DLS CM November 2018

NOVEMBER

2018 IF GLOBALISATION IS SO GOOD, WHY HAS IT BECOME SO UNPOPULAR Graham O’Neill

TURN YOUR COMPANY PROFIT INTO PERSONAL WEALTH SELF EMPLOYED BENEFIT FROM BUDGET TOP 9 MONEY MANAGEMENT APPS MEET THE TEAM RANGE OF SERVICES

TABLE OF CONTENTS If Globalisation is so good, why has it become so unpopular Graham O’Neill Turn Your company profit into personal wealth DPP Office to Set Up a CAB-type Agency No-Deal Brexit - What it would mean for Ireland Top 9 Money Management Apps 9 Simple Steps to Beat the Budget Self Employed Benefit From Budget Airbnb Rules to Return Housing Units to Long-Term Rentals Meet The Team Range of Services

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Welcome to the November 2018 newsletter.

As always this issue contains a variety of articles which we hope will be of interest to you and your business.

If you have any queries please do not hesitate to contact us and one of our highly experienced team will be happy to assist you.

Dervilla and Sarah.

IF GLOBALISATION IS SO GOOD, WHY HAS IT BECOME UNPOPULAR? Graham O’Neill - DIRECTOR AT INDEPENDENT RESEARCH CONSULTANCY LIMITED

Introduction Globalisation is a subject most market commentators viewed as a given until the Brexit vote and the election of Donald Trump. This is now being questioned and the excellent work from Stephen King of HSBC on the subject has been most useful for background research and data.

Up until the Financial Crisis from the post WW2 period globalisation had been regarded as a one-way bet in which everybody benefitted. Examples of globalisation not only include the most recent advances in technology which allows people to connect inexpensively and quickly. through things such as Facetime and WhatsApp, Twitter and Facebook. Globalisation also saw as an initial benefit the availability of Western consumers to benefit from lower production costs (primarily labour) in the emerging world, thus bringing down the cost of tradable goods for everybody.

Globalisation has always been associated with cross border people flows arguably starting with the exodus of part of the population of Europe for the New World, the movement of people from crisis-hit European nations in the GFC and most recently the surge of migrants from Africa to Europe. Modern globalisation has been founded and based on a rules-based international system, primarily sponsored by the United States post World War II. Whilst some parts of globalisation existed in the pre-War period and indeed even earlier in history, it had dramatically accelerated as the US moved away from its preWorld War II isolationism.

All views in this piece are those of the author.

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History Post the First World War early attempts at a more globally integrated approach to problem solving, such as the League of Nations, fell apart in the 1930s depression in which some countries such as the United States experienced deflation, whilst the Weimar Germany saw hyperinflation. In 1944 the Allies, or to be more specific the Americans and British, began to think about the post war economic and financial order. After the sacrifices at home neither country wanted to go back to the chaos of the 1930’s, a decade of depression, devaluation and default. There was a recognition that to impose huge costs on a defeated Germany as had been tried with the Versailles Treaty post WWI would ultimately end in failure. Thus, the Americans and British looked to create a system that would avoid the “beggar-thy-neighbour” behaviours of the 1930s, whilst settlement treaties on the vanquished of WWII avoided a focus on revenge. Arguably, the Americans also had another subtle agenda which was to get rid of the 19th Century empires and to insure the United States was the sole country with super power status in the West. It is now widely recognised that the conditions laid down by the States for its assistance to Britain during WWII were notably tough.

The Bretton Woods Conference of 1944 looked to rid the world of protectionist practices which had so damaged it in the 1930s.

Americans were the front runners in terms of pro globalisation arguments and were behind the creation of three institutions, the International Monetary Fund (IMF), the World Bank and within a few years the General Agreement on Tariffs and Trade (GATT) which then led to the World Trade Organisation (WTO).

With Europe struggling under the costs of the war effort, the US Secretary of State put in place the eponymous Marshall Plan in part to provide a buttress against the threat from the East and to ensure Europe could remain outside of Soviet influence. The European Recovery Plan ran for four years from April 1948. The numbers were huge with the US providing $13bn in aid which was almost 5% of US national income in 1948 and around $130bn in 2015 terms. The quid pro quo was that European countries were encouraged to embrace free market principles, abolishing price controls, supporting free trade and re-building Europe in a way consistent with Washington’s strategic ambitions. The US did not want to see a return to sovereign rivalries which had occurred in the first half of the Century with economic interdependency paramount. Those who were war time allies received no favourable treatment. Arguably the Marshall Plan was behind the huge gains in living standards in Europe delivered during the 1950s and 1960s. A second driver of growth in Europe was the original European Coal and Steel Community and the 1951 Treaty of Paris which eventually evolved into the Treaty of Rome and the European Economic Community around one year later.

Isolationist American foreign policy had resulted in Britain and other advocates of democracy standing alone initially in both World War I and World War II and the formation of NATO (North Atlantic Treaty Organisation) in 1949 saw a break with American isolationism with the 12 founding nations adopting a three musketeers approach to their collective defence which was ‘one for all and all for one’. NATO was of course designed to provide a bulwark against the perceived Soviet and Communist threat, but also to ensure deeper European integration and to ensure nationalist militarism would not return to the Continent. The reason it worked so well was that the US was compelled and happy to have a permanent military presence in Europe. This of course is something which is being questioned today by the current US President.

Thus, the end of the second world war saw a huge change as America moved away from its position of splendid isolationism which had dominated US foreign policy ever since the ‘Munroe Doctrine’. US President James Monroe argued for noninterference in other countries affairs in around 1850. The US had few serious military ambitions following the American Civil War. Arguably the League of Nations was doomed to failure when the US Senate voted against membership in 1919. Whilst the US had initially been unwilling to involve itself in WWII, it did eventually see an opportunity to re-write the world order and America’s role within it. In the immediate post World War II world the US believed it had a moral purpose to demonstrate the values of freedom and democracy to countries far and wide, returning to the Jeffersonian doctrine of an “empire for liberty”. For this to work the US could not return to its insular policies and through the institutions it helped create such as the IMF, World Bank and NATO together with cash provided through the Marshall Plan, shaped the democratic world in the post war period.

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The GFC & Rising Inequality The accepted wisdom that globalisation was to the benefit of everyone was not really challenged until the GFC. There was a growing belief that free market capitalism was the way forward for every country and China’s reforms under Deng Xiao Ping only reinforced this point. As Western and Japanese capital poured into the country living standards improved markedly. Over 50 conflict free years in Europe had seen the development of a single market based on the free movement of goods, services, capital and labour, the so-called four freedoms, first established in the 1957 Treaty of Rome. UK Chancellor Gordon Brown famously claimed he had abolished boom and bust. Fiscal orthodoxy and free market capitalism was perceived to be the way to the ‘promised land’ for everyone, everywhere.

It was a period when all the countries in what can be described as the free world seemed to prosper, so it was hardly surprising globalisation was an idea which proved popular. The US whilst funding in large part many of the institutions that set the framework for a rules based trading system, had also provided significant what was in effect aid money, but at a time which saw its per capita GDP more or less double between 1950 and 1980. As a result there was no internal backlash against this act of ‘generosity’. Germany, left ravaged by the war, had average income of a mere 41% of those in the US in 1950 but this had risen to 76% by 1980. In the same period French per capita incomes grew from 54% to 79% and Italy’s from 33% to 70% when compared to the US. Japan’s ‘economic miracle’ saw a move from a mere 20% to 72%. Countries that had seen the worse destruction and needed to build afresh from the bottom without vested interest from existing institutions or organisations such as trade unions or sunset industries blocking reform or restructuring, saw the most rapid recovery from admittedly very depressed levels. This is in line with the Olson Theory, a Norwegian Professor of Economics who was a Nobel prize winner.

Keynes famously wrote in the General Theory of Employment, Interest and Money in 1936 that “if enough people believe that the world’s fundamental economic problems have been solved, they will begin to take risks that collectively will make the world a much more dangerous place”. This proved to be particularly applicable in 2007 when the US credit crunch started and the whole global financial system was thrust into chaos. Whilst the exact causes of the Financial Crisis have been well discussed, the result was that there was a realisation that low and stable inflation and free market policies provided no guarantees of longer and smoother economic cycles. Thus, in the post GFC period it has been questioned whether increasingly internationalised markets generate outcomes in everybody’s self-interest. Whilst it can be argued that globalisation has and will continue to benefit society as a whole, different collective interests within this have been winners and losers and the differences and distinctions between the ‘have yachts and the have nots’ have become glaringly apparent.

In contrast countries behind the Iron Curtain where globalisation was rejected had a far less satisfactory experience with only modest improvements in real incomes. Latin America too suffered over the period and Chinese and Indian citizens remained extremely poor, with China in particular at that time rejecting any attempt to integrate with the West. Europe undoubtedly benefitted from a half century which avoided both economic and military conflict.

As brands became global the US was in a position to dominate with, for example, Disney and Coca Cola featuring among the top global brands for many years. US dominance of the world order was also helped by its military strength and with the collapse of the old Soviet Union the States was clearly the world’s dominant military power. Today we are seeing challenges to this position from a revitalised China and the strong man leadership of Russia under Putin. China in particular has reason to believe that the post 1945 ‘World Order’, imposed after a century of foreign humiliation of the Middle Kingdom, does not apply today. The last great empire to come under challenge was Britain’s and this came at a time of prolonged economic and social conflict, so it is to be hoped this is avoided today as the existing ‘World Order’ clearly seems to be under challenge by emerging or re-emerging superpowers, namely China and Russia, looking for spheres of influence at a time when a trend towards isolationism in the States is providing a vacuum.

Looking at the States, while living standards have risen since 1980 the distribution of gains have been skewed far more heavily in favour of the already well off. The median weekly salary for full time employees has barely budged in real inflation adjusted terms since 1979, according to the US Bureau of Labour Statistics. For men it is worse as salaries in real terms have actually fallen. The share of income going to the top 1% of earners rose from 8% in 1979 to over 19% in 2012 and the top 0.1% did far better. Thus in the US beyond the top 20% of income earners in the post 1980 period there have been no gains to speak of. Post Crisis policies of low interest rates and quantitative easing have favoured the wealthy as they are the owners of financial assets. This is why we have referred in previous outlooks to QE as “welfare for the wealthy”. Post Crisis policies are seen to have provided a financial uplift for the well off but not delivered broader economic gains that would have benefitted society more widely. In particular, labour has seen a significant decline in its share of GDP with wages remaining subdued thanks to a combination of weak demand, technological change and the ability to relocate to areas with cheaper labour. Even when this has not actually occurred the threat of it remains ever present for many workforces today. As a result gains in sales revenues fed through in a much stronger fashion to the bottom line, with higher profits further fuelling stock market advances. With the rise in income inequality it was not surprising that Thomas Piketty’s Capital in the 21st Century became a New York Times Best Seller. Whilst academics have in many cases strongly contested the claims of this book, it did seem at first sight that the owners of capital were becoming richer at the expense of the less well off.

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GLOBALISATION AND WAGE GROWTH The mystery behind anaemic US wage growth at a time of relatively full employment has attracted much debate. US corporations have continued to enjoy unusually high margins and one of the factors behind this is likely the consolidation of market power within a few names, a subject touched on

by Jeremy Grantham of GMO. Certainly, a period of record high profit margins has coincided with low worker pay.

Traditionally, economists would expect once an economy heats up and demand for workers increases, companies to be forced to raise wages and see a reduction in profit margins.

This may not necessarily equate to a fall in profits as volume growth may outweigh the margin erosion.

Whilst in the short-term a combination of high margins and low wages is good for corporate profitability, longer-term challenges with increases in inequality can easily result in either social unrest or levels of discontent amongst the workforce. Both Brexit and the election of Trump showed that voter disillusionment can result in disruptive political outcomes which could over the longer term be negative for equity markets. Goldman Sachs has estimated that one third of the overall increase in corporate profit margins between 1997 and 2014 is attributed to rising corporate market power, which has meant wage and salary income has languished near historic lows, even as corporate profits remain near a record high as a percentage of GDP. Work by David Autor, an Economics Professor at the Massachusetts Institute of Technology believes this has occurred to a greater extent when there are just a few major players in an industry. This is clearly true of the IT and Internet industry where the winner takes all outcome means there are levels of sector dominance by one firm not seen before. Thus, looking at search the market is dominated by Google, in social media by Facebook and retail by Amazon.

The post crisis recovery in the US has not followed the traditional script. The most recent employment numbers for early August showed a US unemployment rate of only 3.9% which is actually lower than it was before the Financial Crisis – but wage growth of 2.7% which is far lower than occurred in 2007. US company profit margins, despite this being an expansion of now around 9 years, are actually expected to rise to new highs, aided admittedly by a cut in the US tax rate. Labour’s share of the economic pie has been shrinking for about 30 years and there is evidence that globalisation is impacting negatively on wage growth. The ability of companies to relocate operations internationally has meant that a workforce is not just competing in its domestic pool of labour, but rather within a global pool of available workers.

Rising educational standards and skill sets in the developing world are unsurprisingly impacting negatively in the West, especially on lower skilled jobs. Robotics and automation have enabled some jobs to be re-shored home, but here the threat of automation will clearly cap the ability of the labour force to increase wages. In fact, higher levels of wages are often a driving force behind moves to automate.

To date many of these Internet related businesses have had relatively low levels of profitability, but have taken a share of what is often a shrinking profit pool in the sector in which they operate. This clearly would argue in favour of a negative impact on wage growth in industries for example such as retail and travel. Certainly, mark ups in retail have declined as there is now price transparency through Internet comparisons sites and the new disrupters have significantly lowered margins for established players. Today globalisation may be helping wages in the developing world, but is definitely holding back wage growth in developed world labour markets.

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Populism Populism is not a movement that only flourished in the post Financial Crisis period. Historians look back at the 1930s and see a period when populist politicians also thrived due to the belief that policies enacted during difficult times had what was perceived to be unfair effects on large proportions of society.

Today banks are vilified for having enjoyed the profits from the debt driven expansion of the noughties, but succeeded in socialising their losses in the post crisis period. Financial crises often boost political populism with a lurch to what is described as the extreme right, but could also accurately be described as ‘national socialism’. In other words, a combination of nationalist behaviour, combined with policies ostensibly to protect the less well off in society. Whilst both Hitler and Mussolini were elected, Fascism as a movement was popular in the 1930s in many European countries, not least in the UK where Oswald Mosley attracted a large following. The sense that society is not working for everyone as it did has seen the two main political parties see a significant drop in their combined level of support to only 67% in the 2017 General Election in contrast to, for example, 1979 when Margaret Thatcher came to power and the combined vote for the two main parties was over 80%. Labour’s losing share of the vote then was actually higher than the Tory’s winning one at the last General Election. Populist politicians have pushed the line that globalisation only benefits the elites, arguably encouraged by Theresa May, who at the 2016 UK Conservative Party Conference, stated “if you believe you are a citizen of the world, you are a citizen of nowhere”. This labelling of elites as those who see themselves as global citizens can only encourage xenophobic tendencies in countries and has arguably been seen in post Brexit Britain.

Thus, the belief that globalisation is good for everyone has refined itself into a view that whilst it may be a good thing in aggregate, there will be significant losers and the established political elite cannot be relied upon to address this as they represent vested interests unwilling to change. A message from both Brexit and the US election is that unless losers are compensated populism will remain a political force for many years to come.

BACKLASH AGAINST ELITES

In the post Financial Crisis world, the well off in most countries have done far better than the average citizen. This has threatened the democratic legitimacy of globalisation and it is clearly true the rich have more in common with each other, whatever their nationality, than they have with anyone else. Looking at major global cities residential property prices have been driven ever higher by international buyers, many of whom are not even looking to make this dwelling a permanent place of residence.

While at the total level globalisation has benefitted the world, it has also created big winners and losers. The winners include countries in Asia such as China, India, Vietnam and Indonesia, not just the already rich, but the relative losers have been those who are in the bottom half of incomes in North America, Western Europe and Japan. Whilst by global standards these workers remain relatively well off, within their own countries they have lost ground. This has resulted in a sense of resentment and a breakdown in trust between what are perceived as the ruling elite who have rigged the system in their favour and a large part of the population for which the current status quo does not seem to be working. The 2016 Brexit referendum showed the unwillingness now of electorates to trust so-called experts, preferring to rely instead on their own ‘common sense’ and no doubt influenced by campaign promises (some would say lies). Donald Trump’s success in the 2016 election reflected his ability to distance himself from the so-called elite with Hillary Clinton struggling to convince people she understood their concerns. Donald Trump was far more adept at presenting himself as an ordinary person with the common touch, something behind the success of every populist politician in history.

The mobility of capital in a globalised world has reduced the bargaining power of Western labour. The high echelons of the workforce have not seen the same pressure on salaries and have also benefited very often from shares or options in the places they work. If readers are surprised why this challenge did not emerge earlier, it perhaps is partly explained by the fact that historically the rich are generally more willing to vote than the poor. This has now begun to change and the success of the Labour Party in the 2016 election ahead of expectations was primarily due to a significant increase in the number of young people voting than had been the case in recent elections.

With living standards challenged at home many electorates have focused first and foremost on domestic rather than international issues. President Putin had already seen America under Obama signal a pivot to Asia and the ‘America First’ policies of Donald Trump and his repeated criticism of other NATO members level of defence spending, has undoubtedly encouraged a more assertive Russia on the world stage.

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MIGRATION

TECHNOLOGY Technological developments since the 1980s initially fuelled globalisation as, for example, production coordination problems were removed, allowing cars for examples to be made in many different countries. Technology and automation is now allowing some companies to go down the route of re-shoring and a concern would be that it could allow some countries to turn themselves into self-contained communities, perhaps something Donald Trump favours. Technology has also allowed through social media a world where those with similar views will not face challenge. Disruptive politicians have quickly established a meaningful voice no longer forced to go to ‘Speakers Corner’ in Hyde Park to air their views to the population. One common thread amongst most disruptive political parties, be they on the left or right is the opposition to globalisation. This includes Syriza in Greece, Italy’s Five Star Movement and Donald Trump.

Social media has also controversially allowed some parts of the population to become even more narrow minded through a focus of news feeds reinforcing the existing ideas and preferences.

Technology has also allowed a greater understanding of the divide in living standards between the elites and the remainder of the population. With populist politicians arguing that protectionism is the economic extension of nationalism and that these measures will redress the relative loss suffered by the less prosperous parts of the population this is a real threat.

Globalisation in the 21st Century has been challenged politically by a backlash against the elite and those in power. There are other what can be described as disruptive elements concerning people, technology and money. Early globalisation in the 1800s was not driven by trade but rather the flow of people.

The majority of immigrants to the New World before 1820 came unwillingly as slaves and unusually Australia saw its first export success in the form of a tertiary good- ‘jail services’ in the late 1700’s and early 1800’s. As transport costs declined and living standards improved, voluntary migration accelerated significantly. Emigrants left Europe in search of a better life, first of all to the New World and then to the Australasian Continent.

The immediate post World War II period saw developed countries using immigrants as a way to gain a demographic boost and in Europe in particular the working age population wasn’t large enough to support the process of post War reconstruction.

At the time European countries, including the UK, welcomed immigrants as an answer to labour shortages.

An important factor behind immigration is the necessity for there to be a significant income gap between the country being left and the country being entered. This unfortunately argues in favour of Europe facing a migration crisis from Africa for many years to come. Unlike the early migrants to the New World, today there has been a huge increase in state provision of goods and services which has helped make immigration more controversial politically. Populations are increasingly questioning whether immigrants should be allowed to enjoy the fruits of a ‘benefits club’ they have not contributed to. The ending of colonialism has meant that Europeans have no longer had the right to travel the world in search of a new home. The challenges to globalisation have been seen as populist politicians have argued that an increased pool of cheap labour benefits owners of capital and will exert downward pressure on the wages of the lower skilled members of the indigenous population. Academic evidence also suggests that migration is out of the reach of the extremely poor and an increase in living standards in Africa’s poorest countries such as the DRC could actually trigger an increase in the level of migrants attempting to enter Europe. Interestingly, technology through improved and cheaper communications has arguably made it easier for migrants to make an informed decision on here to go, but also allowed those opposed to immigration to readily gain air time for their policies which oppose this.

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SUMMARY The international institutions created at the end of the second World War and in the years following this were ultimately united by the Cold War. Following the collapse of the Soviet Union there was a general belief that the West’s model of liberal democracy and free market capitalism would expand eastwards and was the only model for future prosperity. The relative economic decline of the States has helped legitimise the rise of populist politicians, arguing that the US has been cheated out of its position of unquestioned dominance of the global stage. Thus, even though the global economic pie has increased in size, the way it has been distributed in the Post Crisis period has played into the hands of populist political leaders. Whilst workers initially enjoyed the fruits of globalisation as the cost of tradable goods fell markedly (think what a TV set cost in terms of monthly income back in the 1970s) it can be argued globalisation has now come back to bite the hand that fed it. Americans have long favoured Walmart as a source of cheap goods, ignoring the fact that off shoring production to China meant not just less jobs at home, but in a globalised labour market workers bargaining power fell significantly. In fact it can be argued that in a protectionist world with tariffs one consequence for global profitability would be a decrease in margins as companies were no longer able to contain wage growth in the way that occurred in a world with few trade barriers.

Whilst many readers may be abhorred by the policies of Trump, all the evidence suggests that his popularity amongst his core voter base has actually increased. Arguments in favour of nationalism and its economic extension protectionism have now been entwined.

Globalisation was such a driving force in the post WW2 period because America championed it through both free trade and the multi-lateral organisations supporting a liberal rules bound trading system. It has delivered a benign environment for the owners of capital and allowed corporate profit share as a percentage of GDP to reach new highs and to date show few signs of mean reversion in the post crisis global economy.

This has clearly been a factor behind some of the equity markets strong returns. Any push back to globalisation from less business friendly policies would clearly impact negatively on markets as valuations are not especially cheap.

Within this Trump’s ‘America First’ policies has resulted in this being a year when the S&P500 has been ‘first’ amongst major markets and the US is better placed with a relatively closed economy to suffer less damage (I am loath to say do better) than many overseas markets. The US typically has defensive qualities in more difficult times even when it is lacking valuation support. For Asia and emerging markets in general a full blown trade war would not be positive, but investors cannot be sure whether Trump is serious in his threats, or merely using these and tweets to bring what he regards as ‘competitor’ countries to the negotiating table.

Valuations in EM and Asia have pulled back, partly to reflect this and these markets now look more attractively valued than most areas in the developed world. Any hint at resolving these trade issues would likely result in a sharp rally in the markets that have been hardest hit in recent months. Thus investors face a dilemma as the most defensive major stock market the United States remains on a higher valuation and would likely lag any initial rally in cyclical names. This is a subject investor’s need to keep a watching brief on and understanding the underlying stock exposures and resultant skews in a fund remains important.

Contemporary globalisation has allowed the free movement of capital and labour which whilst benefitting the global population as a whole, has created sharp divides between winners and losers in developed and developing economies. Corporates have undoubtedly been significant beneficiaries of a globalised economy and globalisation will now need to recognise that there are differences between free trade and fair trade.

Globalisation today, driven by flows of capital and people aided by the technological revolution which has left many people uncomfortable with how they see the world going. These people have always had a vote, but now they are more inclined to use it and elect disruptive politicians in the hope that the deterioration in their relative living standards will come to an end.

Graham is an investment researcher of international note and has been working in this area for over 20 years. He began his career in the stock broking industry before becoming an institutional fund manager where he practiced both in Ireland and the UK where he worked in senior roles with a number of institutions including Royal Life holdings, Guardian Royal Exchange and Abbey Life.

Throughout his career, he has managed multi-million Euro funds and developed innovative investment fund concepts. Seeing the need for non biased, critical analysis of the investment industry, Graham began work as an independent investment researcher in 1992 and since then, principally, he has provided services to financial institutions. Graham is also a director of RSM Group, a leading UK investment research company.

Director at Independent Research Consultancy Limited

Through his research process, Graham filters through the broad range of Irish and International investment fund managers for those investment managers who consistently perform best.

He conducts in the region of 150 teleconference meetings and on site interviews with asset managers in UK, Europe, China, Hong Kong, Singapore and Australia. Following on from these meetings, Graham produces detailed research notes.

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TURN YOUR COMPANY PROFIT INTO PERSONAL WEALTH One of the most attractive, tax efficient ways for company directors to extract profits from the company and turn them into personal wealth, is to transfer these profits into a company pension.

€ PROFITS SUBJECT TO CORPORATION TAX

Salary Car Dividends Sell Shares Death

TRANSFER PROFITS BEFORE TAX INTO A COMPANY PENSION PLAN

CAPITAL GROWTH - TAX FREE

Retirement lump sum

Income tax up to 40% PRSI/USC up to 12% Benefit in Kind (BIK) up to 30% (calculation of BIK (i.e. taxable benefit) is 30% x Open Market Value of the car). Please note that the taxable benefit amount is subject to income tax, PRSI and USC.

and

Income for life (taxed) or

Income tax up to 40%. PRSI up to 4% and USC.

ARF (income taken is taxed)

Capital Gains Tax (CGT) of 33%

or

Capital Acquisitions Tax (CAT) of 33%

Taxed cash

Where directors take profit from the company as salary there will be an immediate tax liability, however those who invest in a company pension plan enjoy benefits such as:

• No benefit in kind on employer contributions • Immediate income tax relief on AVCs and employee contributions deducted from salary • Corporation tax relief on employer contributions in the year the contribution is made In order to be eligible to take out a company pension plan the director must be set up as an employee of the company and be in receipt of Schedule E remuneration. At retirement the director will be entitled to a retirement lump sum, some or all of which may be tax free. The balance of the fund can then be used to

• Purchase an annuity which will provide a guaranteed pension income for life, • Invest into an Approved Minimum Retirement Fund (AMRF) and / or Approved Retirement Fund (ARF)

• Take as taxed cash, subject to certain restrictions Pension income in retirement and withdrawals from ARFs & AMRFs are subject to income tax, Universal Social Charge (USC) and PRSI (if applicable) and any other taxes or government levies due at that time. Income tax relief is not guaranteed. Tax rates are current as at August 2018.

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Warning: If you invest in this product you will not have access to your money until age 60 and/or you retire.

The value of your investment may go down as well as up.

If you invest in this product you may lose some or all of the money you invest.

COMPANY DIRECTOR MAXIMUM CONTRIBUTION CASE STUDY Let’s take a look at a typical client example:

So, what tax relief would be available on the employer contributions if David chooses one of these option?

OPTIONS FOR DAVID

OPTION 1 David’s company could offset the €34,000 a year regular premium contribution in the current trading year, reducing the corporation tax in this trading year.

Let’s take a look at David’s situation.

David is 45, married and has been running his own business for 5 years. He is currently drawing a salary of €45,000 and hopes to retire at age 65. He is currently contributing €12,000 a year into a director’s pension plan and it is now worth €52,000. His company has been making profits of over €100,000 for the last couple of years and he expects this to continue. As a result of these profits, David is considering increasing his pension contribution to increase his retirement fund.

Since the new single premium contribution of €118,000 is more than the regular premium contribution; David’s company will spread the tax relief forward over a number of years. So, for this example, as the single premium is about 3 times the regular premium contribution, he will spread forward the relief over the next 3 trading years (€39,333 x 3 years), potentially reducing the company’s corporation tax in each of those years too.

OPTION 2

?

Here, the new single premium contribution is equal to the new regular premium contribution. Once the single premium contribution is less than or equal to the regular premium contribution, it is permissible for a company to offset both the regular premium and single premium contributions in the current trading year.

What contribution options are available for David?

There are three options for David, depending on whether he wants to use the full company profit for the year or not and the tax treatment for each of these options. In each case, the projected value of the fund is approximately €1.5 million.

Option

New Single Premium Contribution

New Regular Premium Contribution

1

€118,000

€34,000 per annum

2

€38,000

€38,000 per annum

3

€0

€40,000 per annum

Since David’s company has sufficient profits this year to do so, it would be able to offset the full €76,000 (€38,000 x 2) in the current trading year, thus reducing their corporation tax bill.

OPTION 3 Under this option, the company pays the maximum regular premium contribution and, again, can offset the full amount in the current trading year, given their profits. Once again, this would reduce the company’s corporation tax bill for the current trading year.

If David continued to make a contribution of €40,000 per annum in future trading years he could offset this amount in those years, potentially reducing his corporation tax bill each year.

BENEFIT-IN-KIND

A further important benefit for David is that none of the contributions under the three options shown are viewed as being Benefit-In-Kind for David. As a result, as well as reducing corporation tax for his company, David would not have to pay any income tax, PRSI or USC in relation to the contributions even though he will get the benefit of the pension pot in retirement.

Pension income in retirement is subject to income tax at your highest rate on withdrawal, USC, PRSI (if applicable) and any other taxes or government levies due at that time.

If you invest in this product you may lose some or all of the money you invest.

The value of your investment may go down as well as up.

Warning:

These figures are estimates only. They are not a reliable guide to the future performance of your investment.

If you invest in this product you will not have access to your money until age 60 and/or you retire.

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DPP DPP OFFICE OFFICE TO TO SET SET UP UP AA CAB-TYPE CAB-TYPE AGENCY AGENCY A new report on law and business recently proposed that the Director of Public Prosecutions office set up a corporate crime agency, similar to the Criminal Assets Bureau (CAB).

An eight-hundred page document, compiled by the Law Reform Commission, was developed in response to the banking collapse, but it extends beyond the banking sector. It also proposes the commission’s response to the issue that exists in terms of prosecuting white-collar crimes.

Additionally, the report recommends extensive changes to some of the regulatory regimes used in a variety of sectors within the Irish economy, including telecommunications, health products, competition, consumer issues and others.

The report supports a move away from the current “light-touch” regulatory regime to a new model that is designed to identify problems and prevent them from developing into full-blown catastrophes.

In this report, the Law Reform Commission also covers former Central Bank governor, Patrick Honohan’s call for law changes that combat “egregiously reckless risk taking”.

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FINANCIAL SANCTIONS

The new Law Reform Commission report includes more than 200 recommendations and gives regulatory bodies more power to impose significant financial sanctions, the power to enforce agreements and handle consumer redress.

The reality of modern business, in which agents or managers have the authority to implement policies, has been taken into account in the Law Reform Commission’s list of suggested changes.

The Central Bank already holds such powers and has used it in the tracker mortgage scandal. However, regulators in the health products, competition, and communications industries do not have access to such powers.

It also mentions Seán FitzPatrick’s collapsed trial. Former chairman of the Anglo Irish Bank, FitzPatrick had the most lengthy criminal trial in Irish history. According to the report, the prosecution’s legal costs for the 126-day hearing amounted to €3 million. Since he was on free legal aid, the state also paid for Mr FitzPatrick’s legal fees, which have been estimated to be the same or more than that of the prosecution. After much legal argument, Judge John Aylmer eventually directed to acquit him.

The Irish Times reported that some of the new powers would include the right to impose sanctions equal to €10 million and or 10 % of the turnover on businesses, and up to €1 million on individuals.

The commission has proposed that the law on fraud be amended.

Specifically, it wants conscious recklessness, such as false accounting, to be considered as fraud. However, it does not recommend new laws against reckless trading, in case it could negatively impact on beneficial risk-taking by businesses.

According to the report, it was clear the prosecution’s case failed; this raised questions about whether the legal system was equipped to take effective action with regard to prosecute serious corporate offenses.

It also highlighted the fact that other cases related to activities of the Anglo Irish bank have led to important convictions.

However, even in those Anglo cases that led to convictions, the report states that the commission is aware of the fact that, “... experienced prosecuting counsel became involved in the case after much of the preparatory work had been completed”.

By law, a company can be convicted of many crimes, including fraud and murder. However, we never see such convictions, as intent must be proven. According to the Law Reform Commission, this issue may have been a contributing factor to the lack of prosecutions for bribery, fraud, theft and similar offenses for corporate bodies in Ireland. For the system to work, someone in a high managerial position within the corporate firm must be accused of committing an offense while acting for the corporate firm.

Just like CAB, the report recommends that the staff recommended for the new corporate crime agency possess a mix of skills. While the commission recognises the Circuit Criminal Court as a capable entity, it does not recommend that such cases be handled by the Central Criminal Court.

A Government paper published in 2017 also suggested the establishment of a new agency that deals with white-collar crimes. However, systems are often considered to work best where it is needed least (in smaller firms) and worst where it is most needed (in larger organisations). This problem has been coined as the “paradox of size”.

Readers may access the Regulatory Powers and Corporate Offences report by visiting the Law Reform Commission’s website.

13

NO-DEAL BREXIT:

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What it would mean for Ireland

According to Donald Tusk a no-deal Brexit is ‘more likely than ever’, and it could have devastating consequences.

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NO-DEAL BREXIT EXPLAINED

How will this affect Ireland

The EU Customs Union has set down certain rules that govern trading between the EU and the UK. One of the agreements is that goods can be traded freely across the single market. A common regulatory structure allows for the free movement of people, capital, goods and services.

If the United Kingdom leaves the European Union without concluding a withdrawal agreement, iit will be considered a no-deal withdrawal agreement. Currently, an agreement is being negotiated. Agreement has been reached on most of the pressing issues, except for the Irish Border backstop. The EU is demanding a legal guarantee that a hard Irish Border will not return after Brexit, regardless of what transpires from the negotiations.

If the UK leaves the EU, these two agreements would be nullified.

That means that all future trade would be based on World Trade Organisation (WTO) rules. Free movement of goods would end between the UK and the EU, as well as between the UK and Ireland. Special import taxes or tariffs would be implemented on certain products, as would custom checks.

If a withdrawal agreement is signed, a transition period will commence starting at the end of March 2019, when the United Kingdom is due to leave the EU. Almost everything will remain as status quo until the end of 2020, which will provide time for powers-that-be to negotiate on the future relationship between the UK and the EU. In the absence of this agreement, however, the UK will leave the EU in March, ending all regulatory and trading links instantaneously.

Such a move could come at a considerable cost for Ireland and the UK as a whole.

Common regulation between the UK and the EU would impact on many industries, including food, pharmaceuticals and aviation, to name a few. Business and trade could be affected in the short term while new arrangements are made and implemented. It would require additional checks near borders, which would affect trade in the long term.

Exports and imports to and from the UK would result in the EUregime being replaced by WTO rules. Approximately 12 % of EU exports to the UK, however, exports in the food sector rise to approximately 40%. When the rules change, these goods would immediately be subject to more checks and bureaucracy. There could well be disruptive delays, and special taxes and tariffs would be applicable to goods entering a country. This could be particularly damaging where food exports are concerned.

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: BREXIT FACTS

Consumers will ultimately be affected. According to economists Edgar Morgenroth and John FitzGerald, who published a paper for the Institute for International and European Affairs, around two-thirds of products on Irish supermarket shelves are either imported from the UK, or move to Ireland via the UK landbridge. Products are often brought here from big supermarkets’ distribution centres in the UK. This could become impossible when a no-deal Brexit is implemented, or even due to trade barriers imposed after an organised Brexit, as all the different products would potentially require a range of checks.

Goods transported to the UK market and approximately two-thirds of goods exported from Ireland cross the UK landbridge. Four new checks could be implemented, including when goods leave Ireland, enter and leave the UK, and when it enters Continental ports.

More than half of all beef exports go to the UK, and would be particularly exposed to a hard Brexit. More than 50% of their value would apply to several beef products, This would price many Irish exports out of the UK market. As such, producers would be forced to seek new markets, while some would operate from within the UK. This would lead to fewer exports, lower prices for farmers, and inevitably, job losses.

A no-deal Brexit could disrupt the supplies of some items on our shelves in the short term. However, the entire sector could be shaken up in the long term, resulting in changes to the mix of products we have become accustomed to, as well as higher prices. According to a study by ESRI, a hard Brexit could lead to price hikes of 2-3%, resulting in consumers spending up to €1,360 more on their annual shopping bills. In the event of a no-deal Brexit, these cost could accrue even more quickly from March 2019.

A hard Brexit would also impact on imports to Ireland.

Since approximate 23% of Irish imports come from the UK, the supply chains of many businesses (especially those in chemicals and pharmaceuticals) would be disrupted.

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BREXIT AND THE AVIATION INDUSTRY

Can Any of This Be Avoided

It’s possible that some of these issues can be avoided with the proper planning in terms of regulations that would allow planes to continue flying. However, neither of the two sides has the power to change international trade regulations.

Perhaps one of the best solutions would be for both parties to agree and that the exit could take longer than initially anticipated. This would be possible if the UK as well as all twenty-seven of the remaining member states agreed.

Ireland’s Department of Finance estimated that a hard-Brexit could result in 40,000 job losses and the GDP lowering by 4.5% in ten years’ time even if there is a transition deal. The Government also commissioned the Copenhagen Economics consultancy firm to perform another study, which estimated that by 2030, a hard-Brexit could lower the GDP by 7%.

There’s talk about planes not taking off in the event of a no-deal Brexit, which might well hold true. The UK aviation industry currently operation under EU regulation, both for domestic flights and flights to international destinations.

New arrangements would be needed if the UK leaves the EU suddenly in April 2019. If the details are not agreed upon in advance, flights between the UK and EU countries could be grounded temporarily - either for a few days until an agreement is reached, or longer, depending on the relationship between the two sides at that point in time.

A no-deal Brexit would bring all changes in a short timeframe, as well as the risk of more costs during the transition years.

If it happens in March 2019, it would hit growth immediately , which would threaten existing tax and economic forecasts for the next year.

According to Taoiseach Leo Varadkar, the Government would not under any circumstances countenance the return of a border on the island. However, many experts believe that there would be no option but to reimpose the border in the event of a no-deal Brexit, as it would facilitate the checking of goods entering the EU market and control smuggling, which is an important issue.

The UK also forms part of the EU regulatory regime where the pharmaceutical industry is concerned. That means that pharma imports from the UK to the EU will be affected, and vice versa. A likely fallback will be stockpiling of vital drugs in both the EU and UK.

15

9

MONEY

Top

MANAGEMENT

Apps

1. You Need a Budget

3. Pricespy

This app is great for people who need to improve their budgeting skills or discipline. If you need a plan to help you reduce your debt, or to save up for a big-ticket expense, You Need a Budget (YNAB) can help. The app will show you how you can even out your expenses - both monthly and unexpected or irregular bills - that crop up over the year. It can also help you to become a bit more aware of how you’re spending your money, resulting in a more financially disciplined you. The You Need a Budget does have an annual subscription fee, but you can try it out for free for the first 34 days.

Savvy shoppers agree that shopping around is a powerful way to save hundreds or even thousands - provided you don’t spend too many potentially income-earning hours shopping around. Now you can save time by using the Pricespy app, which will take care of the shopping around on your behalf. Pricespy will scout out online shops such as Amazon, as well as main street shops, such as Powercity and Smyths. It will compare prices on items such as cameras, cookers, toys, TVs, mobile phones, and white goods.

Listings are regularly updated to display the latest information from the shops, including price, product details, pictures, product information, availability, delivery information and other important details. Although the information is regularly updated, the stores may change their information without notice. Therefore, it’s always important to verify important information on the shop’s own website before you make the purchase.

2. AIB Mobile Banking AIB recently made some changes to their app, that allow new customers to open up current account with the institution without having to go into the bank. You will need a passport to verify your identity in order to open an account, and an AIB agent will perform an interview with you on a live video call. Once your account is open, you can check your account balance, and you can create alerts to notify you of account balances. You can use the app’s MySpending feature to analyse income and expenses across a number of categories. The AIB Mobile Banking app also integrates smoothly with Apple Pay.

4. Splitwise This handy app is great at helping you manage and track shared bills and expenses, particularly for friends and housemates who share costs. Whether you have to divvy up grocery bills, restaurant tabs, rent money, or energy costs, Splitwise can help you track who has paid their fair share, and who still owes the group money. Use the free version or Splitwise, or opt for the paid Splitwise Pro if you want to scan receipts or increase cloud storage.

Most other Irish banks have mobile apps, and you will typically need to snap a selfie and upload either a passport or driving license in order to prove your identity when you wish to open an account.

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5. Home Budget

8. Revolut

This app is similar to Splitwise, Home Budget with Sync assists families - rather than housemates - in tracking their income, expenses and bills, and calculating their disposable income.

It’s a great app for setting budgets for family expenses such as groceries, electricity and more. Use the Family sync feature to allow family members to exchange information about expenses from various devices and collaborate on a single budget. This is a premium app.

The Revolut app revolutionises the way in which people bank. The app claims to save customers money on currency conversion and banking charges. It is available for most newer model Apple iPads, iPhones, Apple watches, and Android devices.

It allows you to open an app-based current account and apply for a debit card through this new banking alternative. The physical debit card is free, but you must pay a €6 delivery fee to cover shipping and handling, which takes approximately nine business days. If you need it sooner than that, an expedited delivery fee will be applicable.

6. Bullet

Revolut allows you to send money transfers to the bank accounts of people in more than one-hundred and thirty countries around the world. You can also exchange or hold up to twenty-four different currencies and create recurring payments to ensure that your bills are paid timeously.

Speaking of uploading receipts - anywhere but in your wallet or a shoebox under the bed - Bullet is a great way to do that.

It’s especially handy for small businesses or freelancers. It’s available through the online accounting software by the same name, released by Bullet HQ. You simply need to snap a photo of your receipts and they are digitally stored in a central location.

The standard Revolut current account allows you to withdraw up to €200 a month from ATMS at no charge. A 2pc fee is attracted to any amounts exceeding that limit.

The Irish deposit guarantee scheme does not yet cover any monies held in your Revolut account, as the company is yet to acquire a banking license. They are currently in the process of applying for it from Lithuania, and will transport it to other countries in Europe. The institution is aimed at protecting depositors as well as current account holders with banks, building societies and Central Bank of Ireland authorised credit unions in the event that the financial services becomes insolvent and unable to repay clients’ deposits. Banks across the EU offer similar deposit guarantee schemes.

Not only does it cut down on paper clutter, but it also provides an easy way to record your taxable expenses. Irish accounting and taxation rules are built into simple workflows, which automate your tax returns process.

The Bullet app is free, but you can purchase optional add-on features and apps, if you wish.

7. Transferwise

The Financial Conduct Authority (FCA) does regulate Revolut, which means that the company must follow all FCA rules, and all client funds must be held in a separate Barclays or Lloyds account. The company’s website states that, in the event of insolvency, clients will be able to claim their funds from the segregated account. Your claim will be prioritised over that of all other creditors.

Small businesses and freelancers, as well as families with children in other countries sometimes have to transfer money abroad. The Transferwise app makes it as much as eight times cheaper to transfer money than it is to use the banks. The Financial Conduct Authority, a British regulator, has authorised the Transferwise app.

Once they have obtained their banking license, Revolut hopes to start offering direct debits, interest on deposits, overdrafts, and personal loans to their customers. London will remain the company’s headquarters, and they intend to also apply for a UK-based banking license if any passporting issues occur.

9. Marketwatch Marketwatch helps investors to stay on top of the latest stock market news. It provides real-time data on currencies, stocks, and commodities. You’re able to track your stocks-related stories and stock picks, and stay abreast of your investments.

Detailed stock quote pages contain key trading information.

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Looking for ways to make your money stretch?

We’ve compiled a list of tips to help you.

STOP OVERPAYING ON HEALTH INSURANCE

9

Simple

Steps to

BEAT

Budget the

STREAM YOUR FAVOURITE SHOWS

Research has shown that two-thirds of Irish policyholders overpay for health insurance cover, and many people still have dated and overly costly schemes. According to Dermot Goode from TotalHealthCover.ie, corporate plans offer the best value.

These are his top picks in terms of value:

Switcher.ie’s research shows that most people watch less than a quarter of the channels they pay for. However, many have added Amazon Prime, NOW TV and Netflix to their viewing. If you’re using these streaming options for most of your viewing, you could probably ditch traditional TV and use a broadband only plan instead. They start from as little as €25 a month.

• Irish Life Health 4D Health 1 at €1,045 (no day-to-day cover); • Laya Simply Connect at €1,100; • VHI Company Plan Plus Level 1.3 at €1,128.

SWITCH TO SIM-ONLY

FIND A CHEAPER ENERGY PROVIDER

Most phone plans include a phone in the data plan, and span somewhere between 18-24 months. Providers tend to build the cost of the phone into the contract. However, you can save a load of money by switching from a bundle plan to a SIM-only deal.

Several of the ten Irish gas and electricity providers have increased their prices twice in 2018 already. However, you can save money on your energy bills by switching to a different provider. If you have average consumption, you can save €300 by switching from your standard plan to a cheaper, discounted deal. New customers who sign up for Bord Gáis Energy will receive a 24 % discount on electricity, or 21 % on dual fuel or gas respectively.

Some unlimited SIM-only deals go for as little as €15 a month, saving you as much as €500 a year.

SWITCH YOUR MORTGAGE PAYMENTS

These deals are only available to new customers, so existing Bord Gáis Energy customers will have to switch elsewhere.

Flogas has a deal of 22 % off for new gas customers and Energia is offering new customers a 30 % electricity discount.

Switcher.ie said that mortgage account holders with standard variable rates of 4.5 % on a €250,000 loan, with an equity of a minimum of 20 %, can save up to €300 per month by switching to a 2.3 % fixed rate over two years from Ulster Bank. Switching to a 2.5% one-year fixed rate with KBC can save you €268.

SAVE HUNDREDS WITH A NEW BROADBAND DEAL

SWITCH YOUR MORTGAGE PROTECTION PLAN

Bundling is a great way to save on your broadband, especially if you have more than one mobile phone, home phone, or TV with the same provider. Some of the discounts available on Switcher. ie exceed €350. If you bundle your products, you will only have to pay one monthly bill, and deal with only one provider. It makes life simpler and saves you money.

Shopping around for a new mortgage protection plan can save you up to €10 a month off your premium. Smokers pay higher rates than people who don’t smoke, so consider kicking the habit and reapplying for a new mortgage protection plan after a year.

CLAIM ALL TAX RELIEF AVAILABLE TO YOU

RENT OUT YOUR SPARE ROOM

Shopping around for a new mortgage protection plan can save you up to €10 a month off your premium. Smokers pay higher rates than people who don’t smoke, so consider kicking the habit and reapplying for a new mortgage protection plan after a year.

Earn up to €14, 000 a year in non-taxable income by renting out a room in your home. This must be one of Ireland’s best tax-free deals.

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SELF EMPLOYED BENEFIT FROM BUDGET

Self-employed individuals have emerged as the major benefactors from the recent budget announcement. They will have an opportunity to earn more before they have to pay tax and will be entitled to Jobseeker’s Benefits if they were to lose their jobs.

They have also avoided social insurance contribution increases.

These changes will benefit approximately 150,000 people.

A self-employed individual can earn up to €1,350 before paying tax. Another benefit gained is the €750 income tax standard rate band increase for all earners. This pushes the band from €34,550 to €35,300 for individuals and €43,550 to €44,300 for one-income married couples.

Self-employed people will also benefit from the universal social charge rate which decreased from 4.75% to 4.5%. According to Department of Finance figures, single self-employed earners who earn €55,000 will save €452 a year in USC and income tax changes as from next year.

However, tax experts say that self-employed individuals are still €300 worse off than PAYE counterparts.

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AIRBNB RULES TO RETURN HOUSING UNITS TO LONG-TERM RENTALS The new Airbnb regulation will bring more than a thousand homes back on the market. Eoghan Murphy, Minister of Housing, is expected to follow Toronto’s model for regulating short-term lets. He first informed TheJournal.ie during the Fine Gael think-in that the new proposed regulations will be similar to those introduced in Toronto.

Toronto introduced new laws in September, enabling people to only rent homes as short-term lets if it is their primary residents. They may no longer rent out secondary suites on short term leases. That means that individuals who own investment properties may no longer rent it out via Airbnb, as the maximum rental period is 180 days.

The housing committee created a working group, which was tasked with creating the best regulatory system for short term lettings. However, Murphy has been clear about his support for the Joint Committee on Housing’s recommendations from 2017.

The recommendations set down by the Committee on Housing differ slightly from the Toronto regulations. It sets out a twolevel regulatory regime which is to be introduced via primary legislation with regard to short-term lets. It will follow a strict regime of short-term letting of entire commercial properties at one level, while a second, less stringent level will focus on people who rent out their primary residences for up to ninety days a year.

Toronto rules also require that homeowners and short term rental companies obtain licenses and registration from the city council.

The new licensing system is likely to impact properties in the capital first. However, according to Taoiseach Leo Varadkar, the new rules will restrict the use of homes and apartments in pressure zones for short-term lettings, such as Airbnb. He confirmed that people will still be able to rent out rooms in their homes on a short term basis. However, you may not use a house or apartment for a long-term Airbnb transaction. Those homes should be released into the market for Irish residents, rather than to tourists.

More than half of the rental properties in Dublin are aimed at short-term letting to tourists. The new rules recommend that short-term casual letting of up to ninety days in a year should be exempt from planning permission. Those properties that are let out for more than ninety days a year should obtain change-ofuse planning permission.

According to Murphy, the department can no longer wait on regulations. The Ministry of Housing is pushing for the publication of the new rules, and the delay was caused by discussions between the tourism and housing departments as to which should take the lead and as to whether Cabinet had to approve it.

As per the Toronto rules, the Irish housing committee recommends that the licensing system be implemented for short term letting platforms and short term lets. Homeowners would have to register with the Revenue Commissioners and local authority alike.

The minister said that more detail will be provided in due course, and the two-stage process will be rolled out, bringing immediate and near term changes. It should have a substantial outcome whereby short-term leases will return to the long-term market, while bringing a proper understanding of what can be expected in terms of regulations and licensing.

Understandably, many Airbnb proprietors are anxious about how the rules will impact on their incomes. Airbnb has been holding information evenings to inform people about the coming changes, and has lobbied Government on many occasions.

Addressing the DĂĄil, Murphy admitted that he is not a fan of home sharing and that the country has a housing crisis. He said that this new development cannot happen in an unfettered way.

He explained that he would give people notice when making the announcement ahead of when the changes will come into effect. He wants to provide people with enough time to prepare for the arrangements, but feels that it should happen quickly.

Understanding that the introduction of such regulations will take time, he is considering other measures that might support the objectives and recommendations in the interim.

According to Airbnb, 640,000 guests used the service over the summer in Ireland. The company has also welcomed talks on creating clean rules for home-sharing.

After approximately two years of discussion. Airbnb expressed some concerns about the Irish home-sharing rules.

20

Dervilla Whelan

Sarah Keane

(BBS, CTA) Managing Director

(BAAF, FCA, CTA, QFA) Director

Dervilla Whelan is the Managing Director of DLS Capital Management Ltd and also one of the founding members of DLS Partners. She was previously a taxation partner in Baker Tilly O’Hare (now part of Baker Tilly Ryan Glennon) and is a graduate of Trinity College, Dublin and the Institute of Taxation in Ireland. Her key skills include advising clients on all aspects of their financial affairs, including advising on the appropriate structures required for all types of investments and pensions. Dervilla is heavily involved in the Family Office service for our high net worth clients.

Dervilla’s involvement with both DLS Capital Management Ltd. and the tax practice, DLS Partners, ensures that her clients benefit from a holistic approach to all of their financial affairs

Sarah Keane is a graduate of Dublin City University in Accounting and Finance and a Fellow of the Association of Chartered Accountants (FCA).

She is also a member of the Institute of Taxation in Ireland (CTA), and the Professional Association for Financial Services in Ireland (QFA). Her key skills include advising clients on all aspects of financial planning, including retirement planning strategies, taxation and investment advice.

Sarah is highly experienced in the preparation of investment financing strategies for individuals and companies. Sarah is also heavily involved in the Family Office service for our high net worth clients.

Graham O’Neill

Stephen Cahill

Graham is an investment researcher of international note and has been working in this area for over 20 years. He began his career in the stock broking industry before becoming an institutional fund manager where he practiced both in Ireland and the UK where he worked in senior roles with a number of institutions including Royal Life holdings, Guardian Royal Exchange and Abbey Life. Throughout his career, he has managed multi-million Euro funds and developed innovative investment fund concepts. Seeing the need for non biased, critical analysis of the investment industry, Graham began work as an independent investment researcher in 1992 and since then, principally, he has provided services to financial institutions. Graham is also a director of RSM Group, a leading UK investment research company.

Stephen Cahill is the Tax Manager at our Tax Practice, DLS Partners. He graduated from DIT and is a member of both the Association of Chartered Certified Accountants (ACCA) and the Irish Tax Institute. Stephen is responsible for all areas of Tax, including, VAT, PAYE, Income Tax, CGT and Corporation Tax. He also is involved in the preparation of Financial Accounts for sole traders and limited companies and assists in the preparation and review of monthly management accounts for larger corporations.

Independent Consultant

(BSc (Marketing), ACCA, CTA) Tax Manager DLS Partners

21

RANGE OF SERVICES RETIREMENT PLANNING

FINANCIAL PLANNING

•• •• •• ••

•• Financial Planning is central to our

Tax-effective funding for retirement.

Income Planning for your retirement Personal Fund Threshold calculations Protecting the underlying value of your pension fund throughout retirement •• Advice on the most tax effective drawn down of your pension vehicles •• Taking transfers from Defined benefit Pension Schemes

PENSION STRUCTURE ADVICE •• Personal pensions •• Self Invested Personal Pensions •• Company/Executive pensions

- Defined Benefit Schemes - Defined Contribution Schemes •• Small Self Administered Schemes •• Personal Retirement Saving Accounts (PRSA’s) •• AVC’s

service offering

•• We compile fact finds based on client’s

personal and financial details •• We produce a Financial Plan for each client, showing their current financial position and their future financial objectives.

•• The Financial Plan will encompass all areas of a client’s financial position, e.g. investments, borrowings, protection policies and pension policies •• Financial Plans are reviewed on an annual basis, taking into account any changes in a client’s personal and/or financial circumstances.

FAMILY OFFICE SERVICE •• Preparation of Quarterly Net Worth Statements

•• Preparation of a comprehensive

INVESTMENT ADVICE •• •• •• •• •• •• ••

Managed Funds Exchange Traded Funds Unit Trusts Investment Trusts Tracker Bonds Deposits Employment and Investment Incentive Schemes (EIIS) •• Structured Products •• Qualified Investment Funds (QIF) •• Renewable Energy Investments

•• •• •• ••

database which contains all information on Assets and Liabilities, thus facilitating instant access to information Centralisation of costs on all Personal & Investment Properties Appraisal of Investment Opportunities Monitoring of Investments Attend meetings relating to Investments on behalf of clients

DLS Capital Management 25 Merrion Square Dublin 2

www.dlscm.ie info@dlscm.ie

DLS Capital Management is regulated by the Central Bank of Ireland

(p) 01 6119086 ( f ) 01 6619180