November 12 deadline! How to fill out the self-employed tax return filings
The 2014 tax return is due to be filed online by 12 November. We will host a live blog on Wednesday October 28 from 12.30 to 2.30pm with tax specialists from Grant Thornton who will answer your questions live. Ahead of that, some of the questions that arise regularly are addressed below:
You can also submit questions to email@example.com ahead of the blog.
1. Q: Who must file?
A: Self-employed persons, most company directors, employed individuals claiming certain reliefs or with share options, and those employed with non- PAYE source income over €3,175.
2. Q: Must you file on-line?
A: Most people are now obliged to file on-line as part of Revenue’s move towards universal mandatory eFiling. Paper returns are still permitted in a very limited number of cases.
For example the following are obliged to file electronically:
- All partnerships
- Self employed individuals filing a return of payments to third parties (Form 46G)
- Self employed individuals subject to the high earners restriction (Form RR1, Form
- Self employed individuals benefiting from or acquiring Foreign Life Policies,
- Self employed individuals claiming a range of property based incentives
- VAT registered cases
- Individuals who avail of the reliefs and exemptions set out below*
Offshore Funds or other Offshore products
(Residential Property and Industrial Buildings Allowances).
3. Q: How do you file? How do you register for on line services?
A: this can be done in three easy steps as set out on Revenue’s website www.revenue.ie – first you apply for a “ROS access number” and then you apply for a digital certificate. It’s easy.
4. When is the deadline? Can it be extended?
The Statutory deadline is actually 31 October. However, provided you pay and file on line you get an extension to 12 November.
Remember you need to pay on line also to avail of this extension. If you cannot afford to
pay on 12 November then you should have filed on 31 October.
5. Q: Must you use a tax practitioner or can you do it yourself?
A: You can do it yourself BUT be wary of complexities and traps. It may be best to invest in a bit of professional assistance rather than risk doing it incorrectly and ending up with interest charges and/or penalties.
6. Q: How do you pay and how much should you pay?
A: You must pay the balance (if any) of your 2014 tax and also make a payment “on account” for 2015 –referred to as “preliminary tax”. This must amount to a certain minimum amount 100pc of the 2014 liability 90pc of the final (yet to be determined) 2015 liability 105pc of the 2013 figure – only allowed where you were paying by direct.
7. Q: What if I can’t afford to pay it at once?
A: If you can’t pay 2014 balance then you don’t get extension so you should have filed by 31 October. Nevertheless, file as soon as possible and contact Revenue’s collector General immediately to ensure that they do not commence enforcement action.
8. Q: What are typical problems/traps that affect people
a. Rental income – what can be deducted?
i. 75pc restriction of interest deduction for residential lettings
ii. Requirement to register lettings with the PRTB
iii. No deduction for LPT, NPPR, household charge etc
iv. Issues that arise with certain “specified reliefs” such as property related incentives
v. Property surcharge (additional 5pc charge where you use certain property related reliefs)
b. What personal reliefs can you claim for?
i. Mortgage interest – restricted nowadays but still available – Usually given at source by lender
ii. Rent relief (only available now if you were renting at December 2010)
iii. Relief for Tuition fees
iv. Dependent relative credit
v. Medical expenses
vi. Pension payments
vii Any tax reliefs now abolished?
From 1 January, all donations from individuals (both PAYE workers and Self-Assessed) will be treated the same and tax relief in all cases will be repaid to the charity at a blended marginal rate of 31pc, individuals no longer get the relief so you can exclude charitable donations from your return for 2014
What is different this year?
i. Full self- assessment applies. It is really just a technical matter but will involve an extra step when preparing your return
ii. Interaction with Local Property Tax: It is really just a technical matter but will involve an extra step when preparing your return paid your LPT Revenue will apply a surcharge when you file your income tax return.
Jim Kelly is a tax director at Grant Thornton