Standard Rate on Trading Income

12.5% from 1 January 2003

Investment/Rental Income

25%

Manufacturing, IFSC and Shannon companies Rate

10% (only for established qualifying companies)

Special rates apply to dealings in land

The payment date for preliminary tax, which must be at least 90% of the final liability, is being brought forward to one month before the end of the accounting period over a transitional period of five years.

Preliminary tax is based on the current year's liability. However, small companies can base the preliminary tax payment on the previous year's liability. A small company is a company with a corporation tax liability of less than Euro50,000 in the preceeding period.

For accounting periods ending on or after 1 January 2003 but before 1 January 2006, preliminary tax (90%) will be payable in 2 instalments. The first is due 1 month before the end of the accounting period and the amount due is as follows:

Accounting Periods Ending on or after

% of current liability 

% of previous year's liability (Small Company)

1 January 2003

36

40

1 January 2004

54

60

1 January 2005

72

80

1 January 2006 and after

90

100

The second payment of preliminary tax to bring the total preliminary tax payment up to 90% of the current years liability is due within 5 months 28 days after the end of the accounting period.

For accounting periods ending on or after 1 January 2003 the final balance of tax (10%) is payable nine months after the end of the accounting period.

For accounting periods ending prior to 1 January 2003, the final balance (10%) will continue to be due within one month after the issue of the notice of assessment.

A new 20% tax credit for qualifying research and development expenditure is being introduced for companies engaged in in-house qualifying research and development undertaken within the European Economic Area.

The tax credit will not be available in any year if the total of R&D expenditure is less than €50,000. The scheme of relief will continue until 31 December 2008.

The credit is subject to a number of conditions and full details of the scheme, which is subject to EU approval, will be included in the Finance Bill 2004.