of the supply of goods or €37,500 in respect of the supply of services.

Audit exemption is set out in Chapter 15 of Part 6 Companies Act 2014. There are now a number of different company types that can qualify for audit exemption subject to the qualifying criteria. The following companies may qualify for this exemption:

• 1. Company Limited by Shares
  2. Designated Activity Companies
  3. Guarantee Companies
  4. Group Companies
  5. Dormant Companies within a group

Qualifying Criteria for Audit Exemption: Company Limited By Shares and   Designated Activity Companies:

• Under the new Act to qualify for audit exemption, the company must qualify as a small company.

Qualification as a Small sized company The qualifications have changed in the new Companies Act 2014. To qualify as a small company and avail of this exemption, a company must satisfy TWO or more of the following conditions in the current financial year and in the preceding financial year (unless it is its first financial year)(s.350(2), (3) & (5) Companies Act 2014):

• Balance sheet total does not exceed €4.4m
• Turnover does not exceed €8.8m
• Number of employees does not exceed 50
• The company’s annual return form B1 for the year in question and the preceding year must be filed on time.

• No notice has not been served on the company, stating an audit is required, by members holding at least one-tenth of the voting rights in the company.

• The company must not fall within certain categories of company as set out in section 362 and Schedule 5 of the Companies Act To check if your company falls into these categories please click here

http://www.irishstatutebook.ie/2014/en/act/pub/0038/sec0362.html#sec362

http://www.irishstatutebook.ie/2014/en/act/pub/0038/sched5.html

Guarantee Companies: Companies Limited by Guarantee can now avail of audit exemption subject to the following criteria:

• Under the new Act to qualify for audit exemption, the company must qualify as a small company.

Qualification as a Small sized company The qualifications have changed in the new Companies Act 2014. To qualify as a small company and avail of this exemption, a company must satisfy TWO or more of the following conditions in the current financial year and in the preceding financial year (unless it is its first financial year)(s.350(2), (3) & (5) Companies Act 2014):

• Balance sheet total does not exceed €4.4m
• Turnover does not exceed€8.8m
• Number of employees does not exceed 50

• The company’s annual return form B1 for the year in question and the preceding year must be filed on time.

• If one member of a Company Limited by Guarantee requests that the company not avail itself of audit exemption and serve notice in writing to this effect on the company in the financial year immediately preceding the financial year concerned or during the financial year concerned but not later than one month before the end of that year, the company must have an audit. (s.334, CA 2014).

 

• The company must not fall within certain categories of company as set out in section 362 and Schedule 5 of the Companies Act 2014. To check if your company falls into these categories please click here

http://www.irishstatutebook.ie/2014/en/act/pub/0038/sec0362.html#sec362

http://www.irishstatutebook.ie/2014/en/act/pub/0038/sched5.html

• Charities falling under the Companies Limited by Guarantee Category can also claim audit exemption subject to criteria (a) to (d), however if their annual turnover exceeds €100,000 they must be audited.

• Charities with charitable tax exemption may still be required to have an audit by the charities regulator. Eg if the charity is in receipt of state funds then it may be necessary to have the accounts audited.

  Group Companies:

• Audit Exemption applies to any group company if the group as a whole qualifies as a small group. The entire group and all its subsidiary undertakings must, when taken as a whole, satisfy 2 of the following 3 conditions in order to qualify as a small group:
• The balance sheet total, in relation to the holding company and the other members of the group taken as a whole does not exceed €4.4 million.
• The amount of turnover of the holding company and the other members of the Group taken as whole does not exceed €8.8 million.
• The average numbers of persons employed by the holding company and the other members of the group taken as a whole does not exceed 50.

The above conditions must be met in the year (the conditions must also be met in the preceding year unless it is the holding company’s first financial year.) (s359 (5) CA2014).

• The company’s annual return, to which Financial Statements are attached, must be filed correctly and on time for the year in question and the previous year (s.364 CA2014). This applies to all of the companies in the group, not just the company applying for the audit exemption.

 

• A group or any individual member of that group cannot claim audit exemption, where notice has been served on the holding company or any of the subsidiary companies in that group, stating an audit is required, by members holding at least one-tenth of the voting rights.

 

• The company must not fall within certain categories of company as set out in section 362 and Schedule 5 of the Companies Act 2014. To check if your company falls into these categories please click here

http://www.irishstatutebook.ie/2014/en/act/pub/0038/sec0362.html#sec362

http://www.irishstatutebook.ie/2014/en/act/pub/0038/sched5.html

  Dormant Companies within a group Where a company is part of a group, and that group does not qualify as a small group, the “dormant” company within that group can still apply for audit exemption in the following circumstances: The directors of the company must hold a meeting with recorded minutes, and form the opinion that the company will satisfy the following conditions:

• The company had no significant accounting transaction in that year.

Transactions specifically excluded from being a significant accounting transaction are:

• A CRO fee to change the company name.
• A CRO fee to re-register the company.
• A CRO annual return filing fee.

• The company’s assets and liabilities comprise only permitted assets and liabilities.

Permitted assets and liabilities are investments in shares and amounts due to or from other group undertakings.

• The company cannot hold any fixed assets eg property
• The company cannot have a bank account.
• The company cannot have a tax liability.
• The company cannot have any non group contingent asset or liabilities.

 (Our team can advise you on whether your company can avail of audit exemption and how to claim it)