Contributor: Clara Barry, Assistant Manager, Financial Services Tax, BDO
A number of measures could be taken to lower the administrative burden of Irish tax compliance.
The need for simplification of the Form CT1 is illustrated by the fact that this form has bloated to 70 pages (FY2025). This should be condensed to record only what is essential for Revenue to accurately assess a company’s corporation tax liability and risk profile.
Revenue might also consider allowing corporate groups to elect to file a single consolidated CT1. Comparable permissions exist in other jurisdictions (e.g. Germany).
We would welcome a single pay-and-file date for CGT, as opposed to basing this on the date of disposal of asset(s).
Enhanced Reporting Requirements (‘ERR’) mandate that businesses report in real-time certain non-taxable benefits to employees. We suggest that reporting the same data monthly would suffice for Revenue’s purposes, whilst reducing inadvertent non-compliance, and being generally less burdensome for taxpayers (small businesses in particular). We further note that there is a fixed penalty of €4,000 for non-compliance with ERR. We would argue this is excessively punitive, particularly because there is no resulting loss to the exchequer.
Finally, we encourage a cautious approach to implementing a broad electronic withholding tax (‘eWHT’) system (for PSWT, RCT, DAC7). We would like to see any change introduced with phased implementation, clear guidance, and sufficient lead-in time.
It is particularly important that the proposed changes to the RCT system are fully thought through. Specifically, we suggest that removal of the 0% rate would negatively impact critical housing and infrastructure construction projects.
Content adapted from Finance Dublin Irish Tax Monitor.