We have summarised the budget announcements that will affect business owners. This includes businesses that have employees and may need to take account of the budget changes in relation to payment of their staff;
- Corporation tax exemption for start up companies will be extended for another three years to cover companies which commence trading in 2012, 2013 and 2014
- Tax breaks for companies who try to invest in so called BRICS countries – that is Brazil, Russia, India, China and South Africa
- The first €100,000 in research and development expenditure will be allowable on a volume basis. A certain portion of the research and development tax credit can be utilised to reward key employees
- The standard rate of VAT is being increased to 23% from 1 January 2012. The 13.5% rate of VAT is unchanged. The 9% rate of VAT introduced in the Jobs Initiative for certain sectors is to continue
- Universial Social Charge exemption level raised to €10,000
- Employer PRSI relief on 50% of employee pension contributions is being eliminated. A broadening of the PRSI base is to occur to cover rental, investment and other forms of income from 2013.
- Tax exemption for first 36 days of Illness Benefit ended in an effort to reduce absenteeism
- Redundancy rebate from the State will be reduced from 60% to 15%
If you need help adjusting your Sage software to comply with budget changes, we will be publishing updates for our customers on the support section of our website.