The pay and file deadline is fast approaching. Revenue has given some flexibility to taxpayers in respect of the forthcoming tax deadline, however we would still recommend that you get organised as early as possible. Get your information to your accountant on time and allow them the time to process your information. That way you avoid any surprise payments and/or penalties.
Below is a summary of all you need to know about self- assessment: who should register; how pay and file works; filing deadlines; and, a checklist for preparing your annual tax return – for PAYE workers and self-employed.
Need assistance? Talk to us, we streamline the process for you and ensure that you pay and file on time.
Do I need to register for income tax self-assessment?
The answer is YES if you meet any of the following criteria
- you are self-employed
- your only or main source of income is:
- rental income
- investment income
- foreign income including foreign pensions
- maintenance payments
- fees that are exempt from PAYE
- you have profited from share options or share incentives.
You do NOT need to register for self-assessment if:
- you only have PAYE income
- your taxable non-PAYE income does not exceed €5,000 and your gross non-PAYE income does not exceed €30,000.
How do I register for self-assessment?
How does ‘Pay and File’ work
Under self-assessment there is a common date for the payment of tax and filing of tax returns.
You must file your annual tax return on or before 31 October in the year after the year to which the return relates.
This system, which is known as PAY and File requires you to:
- file your return for the previous year
- make a self-assessment for that year
- pay the balance of tax for that year
- pay preliminary tax for the current year.
Revenue has made it clear that the relevant return and payment date is no later than October 31st for those who do not pay and file through its online system, and suggested that the most efficient way to pay and file is by using ROS.
Furthermore, Revenue has announced a four-week further extension to the Pay & File deadline for those who file online.
For customers who file their 2019 Self-assessed Income Tax Return and make the appropriate payment through the Revenue Online Service (ROS) in respect of Preliminary Tax for 2020 and any Income Tax balance due for 2019, the due date is now further extended from 12 November 2020 to Thursday, 10 December 2020.
We would still recommend that you get organised as early as possible. Get your information to your accountant on time and allow them the time to process your information. That way you avoid any surprise payments or penalties – up to 10% penalty for those who fail to file on time.
Annual Return Checklist
Before submitting your tax return, you should check that you’ve completed all the sections. Where you have no income in a particular category, you should write ‘none’ rather than leave it blank.
If you’re claiming mortgage interest relief, you should enter the loan account number of your lender and attach your mortgage interest certificate stating the amount paid during the last tax year, as well as an estimate of the interest payable in the following year.
Tax forms include customised pay slips showing your PPS number, tax type, etc., which must be returned with the tax form, even if you’re making a nil return. You should also include copies of the following documents:
- Form P60
- Form P45 if you’ve ceased employment
- Details of any benefit in kind (especially a company car)
- If you’re receiving any social welfare income, a statement from the Department of Social and Family Affairs confirming the kind of income, the date payment began and the weekly amount
- Details of any rent paid (which should be entered on form ‘Rent 1’)
- If you’re receiving rental income, a detailed account of gross rent and expenses such as furniture on which you may be entitled to a wear and tear allowance
- Details of any acquisitions and disposals of assets during the tax year which may be liable for capital gains tax
- Documentation relating to government stocks, rents and other income
- The relevant claim form if you’re claiming a dependent relative allowance for the first time
- Details of any allowable medical and dental expenses, which should be entered on forms ‘Med 1’ and ‘Med 2’ respectively
- Confirmation of any private health insurance subscriptions paid during the previous tax year
- Receipts for private tuition if appropriate
- Certificates of private pension contributions
If you’re a company or a sole trader, you also need to submit;
- A trading account showing details of sales and profit/loss for the tax year
- A profit and loss account
- A capital account
- A balance sheet showing business assets and liabilities
Finally, make sure that you sign the form!
How to Pay
There are a number of ways of paying your income tax in Ireland:
- By cheque – (payable to the Collector-General) posted to the Collector-General’s Office using the pre-paid envelope provided with your tax form; note that a cheque is cashed on receipt.
- By single debit authority – (SDA) as above, the advantage being that an SDA isn’t debited until the due date.
- In person – at the Collector-General’s Office Sarsfield House, Francis Street, Limerick.
- By bank giro – (obligatory for payments of preliminary tax, VAT and employer’s PAYE/PRSI).
- Online – at the Revenues website, either using a debit card or setting up a debit instruction. If you have an account with AIB or Bank of Ireland, you can arrange payment directly from your account.
Further reading on revenue’s website – A Guide to Self-Assessment
We are here to help. Contact Avid Partners to help you prepare your annual tax returns. Call us to arrange a consultation on 0818 303087 or email us at email@example.com.
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