Business Irish

Saturday 10 December 2016

Irish start-ups to get UK-style tax regime

Published 30/05/2016 | 02:30

Minister for Jobs, Enterprise and Innovation Mary Mitchell O'Connor. Photo: Tom Burke
Minister for Jobs, Enterprise and Innovation Mary Mitchell O'Connor. Photo: Tom Burke

The Government will slash the rate of Capital Gains Tax (CGT) for new start-ups to 10pc from next year, bringing the environment more in line with the UK.

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In Budget 2016, a reduced capital gains tax rate of 20pc was introduced on the sale of all or part of a business with an overall limit of €1m in chargeable gains.

Jobs Minister Mary Mitchell O'Connor told the Small Firms Association (SFA) annual conference she was committed to helping secure the commitments set out in the Programme for Government for small businesses.

She said this included "reducing the capital gains tax rate for new start-ups to 10pc from 2017 and to increase the earned income tax credit from €550 to €1650 for the self-employed. This will match the PAYE credit by 2018."

Ms Mitchell O'Connor also said that Government will introduce a PRSI scheme for the self-employed.

She said she has noted that the SFA would like the scheme to be voluntary.

Prior to the Budget, then Jobs Minister Richard Bruton called for CGT to be cut to 10pc on all business gains with a lifetime limit of €15m.

He also sought to have the relief made available on all gains, rather than just the first asset sold by entrepreneurs. The call was backed by Enterprise Ireland and the IDA.

Irish Independent

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