Syndicated Archives - Page 45 of 195 - Devine Accountants

Normally the mention of pensions is enough to send people looking for a pair of slippers and a cup of cocoa, but in fact, pension planning is far more relevant in your 30s and 40s than when you’re about to retire.

The current older generation is among the best catered for in the EU. That’s not saying the state pension of €233 a week is going to set the heart ablaze, but the truth is that for anyone under 40, even that will simply not be affordable when their time comes. Pensions are paid out of general taxation and at the moment there are five workers for every pensioner. By 2050 there will be just 2:1. That is unsustainable according to experts.
Irish people are living longer, healthier lives. That’s great news of course, and we can expect to live well into our 80s. Indeed, those born at the turn of this century are likely to see the next one in too.

But the upshot is that we have made little or no effort to plan financially for those people — traditional pensions were only meant to pay out for 10 to 15 years, not 25 to 30.
“Half of females currently aged 65 years have a 50pc chance of living beyond 91, and as many as 25pc beyond 97. For men, the figures are a little lower. However, financial planning for retirement is not keeping pace with these longer life expectancies,” says David Harney, chief executive at Irish Life Group.

He adds: “A target of one third of salary, plus the state pension, is recommended for a comfortable retirement but 90pc of people in defined contribution schemes will see a salary replacement of just 18pc plus the state pension unless they save more, and start pensions earlier.”
The average age at which people first purchase a pension is 44, almost 10 years later than it was in 2000.

Work has changed too. Instead of spending 40 years in one place, people may have 10 or more jobs across the world. It makes retirement planning very challenging.
Willie O’Leary of Clear Financial Planning says: “Understandably when you’re young, retirement seems a world away and not something to concern yourself with just yet, but that is absolutely the wrong approach.

“There simply won’t be enough in the state reserves to provide people with a sufficient pension.”
Even where provision is made, the old ‘defined benefit’ (DB) pension is a thing of the past. There are 482 such schemes in existence, down from 1,232 a decade ago.

Traditionally perceived as a guaranteed payout at retirement, over half are insolvent and struggling with poor investment conditions. Says Brendan Kennedy, head of the Pensions Authority, which collates funding figures from schemes: “All DB schemes are obliged to report to us annually, showing if the scheme has fallen into deficit and they are obliged to file a proposal to remedy it.”
It cannot, however, compel them to follow it which is why schemes get wound up, or benefits get cut.

Those already retired are ring-fenced; it is those nearest retirement who suffer the most.
“When the investment markets crashed in 2008, many schemes had lower assets than they had assumed and had to either put more money in or cut the pensions they were promising. Asset values have recovered but low interest rates mean the cost of providing the pensions has risen significantly,” says Jerry Moriarty of the Irish Association of Pension Funds. It has resulted in countrywide closures and cuts, leaving many employees bewildered.

“The simple advice is ‘start early’, ideally with your very first pay cheque. If you never had it, you’ll never miss it,” Moriarty adds.
Finding out what you have is the first step.

The Pensions Authority has a great pension calculator on its site (pensionsauthority.ie) to get the ball rolling. Once you put in what you have, and what you expect, it will calculate the ‘gap’, which at least lets you know if you should be doing something.

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

A major clampdown on uninsured drivers is to be implemented in a bid to tackle the rocketing cost of motor insurance.

Gardaí are to get the technology to carry out roadside checks to see if drivers have insurance.
There are about 150,000 drivers on the roads who have no insurance.

Now a new database is to be put in place giving details of all drivers, which company insures them, and details of the cars and registrations.
The widespread roll-out of automatic number plate recognition technology will allow gardaí at the side of the road to quickly work out if the driver has insurance cover for the vehicle. Details about uninsured drivers would be listed on the database.

Meanwhile, another database of fraudulent personal injuries claims is to be put in place to cut down on false and exaggerated claims.
It is understood that this database is likely to be funded by the insurance industry.

However, no decision has been made yet on which State agency will be in charge of the fraud database, which is likely to become known as the ‘swindlers’ list’.
The Government believes a new database will help to identify repeat claimants and those engaged in staged accidents.

The measures were approved by the Cabinet yesterday after a report prepared by Junior Minister Eoghan Murphy.
But Mr Murphy admitted that no firm commitments had been made on extra resources for gardaí to roll out the new number plate recognition technology.

About 100 garda cars were already equipped with the technology, he said.
The action plan comes after motor insurance costs shot up by almost 70pc in the past three years.

The report sets out 71 actions, as part of 33 recommendations, to be implemented to bring insurance costs down.
One of the measures is the setting up of a commission to look at personal injury awards in Ireland compared with other countries. The new personal injuries commission is to be chaired by retired High Court Justice Nicholas Kearns.

It will examine payouts for soft-tissue injuries and compare them to the average awards in other countries, but the final decision on the level of awards made in court will still remain with the judiciary.
Premiums

Mr Murphy said it would take time to implement all 33 recommendations in the motor insurance report.

There was no silver bullet, he said, and it could be a while before the measures feed through to lower premiums.
Insurance Ireland welcomed the planned Government changes.

Separately, the country’s second largest health insurer, Laya, enjoyed a 22pc increase in pre-tax profits in 2015 to €15.7m.

The jump in profits followed Laya hiking up premiums.
The price hike in 2015 followed an earlier average jump in premiums of around 20pc from March 2014.

The pre-tax profits enjoyed by Laya Healthcare Ltd during 2015 and 2014 total €28.65m.

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

Motor insurance reforms being introduced by the Government will put the brakes on premium hikes, according to experts.

But it will be the second half of the year before the changes start to have an impact.
The Government’s working group on insurance costs will also help Dublin-quoted insurer FBD break even this year and return to profit next year, financial analysts said.

Emer Lang, an insurance analyst at Davy Stockbrokers, told investors the measures being introduced would mean there would be more scrutiny of insurance pricing in the market.
She said in a note that the planned changes were “likely to exert pressure on insurers to pass a share of benefits accruing on to consumers”.

“The implementation of these measures and reforms should help to stem the recent inflationary claims environment. However, the report itself acknowledges it will take time to implement,” Eamonn Hughes of Goodbody Stockbrokers said.
President of the Law Society, the representative body for solicitors, Stuart Gilhooly, said rises in premiums would ease this year due to the measures.

The Government’s working group on insurance costs outlined 33 changes, including the setting up of a fraud database and the establishment of a new commission to look at award levels in Ireland compared with abroad.

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

Consumer sentiment has fallen to a 22 month low reflecting unease in the Irish consumer following the Brexit vote and the US presidential election.

According to Tuesday’s survey by KBC Ireland and the ESRI, the monthly drop in sentiment was relatively modest – but enough to drive the index to its lowest level since February 2015.
The index slipped to 96.2 in December 2016 from 97.8 the month before, indicating that the average consumer’s disappointment in 2016’s economic recovery.

Potential threats such as Britain’s decision to leave the EU. the looming Brexit negotiations in 2017 and the election of Donald Trump appear to have impacted sentiment.
The KBC survey revealed that almost 40pc of consumers believe that the economy will improve in the next twelve months. Howvere, compared to December 2015, this positive outlook was felt by 61pc of consumers.

“The December survey is not pointing to a dramatically poorer economic outlook but to a sense of detachment from extremely strong conventional economic metrics of recent years and concern about an increasingly uncertain future,” commented the bank’s chief economist Austin Hughes.
“The perception that the economic recovery to date has not been sufficiently inclusive and that the persistence of that recovery may be less certain in the year ahead means that the predominant mood captured by the consumer sentiment survey at present is a feeling of missing out”, the economist added.

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

The seismic shift in world and European politics following Brexit and the election of Donald Trump as 45th President of the United States has led to an environment of global political and economic uncertainty and challenging and uncertain times ahead for Irish businesses.

2016 has been a landmark and unprecendented year and Taoiseach Enda Kenny has described Brexit as ‘arguably the greatest economic and social challenge for this island in 50 years’. A Department of Finance / ESRI Survey has revealed that Irish GDP is forecast to be down by 2.3% from what it might have been within 5 years, even if Britain negotiated a free trade agreement with the EU.

The short and longer term impacts of these two major political events are still largely unknown and experts are still divided and uncertain on the full impact that they will have on Irish businesses.

With Uncertainty Comes Risk

There are key concerns for Irish exporters and with the potential for US corporation tax to be slashed to 15%, there will also be a massive impact on the many US companies with Irish global headquarters. Nobody quite knows what to expect and with uncertainty comes risk.

The market volatility has already had an impact and been quick and sharp in its response and this is likely to continue for the forseeable future. The landscape has utterly changed and it’s time now more than ever for Irish businesses to inform and educate themselves, face the challenges and be creative in coming together to have their voice heard.

Essential Businesses Are Represented

So where to now for Irish businesses post Brexit and Trump? It’s now essential for Irish businesses to ensure that they have the correct representation whether home grown, multinational, big or small whatever sector of the economy.

Ibec, Ireland’s largest, most influential and best known business representation organisation, has committed to becoming Ireland’s leading voice of business on Brexit, safeguarding Ireland’s reputation, competitiveness and future.

Ibec Director of Policy Fergal O’Brien said: “Brexit and the possibility of a more protectionist US pose very significant risks to Ireland. The budget introduced some useful measures in response to Brexit, but did not go nearly far enough. Companies are moving quickly to manage severe competitive pressures, but an urgent, targeted national response is required.

“The exporting industries most affected by the sterling fall are typically job intensive and deeply embedded in local economies. A review of the historical exchange rate and agri-food export relationship shows that a 1% weakness in sterling results in a 0.7% drop in Irish exports to the UK. This has already begun. Our most recent trade figures for the year to August showed the value of Irish food exports to the UK fell by 8.1% annually. This fall accelerated to 14.5% annually in the two months since the referendum and has hit all categories”, explained Fergal O’Brien.

Closely Working With Government and Stakeholders

Along with its 40 industry sector associations, Ibec leads, shapes and promotes business conditions to drive economic growth and secure prosperity, right across the country. Ibec works with their members to develop policy in key areas of interest. Through their close working relationships with politicians, government departments, state agencies, policy makers and other stakeholders, they ensure those interests stay at the top of the political agenda.

Ibec members receive unrivalled access to market data, economic and legal briefings, executive networking events and sector-specific conferences across the entire economy. Members can also tap into the scale of their employment law and HR practice to support with employee relations and HR policies and procedures.

From small to medium businesses to larger enterprises and employers looking for advice, networking and industry insights in this unprecedented time of political and economic change, it’s a key time to make the move and join Ibec. In this current environment of global uncertainty, Ibec will be the authoritative voice of Irish business.

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

Parliaments in six countries have opposed the European Commission’s proposals for a common tax base across the European Union, according to Irish MEP Brian Hayes.

The Commission announced details of a planned common consolidated corporate tax base (CCCTB) in October. The idea is to apply a universal tax code for all multinationals operating inside the EU earning in excess of €50m.
Mr Hayes believes the seven objections show that “governments have a stronger mandate from their elected representatives going into negotiations”.

“These seven national parliaments, including the Houses of the Oireachtas, have issued formal objections to the European Commission clearly stating that the CCCTB proposal does not meet the principles of subsidiarity,” Mr Hayes said.
The proposal was objected to by the Irish, Swedish, Danish, Maltese, Luxembourgish and two chambers of the Dutch Parliament.

The prospect of CCCTB being passed now looks increasingly unlikely given the significant block of countries opposed to the legislation. Any changes to EU tax codes requires the agreement of all 28 member states. Ireland’s position is likely to be bolstered by the views of the opposition of other EU states.
A block of member states could still push ahead with a limited version of the scheme under so-called enhanced cooperation structures, in which a subset of countries can adapt shared rules. However, the prospect of an EU wide shake-up now appears to be fading. The CCCTB proposals would effectively remove Ireland’s right to determine taxation rates, Mr Hayes said.

“Consolidation of the tax base represents wide-scale tax harmonisation through the back door. It cuts across how states set their tax corporate rates and policy and is a cumbersome way of addressing cross-border tax losses,” he added.

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

Some of the world’s biggest banks announce earnings this week, including JPMorgan Chase, Wells Fargo and Bank of America.

There’ll also be focus on the US economy and how it fared during the busy Christmas shopping period.
Sales at US retailers probably accelerated in December, highlighting robust holiday spending as 2016 drew to a close, a government report is projected to show.

Car manufacturers and suppliers gather in Detroit for the annual North American International Auto Show as the incoming Trump administration weighs policy changes that may reshape the car market.
Closer to home, German Chancellor Angela Merkel gives a speech today on Europe’s future in her first policy comments of 2017, an election year in Germany.

Later in the week, Ms Merkel and Luxembourg Prime Minister Xavier Bettel will hold talks expected to focus on Brexit and the EU’s agenda for 2017.

A number of airlines will also today give updated traffic statistics for December, including Air France-KLM and IAG. Tesco will also provide an update on its activities on Wednesday.

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

Pay rises, housing and tax are employees’ top priorities for 2017. Wage rises remain on the table despite concerns over Brexit and housing.

Uncertainty surrounding Brexit and a Trump presidency have done little to dampen expectations of wage growth in Ireland for 2017.

According to detailed research across companies and staff in areas such as technology, accounting, law and sales and marketing, more than three quarters (77pc) of employees have entered into the New Year with hopes of a pay rise.

Surprisingly, an even higher proportion of companies are planning to grant those pay hikes, despite a myriad of concerns identified among employers.

According to the Abrivia annual salary survey, in association with Trinity College Dublin, 75pc of firms increased salaries by up to 5pc in 2016 and 80pc expect to increase salaries again in 2017 by a similar amount. They are optimistic about hiring too, with 84pc of firms expecting to take on more staff.
However, this optimism is peppered with notes of caution.

For example, the sales and marketing sector is noted to be one of those most fearful of the implications of Brexit.
The sales sector will continue to expand numbers and increase salaries, the research across 2,250 employees and 502 employers found. Most pay increases for sales staff are expected to come in at under 5pc.

“Sales is one of the sectors most fearful of the impact of Brexit. Clearly sales see damage to their profitability from the UK leaving the EU,” the report said.
Similarly, the marketing sector will continue to expand numbers and increase salaries. Salary increases are expected to be more aggressive, with 42pc expecting to increase pay by 3 to 5pc and an 42pc by more than 5pc. This is despite the fact that, along with the sales sector, marketing companies fear the most from Brexit in terms of profitability and pay. This may be largely due to the fact that the sector is domestically focused.

One of the stronger sectors for 2017 is anticipated to be accountancy, which is being driven by demand from multinationals and plcs.

Areas such as consumer goods, pharmaceutical, technology, healthcare and shared service centres have seen increased demand for accounting professionals.

“This has largely been due to continued investment in Ireland by many of these companies as a European hub for their expansion,” the study by recruiter Abrivia said.
“We also saw that hiring activity increased within the SME and mid-sized indigenous business sector,” it said.

“Candidates are benefiting from competitive remuneration packages and have a range of desirable opportunities to choose from.”
Last year, there was a 29pc increase for qualified accounting positions from the previous year. There was also growth in senior roles in the industry and commerce markets.

“These include CFO, head of finance, finance director and financial controller opportunities with salaries ranging from €80,000 to €160,000,” it said.
While Brexit is a significant concern for employers generally, there are many local issues at play, with 30pc seeing housing or the rental market as an impediment to hiring.

For example, the report estimates that employees wishing to live “responsibly” in South County Dublin would require a post-tax salary of €62,500, that would require a gross salary of over €100,000.

While housing is a concern, the primary consideration for employers is taxation. Just over half of firms surveyed find the marginal tax rate an impediment to the recruitment of international staff, although this varies from sector to sector.
Accountancy, sales and “other” sectors such as construction and manufacturing see the tax rate as a problem at 88pc, 59pc and 53pc respectively.

“It is not surprising that accountancy sees it as the largest impediment given their specialist knowledge and ability to understand the intricacies of regulatory arbitrage,” the report said.

It said staff retention may become more important in uncertain times and looked at the reasons human resources (HR) managers believed staff left a company compared to employee reasons.
Both HR managers and employees rank the lacking of career advancement opportunities as the most important reason to leave the organisation.

The second main reason for employees to leave is unhappiness with organisational culture, which is followed by dissatisfaction with management and low pay. However, HR managers ranked pay as the second reason people left.

The report also flagged concerns about the level of private pension provisioning by workers. While 56pc of respondents have a private pension across all sectors, many sectors have very low levels.
People in marketing and the legal profession have particularly low levels of private pension uptake.

In response to the follow-up question to those without a private pension, 60pc across all sectors said that they were not contemplating purchasing a private pension within the next 12 months.

This study also looked at the place of younger workers or millennials in the workforce.
Almost two-thirds of employers said they find millennials difficult to manage, with companies in law, marketing and ICT experiencing the greatest difficulty in managing this group.

The report said that may reflect that this highly educated group is facing into a generally more hostile labour and housing market than their predecessors.

“Real wages fell for this grouping because of the recession and youth unemployment rates were very high,” it said. In Ireland, the youth unemployment rate is still around 20pc.
Millennials (born between 1979 and 1994) also perceive their workload to be higher. For example, when asked if they feel if there is too much work to do everything well, 14pc of millennials strongly agree with this compared to 6pc among Generation X (born between 1965 and 1978) and 2pc in Baby Boomers (born between 1946 and 1964).

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

Young Irish people want to ditch their cash and cards and pay for things using Google, Facebook and Apple instead.

Over half of us expect Ireland to become cashless in future, while three-quarters of those under 22 say they trust tech brands such as Facebook, Google and Apple to provide payment and financial services.
The study from Core Media also shows that almost half of those under 35 have used new payment methods such as Android Pay on smartphones.

Mobile payments and other ‘peer to peer’ transactions are likely to lead the charge, according to the survey.
It comes just weeks after Google introduced its Android Pay smartphone payment system in Ireland.

Those with Samsung, Sony and other Android phones can pay for things in stores by swiping their phones against the shop’s existing payment equipment.
The system works anywhere that accepts MasterCard or Visa contactless debit and credit cards that are issued by AIB or KBC.

Apple is thought to be preparing the introduction of Apple Pay into the Irish market, while Samsung Pay may extend a planned UK launch to Ireland in 2017.

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

Ireland will not be isolated by EU efforts to change the company tax rules, EU Commissioner Phil Hogan said.

The commissioner, who has publicly supported the Brussels decision last August to demand €12bn in back taxes from the multinational Apple, said the fallout from that decision led to many misunderstandings about EU tax plans.
“There is no risk whatever to Ireland’s 12.5pc rate of company tax. Any change in EU rules on taxation requires unanimity and Ireland could veto any such change,” Mr Hogan said.

But the commissioner said that in practice many other member states, including the Czech Republic, Luxembourg and others, would oppose any such change so Ireland would not be left politically isolated on the issue.
Mr Hogan insisted that the Apple verdict turned around whether “aggressive tax planning” was used to such an extent that it constituted state aid. “These matters are currently sub judice and the subject of an EU court appeal which will play out in the coming year or two,” he said.

Mr Hogan also said he believed that US-based multinational companies would still be attracted to Ireland for its access to an EU market of 500 million people, a skilled English-speaking workforce and a similar legal system.
“But tax incentives will remain an important facet of Ireland’s and many other member states’ economic policies,” he said.

Dublin MEP Brian Hayes yesterday also revealed that seven national parliaments in the EU have objected to the European Commission’s proposals for a Common Consolidated Corporate Tax Base (CCCTB). The plan is a relaunch of efforts to have common EU rules to calculate company’s taxable profits.
These seven objections do not trigger the formal “yellow card” procedure which would have stopped the process at this early stage because one third of the 28 member states are required for this.

Mr Hayes said the seven national parliaments, including the Houses of the Oireachtas, sent formal objections to the European Commission stating that the CCCTB proposal does not meet the principles of subsidiarity.
The proposal was objected to by the Irish, Swedish, Danish, Maltese, Luxembourgish and Dutch parliaments. The UK’s House of Commons, one of the biggest advocates of the yellow card procedure, published a critical report but did not formally object.

He said the commission must listen closely to these parliaments’ objections from national parliaments and the Irish Government must still engage with other member states.

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