By Seamus Parfrey

• 10 Fundamental Laws of Accounting

1. Trial balances don't balance. 
2. Bank reconciliations never reconcile. 
3. Working Capital does not work. 
4. Return on Investments never will give a return. 
5. Creditors have better memories than debtors. 
6. A credit card limit is a minimum target. 
7. A budget is an orderly system for living beyond your means. 
8. The time spent discussing any item in the accounts is in inverse proportion to its size. 
9. Materiality in accounts depends on the audit deadline. 
10. Never meet your accountant on a Wednesday as it spoils two whole weekends

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A lady goes to see her doctor with some worrying symptoms and he examines her.

"I'm sorry," he says "but it's bad news. You have only six months to live."

The patient says, "Oh doctor. That's terrible. What should I do?"

The doctor says, "I advise you to marry an accountant."

"Will that make me live longer?"

"No," says the doctor. "But it will seem an awful lot longer."

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The doctor comes to see his heart transplant patient.

"This is good news. It is very unusual, but we have two donors to choose from for your new heart."

The patient is pleased. He asks, "What were their jobs?"

"One was a teacher and the other was an accountant."

"I'll take the accountant's heart," says the patient. "I want one that hasn't been used."

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A restaurant was so sure its massive Sumo chef was the strongestman around, they had a standing €1,000 offer that the chef would squeeze a lemon until all the juice ran into a glass and then hand the lemon to a patron. Anyone who could squeeze just one more drop of juice out of the lemon would walk away with the money. Many people had tried but nobody could do it.

One day a scrawny little man wearing thick glasses and a shiny polyester suit came in and said in a tiny squeaky voice, "I'd like to try it". After the laughter had died down the chef said, "OK". He grabbed a lemon and squeezed away. Then he handed the wrinkled remains of the rind to the little man. The crowd's laughter turned to total silence as the man clenched his fist around the lemon and one by one 6 drops fell into the glass.

As the crowd erupted into cheering, the chef paid the €1,000 and asked, "What do you do for a living? Are you on the rigs, a builder's labourer or what?"

He adjusted his glasses on his nose and said, "I work for Michael Noonan as his national tax adviser."

By Noel Murphy

For the past few years many foreign based companies have located their headquarters in Ireland. 

The main benefits of locating a holding company here are:

1. Low corporation tax rate of 12.5%.
2. No dividend withholding tax (DWT) on payments made to individual shareholders resident in either an EU or double tax treaty country.
3. No DWT where dividends are paid to a non-resident company shareholder where that company is not controlled (50% or more shareholding) by Irish tax residents.
4. Dividends received by an Irish holding company from trading profits of a subsidiary are usually taxed at 12.5%.
5. Limited transfer pricing legislation.
6. Recent Irish Finance Acts extended the 3 year exemption from corporation tax for startup companies for the first three years of trading.
7. Capital Gains Tax exemption for disposal of shares in certain subsidiary companies. There is a minimum share holding requirement of 5% and a shareholding period of 12 months within the last 2 years together with other conditions.
8. Remittance taxation system available for non-domiciled Irish resident individuals which provides a tax incentive to foreign individuals to locate in Ireland.
9. Combining trading activities with a holding company function - charging fees for managing a foreign subsidiary at a low corporation tax.
10. Double tax treaty network with many countries which simplifies the distribution of profits internationally.
11. Low capital start up costs for setting up an Irish company.
12.  Membership of the EU and a common currency when trading with EU member countries.

If you are considering locating a holding company in Ireland and require further advice on these issues please contact me.

 By Seamus Parfrey