TaxSource Total

Here you can access summary of the key current tax developments in Ireland, the UK and internationally as reported by Chartered Accountants Ireland

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Brexit update

The past few weeks has seen a flurry of Brexit activity. The European Commission released a draft divorce text and angered the UK government by suggesting that the only plausible way a hard border can be avoided on the island of Ireland is for Northern Ireland to remain within a Customs Union with the EU. With Theresa May saying she could never agree to this and despite making a speech following the release, pressure is mounting on the UK to offer solid details on how to solve the border problem.

The European Commission has released the draft divorce treaty spanning over 100 pages which sets out the legalities of the agreement reached back in December between the EU and the UK and saw the Brexit talks advance to the second phase.

Among other things, the text covers citizens’ rights, the financial settlement, customs issues and the territory of European Court of Justice. In the sections which relate to Ireland and Northern Ireland, the text proposes that if a deal is not reached, a common regulatory area would remain on the island of Ireland. Effectively this means that Northern Ireland would remain in the Customs Union with the EU if the UK leaves it as without a free trade agreement or a unique solution offered by the UK, this is the only way the EU can see that a hard border can be avoided.

The UK has already signalled that it will reject certain aspects of the text, which remains in draft and will be circulated among the 27 Member States for input and review.