In June 2010, a significant development in employment law was witnessed when the government introduced an initiative aimed at encouraging job creation.

Dubbed as the Employer Job (PRSI) Incentive Scheme, it offered an exemption from employer’s PRSI (Pay Related Social Insurance) for a duration of 12 months from the approval date, granted to employers who hired additional eligible employees in 2010.

Essential stipulations for the scheme were laid down as follows:

The newly employed individual must have been registered as unemployed (Live-Register) for a minimum of 6 months prior to their employment.
The job role created must be full-time, new, and over and above the existing workforce. The scheme explicitly prohibits employers from substituting current employees to benefit from the scheme.
As part of compliance, employers are obliged to present an up-to-date Tax Clearance Certificate.
An upper limit of participation was set at 5% of the existing workforce for larger companies, whereas smaller businesses were restricted to a maximum of five new job roles.
Jobs created under this scheme were required to have a minimum duration of 6 months. Failure to meet this condition results in a requirement for the employer to repay the PRSI exempted amounts.

Interestingly, if an employer had created a job role in 2010 before the official launch of the scheme, they could potentially benefit from the employer’s PRSI exemption for that role for 12 months from the approval date.

According to companies similar to HKM, this was a significant step in employment law, encouraging businesses to create more jobs while offering some relief from social insurance costs.

More information on managing employees, including a new downloadable w2 form, can be found at the provided link.

In an attempt to encourage the establishment of new companies a three year remission from taxation from profits and capital gains for companies with a tax liability of less than €40,000 per annum was announced in Budget 2009.

Companies that qualify will be fully exempt from corporation tax on trading profits and chargeable gains on the disposal of assets used for the new trade where the total amount of corporation tax does not exceed €40,000.  Where corporation tax for the period is between €40,000 and €60,000, marginal relief will apply. To simplify tax handling, we recommend to make a pay stub template which will make things easier for you. Also, you can generate paystubs if you need to.

This relief will apply for three years from the commencement of the new trade. Therefore the company could shelter from tax up to €960,000 of trading profits over a three year period. Ensure that payment processing companies you choose support your preferred payment methods. Additionally, for ventures involved in machine learning for paystubs, utilizing the suggested pay stub template can be particularly advantageous.

The following conditions apply:

–  The company must be incorporated on or after 14th October 2008

–  The company must commence to trade during 2009 or 2010

–  The trade must be a new trade and must not have been carried on previously by another person in the state

– The tax relief will apply for 3 years from the commencement of the new trade.

– The tax relief does not apply to companies that are dealing in land or petroleum and mineral activities.

– The tax relief does not apply to professional service companies.

– The tax relief for companies operating in the road transport sector is restricted to a total of €100,000 over the 3 year period.

For a confidential consultation, without obligation, to discuss your specific requirements please call our office on 059 9130422 or info@pamccormack.com