Society of Chartered Surveyors, Ireland. Budget 2015

Transcription

1 Society of Chartered Surveyors, Ireland Budget 2015

2 Agenda 1. General Budget Overview 2. Home Renovation Tax Incentive Scheme 3. Living City Incentive 4. Relief from CGT 7 year Exemption 5. Windfall Tax 6. Hoarding of Land Disincentives 7. Re-Zoning of Lands 8. First Time Buyers DIRT Relief 9. Social Housing Strategy 10. Public Private Partnerships 11. Off-Balance Sheet Vehicle

3 Introduction The Minister for Finance, Michael Noonan introduced Budget 2015 which sets out a plan to regain control of Ireland s fiscal and economic policies, to grow the economy and to get people back to work

4 General Budget Overview Income Tax Higher income tax rate reduced from 41% to 40% Increased standard income tax bands USC Reductions and increases in various rates of USC PRSI No change Combined effect is to retain the 52%/55% marginal tax rate for high incomes but to reduce the marginal tax rate for low/medium incomes

5 General Budget Overview Corporation Tax 12.5% rate remains unchanged Double Irish phased out Companies tax residence rule changes Extend 3 year Start Up Company relief to new companies commencing in 2015 Knowledge Development Box to be introduced next year R&D The 2003 base year is being removed from 2015

6 General Budget Overview VAT 9% VAT rate remains unchanged for the tourism sector. Comes with a warning not to increase prices 2015 will see the introduction of new Place of Supply rules for eservices Farmer s Flat Rate Addition increased from 5% to 5.2%

7 General Budget Overview CAT No change to CAT rate of 33% or tax free thresholds Agricultural Relief changes CGT No change to CGT rate of 33% Retirement Relief conditions amended favourably for land disposals Extension of deadline for CGT farm restructuring relief to 31 December 2016

8 General Budget Overview Excise Duties 20 Cigarettes increased by 40c15/10/2014 Roll your own increased by 20c Alcohol, Petrol, Diesel unchanged Extension of qualifying excise duty relief for micro breweries

9 Home Renovation Tax Incentive Scheme (HRTI) Relief available at 13.5% on home renovation spend in 2014 and 2015 Tax credit for spend between 5,000 and 30,000 Contractor must be tax compliant 9,300 homes availed of scheme representing nearly 190 million worth of works and 3,000 contractors

10 Home Renovation Tax Incentive Scheme (HRTI) Extended to include rental properties owned by landlords who are subject to income tax on rental income Extended to support legitimate operators in the rental and construction sector and help upgrade the quality of private rental stock Available to landlords for work carried out from Budget night until the end of 2015

11 Living City Initiative Initially introduced in Budget 2013 and applied to 6 cities: Dublin, Cork, Limerick, Waterford, Galway and Kilkenny Owner-Occupiers: Entitlement to offset the entire cost of renovation against the home owner s taxable income over a ten year period Commercial Premises Capital Allowances: 15% per annum for 6 years and 10% in year seven An attractive initiative, designated to maximise use of existing pre-1914 buildings by transforming them into modern homes and to bring families back to city centres

12 Relief from Capital Gains Tax (CGT) 7 Year Exemption Where property held for 7 years, gains attributable to that period exempt from CGT The 7 year incentive relief from CGT will not be extended beyond 31 December 2014 Felt the scheme has achieved its objective of increasing property transactions and is no longer needed High volume of transactions in the coming weeks?

13 Windfall Tax Tax is charged at 80% in respect of a disposal of development land where both a rezoning and a disposal took place on or after 30 October 2009 Abolished from 1 January 2015 The 33% rate of CGT and other standard taxation arrangements will now apply to the property market as it does to other normal functioning capital asset markets

14 Hoarding of Land - Disincentives Public consultation in the coming months on the issue of owners of zoned land who are not taking steps to develop their land or sell it to others who will Will examine what taxation measures might be taken to penalise land owners who do not develop land that is already zoned and serviced

15 Re-Zoning of Lands Public consultation in the coming months on the issue of owners of zoned land who are not taking steps to develop their land or sell it to others who will Will examine what taxation measures might be taken to penalise land owners who do not develop land that is already zoned and serviced

16 First Time Buyers DIRT Relief Budget 2015 introduced a refund of DIRT on savings used to purchase the home by first time buyers Refund will apply from the Budget night until the end of 2017 Maximum savings up to 20% of the purchase price Incentive for first time buyers

17 Social Housing Strategy Overall capital investment of 2.2bn for social housing provision for the next 3 years 1.5bn invested by Exchequer by mn invested by PPPs by mn invested by financial vehicle from 2015

18 Social Housing Strategy Taking action to support the private and social housing and rental sectors by addressing issues in relation to the: Planning Regulation and Development Systems; Supply of Land and upgrading of existing housing stock; and Financing of Private and Social Housing Development

19 Social Housing Strategy 2015 specifically million for the housing programme Represents the first major investment in housing since 2009 Will deliver an additional 2,500 housing units in 2015 and over 6,700 housing units by 2017

20 Public Private Partnerships Model which has helped deliver 23 schools in recent years Objective is to deliver a further 1,500 housing units by 2017 from this mechanism

21 Off-Balance Sheet Vehicle Channel investment funds to the voluntary housing sector Will operate on an independent, commercial basis to provide financing to Approved Housing Bodies

22 Conclusion There is only one thing worse than being talked about...

23 Thank You