Pearse Trust Blog

Dividends are voluntary in the sense that there is no legal obligation for a company to pay a dividend, unless otherwise stated in the company’s constitution. 

A dividend must be paid from the distributable profits of the company and depending on the type of dividend it will be declared at a general meeting of the company or by a resolution of the directors. Once a dividend has been declared it is due and payable.

The “sharing economy” may sound like one of those modern buzzwords, relevant only to those spending unhealthy amounts of time on their smartphones.

But it is turning out to be big business – but also potentially risky from a tax perspective.

Under normal circumstances, an Irish company will purchase commercial property to use for the purposes of its business.

The purchase of residential property by an Irish company may not necessarily be for business reasons.

Where an Irish company decides to acquire either a commercial or residential property, it is important to consider the Irish taxation implications.

Donald Trump and Hillary Clinton don’t agree on very much, and their tax plans reflect their intentions to take America in two very different directions.

Yet, amid the verbal barbs of an increasingly acrimonious Trump vs Clinton election campaign, they do find some common ground on tax.

Unsurprisingly, both candidates claim that their respective policies are a recipe for economic growth. Also, both claim that their plans will reintroduce fairness into the tax system.

Yet, in the main, their proposals are predictably partisan. Ergo, Trump has proposed a substantial tax cut for entrepreneurs, while Clinton’s spending programs are paid for by increasing taxes on the wealthy.

Meetings are an integral part of how companies can make effective decisions and offer a platform for discussions on major strategic decisions.

They may be held for a specific reason or to discuss a host of issues affecting the mechanics and success of the firm.

In this blog, we will focus on the holding of effective board meetings and how to improve board meetings in general.

Previously we discussed Conflicts of Interests and the importance of declaring a suspected conflict to your fellow directors.

In this blog we will discuss how the remaining board members should deal with a declaration of conflict of interest. 

When a board of directors is informed of a potential conflict, all reasonable steps must be followed to ensure that the company and its action are beyond reproach.

This includes discussing the issue, taking a vote and having the whole discussion is included in the minutes.

As an officer of a Company, a director must endeavour to recognise and avoid instances when their own interest may conflict with the interests of the Company.

While avoiding conflicts had historically been a director's duty covered by Common Law, formal legislation was added to the UK Companies Act on 1 October 2008. 

Section 175 of the Companies Act 2006 states that a director has a duty to avoid any “situation in which he has, or can have, a direct or indirect interest that conflict, or possibly may conflict, with the interests of the company”.  An example of an indirect interest would be if the Company you act on behalf of is considering buying land which is owned by a relative.

The Companies Act makes specific reference to the importance of acknowledging conflicts specific to property, information or opportunity, for example meeting a potential new client through your role as director of ABC Limited, but forming a business relationship through another company you act for.

The main purpose of this material is to give a general update of the more important Irish tax filing and payment deadlines under the Irish self-assessment tax system.

Corporation Tax

Irish tax resident companies are required to file its Corporation Tax (“CT”) return via Revenue’s Online Service (“ROS”). The CT return and balancing tax payment are generally due by the ninth month after the accounting period (“AP”) end but no later than the 23^rd day of that month.

The recently decided UK case of Rosenblatt v Man Oil Group SA [2016] EWHC 1382 (QB) highlights the importance of clarity of wording in solicitor’s retainer / engagement letters with regards to revising fee agreements.

In this case, the High Court considered an appeal in a dispute surrounding the interpretation and application of a fixed fee structure in a solicitor’s retainer.

More specifically, it was considered whether the solicitor was to be held to a fixed fee structure which had been agreed with his client, or whether that structure had been superseded thereby entitling the solicitor to charge fees, on an hourly rate, subject to assessment, that were higher than those agreed by the fixed fee structure.

Recently, the United States Treasury put a key piece in place in the BEPS jigsaw, by unveiling final country-by-country (CbC) transfer pricing reporting regulations for certain companies in the United States.

The OECD’s BEPS project is intended to give governments "comprehensive, coherent and coordinated" solutions for closing gaps that allow corporate profits to "disappear" or be artificially shifted to low- or no-tax jurisdictions.

The final package of recommendations is divided into 15 action areas, including new standards of transparency in the area of transfer pricing.