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Bamboozled by bills: 25pc of householders believe they were overcharged

Householders are being bamboozled by bills – with many fearing they are being overcharged, new research has found.

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Theresa May rejects accusation of hiding Brexit facts as full legal advice published

EU ‘ready for no-deal Brexit’ if UK sinks deal
Irish backstop for UK’s withdrawal deal could last ‘indefinitely’, legal advice states
Report also warns of Britain becoming stuck in “protracted and repeating rounds” of negotiations
Theresa May said she is listening to concerns on Brexit backstop to find way forward
DUP says UK government’s Brexit legal advice is devastating

Britain could be kept “indefinitely” in a customs union with the European Union if UK Prime Minister Theresa May’s Brexit deal is backed, according to details of the government’s full legal advice on the deal published on Wednesday.

The advice said that Britain risks becoming stuck in “protracted and repeating rounds” of negotiations to leave the European Union if it enters a so-called backstop arrangement.

“Despite statements in the Protocol that it is not intended to be permanent and the clear intention of the parties that it should be replaced by alternative, permanent arrangements, in international law the Protocol would endure indefinitely until a superseding agreement took its place,” the advice said.

The Protocol refers to the so-called Irish backstop agreement in May’s withdrawal deal she has agreed with the EU to prevent the return of border controls between Northern Ireland and Ireland.

The government was forced to publish its legal advice on its Brexit deal by parliament on Tuesday after being found in contempt for refusing to do so.

Many opposition parties members say they want to see the advice to better inform themselves before voting on Prime Minister Theresa May’s deal with the EU on December 11.

Following the report being published, Theresa May said she has not concealed the facts on the Brexit deal from parliament.

May was tackled by the leader of the Scottish National Party at Westminster, Ian Blackford, to explain why Northern Ireland would have a deal to remain in the EU’s single market under the so-called backstop and Scotland would not.

“We have not concealed the facts on the Brexit deal from members of this house,” she told parliament.

Read more: Explainer: What happened on day one of the Brexit debate – and what happens next?

The advice on how to exit the backstop agreement to prevent the return of a hard border between Northern Ireland and EU member Ireland is under scrutiny, particularly by May’s nominal allies in Democratic Unionist Party (DUP).

“I believe that the deal we have negotiated is a good deal. I recognise that concerns have been raised, particularly around the backstop and that is an issue, … I am continuing to listen to colleagues on that and considering the way forward,” Mrs May told parliament.

British interior minister Sajid Javid said the government was listening and continuing to explore ways to make the so-called backstop arrangement in the Brexit deal more acceptable to the DUP.

The DUP has shown its deep anger over the backstop arrangement to prevent the return of a hard border between the British province and EU member Ireland, arguing that it would essentially split the province from the rest of the mainland.

“I think again .. it’s right that we look and continue to explore whether there are other arrangements as well that can lead to more permanent and more easily acceptable outcome,” he told parliament.

Meanwhile, the European Union is continuing with contingency planning in order to manage Britain’s withdrawal from the bloc in the event the British parliament next week rejects a Brexit deal, a senior EU official said on Wednesday.

“We need to see what’s the outcome of discussion in UK parliament,” European Commission Vice President Valdis Dombrovskis told reporters. “We are preparing for the deal. We have agreed on the deal with the government. We are making sure that it can be implemented — and in parallel we have done some contingency planning also.”

The deputy leader of the DUP described the government’s full legal advice on Brexit as devastating.

The Democratic Unionist Party (DUP) are unhappy with the EU divorce deal’s so-called backstop provision which will align Northern Ireland more closely with the European Union than the rest of the United Kingdom if no other way can be found to avoid a hard border with the Republic of Ireland.

“Devastating,” Nigel Dodds said on Twitter after the advice was published. “The legal advice just published proves NI (Northern Ireland) would be in full EU Customs Union while GB (Great Britain) is not.”

Article Source: http://tinyurl.com/kbwqb42

Digital tax kept alive by France and Germany

Europe’s efforts to tax large tech companies were kept on life-support yesterday as France and Germany proposed a final-hour compromise that scales back the broad plan initially envisioned by Paris.

Ireland, along with other countries including Sweden, opposes the tax plan and even the watered down proposals will face resistance.

The updated proposal is to tax the European advertising revenue of digital companies at 3pc. That’s watered down from an initial plan to set a levy on all digital revenues of large multinationals.

The new plan would generate about half the revenue previously planned and mainly hit Google and Facebook, which dominate the online ad market, according to an official with knowledge of the matter.

Both companies are among Ireland’s biggest employers and pay significant corporation taxes here, though the bills are a tiny fraction of the massive revenues booked here.

“Like any European compromise, some will be disappointed. They’ll say it’s not enough and I can understand them,” France’s finance minister Bruno Le Maire said.

The tax plan requires unanimous support to come into force as EU-wide legislation.

The Irish position is that any major changes to international taxation should be agreed through the Organisation for Economic Cooperation and Development (OECD) level – where the US and other big non-EU countries are also represented.

Finance Minister Paschal Donohoe is understood to have reiterated that position at yesterday’s meeting in Brussels.

“The Minister continues to have strong principled concerns about this policy direction as previously outlined. As other countries mentioned, the right and safest way to deal with this is through the OECD to find consensus on global matters. Ireland will engage constructively over the coming weeks and months,” a spokesman said.

Finance ministers from reluctant countries didn’t give their backing to the narrowed Franco-German plan at the meeting, but said they wouldn’t stand in the way of further talks. “I promise to be constructive and I’m ready to look at the proposal, but I still have serious concerns with it,” said Finnish Finance Minister Petteri Orpo.

A draft of the new proposal will be presented by the European Commission within weeks and put to a vote of member states in 2019.

Article Source: http://tinyurl.com/kbwqb42

Mortgage approvals jump by 11pc as values also increase

Mortgage approvals jumped in October, both in terms of volume and value.

Across all types of borrowers, banks approved a total of 4,262 mortgages in October, up 11.4pc month-on-month.

This is a 13.6pc increase in approvals year-on-year, figures from the Banking and Payments Federation Ireland show.

First-time buyers accounted for the lion’s share of activity, with 2,014 mortgage approvals.

The figures also show the value of mortgage approvals rose by 11.4pc year-on-year, and 13pc when compared with the previous month.

Mortgages approved in October 2018 were valued at €929m, of which first-time buyers accounted for €446m.

Meanwhile, the level of re-mortgaging or switching approvals rose on a year-on-year basis by 71pc both in volume and value terms – albeit off a low base.

Commenting on the figures, Felix O’Regan, director of public affairs at the Banking and Payments Federation, said: “All segments of the mortgage market contributed to an overall increase in annualised approval volumes and values in the 12 months to end-October 2018.”

Last month, following a review, the Central Bank said the rules dictating the amount of money people can borrow for a home and the size of deposits needed are to remain unchanged.

Introduced in 2015, the rules are in place to stop banks over-lending and consumers from over-borrowing.

The rules have been credited with slowing down the pace of house price growth.

Article Source: http://tinyurl.com/kbwqb42

Drive down wage costs, renegotiate supplier prices to boost profits

Q. Could you give me a few words of wisdom on improving the profitability of a manufacturing business?
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Tax windfall won’t boost spending – Paschal Donohoe

Bumper corporation tax receipts pushed the overall tax–take in November to €631m ahead of target.

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You’d be crazy not to tap into open-source software and communities

Last week in this diary I discussed our remote-working strategy. By adopting a company culture of remote and flexible work, we gain access to much larger pool of global talent. The trade-off is  Read more

Should I accept pension transfer value?

Query: I left my former employer two years ago after working there for almost 20 years. I have an entitlement to a pension from that company’s defined benefit (DB) pension scheme. I have received a letter from my former employer, offering me an ‘enhanced transfer value’. Should I transfer my benefit entitlement out of that DB scheme. I have a defined contribution (DC) scheme with my current employer. What do I need to bear in mind when coming to a decision? John, Carrick-on-Shannon, Co Leitrim

Answer: There has been a big decline in the number of defined benefit (DB) pension schemes in recent years. For many schemes, a combination of increased longevity, low interest rates and changes in accounting rules have resulted in scheme liabilities outweighing assets – a funding deficit, and an increasing cost burden on sponsoring employers.

Many schemes are either closing to new entrants, closing to future benefit accruals or winding up altogether. An added problem for employers and trustees is that for many DB schemes, deferred members outnumber current active members. (Deferred members are former employees who still have a benefit entitlement in the scheme and have not yet retired.)

In an attempt to ease the administrative and financial headache associated with these scheme members, many trustees and employers have contacted former employees and reminded them of the option they have to transfer out to alternative pension arrangements. Sometimes a financial incentive to do so is offered.

There are a number of things to consider when deciding whether or not to transfer out of your DB scheme.

The first and most important factor to understand is that if you transfer out of the DB scheme of your previous employer, you will be transferring your DB benefit into a DC arrangement – either the DC scheme you have with your existing employer, or a buyout bond which you take out yourself. If transferring to a DC scheme, the investment risk in relation to the pension fund passes from your former employer to you personally.

On first impressions, a DB pension scheme is the best type of pension you can have – they’re often referred to as ‘Rolls-Royce’ pensions. A DB pension promises to pay you a pension based on a percentage of your final salary so planning for the future is easy. However, the ability of a DB scheme to pay you a pension based on your final salary depends on the scheme’s ability to fund its pension obligations for all members going forward. Benefits under DB schemes are not guaranteed. If a scheme’s assets are not sufficient to pay the benefits (liabilities) and the employer is not in a position to meet the shortfall, the pension promised to you may have to be reduced.

Therefore the current funding position of the scheme is an important consideration if you are offered a transfer value. If the scheme is not fully funded, this will be reflected in the transfer value provided to you.

That’s not to say that if a scheme is currently in deficit, it will remain so – or that an employer company will not be in a position to eliminate the deficit going forward. The opposite is also true. A currently fully funded scheme may not remain so. Consideration therefore needs to be given to the financial health of the scheme, and the future financial health of your former employer – in so far as this can be determined.

Some DB schemes offer enhanced transfer values – where you typically get a better transfer value than a shortfall in a DB scheme would typically allow for – to try to encourage existing members to leave the scheme.

If taking any transfer value to a DC arrangement, you would need to calculate the investment growth which you would need on that transfer value to provide you with the same – or a higher level of benefits – than the DB scheme was promising to pay. The required level of investment growth (which you would need to give you equal or higher benefits than the DB scheme) may well be accompanied by a level of investment risk which you are uncomfortable with. For this reason, many deferred members of DB schemes have in the past decided to remain in the scheme.

However, the financial pressures which many of the employers who provide DB schemes are under have made people reconsider.

Deciding on whether to take a transfer value from a DB pension scheme is an important decision and it cannot be reversed. It is important that all of the options available are reviewed and considered carefully.

If you stay in the DB scheme, the current financial health of the scheme may well improve or diminish over time.

Transferring out may well give you greater flexibility in terms of when and how to access your benefits, what the pension invests in, how much income to take in retirement (you would no longer be limited to a specific amount each year) and so on.

There are risks involved in staying in the DB scheme – or in taking the transfer value. However an enhanced transfer value does reduce the risks of taking a transfer value somewhat. Get independent financial advice before making your final decision.

Article Source: http://tinyurl.com/kbwqb42

Mortgage approvals jump by 11pc as values also increase

Mortgage approvals jumped in October, both in terms of volume and value. Read more

‘If you’re going to leave, leave, but don’t do this halfway house’ – Tony Blair on second Brexit referendum

Former UK prime minister Tony Blair said any second Brexit referendum should be a choice between remain and a hard Brexit. Read more