2. Budget 2010

3. October 2008

4. April 2009

5. December 2009

6. Budget Strategy -Objective -Rebuild Nations Self Confidence -Restore International Reputation -How -Bold – Decisive – Innovative Steps -Conclusion -Worst is Over -Return to Growth in 6 – 9 Months

7. €4 Billion Question ?

8. Signalled Changes Taxation of child benefitX Introduction of carbon tax Introduction of property tax2010 Review taxation exempt income / reliefs CAT/CGT Business Reliefs X Pension Contributions / Lump Sums? Reduce VAT/Excise Car Scrappage

9. Personal Tax

10. Income Tax Rates No Changes Reminder –Income Tax –PRSI – Health Levy – Income Levy

11. Simplify and Reform Tax System -Reform and Fairness -Social Contribution -Low Rate -Broad Base -Income Tax -Progressive Rates -2011

12. Employee >€75k€75k-€175k€175k+ Income Tax414141 PRSI4-- Health Levy455 Income Levy246 51%50%52% IT, PRSI, Health Levy & Income Levy

13. Self-Employed >€75k€75k-€175k€175k+ IT414141 PRSI333 Health Levy 455 Income Levy246 50%53%55% IT, PRSI, Health Levy & Income Levy

14. International Comparisons: Overall marginal tax rates for employees on €80,000

15. Why No Tax Increase? -Reached Limit of Taxation -Heaviest Burden on Higher Earners -Income Levy : Gross -High Earners Cap

16. High Earners Cap -Introduced 2007 -Restricted Specified Reliefs -Aim - Effective Rate 20%

17. How It Worked 2009 -20% Effective Rate -Restricted Relief to Higher of: -€250,000 OR -50% of Income 2010 -Now 30% Effective Rate -Entry Point €125,000 -Full Restriction if Income > €400,000 -Finance Bill Clarification

18. 20092010 €’000€;000 Income600600 Specified Reliefs 400400 Allowed 300150 Restricted 100250 Taxable300450 Tax @ 41%123185 Effective Rate 200920%30% High Earners Cap - Example

19. Tax Exiles

20. New Irish Domicile Levy -Non Resident Domiciled Individuals -Worldwide Income > €1m -Irish Located Capital > €5m -Annual Levy €200,000 -Details in Finance Bill

21. Mortgage Interest Relief Budget 2009 –Relief to cease for loans over 7 years Interest Relief now until 2017 – Home Owners in Negative Equity –New Loans before 1/7/2011 –Loans from 1/7/2011 to 31/12/2012 (Restricted)

22. Residential Rental Property Reminder – current position Tax deduction for interest reduced to 75%

23. Investments/Savings Existing 25%/28% Tax New National Savings Product –National Solidarity Bond –5/7 Years –2010 –Details to be announced

24. Pension -Overhaul Imminent -No Immediate Change -Frame Work Policy to Review -Likely Outcome -Max Tax Tree Lump Sum €200k -Excess Taxable? -SSIA Type Scheme -No Tax Relief

25. Child Benefits Children’s Allowance – 10% cut to allowance – Future Taxation / Means Test ? Incentive in 2009 –Preschool – Free Year –Effective 1/1/10

26. Business Taxation Ireland Inc

27. Business Taxation Corporation Tax –12.5% tax rate unchanged – International Brand Employers –Employers PRSI unchanged (8.5 – 10 ¾ %) –Employer Job Incentive Scheme –Details to be announced

28. New Company Set Up Introduced 2009 Profits < €320k per annum 3 Year Period Extended set up’s in 2010.

29. Smart Economy Irish Economic Focus Research & Development tax credits –Qualifying R & D –25% cash refund Intellectual Property Awaiting Innovation Taskforce Report

30. Support Motor Industry Car Scrappage Scheme – Car over 10 years old – €1,500 off VRT – Emissions band A or B Environmentally Friendly – Extension of VRT Relief to 2012 VAT Margin Scheme

31. Supporting Retail Sector VAT Rate – Reduced from 21 ½% to 21% from 1/1/10 Excise Reduction on Alcohol

32. Supporting Agriculture Waste Management Capital Allowances –No Income Levy Forestry & Bio Energy

33. Supporting Other Industries Construction –Retrofit Tourism –Railway Scheme Other – Energy Efficient – Extends to Catering/Hospitality

34. Supporting Financial Services Incentives to develop International Funds Industry Hub Changes expected in Finance Bill

35. Incentives to Protect Employment Training Fund Food Industry Employment Job Incentive Scheme

36. Employment Subsidy Scheme Enterprise stabilisation fund –Assist Irish export companies in difficulty Second round now open –Eligibility extended Non Export –Minimum of 10 full time employees –Jobs at risk / Commit to retain jobs –Tight Deadline/ Immediate Application

37. Getting Credit Flowing Review Committee NAMA – External Review Process Review Banking Policies – Particular Focus on Retail, Car, Tourism & Agriculture

38. New and Other Taxes

39. Carbon Tax €15 per Tonne on Fossil Fuels Effective Midnight 9/12/2009 – Petrol3.5% Increase – Diesel4.6% Increase Effective 1/5/2010 –Home Heating …. 8.7% Commencement Order –Coal & Briquettes

40. Other Taxes Site Valuation Tax –Residential Property –Establishing Ownership Register –Valuation Database Water Charges –Based on Usage

41. Capital Gains Tax (CGT) & Capital Acquisitions Tax (“CAT”) No changes currently Rate 25% Finance Bill?

42. Stamp Duty No changes currently

43. Anti Avoidance Clearly Signalled Tax Avoidance Schemes Strengthening Revenue Power

44. Conclusion

45. Tax Planning in the Current Environment

46. Current Environment Existing Legislation Finance Bill / Finance Act Maximise available remaining tax reliefs –Secure tax savings –Improve cashflow Window of Opportunity

47. Cashflow Saving Tax Tips Preliminary Tax –If profits decreasing – base on current year Move to a cash receipts basis for VAT Review direct debits for PAYE / VAT Directors loan v Salary Use of a Redundancy Rebate

48. Losses Ability to Use Losses Losses arising –Land write downs / restricted –Capital allowances claims – obsolete assets –Stock / Bad Debt provisions –Inter group loans – write off / down Use –Carried back to prior year (company) –Offset against other Income (Personal)

49. Tax Based Funding/Reliefs Pensions Seed Capital Relief –Start ups –Tax relief on investments up to €600k –Set against Income Tax bill in prior 6 years –Refund of income tax Business Expansion Scheme –Tax relief of €150,000 pa for individuals –Qualifying company can secure €2m –Lack of other tax incentives for individuals

50. Opportunities with Reduction in Asset Values Take assets out of company Re-organise company structure Transfer assets to children

51. Opportunities for Family Businesses / Companies Low valuations – opportunity to transfer CAT threshold for children €434k Significant tax reliefs remain at present Retirement Relief: extract €1.5m cash tax free (if husband & wife qualify) Commission on Taxation Report

52. Company Pension Schemes Significant pension fund contribution –Based on age, years of work and salary 25% tax free lump-sum Changes Signalled

53. Conclusion Economy Worst is Over? Tax Watch this Space