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Written by

Jacob Howard

Product Marketing Manager, FE fundinfo

Published on

Understanding Irish gross cashflow modelling in FE CashCalc

FE CashCalc's gross cashflow modeller calculates Irish income tax, USC, PRSI, DIRT, capital gains tax, exit tax and deemed disposal automatically from figures entered gross, removing the need for advisers to net down or manually calculate any Irish tax liability.

FE CashCalc now offers a third cashflow modeller: Irish Gross Cashflow. The net modeller expects figures to be entered net of tax and applies only basic pension tax logic, making it suited to simple forecasts or offshore clients who fall outside the Irish tax system. 

The new gross model is built around the Irish tax system. Advisers enter figures gross and FE CashCalc calculates income tax, USC, PRSI, DIRT, capital gains tax, exit tax and deemed disposal automatically, with a full breakdown of every calculation. 

This post walks through the core differences and shows how to set up a gross cashflow from client data already held on the system, with a full map of which Irish tax applies to which pot or income type. 

At a glance Irish Gross Cashflow capabilities 

Pot or income type 

Irish tax applied 

What triggers it 

Granularity FE CashCalc calculates 

Cash (Irish or EU account) 

DIRT 

Interest received 

Gross interest, DIRT deducted, net amount, split by owner or joint holding 

Cash (non-EU account) 

DIRT (offshore treatment) 

Interest received 

Same detail as above under separate offshore account tax rules 

Direct investment account 

Capital gains tax 

Withdrawal or gain taken 

Gross withdrawal, annual exemption applied, CGT paid, itemised per owner 

Insurance bond 

Exit tax and 8 year deemed disposal 

Withdrawal or 8 year anniversary 

Exit tax on the gain, 1% government levy on contributions (can be waived) 

UCITS fund or ETF 

Exit tax and 8 year deemed disposal 

Withdrawal, income or 8 year anniversary 

As above, plus any interest or dividend income split out separately 

DC pension (ARF or vested PRSA) 

Income tax, USC, PRSI on imputed distribution, plus excess and shortfall tax 

Drawdown, lump sum, imputed distribution 

Tax-free lump sum up to the allowance, imputed distribution by age band, excess lump sum tax, shortfall tax 

State pension 

Income tax, USC, PRSI 

Payment received 

Included automatically in the client's annual income tax calculation 

Employment and other income 

Income tax, USC, PRSI, tax credits 

Salary, bonus, benefits in kind, other income 

Full band and credit calculation, income changes over time, joint or separate assessment 

 

How to build a Irish gross basis cashflow in FE CashCalc 

 

 

Get client data into FE CashCalc

1. Select your client and open the 'Info' tab to review the data already sourced for them, including investments, pensions, incomes and expenses.

2. If you need to add more client data, you can have the client complete a fact find through FE CashCalc’s portal, pull it in through a third-party integration or add this data manually.

Get client data into FE CashCalc

Create a gross cashflow

3. Click 'Update a Calculator', give the cashflow a name and choose gross rather than net. FE CashCalc pulls in the client data automatically and exports it into a new cashflow.

Create a gross cashflow in FE CashCalc

4. Alternatively, you can create a cashflow by opening the 'Cashflow' tab to switch between previously created net and gross cashflows, or start a new one as a blank forecast, a clone of an existing forecast, or built from the client's saved fact find data.

Create gross cashflow in FE CashCalc alternative

Set assumptions and surplus handling

5. Under 'Assumptions', set the forecast end date and inflation rate.

Set assumptions and surplus handling

6. Decide what proportion of surplus income is saved rather than left to accumulate in the current account. In the gross model, surplus can be redirected into a different pot, such as a pension, rather than defaulting to cash.

Record client and tax status

7. In 'Inputs and Timeline', record any tax-free lump sum already used and each client's pension access age.

Record client and tax status

8. Flag full medical card status, which reduces USC rates, and marital or civil partnership status.

Flag full medical card status

9. Select 'joint assessment' to automatically optimise the standard rate band allocation each year, or set a fixed split manually.

Add pots, pensions, income and expenses

10. Click on the 'Savings and Investments' tab to add pots, the system allows you to categorise each as cash, direct investment account, insurance bond or UCITS/ETF so the correct tax treatment applies. Growth rates can be typed in directly or pulled from an FE Analytics portfolio.

Add pots, pensions, income and expenses

11. Add pensions, incomes, tax credits and expenses (labelled essential, lifestyle or discretionary).

Add pensions, incomes, tax credits and expenses pt2

12. Use the 'Transfers' feature to move money between pots without manually setting up matching contributions and withdrawals.

Use the transfers feature to move money between pots

Review the output

13. Review the 'Cashflow Model' tab for money in, money out, savings over time and a dedicated taxes view.

Review the output

14. Use 'Yearly Breakdown' for a full year-by-year calculation of income tax, USC, PRSI, CGT, DIRT and exit tax.

Use yearly breakdown for a full year-by-year calculation

The outcome

The adviser has a fully modelled Irish gross cashflow built directly from client data, with every tax liability calculated and itemised automatically rather than estimated manually.

This gives clients a transparent, year-by-year view of how tax affects their financial plan, and gives advisers a faster, more consistent way to build forecasts across their book.

FAQs

Frequently asked questions

The net modeller expects figures entered net of tax and applies limited tax logic. The two gross modellers (one for UK and one for Ireland) are built around the tax system. For the Irish one, this calculates income tax, USC, PRSI, DIRT, CGT and exit tax automatically from gross figures. 

The net model suits simple cashflows or offshore clients who fall outside Irish tax rules. The gross model should be the default for most cashflows built for clients based in Ireland. 

Yes. Data can be added manually, collected through a client fact find in the portal, or imported through third-party integrations, then exported directly into a new cashflow. 

Advisers can redirect some or all surplus income into a specific pot, such as a pension, rather than letting it default to the current account, giving a more realistic picture of what a client is likely to spend or save. 

Yes. Selecting joint assessment automatically optimises the standard rate band allocation between both clients each cashflow year, though a fixed percentage split can be set instead if preferred. 

A new gross cashflow can be created from the same client fact find data at any time. Net and gross cashflows sit side by side under the cashflow tab, so advisers can switch between them without re-entering client information. 

The gross model adds full USC, PRSI, DIRT, capital gains tax, exit tax and deemed disposal calculations. The net model applies only basic pension tax logic and otherwise expects figures net of tax.