How to do your own End of Year Review as a Contractor

 

How to do your own End of Year Review as a Contractor

As an employee an inevitable part of the working year is the end of year review. The purpose of a year-end review is for you to reflect on your achievements, learnings and take some time to recognise what went right and wrong as you plan & set goals for the coming year.

As a self-employed contractor taking time to conduct a self-assessment is often overlooked, however we are here to tell you to pen in time now to grab a coffee & look back through your year as well as forward to where your career & personal path is headed in 2021.

Taking time to do a self-assessment means you will be entering 2021 in a ‘woke’, rather than autopilot headspace, with control of where you are steering your future based on where you have come from.  

Importantly it gives you the chance to see if the destination you are headed towards is out of kilter versus your long term goals, or maybe it’s perfectly on track!

Here is how to assess your year & start to plan for the next:

-  Thinking about the last 12 months what goals did you set out coming into 2020 and what were your 3-5 biggest achievements in that period. Reflect on these and try to understand how you can bring the learnings and skills from these achievements into 2021. Maybe you took on a new project in your role, maybe you mentored a new staff member or changed industry – what do your biggest achievements tell you about what success means to you and how can you build that into your 2021 goals?

-  How is your contracting role fitting in with your personal goals – maybe that is work life balance, income, job satisfaction, time management etc. What has this year contracting taught you about how it fits into your values & personal goals? Is there anything that needs to change in 2021 or that you would like to build into your goals for the year based on the wider ecosystem of your contracting role and your life?

-  Identify one time when your working contribution contributed to success for a company or project you have worked on. We can often forget significant contributions we have made to company success (as we rush onto the next task) that are highly valuable in negotiating contract renewals or adding to our CV for future role applications. Note your successes when they happen with some top line details and then at the end of the year pick your most notable & impressive ones!

-  Think of some challenges you faced this year (2020 certainly gave us a few of them!) and how you overcame them – this shows both your personal & professional self your ability to bounce back without the all too often modesty we afford to overcoming struggles. It demonstrates your resilience and determination even in difficult times. So often we plough through the year and forget the mountains we have overcome that can give us confidence the next time we face a hurdle and recount how we handled the last! Step back, reflect and pat yourself on the back!

-  Think about any skills/ topics/opportunities that came up this year within your contracting role in the last 12 months that you didn’t feel 100% confident in to pursue. What would like to improve and build on in the coming year?

-  Thinking about the future plan & what will help you to get there – is there a course that might help you, a mentor you could chat with, research you need to do- what is your first stepping stone to your 2021 goals? This one takes time to think through …is there something you want to work towards- a promotion, a company, a move to a new country or a totally new start in a new role – what is the first thing you can do to get started – now is the time to plan & set your 2021 vision!

We spend so much time ‘busy’ in the day to day that taking the time to review can seem impossible to fit in but, in reality it’s crucial, and it’s massively valuable especially when self-employed to stay on track and focused.

Taking the time to assess your journey so far means you have time to check you are on the right road, maybe even on the right map as you steer into your future and a brand new year!

As an independently employed contractor setting aside some effort to direct a self-evaluation is frequently ignored, anyway we at icon accounting, our Accountants in Ireland are here to advise you for Accountancy Services for Contractors to pen in time presently to get an espresso and think back during your time just as forward to where your vocation and individual way is going in 2021. https://www.iconaccounting.ie/blog/how-to-do-your-own-end-of-year-review-as-a-contractor

Brexit - Importing & Exporting post 31st December 2020

This will be a very steep learning curve for many businesses no matter how well prepared they happen to be. I am sure the new systems will be second nature after a few months, however, getting to this point will be challenging and not without its stumbles.

To quote TB or Brendan Behan, whichever you favour…“Every cripple has his own way of walking”

In other words, we will find many paths and many more solutions to the issues we face, but ultimately, we will overcome these. Some suggest specialist “businesses” might smuggle, though their expertise may very well already be in place for this!

On a more serious note for businesses, please ensure your VAT number is EORI registered, this can be completed on Revenue’s online Service ROS. Failure to enable this number may result in your goods being held by customs

Just a few quick points on importing and exporting:

Importing

From 1 January 2021, Irish businesses that currently buy goods from the UK will be met with additional tariffs and admin work to ensure their compliant import. EU customs rules will apply to all goods which are brought into the EU from the United Kingdom; familiarise yourself with those that apply to those products that you import. You may need to arrange your own customs clearance agent, or for smaller items, the transport company will be able to handle this at an additional fee.

If you buy goods for resale, which UK authorities have issued marketing authorisations, approvals or certifications, next year these will not be sufficient when placing products for sale in EU.

Act in good time to transfer certificates and authorisations from any UK-based body or authority to one based in the EU, or to seek new ones within the EU. Markings or labelling of goods referring to statutory bodies or persons in the United Kingdom will not comply with EU labelling requirements after Brexit. Make sure the goods you import from the UK can be distributed the way that you intend.

Exporting

As of 1 January 2021, if you export goods to the United Kingdom, you will become an exporter of goods, subject to the UK laws applicable to importers of those products. Even if a deal can be reached on tariffs and quotas on products traded between the EU and the United Kingdom, goods will be subject to any applicable UK regulatory and compliance requirements for goods sold in the UK. In certain key areas the UK has already indicated an intention to adopt a different approach to the EU on checks, controls and requirements on imports, including for safety, health and other regulatory or public policy purposes. Make sure you keep track on how new UK laws impact on your exports to the UK and how they differ from your EU sales.

Free movement of goods and road transport operators across UK borders with the EU will become more complicated. From the beginning of 2021 UK road transport operators will no longer have automatic access rights to the EU and will need to comply with formalities when crossing the UK-EU border. Consider longer delivery times and factor in any additional formalities to be completed when updating your supply chain and logistics commitments to take account of Brexit. to know more click here. https://www.iconaccounting.ie/services/switching-accountants

Why Upskilling Matters More than Ever

 Over the past months at Icon Accounting we have noted a continued upward trend in contracting roles available, new contractors starting for the first time as well as contract renewals for our existing contractor community.

This is incredibly positive news for the contracting industry overall showing it remains robust & more than that it is in real positive growth!

With this positive news comes the reality that as a sector it is becoming more competitive than ever, and standing out as a professional contractor is crucial to land and keep the best roles.

There are lots of ways to stand out as a professional contractor and at Icon we are always looking at ways we can help YOU to stand out!

One of the best ways to differentiate yourself is through continuous professional upskilling, ensuring your skills & qualifications remain fresh, relevant & in date in a fast changing world!

At Icon we have recently launched iPerks a contractor platform giving you access to a multitude of benefits, one of which is upskilling through a range of courses with globally accredited colleges ensuring you can upskill in your role without spending a penny!

What Is Upskilling?

Upskilling is the process of learning new skills that will aid in ones work or personal development.

Why Does It Matter?

The Covid -19 pandemic has shown us how rapidly the work of work can change & how quickly we can be forced to adapt our skill set to new realities. The business world is changing at a faster pace than ever before.  Remote working has been accelerated into a necessary reality for many sectors, as has automation of many previously manual tasks with improved technology systems often even removing the need for headcount across many functions.  In reality this means that we are now competing with a global workforce rather than a local workforce & being forced to pivot & grow our skillset to stay relevant in pretty much every sector of business.

How Can It Benefit Me?

Upskilling should be looked at as a real benefit for both your career & personal progression. As well as coming with the often added benefit of increasing your chances of promotion within your role or company & opening up lots of new opportunities in your career it is likely to benefit your confidence as well as your income!

Where To Start?

This is the really important part – for many the idea of upskilling feels too big or daunting to explore and so they stop before they have started- unsure of where to even begin, often intimidated by the thoughts of a return to learning. Our advice - start at the beginning!

What do we mean here?

Think with the end goal in mind. Do you want to change professional path? Are you looking for a promotion? Is there a certain company or role you have your eye on?

Getting the goal in mind you can then begin to see what you options are to start on the path to upskilling in that direction.

- Use your professional network to link in for virtual coffees to explore options with people who have the roles you would love or are in companies you would love to get into- find out how they went about their career path – you might be inspired!

- Review your CV to see where the gaps might be in relation to your career goals.

- Research your industry and see what roles are trending, popular & offer competitive earning potential

- Reflect on the parts of your current career your enjoy and where you would like to grow more – this might be people management, professional skills, upgrading an existing qualification or even taking a short specialist course in a niche area

Through Icon you also have exclusive access to our iPerks platform offering hundreds of accredited courses across many sectors to help you add real qualifications to your CV without a hefty price tag!

Conclusion

Staying one step ahead is the key to career success no matter what your sector, upskilling is one of the best ways to get there!

Not yet contracting with Icon? Talk to our team today to see how you could benefit from becoming a professional contractor with us & how we can help you upskill along the way!

Info@iconaccounting.ie

5 Key Learning Points from LinkedIn’s Marion Markey

 We are always looking to add more value to our existing clients and are very thankful to Marion Markey from LinkedIn who took the time out to give us all some tips on how to get the most from our LinkedIn profiles!

Be Visible

There are over 660 million members, 20 million jobs and 30 million employers on the platform making it the largest professional network by far.
If you are not on LinkedIn already, it should be a priority to create a profile in 2021. Connect with peers and expand your network to ensure that you not only stay up to date with the latest market trends but also future opportunities.
85% of jobs are filled through peer referrals making it the number one source of recruitment.

Detail your work experience!

If you add details to your work experience whether it be details about the project, the contribution you made, key learning points and any challenges faced. By doing so, you are 5 times more likely to receive connection requests, 8 times more profile views and 10-fold the number of messages received.
If searching for opportunities, you can also edit your experience and skills to appear in the order of relevance – ensuring that potential employers see the parts of your profile that you want them to!

Add examples of your work!

You can and should upload videos, presentations, and videos of previous projects that you have worked on. This is an ideal tool for making sure your profile visitors get a complete picture of your professional accomplishments to date.
Giving a dynamic, visually appealing representation of your professional story can make you stand out from a very competitive labour market.

Activity is still underrated

Adding your own skills, endorsing other’s skills, and sharing status updates are all tried and tested ways of increasing profile engagement. Endorsing others on top of the fact that if you endorse a colleague or peer, they are likely to return the favour.

Plus, members who add skills generally see 17 times more visitors to their profile than those who do not.

Best practices for sharing updates for those less comfortable or familiar with LinkedIn below:

- Share your authentic voice

- Post frequently

- Start a conversation or share your point of view

- Include rich media to increase engagement

- Create an opportunity for reciprocity

To be successful in Contracting, you need to be an expert in your field – do not be afraid to share that expertise.  Publishing content is a separate feature to sharing a status update and one that is often associated with expert level opinions.  As a successful independent professional, you are an expert in your field – show that to your entire network by publishing content. 

Create a headline that captures attention, include a photo to stand out and think about your audience when deciding on article length.

Most importantly, be yourself and always remember that line between LinkedIn and Facebook or Twitter, your opinions should be professional, never personal, political, or otherwise.
With the world working remotely and with social interaction limited with Covid-19, having a digital footprint and a LinkedIn profile is more important than ever before.

Thanks again to Marion Markey from LinkedIn for joining us and for offering to assist any of our contractors should they have any queries, you can contact Marion at mmarkey@linkedin.com or as always you can get in touch with any of the team at Icon Accounting by calling 01 – 8077106 or by emailing info@iconaccounting.ie

LinkedIn has always been the greatest source of knowledge. We at Icon accounting, one of the best accountancy firms in Ireland always seeking good knowledge that can help our business to grow. This type from Marion Markey we got the opportunity to learn some tips on how to get the most from our LinkedIn profiles which include; Be visible, Detail your work experience, add examples to your work, add your skills set, endorse other profiles, most importantly know the difference between Facebook, LinkedIn, and other social platforms. As we are having the team of best accountant in Ireland these tips will surely be going to help our accountants.

Covid Restrictions Support Scheme ("CRSS")

As some businesses face into their third week of lockdown, Revenue have just released details on the operation of the Covid Restrictions Support Scheme (we'll call it CRSS from here on!)

CRSS has been introduced to assist businesses that have been significantly impacted by localised and national lockdowns

Successful applicants will receive cash payments from Revenue known as an Advance Credit for Trading Expenses (“ACTE”).

The scheme will operate from 13 October 2020 to 31 March 2021.

Who can apply for CRSS

- Companies

- Self-Employed Individuals

- Partnerships

Conditions to qualify for CRSS

- Must be trading in a location that where restrictions are imposed.

- The public are prohibited or significantly restricted from accessing your business premises. For the majority of businesses this means restrictions at Level 3 or higher. 

- Existing business - the income (excluding VAT) does not exceed 25% of an amount equal to the average weekly turnover of the business in 2019 multiplied by the number of weeks in the claim period.

- New business – the income (excluding VAT) does not exceed 25%% of an amount equal to the average weekly turnover of the business in 2020 multiplied by the number of weeks in the claim period.

- Tax Clearance Certificate is available.

- VAT obligations are up to date.

- You will resume trading once restricted are lifted.

Determining a Claim Period

Covid Restriction Period - A claim period will commence on the day the Covid restrictions are applied and will end when the Covid restrictions are due to end (based at the time the restrictions are introduced).

Covid Restriction Extended Period - If the restriction is extended this will constitute a new claim period from the date the restriction was due to end initially and will end on the date the extended period is due to end (based at the time the period is extended).

Example

On 13^th October Level 3 restriction in Dublin was set until 28^th October. Therefore 13^th – 28^th October is a Covid Restriction Period.

On 22^nd October further restrictions were implemented until which are due to end 1^st December. Therefore 29^th – 1^st December is a Covid Restriction Extended Period i.e. this is a new claim period.

ACTE Amount that can be Claimed

ACTE will be determined by the business’s prior turnover with a maximum weekly payment available capped at €5,000.

ACTE will be based on the turnover from 1 January 2019 to 31 December 2019:

- 10% average weekly turnover for 2019 up to €20,000

- 5% average weekly turnover for 2019 exceeding €20,000

*For new businesses established between 26 December 2019 to October 2020, ACTE will be based on turnover from date business commenced to 12 October 2020.

Example

Joe Bloggs turnover from his business in 2019 was €663,000 (exclusive of VAT). Assuming claim period is for 7 weeks.

- Average weekly turnover for 2019 - €663,000 / 52 = €12,750

- 10% of €12,750 = €1,275

- Multiplied by number of full weeks in claim period €1,275 x 7 = €8,925 ACTE

How is ACTE treated for tax purposes?

The ACTE payments receivable from Revenue must be reported in the tax return when preparing the taxable profit by reducing the amount of deductible expenditure.

How to Claim

The claim process is available on Revenue Online Services under the e-Repayments. This will be a 2-step process:

1) First register for CRSS on ROS, and

2) Complete a claim in respect of a claim period/s.

If you have a tax agent, they can access this using their agent ROS account.

If you have any queries you can visit Icon Accounting or email is at info@iconaccounting.ie and one of our members will be in touch in no time. We are one of the best Accountancy services in Dublin, Ireland.

Good try, But no you definitely can't claim that…

 Expenses – What you Can’t Claim as a Contractor (& some of the strangest requests we have had!)

Whether you are new to contracting or a seasoned contractor the topic of claimable expenses remains cloudy for many…

At Icon we have created videos & blogs covering general expenses and frequently requested topics like ‘home office expenses’ but we understand there are always more questions and always some remaining grey areas of what counts as a claimable business expense.

We have compiled the most frequent (an unusual) expenses queries we get at Icon Accounting of expenses you CANNOT claim. So, before you buy that golf membership or upgrade the kitchen table to serve as your new desk make sure you read this…

Holidays

Sorry your trip to sunnier climates does not count as an allowable business expense- though we wish it did too!

We have clients who try to claim holidays abroad, justifying it as a business trip,  in one case we had a client who tried to expense a trip to Maldives…justification was that he chose to go there with the other director in order to hold the AGM of the company….Co-incidentally himself and the other director only got married the week before… a curious coincidence !

Entertainment

A night out with your friends is not an allowable business expense. We had one former client who spent a large sum of money in a “gentlemans club” – apparently, he was trying to get his contract extended and brought the Project Manager on a night out

I hope he got a rate rise in next renewal; we definitely won’t be explaining that one to the Revenue auditor!

Golf

Golf clubs, Golf club membership, Golf trips. Golf is a common thread with our clients, unfortunately it’s not possible to claim this as a business expense. While it’s a great way to network & do business it’s difficult to justify the wholly, exclusively for business needs and necessary test with Revenue. So, you will have to work on the handicap outside of business hours on this one!

Home improvements

Whilst improvements to a home office can be deemed allowable in certain circumstances, the purchase of fridge/freezers, wine cooler and a €3,000 kitchen table would certainly not be allowed by our friends in Dublin Castle- yep people have asked us! though we do like the idea of a wine cooler in the office!

Children’s Gifts

We have had some strange requests over the years, particularly at Christmas, these include Kids bicycles, PlayStation, Lego, and dollhouses…

Tax tip for Xmas, do not buy I pads, children’s bikes under the bike to work scheme, a 2nd I-phone or jewellery for your partner. If it’s not for the business, it’s not an allowable expense believe us!

Valentine’s Day

 Every year we have client’s going on “business trips” around the 14th of February, usually for the weekend to a conference. This is a big NO NO as it is something Revenue always looks out for!

TV’s

A curved TV… back when they cost €2k and certainly did not make the cut when described as a 2nd monitor for the laptop…. hmmm

Pet Food

Pet food for the company “guard dog”... That happens to be a whippet. We’re afraid that Fido’s dinner will have to come from your pocket instead

Teeth Whitening

Yepee have been asked! While your teeth will look beautiful on zoom, I doubt the taxman cares much for your pearly whites

(Very) Personal Subscriptions

When we say ‘subscriptions’ can be expensed we are talking about your Zoom subscription or professional body annual membership fees. Plenty of Fish & Grindr don’t count sorry folks and make for awkward conversations with your account manager – trust us!

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy firms in Ireland

Contractor Mortgages with Robert Whelan

 

#AskTheExpert Series: Contractor Mortgages with Robert Whelan BComm, QFA, Rockwell Financial Management. COVID has brought with it many challenges.

With work now untethered from place, and with family ties brought into sharper focus, you may well be considering your plans for a move, and therefore a mortgage.  First time Contractors often fear that taking a contract role means giving up the chance to obtain a mortgage.

Thankfully, that is just not true. In fact, you may be in a position to borrow more as a Professional Contractor, as your income is likely to be greater than that of a permanent employee.

As part of our recent #AskTheExpert series, Robert Whelan BComm, QFA of Rockwell Financial Management outlined universal criteria for obtaining a mortgage and the most common Contractor questions on mortgages.

Read on for a synopsis of what was discussed, as well as a look at how Icon Accounting can help you on your mortgage journey.

Universal Criteria for Getting a Mortgage

The standard benchmarks for permanent employees also apply to Contractors:

- Deposit

- Loan to Income

- Repayment Capacity – Everyone is familiar with the struggle of saving for a deposit, but did you know that your behaviour over the past six months can make or break your mortgage application? Demonstrate that you can meet the mortgage repayment you are likely to have by showing evidence of your ability to pay rent/save to the same amount.

- Credit History – Access a forensic analysis of your own credit history, otherwise known as a Consumer Credit Report here.

Did you know that 10% of all mortgage applications can get an exception to rules such as loan to income, deposit, or net disposable income (mortgage repayments cannot exceed a percentage of your net disposable income – typically 40-45%).

When starting your mortgage journey, be aware of the Central Bank rules on mortgages, and if you are looking for an exception, be exceptional.

For example, if your bank has requested proof of repayment capacity and you wish to be granted an exception on your loan to income, show a larger repayment capacity than asked.

Click here to read Robert’s Top Tips for Contractor Mortgages (the do’s and don’ts to be aware of).

Most Common Contractor Questions on Mortgages

- How long do I need to be contracting before I can apply for a mortgage?

Typically, contractors could apply for a mortgage after 12 months in contract, which would demonstrate a continuity of career. However, post-Covid, the banks may be more reticent to consider an application of under two years. This is sector dependent.

- Will I need a bigger deposit as a contractor/Will I be considered higher risk?

No, certainly not.

- What happens if I leave contracting/How long do I have to wait to apply?

Typically, I would advise ex-contractors to wait until they have been in a PAYE/Permanent position for six months.

- What’s changed post-Covid?

Post-Covid, we have seen turnaround times slow somewhat. We have also noticed a greater scrutiny placed on the sector that a contractor is operating within.

How Icon Accounting can help you on your Mortgage Journey

If you are an Icon client who is applying for a mortgage, we can provide the following

- Certificates of Salary

- Three to six-month payslips

- Letter confirming that taxes are up to date

- Tax Clearance Cert

- Copy of previous three years of tax returns

- Financial statements for your limited/umbrella company

- Bank statements for your limited company

If you have any questions about Contracting, the advisory team would be glad to field your questions. You can get in touch here.

If you are already an Icon client, and have any questions on mortgages, reach out to your Account Manager. If you would like to speak directly to a Mortgage expert, contact 01 2966120 or visit www.rockwellfinancial.ie

If you have any queries when ordering your Taxsaver ticket, don’t hesitate to contact us at taxsaver@iconaccounting.ie and one of our members will be in touch in no time.

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy services in Dublin, Ireland.

Budget 2021

 Read our Summary of Todays Budget

Today, the Minister for Finance, Pascal Donoghue, and Minister for Public Expenditure & Reform, Michael McGrath, have announced Budget 2021.

While previous budgets took place against a backdrop of relatively strong economic growth, the backdrop of today’s budget has been the Covid-19 crisis and Brexit.
Since March of this year, we have seen record levels of unemployment and the unemployment rate continues to rise at a high pace due to the pandemic.

Taxation receipts have been stronger than expected, however, the country still finds itself with a deficit of approximately €21 billion for 2020.

The outlook for 2021 is not much better and it is on this basis that most of Budget 2021 has been framed.

Personal Tax

• The retention of existing income tax rates (of 20% and 40%) and tax bands (€35,300 for single individuals and €44,300 for married single earner couples).
• An increase in the earned income tax credit (introduced in 2015 for self-employed individuals) from €1,500 to €1,650 - finally achieving parity with the PAYE credit.
• In a surprise move, the seldom claimed Dependant Relative Tax credit, has seen a jump from €70 to €245. It is estimated that nearly 200 thousand people have a qualifying relative living with them, and they may be more tuned into claiming this now (please note: your children do not qualify you for this credit).
• An increase in the home carer tax credit from €1,500 to €1,600.
• USC rates remain the same, although the bands have changed slightly, to allow for the increase in the minimum wage to €10.20.
• Homeworkers can now claim a portion of their broadband as a tax allowable expense.          
• Children’s allowances are also set to increase €5 for children over 12, and €2 for children under 12, per week, respectively.

Employment and Business supports

• Debt warehousing has been added as a new variant of the employment wage subsidy scheme. This will provide continued support to businesses affected by COVID-19.
• A new scheme, for businesses which have had to close because of COVID-19 Level 3 or higher restrictions, will see grants available of up to €5,000 per week.
• Commercial Rates are to be waived for the rest of 2020.

Corporation Tax

• Changes to the international tax framework were flagged and we should expect Corporation tax to look a little different in future years.

• Corporation tax receipts from multinationals for the first 8 months of 2020 have generated a remarkable €7.5 billion. No changes are made to the headline rate of 12.5% on trading activities, non- trading 25% and surcharges of 20% for estate income and 15% for Professional Services still apply.
• Revised rules for the tax treatment of Intangible assets apply from tonight, this is targeted at the multinational sector, and is linked to a move to a digital tax.
• Digital Gaming Sector – Work will take place in 2021 on the development of a tax credit for the digital gaming sector.

Employers PRSI

• Rates remain unchanged. Though there is a small increase to the weekly income threshold for the higher rate of employers PRSI, this €4 increase brings it to €398 per week.

VAT

• The July stimulus package seen the standard VAT rate drop from 23% to 21% on September 1^st.
• Further VAT cuts were announced in today's budget showing a return to the 9% VAT rate which had previously applied for the tourism and hospitality sector. This change will take place on November 1st.

Entrepreneur Relief

• Changes to this had been suggested by various pre-budget commentators, however, this has been left alone and no changes will take place.
• A slight amendment to the shareholding requirements has been made, allowing some 5% shareholders a greater time span for their qualification to the scheme.

R&D Tax Credits

• No changes to the existing rules in place, and as always, any claim will need to be substantial to ensure value.

Property

• The residential development (stamp duty) refund scheme has been extended until 31st of December 2022.
• The Help to Buy scheme which has proven to be successful for first time buyers trying to get on the property ladder has been extended to the end of 2021.

State Pension

• The planned state pension age increase to 67 has been scrapped.

This will now remain at 66.

Stealth Taxes

• We haven't heard very much of this term of late, but the government have managed to introduce a range of stealth taxes in this budget, primarily for those who a diesel car, have an open fire and enjoy a cigarette!
• The cost of the price of cigarettes has increased by 50 cents.
• Vehicle tax increases, carbon tax increases, vehicle registration tax increases, petrol and diesel increases are all hallmarks of a Green Party power play.

Conclusion

The pandemic has dictated the direction in which this budget was laid before us.

In many ways, lessons learned from 10 years ago are now coming into play, immediate supports for education, reskilling, and retraining are most welcome.
Additional supports for home workers, students studying from home, and those currently receiving the pandemic unemployment payment show that this government is capable of fast response.

Clearly, the health sector will require an enormous amount of funding over the next 18 months, Budget 2021 has achieved this without pain being inflicted on the workers of Ireland.
It remains to be seen if the same scraping and scrimmaging will be available to us in future years.

As always, we will need to see the contents of the Finance Act 2021, where changes, additions and amendments to today’s budget are finalised. 
We will provide further updates when this is published next month.

If you have any queries when ordering your Taxsaver ticket, don’t hesitate to contact us at taxsaver@iconaccounting.ie and one of our members will be in touch in no time.

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy Firms in Ireland. 

Digital Detox - Life Hacks

 Do you check your phone first thing in the morning? Do you find yourself scrolling through social media sites? Do you find it hard to step away from your laptop? Are you glued to your tablet when you are in your bed? If so, you might be a good candidate for digital detox.

Sometimes we only take a pause when our battery dies. We are too busy in our tech that we start ignoring the real-world experiences, more so during these strange times. With the advent of working from home we do not know when to step away from our workspace. The logoff button has somewhat been forgotten. 

Here are some of the tips that might help you train your mind to step out of digital world and prioritise your mental and physical health.   

Set App Restrictions on your Phone

Social media in not so social times can ramp up your hours spent on your phone. It is shown in studies that an individual spends 144 minutes/day on social media sites. This time can easily be saved if we start restricting social media app screen time. Start Slow!! Restrict to 120 minutes initially then try to get down to 30 minutes in a day. Suddenly you will find yourself with a lot of time to do other things.  

Use the 20-20-20 Rule

With all the screen time everyday our eyes get tired. We put a lot of strain on them without knowing. 20-20-20 rule is a very good trick to maintain your eye health. Every 20 minutes look at something 20 feet away for 20 seconds.  

Take Mini Breaks

Work can be really busy sometimes. When we are working from home, we forget that we are not taking coffee breaks like we used to in the offices. We quickly grab something to eat/drink and sit back on our desks. Take small breaks to counter this, go for a walk, stretch out, sit in your back garden.  

Say Goodnight to your Devices at Evening

There was a recent survey that suggested using your mobile phones during evenings can disrupt melatonin production, your quality of sleep and your mood. Make a habit to put a bedtime schedule on your phone or put it on do not disturb so that you are not jumping for your phone on each notification.  

Try using the Rule of Thirds 

Divide your life in thirds: 8 hours for sleep, 8 hours for work and 8 hours for what you want to do. Taking time off from work can drastically improve your productivity. Try picking a lost hobby that you always wanted to do. This way you will find yourself spending less time on screen and going back to things that you really like.  Researches have shown that if you spend more than 40 hours a week in work your productivity starts to diminish.  

Let’s start saying no to our phones, laptops and tablets and yes to exercise, family and hobbies during this pandemic.  

If you have any queries when ordering your Taxsaver ticket, don’t hesitate to contact us at taxsaver@iconaccounting.ie and one of our members will be in touch in no time.

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy Firms in Ireland. 

How Covid-19 has affected Contractor Expense Claims

 Transport tickets are out & ergonomic chairs are in. Since March 2020 contractor expenses have changed dramatically. With some unsurprising new expense claims topping the charts there are some unexpected newcomers…

We have put together a blog on the top expenses our Contractors have claimed through their limited company during Covid-19.

Overall, the results are very interesting and give great insight into behaviours and thinking within the contracting community over the last 7 months.

With the forced move from office spaces to home working the majority of our clients have now kitted out their homes (and bedrooms) with desks, chairs and extra computer & communications equipment.

Unsurprisingly as a result,  office furniture and computer equipment take the top 2 spending spots in our poll. Within that, the most popular items purchased were monitors and chairs to bring a professional and functional working feel as well as comfort to a home office set up.

Interestingly we have also seen an increase in clients taking out life cover through their limited company and setting up for a pension for a rainy day. Perhaps this is a sign of professionals reflecting on their futures and having a little more time to plan, but also demonstrates the income stability within our community to continue to invest in savings options even in turbulent times.

The top 10 expenses claimed since March 2020 were….

1. Office furniture
2. Computer & Mobile Equipment
3. E-workers allowance & Home Utilities
4. Pensions
5. Upskilling with online courses & platforms
6. Life Insurance Cover
7. Hot desks hire
8. Software Subscriptions, e.g. zoom
9. Stationary
10. Travel

One glaring omission from the list is relocation expenses, which has dramatically decreased given the working at home guidelines in the past months and the restriction of movement. It will be interesting to see in the coming months if travel creeps back up the list from 10^th place or if companies will fully commit to flexible remote working arrangements for the contracting community.

Looking at our list- are there expenses that you might you have missed out on claiming?

Speak to your Account Manager to help you maximise your allowances & make sure you have claimed for purchased items that you may not have considered as a business expense thus far!

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy firms in Ireland.

Contractors: 10 Important Tax Saving Tips

 If you are an independent contractor operating in Ireland, you’ll need to declare your income to the Revenue Commissioners and pay tax through the self-assessment tax system.

However, a combination of effective planning and ensuring you avail of all applicable tax reliefs can impact your tax bill. You need to assess your tax saving opportunities in order to maximise your tax credits and increase saving. Ask yourself – what taxes can my business claim?

While we at Icon Accounting are always on hand to help you with your accounting needs, below are some of the most effective tax saving tips that could help reduce your tax liability.

Claim for ‘Allowable Deductions’

Contractors are entitled to claim legitimate business costs as expenses, which can be offset against income. Any expenses are deducted from your profits, so the higher your expenses, the lower your taxable profits. There are many common contractor or freelancer expenses you may be able to claim for, such as: phone bills, motor expenses, insurance costs and materials.

Avoid Penalties

Avoid penalties for the late submission of your tax return. As an independent contractor, tax must be paid on or before the annual tax deadline, based on the income you earned in the previous year. If you don’t pay your tax bill on time, you could be liable for a penalty, which can rise if your payment continues to be late.

        – When is the income tax return deadline 2020?

          The income tax return (AKA Form 11) deadline for 2019’s income is the 31st of October 2020. If you file and

          pay your taxes online, the deadline is Thursday 12th of November 2020.

        – When is the companies office return deadline 2020?

          Depending on ARD Date (initial €100 plus €3 per each day for late submissions).

          Also late accounts require an Audit – Increasing Professional fees.

        – When is VAT returns deadline?

          VAT returns are due 23rd of Month following period end (Bi monthly, Quarterly, 6 monthly or annually)

Claim Medical Expenses

If you pay medical expenses that are not covered by the State or by your medical insurance provider, you can still claim tax relief on those expenses. You will receive tax relief for health expenses at the standard rate of 20%.

Maximise Tax Credits

There may be various tax credits that apply to you, so be sure to review and apply for them where appropriate.

You may be able to:

        – Transfer any unused tax credits from your spouse across to you or apply for joint assessed tax.

        – Ensure you are getting the SPCCC tax credit if you are a single parent.

Claim Assets

Assets including a car, computers, office furniture or any plant and machinery that are required in the course of running your business – can be claimed over a period of 8 years.

Apply for Earned Income Credit

As a self-employed person, you can claim the Earned Income Tax Credit of €1,350 or 20% of your qualifying earned income, whichever is the lower. Be aware, however, that Earned Income Tax Credit can only be applied to trading income and is not available against investment or rental income.

Add Family Members to the Payroll

Wages paid for work done by family members is an expense of the business and its tax deductibility must be considered like any other expense. A family member can be employed for administration or record keeping. This is not considered technical work – if they are being employed for technical work, they should have the skills, qualifications and experience necessary to carry out that work and to justify the rate of pay.

Use the ‘Small Benefit Scheme’

The Small Benefit Scheme allows employers to provide a tax-exempt benefit to Irish employees of up to €500 per employee, per year. This is a totally tax-free gift but must be awarded in the form of a benefits voucher and cannot be paid in cash.

Expense Travel and Subsistence

Travel is an allowable expense when the journey is necessarily incurred in the performance of the duties of the office or employment. Examples of allowable travel are travel to continued professional development courses, travel from place of work to clients’ premises, travel for meetings etc.

Subsistence allowances can be utilised on the same basis – i.e. If the time spent away from the normal place of work is over a certain number of hours/days then specific subsistence rates apply.

Pay into a Pension

Pensions are one of the most tax efficient investments you can make. Any premiums paid by a self-employed person are allowed for tax relief for up to 40%.

Pay into an Income Protection Policy

Like pensions, income protection policies are very tax efficient.  Income protection policy payments allow self-employed persons to claim tax relief for up to 40%.  Income protection is also commonly known as Permanent Health Insurance.

Beware of Professional Services Surcharge

You might think that you can leave the profits in your company and only pay 12.5% corporation tax, rather than taking the money out as salary at up to 52%.

However, this surcharge counters this method of tax avoidance by imposing a surcharge of 15 per cent on 50 per cent of the company’s undistributed professional and service income.

When you eventually liquidate the company you will pay an additional 33% (at current tax rates) – Your effective rate being 46%. You need to consider which is better for you – to have the cash personally now or leave the cash in the company for a number of years saving 6% (at current tax rates).

Get Professional Support

Enlisting the help of a tax specialist, such as Icon Accounting will make sure that you are not only maximising your tax opportunities but by keeping track of the various expenses or tax reliefs that you can claim. We will calculate your income tax accurately, so you don’t run the risk of over- or under-paying and will file the tax return on your behalf and on-time.

Stay tuned for new updates and we will back with all new features again shortly. Icon Accounting the best Accountancy services in Dublin.