Taxback.com say that by now self-assessed tax payers should have their affairs in order and have submitted a tax return in order to have met the final filing deadline of November 10th for online returns.

However, the experts at Taxback.com are calling on all of those who have missed the deadline and/or those who believe that they are not in a position to meet their tax obligations this year, to come forward as soon as possible, so as to mitigate the effect of any potential fines and/ or to resolve any issues that may lead to non-payment.

Barry Flanagan, Senior Tax Manager at Taxback.com explained,
“We see it every year – hundreds, maybe even thousands, of people who have failed to prepare for their tax return in time – even though they know it’s coming. Some people are simply just bad at paper work and administration, whereas others find themselves in the more precarious predicament of not being in a financial position to pay what’s owed. Many of these people take the “Ostrich approach” and rather that tackle the issue head on, they bury their heads in the sand in the impossible hope that it will go away. We are calling on people who fall into either category – or somewhere in between – to take action now because early action is better than no action at all – even if you have missed a deadline”.

The tax refund experts say that potential surcharges for late filing of Income Tax returns increase from 5% of the amount of tax due to 10% of the tax due, if the tax return is filed more than 2 months after the filing deadline.

Barry went on to say,
“We’ve processed thousands of returns for people over the last few weeks – and people have been contacting us up until this morning – often in a commotion because they’ve realised that they will now miss the final deadline. And while unfortunately that may be the case for many people, we are still advising those who call that it’s never too late to file a tax return – and if you become aware of an error or omission it is your responsibility to self-correct. Revenue can reopen any previous year where either fraud or error is suspected.

In our experience, people are not aware that both the penalty and interest can increase if the taxpayer continues to delay filing their tax return. Many people will find themselves in the position whereby they will have to file a return this year for the first time – for example, if they have rented out a property in 2015 – even if they just rented a room out on Airbnb – or if they set up a new business in 2014/2015. These people might be struggling with the paperwork involved or they simply might not be aware of what is required of them by Revenue”.

The tax experts say that if a self-assessed taxpayer with, for example, a 2015 tax liability of €10,000 failed to file their 2015 tax return and pay their liability before the due date, they may now face a potential surcharge of 5%, i.e. €500. If the same taxpayer delays filing their tax return until the New Year it will be more than two months late and so they face a potential surcharge of 10%, i.e. €1,000. There is also the possibility that Revenue will charge an amount of interest, per day, on the overdue tax.

Financial Difficulties
Taxback.com say they have also encountered a number of cases whereby the individual is simply reluctant to file because they know that they current don’t have the financial means to meet their tax obligations.

Barry went on to say,
“All too often we see people who just can’t pay so they “steer clear” of doing a tax return in the hope that Revenue will miss it. This is never the case. Revenue is fastidious when it comes to self-assessed taxpayers filing tax returns and the late fling surcharge is automatically applied by ROS. It is in the interest, therefore, of all self-assessed taxpayers that they address their tax affairs as soon as possible and limit their potential exposure to surcharges and interest.
However, Revenue is not an unreasonable entity – their policy is always to communicate with the taxpayer to resolve any situation – before taking more drastic action.

Just recently in the Dáil Minister Noonan said that,

“Revenue’s clear preference is always to engage positively with taxpayers or businesses experiencing temporary cashflow difficulties and where required to agree mutually acceptable payment solutions rather than deploying debt collection/enforcement sanctions”.

This contention is clearly evidenced by the volume of phased payment arrangements agreed each year. For example, during 2015 it agreed almost 8,500 phased agreements covering approximately €96m of tax debt.

But in the Minister’s words ,
“any such engagement is predicated on open and honest discussion by the taxpayer/business, including a willingness to identify and agree a realistic payment arrangement. Any agreed arrangement must include interest, which is a statutory charge and a commitment to pay current taxes on a timely basis”.

Revenue has clarified that the number of actual cases where the Sheriff was deployed for the years in question was 22,099 (2012), 19,801 (2013), 22,349 (2014) and 21,291 (2015). The difference between the number of referrals and the number of cases arises because a taxpayer/business may have more than one outstanding liability referred to the Sheriff over the course of a year.

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