It’s that time of year again, the income tax filing deadline is fast approaching and it’s time to focus on getting your tax affairs in order if you haven’t already done so. This is a brief summary of the main points to note on whether to file an income tax return and the other tax dates to note that are coming up soon.
The filing deadline for income tax returns for the year ending 31st December 2014 is almost here. If you file on paper then the return need to be filed and any liabilities paid before 31st October. An extension is available to the 12th November if you pay and file on line using Revenue’s Online System (ROS). Both filing and payment need to take place online before the deadline in order to qualify for this extension.
Who needs to file a return?
You are obliged to file an income tax return if you are a chargeable person for the year in question. A chargeable person is anyone who has income from sources other than PAYE employment that exceeds €3,174.
If you are a PAYE worker but also have social welfare income this is taken into account using your tax credit allocation to your PAYE income therefore this does not bring your into the chargeable persons bracket.
It is important to ensure that if you have any other income sources in excess of the €3,174 limit that you meet your obligation to file an income tax return in a timely manner.
What needs to be included?
Income from all sources both Irish and foreign need to be shown on your tax return. This includes your PAYE income, self employment profits, deposit interest, dividend income, social welfare income, any foreign income to name but a few. If in doubt about whether to include an item then seek advice but in general all income needs to be included on the return for the year in question.
Capital gains arising in the year 2014 also need to be included on the return. The tax arising on these gains should have been paid but the details of the gain need to be shown on the tax return for the year in question, the due dates for payment of CGT are set out below.
What reliefs are available?
Revenue have reduced tax reliefs available to taxpayers in recent years. Relief is available at 20% on medical expenses that have not been reimbursed by private health insurance. Pension contributions not relieved through payroll can also be claimed and this relief is available at the marginal rate of tax (41% in 2014). Tuition fees for third level colleges are also eligible to relief at 20% with limits applying to the maximum amount that can be claimed.
Penalties for non compliance
If a return is filed late a surcharge applies of 5% of the liability if filed within 2 months of the due date or 10% thereafter along with interest arising on the late payment chargeable from the due date of the return.
Other important dates
Capital gains tax (CGT) is due on 15th December 2015 on any chargeable gains arising in the period 1st January 2015 to 30th November 2015. It is important to note this short timeframe if disposing of assets before the end of November that any CGT arising needs to be paid before 15th December 2015. Any CGT arising on gains arising in December 2015 needs to be paid before 15th January 2016.
Capital Acquisitions Tax (CAT) for beneficiaries who received gifts or inheritances with valuation dates in the year ended 31st August 2015 need to file a return before 31st October 2015 and can avail of the extension to 12th November if filing and payment take place online.
If you feel you may need to file a tax return for any of the above taxes contact us to arrange a meeting to discuss your case and ensure that any obligations are met in a timely manner.
This article is based on the current tax rates and rules. Changes may be introduced in the upcoming budget for 2016. These changes will be discussed in our next article.