The restart grant and restart grant plus are a contribution towards the cost of re-opening or keeping a business operational and re-connecting with employees and customers.
I am advised by Revenue that in the case of a sole trader who is within the charge to income tax, such a grant would be taken into account in computing amounts chargeable to income tax. The tax treatment of the grant will depend on how it is used:
- Where the grant is used by the sole trader to defray expenditure which is revenue in nature, such as utility or insurance expenses costs, it will be taken into account when calculating the trader’s taxable trading profits.
- Where a grant is used to fund the acquisition of plant and machinery for use in the sole trader’s business, expenditure which is capital in nature, the trader will be entitled to claim capital allowances in respect of that expenditure net of the grant received.
Revenue also advise that a similar treatment applies for a company in receipt of the restart grant or restart grant plus.