Welcome to our April Newsletter

As we approach the end of April, the Government has recorded record Corporation Tax receipts, which leaves it able to continue its spending, and support what is a very buoyant economy for the majority. Over the last few weeks, it seemed the whole country was on holidays, with travel numbers returning to, if not exceeding pre-Covid levels. Hopefully this air of positivity continues over the next few months.

UK Pension application deadline extended

As we predicted in last months newsletter, the UK Government has extended the deadline for applications to 31st July next. Essentially, they did not expect the number of applications they received, many of them from Ireland. Many of our older clients, who had spent the 80’s and 90’s in the UK have successfully made applications. In most of our client’s cases, it cost them stg£824 to buy each year of service. So, if they had to buy 5 years – service totalling stg£4,120, once they received the pension for 1 year they were better off.

The application process is quite simple – start off by downloading the form CA5403. Then log on to www.tax.service.gov.uk/check-your-state-pension/account Follow the instructions, and if you need any help, give us a call. 

Have you become a director and shareholder in a company since 2019?

A person who is both a director and owns at least 50% of the shares in a limited company is deemed to be insurable for PRSI purposes at class S, rather than Class A, which the majority of PAYE workers are insured at 50% was introduced in 2013 – prior to that it was 15%.

So why is this important? For directors who are insured at class S, the company does not pay PRSI of 11.5%. If a director is insured at A1 class, and say has a salary of €100,000, the company pays PRSI of €11,110 as an additional cost. This is a significant cost.

To confirm what class you are paying PRSI at, just have a look at your last payslip. If it is A1, please contact us immediately, as it is possible, through a relatively simple process to reclaim up to 4 years contributions. In the example above, this would be in excess of €44,000.

Alternative forms of finance

Many of our clients put off replacing or investing in new plant and equipment during Covid, but are now faced with doing so. A number have been rejected by the pillar banks for finance as they are debt warehousing, or their balance sheet has been weakened by 2 years poor trading. In these circumstances, we have found there are now more alternative lenders than ever in the Irish market. Yes, their rates are higher than the mainstream banks, but we have found their decision making a far quicker process. Here’s a few we have found to be good.

Peer to Peer Lending

P2P lending involves matching businesses with private lenders who bid via online platforms to provide you with financing. Linked finance is Ireland’s main P2P lending platform, having

facilitated lending of 100million into the Irish market since 2013.

P2P is quick and easy; the application process is all online & providers pride themselves on providing credit decisions in as little as 24 hrs.

Linked offers unsecured loans from 10 – 500k at rates between 6.75% – 16% (depending on a risk assessment of your business). For comparison, at the time of writing, both BOI & AIB are offering SME loans at rates starting from 6.95%. For the best rates we always advise shopping around:

Linked Finance: www.linkedfinance.com
Grid Finance: www.gridfinance.ie
Flender: www.flender.ie

Cash advance facilities

Looking for a short-term financing option, perhaps to cover wages or stock & your revenue is mainly generated from credit/debit sales? Consider a cash advance. With Grid Finance businesses can borrow up to 150K at rates from 8% – 15%.

Instead of making monthly fixed repayments, cash advance providers take an agreed percentage of your debit/credit card sales before your merchant transfers the funds to your bank account. This works particularly well for seasonal businesses or those in retail/hospitality; quieter periods when sales are low, mean lower loan repayments & less strain on cash flow.

Other providers of cash advance facilities: Linked finance and Payment Plus (www.paymentplus.ie)

If you are considering taking a loan, please call us and we will assist you in that decision making, and provide the paperwork/accounts you need to support your application.

PPS numbers now required for Company Registration Office (CRO) forms

From 23rd April 2023, it will be necessary for directors to insert their PPS numbers on many CRO forms. In preparation for this, we here at Guardian, have requested PPS numbers from proposed directors when forming new companies since 2022. It’s not a problem for many directors that are Irish resident who already have Irish PPS numbers. We see the difficulty being where a non-resident person is being appointed, who does not have an Irish PPS number. The process to get a PPS number is taking 5 – 15 working days. To avoid this, the CRO, is introducing its own identification number to be used in place of a PPS number. The CRO are calling this a “VIF” or Verification of Identity for CRO and RBO (Register of Beneficial Owners).

The alleged purpose of this new initiative is to protect a person’s identity, as currently so much personal information of a director are readily available on the CRO. Another reason put forward is to eliminate multiple appearances of a person – i.e. a person may appear several times on list due to having changed address and not updating the CRO record. People will now be classified by PPS number, thus tying all entries together.