Understanding Tax

Undertanding Irish Tax Law

Navigating the tax system can be overwhelming, especially for individuals and businesses trying to stay compliant while minimizing their tax liability. At Gahan & Co., we simplify the complexities of taxation, ensuring you understand your obligations and opportunities within the Irish tax system.

Why Understanding Tax is Important

Whether you’re a sole trader, an SME, or an entrepreneur, understanding tax is essential for financial success. Proper tax management helps you:

  • Avoid penalties and compliance issues.
  • Maximize available deductions and reliefs.
  • Plan your finances more effectively.
  • Reduce unnecessary tax burdens through strategic planning.

Key Areas of Taxation in Ireland

1. Income Tax

Individuals earning income in Ireland are subject to income tax, which is calculated based on earnings and applicable tax credits. Key elements include:

  • Standard Rate (20%) and Higher Rate (40%).
  • Personal Tax Credits, including PAYE credit and married tax credits.
  • Self-Assessment Tax for sole traders and freelancers.

2. Corporation Tax

Businesses operating in Ireland benefit from one of Europe’s lowest corporation tax rates:

  • 12.5% for trading income.
  • 25% for non-trading (investment) income.
  • Reliefs available for start-ups and R&D investment.

3. VAT (Value Added Tax)

VAT is charged on goods and services in Ireland. Understanding VAT is crucial for businesses:

  • Standard Rate: 23% (most goods and services).
  • Reduced Rates: 13.5% and 9% (hospitality, tourism, certain services).
  • VAT registration is mandatory if annual turnover exceeds €37,500 for services or €75,000 for goods.

4. PAYE (Pay As You Earn) & PRSI

Employers must deduct and remit:

  • PAYE: Income tax deducted from employees' wages.
  • PRSI: Social insurance contributions for benefits like pensions and maternity leave.
  • USC (Universal Social Charge): Progressive tax applied based on earnings.

5. Capital Gains Tax (CGT) & Inheritance Tax

For individuals selling assets or inheriting wealth:

  • CGT Rate: 33% (with exemptions available).
  • Capital Acquisitions Tax (CAT): 33% on inheritances above thresholds.
  • Reliefs available for business and farm transfers.

Tax Planning & Compliance Services

At Gahan & Co., we offer expert tax planning and compliance services, including:

  • Tax Registration & Filing: Ensuring timely and accurate tax submissions.
  • Revenue Audits & Investigations: Expert guidance in case of audits.
  • Tax Relief & Incentive Advice: Identifying opportunities to minimize tax.
  • Payroll & VAT Support: Managing employer obligations efficiently.

How We Can Help

Understanding tax is not just about compliance; it’s about optimizing your financial position. At Gahan & Co., we provide tailored advice to ensure you meet your tax obligations while benefiting from available reliefs and incentives.

Book a Consultation Today

Let us help you take control of your taxes and maximize your financial potential. Contact us today to schedule a consultation with our tax experts.

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