The Minister introduced a timely package of improvements to a number of tax supports to Irish businesses.
FED is an income tax relief available to employees who temporarily carry out their duties overseas in specific countries and the purpose of the relief is to encourage Irish businesses to export to these new markets. SARP provides an income tax relief for employees who are assigned to work in Ireland.
During 2019, the Department of Finance conducted a review of both of the above reliefs and it was concluded that the policy rationale for their existence is strong. Both schemes have been extended to 2022. There were no further changes to the reliefs in the Finance Bill.
As we are aware, SME’s and start up experience difficulties in recruiting and retaining skilled workers and find it difficult to match the salaries that are being offered by multinationals enterprise. KEEP was designed to incentivise talent to take up employment with SME’s . It provides for CGT treatment on the disposal of share acquired under a share option scheme as opposed to Income Tax. To date there has been relatively little uptake on the relief and section 10 of the Finance Bill reflects the amendments, which were announced on Budget day. The amendments to be enacted will impact on the following:
The amendment will become effective subject to Ministerial Order once the relevant notifications have been made at an EU level.
The EII scheme was overhauled in Finance Act 2018 and the changes announced in the Budget and Finance Bill continue that reform. The main changes introduced were as follows:
There are a number of other technical amendments to ensure that the conditions in relation to investments made prior to 8th October 2019 continue to apply and that the clawback provisions will also apply to investments to be held for 10 years.
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