Here is all you need to know about the proposals for the participation exemption for foreign dividends.

A Roadmap to the Introduction of a Participation Exemption to Irish Corporation Tax has been published, setting out a timeline for the introduction of a participation exemption with respect to foreign dividends and foreign branch profits. A public consultation on the design of the proposed systems will run until 13 December 2023.

Vacant Homes Tax

On 30 August 2023, Revenue published Part 22B-01-01 of the Tax & Duty Manual: Vacant Homes Tax. Vacant Homes Tax (VHT) was introduced in the Finance Act 2022 and applies to residential properties that were in use as a dwelling for less than 30 days in a 12-month period. The first chargeable period is the 12 months to 31 October 2023.

VHT is charged annually at three times the base Local Property Tax (LPT) rate (the rate excluding any local adjustment factor) on the value of habitable residential properties. VHT is charged in addition to LPT. Owners of vacant properties are required to self-assess their liability to VHT by looking back over the previous chargeable period to determine if their property was in use as a dwelling for less than 30 days in that chargeable period. Where a property has been in use for less than 30 days, a return must be filed electronically within 7 days of the end of the relevant chargeable period, i.e. by 7 November.

Certain residential properties are outside of the scope of VHT: properties that are exempt from LPT; properties that are genuinely tenanted for a period of at least 30 days in the chargeable period; and properties which changed ownership during the chargeable period either by way of gift, sale, inheritance or a compulsory purchase.

In addition, there are eight scenarios where an exemption from the tax can be claimed, even where a property is used for less than 30 days in a chargeable period, including where the property was being actively marketed for sale or rent, or where it was unoccupied due to illness or death of the owner. In these situations, the exemption must be claimed on the VHT return.

Due to the low rate of VHT, it is felt that the cost of administering the tax will not justify its returns; whilst we cannot be certain, it is expected that the rate of VHT will be increased in the Budget on 10 October.

Revenue issue invitations to webinars on Enhanced Reporting Requirements for Employers

From 1 January 2024, employers who pay any of the following expenses/benefits to their employees will be required to report those benefits to Revenue:

• Travel and Subsistence;
• Small Benefit Exemption; and
• Remote Working Daily Allowance.

Revenue has started to send invitations to webinars to employers and agents via the ROS inbox. The webinars will give an overview of enhanced reporting and will cover:

• requesting Employer Reporting Notifications;
• submitting expense/benefit details; and
• viewing expense/benefit details.

For full details on the enhanced reporting requirements please see: Enhanced reporting requirements from 1 January 2024 (revenue.ie)