Thursday, 5 July 2012
Department of Finance
From 1 January 2012, the Revenue Commissioners have substantially modernised the operation of Relevant Contracts Tax (RCT). Key features of the new scheme are a streamlining of the processes for the submission of information and payments to Revenue and the introduction of a new RCT rate at the standard rate of 20%. The latter was designed to improve the cash-flow position of tax compliant subcontractors with a view to boosting employment prospects in the sector. Revenue have introduced a dedicated online facility which now offers principal contractors a fast, efficient and paper free system. This has had the effect of significantly reducing the administrative burden associated with RCT for both compliant principals and subcontractors. There has been a very broad welcome among the tax compliant trade for the significant benefits associated with the radical reform of the RCT scheme. There has been no change in terms of the obligations on principal contractors to notify Revenue of details of subcontractors whom they engage to carry out contracts. For this purpose, the details to be supplied by subcontractors to principal contractors on engagement remain unchanged.