GBW

Budget 2014

Issue link: http://read.digitaleditions.ie/i/193251

Contents of this Issue

Navigation

Page 5 of 5

Budget 2014 FARMERS FLAT RATE ADDITION The flat rate addition, payable to unregistered farmers to compensate them for VAT incurred on costs, will increase to 5% from 4.8% from 1 January 2014. The VAT rate applicable to the sale of livestock remains at 4.8%. CASH RECEIPTS BASIS Traders whose turnover is below the current threshold of €1.25m are entitled to account to Revenue for VAT on sales when they get paid, rather than when they issue sales invoices. This threshold will be increased to €2m with effect from 1 May 2014 and will extend the availability of this important cash flow saving measure to a larger number of traders. EXCISE CHANGES From midnight on Budget night, the excise applicable to a packet of 20 cigarettes will increase by 10 cents (with pro rata increases for other tobacco products), a pint of beer or cider or a standard measure of spirits will increase by 10 cents while a bottle of wine will increase by 50 cents (all increases are VAT inclusive). There is no change in the excise applicable to petrol, diesel or home heating oil. VAT ANTI-FRAUD MEASURES To assist Revenue in combating the shadow economy, legislative changes will be introduced in three areas: - disallowance of input VAT – businesses which have not paid (in full or in part) for supplies within six months will be required to repay the VAT claimed on those supplies (a similar provision already applies in the UK). - quick reaction mechanism – allows Revenue to introduce an emergency and temporary reverse charge mechanism to certain goods and services to deal with sudden large scale VAT fraud. - record keeping – powers to allow Revenue issue notices to traders to procure specific information where Revenue believe that the specified records might assist in identifying VAT fraud. AIR TRAVEL TAX This will be reduced to zero with effect from 1 April 2014 with the objective that airlines increase routes and flight numbers as a result of the initiative. PENSIONS TAX RELIEF Relief for pension contributions continues at the marginal rate of tax. PENSION LEVY The 0.6% Pension levy introduced to fund the Jobs Initiative in 2011 will be abolished from 31st of December 2014. An additional levy on pension funds of 0.15% will, however, be introduced for 2014 and 2015. Therefore the total pension levy in 2014 will be 0.75% reducing to 0.15% in 2015. CHANGE TO THE MAXIMUM ALLOWABLE PENSION FUND. The limit on the total capital value of pension benefits that an individual can draw in their lifetime, where those benefits are drawn after 7th of December 2005, has been reduced from €2.3 million to €2 million. This limit is known as the Standard Fund Threshold (SFT). Individuals with pension benefits in excess of €2 million on 1st of January 2014 will be able to protect the capital value of those rights by claiming a Personal Fund Threshold (PFT) subject to a maximum of €2.3 million, being the old SFT. Those who already have a PFT will retain it and do not need to take any action. In valuing Defined Benefit rights the current capitalisation factor of 20 will apply for benefits accrued to 1 January 2014. It is proposed that benefits accrued after this date will be capitalised using a new age related factor. For example at age 50 or less the capitalisation factor will be 37 while at 65 it will be 26. This leaflet is only a summary of the Budget Speech and is not intended to be a comprehensive guide. 15/10/13. Printed by Unique Publishing (01) 860 3477

Articles in this issue

view archives of GBW - Budget 2014