Summer is approaching – it may be time to employ and pay your children!

As June approaches, many of our clients encourage their secondary school or college age children to work in the family business, to either get a flavor of the business, or merely to help cover holidays.

Please note, that this can prove to be very tax efficient way of covering these children’s school or college fees. Each child receives tax credits of €3,350 per annum, and can earn up to €37,500 @ 20% tax per annum. If we take the example of a child who works 12 weeks for you x 40 hours per week @ €13 per hour = €6,240. The PAYE on this, assuming the child has not earned income elsewhere in the year, is €1,248. However, their tax credits to 31st August are €2,190 and thus they would pay no PAYE. Some USC and PRSI are payable, but its small. You could then encourage your child to use some of this money to pay their school or college fees.

If the child is in college and has skills commensurate to the work they are doing, you could pay a higher hourly rate, and thus the gain is even greater. Please contact Keith or Michael (kdoherty@guardianma.ie and mdempsey@guardianma.ie) if you wish to discuss how this may suit your own particular circumstances.

Debt collection service

We are delighted to announce that Guardian can now offer an efficient and effective debt collection service. Over the last few month’s we have trialed it with clients in the trades sector, professional services, and consulting, and all have been very successful.

If you are having problems with debtors, even a handful, we can help you at a variable cost without the need for a long-term commitment. Please get in touch with Colum if you wish to enquire how this service works (colum@guardianma.ie/01 4240519).

Is it time to remove your husband or wife as a director?

Prior to September 2008, an Irish company had to have at least 2 directors. Until then, most people, when forming a company appointed their life partner as the other director, even though the partner may not have been involved on a day-to-day basis with the business. Many remain as the second director even now.

However, since 1st September 2008, a company may have only 1 director and a secretary, and indeed you can appoint a corporate secretary such as Guardian to fulfill that role. If you chose to do this, there may be an opportunity to pay the exiting director tax free money, under a process called Compensation for Loss of Office. This payment may be tax free under the same rules a redundancy. If these are your circumstances, please contact james@guardianma.ie and he will expand on the matter.

Thinking of expanding or strengthening the Management team?

Many of our clients are experiencing strong organic growth, and/or are considering moving into a new market/exporting. If this matches your current state, here’s an incentive we have come across from Enterprise Ireland. Please note, it’s a support to assist with a person’s salary – you need not be involved in export. To qualify, you must have over 10 employees and have been trading for at least 2 years.

Overview of Enterprise Ireland Key Manager/Part Time Key Manager Support

The aim of this initiative is to provide partial funding towards the cost of recruiting a Full Time or Part Time Key Manager with skills that are critical to the future growth of the client. This individual must contribute to significant and measurable improvements in company productivity and/or changes in its output to meet defined market requirements. The Part Time Key Manager grant has been introduced in order to support companies to attract senior leadership talent by offering more flexible working arrangements.

Key Manager support is not intended to be a mechanism to subsidise general recruitment.

Examples of Key Manager positions are: Chief Financial Officer (CFO), Chief Technical Officer (CTO), R&D Manager, Production Manager, etc.

Inheritance from a critically ill child

There are 2 certainties in life – Death and Taxes. No one likes to talk about death, but in the rare and extremely rare event where a child is critically ill, and will pass away before a parent(s), there is an opportunity to significantly reduce inheritance taxes. Common instances where this may arise, is a child has received an award of damages for various reasons, or the child, now an adult themselves, has been exceptionally successful financially, but is now faced with a life ending illness.

I sincerely hope to never encounter this myself, or for you to, but if you are aware of any friend or family member who finds themselves in this position, please put them in touch with us, and we can help them reduce taxes.