(slide 1)

Goodafternoon!
Ladies and gentlemen, my name is Tymur, and today I will tell you about the
tax system in Ireland.
If during the presentation you will have questions - please write them down,
and in the end I am happy to answer them.
(slide 2)
The main topics of my report will be:
Preface
Chapter 1. Direct taxes
Chapter 2. Indirect taxes
Chapter 3. Taxation evasion and tax avoidance
Conclusions
(slide 3)
In Ireland there is an income tax, a VAT, and various other taxes. Employees
pay pay-as-you-earn (PAYE) taxes based on their income, less certain
allowances. The taxation of earnings is progressive, with little or no income tax
paid by low earners and a high rate applied to top earners. However a large
proportion of central government tax revenue is also derived from value added
tax (VAT), excise duties and other taxes on consumption.
(slide 4)
On the following slide you can see the infographic with key indicators of the
country, and the main objectives of the tax system
universal free education
taxpayer funded healthcare
social welfare payments
public capital expenditure
(slide 5)
Income tax is charged in respect of all property, profits, or gains.
For administrative purposes, taxable income is expressed under four schedules:
Schedule C: public revenue dividends (i.e. coupon payments on
government debt)
Schedule D

 Schedule E: Income from public offices, employment, annuities, and

pensions.
Schedule F: Dividends from Irish companies.
Since 1 January 2012, the tax rates apply as follows:
At 20% (the standard rate):
the first 32,800, for individuals without dependent children
the first 36,800, for single or widowed persons qualifying for the One-Parent
Family tax credit
the first 41,800, for married couples.
The balance of income is taxed at 41% (the higher rate).
(slide 6)
PRSI is paid by employees, employers, and the self-employed as a percentage
of wages after pension contributions.
It includes social insurance and a health contribution. Social insurance
payments are used to help pay for social welfare payments and pensions.
(slide 7)
A capital gains tax (CGT) is a tax on capital gains, the profit realized on the sale
of a non-inventory asset that was purchased at a cost amount that was lower
than the amount realized on the sale. The most common capital gains are
realized from the sale of stocks, bonds, precious metals and property.
Since 5 December 2012, there is a 33% tax on capital gains, with several
exclusions and deductions (e.g. agricultural land, primary residence, transfers
between spouses). Gains made where the asset was originally purchased.
Costs of purchase and sale are deductible, and every person has an exempt
band of 1,270 per year.
(slide 8)
Capital acquisitions tax is charged to the recipient of gifts or inheritances, at
the rate of 25% above a tax-free threshold.
Gifts and inheritances are gratuitous benefits; the difference is that an
inheritance is taken on death and a gift is taken other than on death.
(slide 9)
Deposit Interest Retention Tax (abbreviated as DIRT), is a retention tax charged
on interest earned on bank accounts, as well as some other investments. It was
first introduced in Ireland in the 1980s to reduce tax evasion on unearned
income.

From 1 January 2012, DIRT is charged at 30% (was 27% in 2011) for payments
made annually or more frequently. The tax is deducted by the bank or other
deposit-taker before the interest is paid to you.
(slide 10)
Corporation tax is charged on the profits of companies which includes both
normal income and chargeable gains. Certain expenses such as interest
repayments can be offset against profits. The current rate of corporation tax in
Ireland ranges from 10% to 25%, depending on the nature of the business.
The main rate, which is 12.5%, applies to trading income of companies. It is low
compared to international standards and its longevity (introduced in 2003) has
ensured widespread confidence among international enterprises in the value of
investing in the Irish economy
(slide 11)
VAT rates range from 0% on books, children's clothing and educational services
and items, to 23% on the majority of goods.
The 13.5% rate applies to many labour-intensive services as well as to
restaurant meals, hot takeaway food, and bakery products.
A 4.8% rate applies to supply of livestock and greyhounds.
A 5.2% "flat rate addition" applies to the agricultural sector, although this is not
strictly VAT it is charged by farmers not registered for VAT to compensate
them for VAT which they must pay to their suppliers.
(slide 12)
An excise or excise tax (sometimes called a duty of excise special tax) is an
inland tax on the sale, or production for sale, of specific goods or a tax on a
good produced for sale, or sold, within a country or licenses for specific
activities.
In Ireland excise tax is charged on mineral oil, tobacco, and alcohol.
Mineral oil includes hydrocarbon oil, liquefied petroleum gas, substitute fuel,
and additives
(slide 13)
Tax evasion in Ireland, while a common problem historically, is now not as
widespread. The reasons are twofold most people pay at source (PAYE) and
the penalties for evasion are high. The Irish Revenue target specific industries
every year. Industries have included fast food take away restaurants, banks and
farmers.
Tax avoidance is a legal process where one's financial affairs are arranged
so as to legitimately pay less tax. In some cases the Revenue will pursue
individuals or companies who avail of tax avoidance; however their success
here is limited because tax avoidance is entirely legal.

The areas where tax evasion can still be found are businesses that deal in a lot
of cash. The trades, small businesses, etc., will sell goods and perform services
while accepting cash for the good/service. The buyer will avoid paying VAT at
21% and the seller does not declare the monies for Income Tax. Revenue
perform random audits on businesses to discourage and punish this.
Businesses are regularly taken to court for tax evasion. Revenue claim a
business will be audited roughly every seven years.
(slide 14)
In the years 1990-2000, Ireland has become one of the largest offshore zones ,
which positively affected the success in attracting international financial
institutions. If an offshore company located in Ireland , its income derived
worldwide fall under the Irish corporate taxation .
Preferential treatment in the country has attracted banks and foreign capital.
For example, the Dublin International Financial Services Centre (IFSC)
specializes in the processing of bank information for Citibank, Merrill Lynch,
Daiwa, ABN Amro and another four hundred foreign banks.
Ireland has a very wide network of agreements on avoidance of double
taxation , which has 15 contracts. With a variety of different countries signed
on the extent and nature of the tax benefits of the agreement. In accordance
with these agreements is almost entirely tax " at source " exempt interest on
loans , royalty payments , rental payments on aircraft ownership and real
estate.