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2013 Finance Act – Part 4 – Irish Tax System



This is a ten-part Worldwide Tax Blog Series on a cross section of amendments in the Irish Tax System and a general overview:

Universal Social Charge – Part 1

The Remittance Basis for Income Tax – Part 2

The Remittance Basis for Capital Gains Tax – Part 3

Taxation of Certain Social Welfare Benefits – Part 4

Mortgage Interest Relief – Part 5

Donations To Approved Bodies – Part 6

Farm Restructuring Relief – Part 7

FATCA – The US Foreign Account Tax Compliance Act – Part 8

Close Company Surcharge – Part 9

Stamp Duty – Part 10

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4. TAXATION OF CERTAIN SOCIAL WELFARE BENEFITS

From 1st July 2013 certain Social Welfare Benefits not previously chargeable to Income Tax will come into the Income Tax net including:

1.  Maternity Benefit
2.  Adoptive Benefit
3.  Health & Safety Benefit

Revenue will now be permitted to amend tax credit certificates and standard rate cut off points to collect the tax arising on these benefits.

These benefits are not liable to the Universal Social Charge.

What happens if the salary is paid by the Employer during Maternity Leave?

Previously the employer paid the full salary to the employee less an amount representing the maternity benefit.  The net salary was liable to Income Tax, Universal Social Charge and PRSI while the employee received the Maternity Benefit tax free. 

The employer received a tax saving on employer’s PRSI for the amount of the Maternity Benefit received by the employee.

From 1st July 2013 onwards the employee will pay up to 41% Income Tax on the amount of the Maternity Benefit.

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Since founding Accounts Advice Centre in Dublin in 1996, Claire McNamara has established a reputation for successfully advising businesses, corporate and personal tax clients. Her knowledge spans various sectors and her experience includes corporate transactions, inheritance tax planning, International Tax Treaties, personal tax as well as advising on issues affecting non domiciled individuals and offshore clients. She constantly delivers a value added service and efficient tax management solutions to high net worth private clients, property owners, executives, entrepreneurs, entertainers and members of various professions.

As a Chartered Tax Adviser, Claire has considerable experience in professional practice and will personally help you to deal with all your tax affairs competently, professionally and successfully. She has also lectured extensively in taxation on courses for the main professional accountancy qualifications including A.C.C.A., A.C.A. and C.P.A. and is actively involved in preparing students for the Irish Tax Institute’s CTA qualification.

Claire has effectively handled a number of Revenue Audits and Appeals on behalf of her diverse client base and has successfully negotiated solutions resulting in substantial differences to the eventual tax liability, surcharge and penalties.

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4 thoughts on “2013 Finance Act – Part 4 – Irish Tax System

  1. […] Remittance Basis for Income Tax – Part 2 The Remittance Basis for Capital Gains Tax – Part 3 Taxation of Certain Social Welfare Benefits – Part 4 Mortgage Interest Relief – Part 5 Donations To Approved Bodies – Part 6 Farm Restructuring […]

  2. […] Remittance Basis for Income Tax – Part 2 The Remittance Basis for Capital Gains Tax – Part 3 Taxation of Certain Social Welfare Benefits – Part 4 Mortgage Interest Relief – Part 5 Donations To Approved Bodies – Part 6 Farm Restructuring […]

  3. […] Taxation of Certain Social Welfare Benefits – Part 4 […]

  4. […] Taxation of Certain Social Welfare Benefits – Part 4 […]

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