Farming The taxation of farming is subject to special rules on account of the seasonal nature of the business. Formerly, certain farmers were exempted from income tax entirely, when they rateable valuation of their land fell below a certain amount. Farming includes farming land in the State wholly or mainly for the purposes of husbandry, other than market gardening. Husbandry includes cultivation and growing crops, […]
Partnerships A partnership exists when business is carried on by two or more persons in common. A partnership is not a separate legal entity and is not taxed as such. Legally, a partnership comprises the individual partners. There is a great deal of flexibility in relation to the way partnerships may be constituted. Partnerships may range between relationships of equals, to relationships of individuals with […]
Farming The taxation of farming is subject to special rules on account of the seasonal nature of the business and other factors. Formerly, certain farmers were exempted from income tax entirely, when the rateable valuation of their land fell below a certain amount. Farming includes farming land wholly or mainly for the purposes of husbandry, other than market gardening. The special rules apply only to […]
Basic Options Losses can be used as follows losses carried forward from an earlier periods current year losses losses carried back to the preceding corresponding period losses carried forward against future income Losses on trades carried out wholly abroad only may only be offset against future profits of the same trade . However, such losses may be offset against other foreign income . There are […]
Commencement The issue of when a trade commences may be important. It determines dates of liability for tax and raises issues in relation to allowable expenditure. A distinction is drawn between trading and commencing to trade. Market testing and feasibility is likely to predate trading. When assets are purchased in anticipation of trading, trading may not necessarily have begun. It depends on the circumstances. Where […]
Trades and Professions Persons who are self-employed, in business on their own account, are taxed as a business or trade. The independent contractor / employee distinction, discussed in our employment guide is relevant in this context. Most businesses / self-employed activities will constitute a trade. The so-called “badges of trade” are relevant to determine whether a particular activity is a trade for the purpose of […]
Revenue v Capital Expenses In calculating the profits of a trade / business, the expenses incurred in relation to that trade are allowed as deductions. “Revenue” expenses only are allowed. Capital expenses are not allowed but may be allowed against capital gains tax liability in the ultimate disposal of the asset concerned, but not otherwise. For example, repairs are a revenue expense, allowed against profits, […]