Professional Service Company Surcharge on undistributed income

[deargas]

Myself and my business partner operate a business where the majority (90%) of our income is derived from selling advertising in an online capacity.

What is the concensus that my company is an advertising agency? ie that the company falls outside the scope of the Professional Service Company Surcharge, and is not liable to the 15 per cent charge on 50 percent of the undistributed trading income.

I've read the relevant materials;

Revenue [pdf]
[broken link removed]


There is a definition of an Advertising service in this page
http://www.revenue.ie/en/tax/vat/leaflets/advertising-services.html

The ruling which brought about the opinion that an advertising agency was not 'carrying out a profession'
http://www.charteredaccountants.ie/taxsource/1997/en/act/pub/0039/cl/sec0441-1-cl.html

[broken link removed]

 

[dublin66]

You are unlikely to be liable to professional services surcharge. The Cronin High Court case your refer to there gives you your answer. This case was concerned with requiring professional qualifications in order to practice and be liable to the surcharge. My view is that you are safe enough. The question I would ask is - do you need professional qualifications to sell advertising in an online capacity? You may well have such qualifications but are they needed to perform your work? If not you are fine.

 

[Joe_90]

I would agree that the surcharge would not apply in this case but would disagree with the premise that a professional qualification is required.

Accountancy companies are subject to the surcharge and there is no requirement for a professional qualification to act as an accountant.