Time running out to take decisive action on your tax return
You have little time to waste in order to meet deadlines to file tax returns to settle any liability for last year and to pay for the year ahead
It’s tax returns time again. It might seem a bit strange this year, coming as it does so soon after the rescheduled budget, but with the deadline now fast approaching it’s time to take action. And remember, next year the deadline might come even sooner.
First things first. If you have a tax liability arising from 2012, you will need to file a tax return as soon as possible. The deadline for doing so by post is next Thursday, October 31st, but if you want to buy a little time you can do so online, through Ros (ros.ie) before November 14th.
The November 14th date also applies to those looking to settle a liability arising from capital acquisitions tax (CAT). Remember however, that if you have not already set up an account with Ros – or have changed computers or lost your digital certificate – it will take some time to get things in order before you will be able to pay and file.
If you wish to avail of the longer deadline and file online, you will need to take action – and fast. Registering with Ros is a three-step process, which will take eight days, as it involves the post, and Revenue recommends you leave at least 10 days for the process. The steps are as follows:
Step one: Apply for a ROS Access Number. This involves entering your tax registration number (your PPS number in the case of self assessed returns), which will be validated by Ros, who will then post your ROS Access Number to you.
Step two: apply for a digital certificate. This involves entering your access number along with your registration number and an email address. When this is processed by Revenue, a ROS System password will be generated and posted to you.
Step three: retrieving your digital certificate. To install this you need your ROS System password, and you will then be asked to create your own password. Once this is installed you will be able to use the service.
Beware the Revenue’s “hotspots”
As the recent budget has shown, with its effort to keep construction workers in the tax net by allowing homeowners claim back their VAT, cutting down on tax evasion and the black economy is a key focus of the Government.
As a result, the Revenue is paying much closer attention to expenses that those filing self-employed tax returns are looking to deduct from their tax bill.
Earlier this year for example, it was disclosed that the Revenue had discovered €42 million which it was owed from an audit of more than 700 property owners. Landlords had avoided taxes in numerous ways including not declaring rental income, claiming false or non-allowable expenses, and clawing back stamp duty.
In addition, the Revenue has cast its eagle eye on mileage expenses that contractors and company directors are claiming for.
But this doesn’t mean that you should not file legitimate expense claims. Mairead O’Grady, taxation partner with Russell Brennan Keane, urges people to remember that all business expenses should be captured to minimise taxable profits, such as bad debts, loan interest, etc. Stock on hand should be reflected at its minimum value, in particular development sites, she recommends, while capital expenditure should be examined to establish if it can be seen as a repair or plant and claimed as a tax deduction.
And individuals should not forget other deductions they might be able to claim, such as the flat rate expenses that apply for various professions and trades. A bricklayer for example can claim a deduction of €175 against their tax bill, rising to €1,312 for miners.
Remember your property filing
If you are one of the 10 per cent or so who have not yet filed a property tax return, it’s time to do so or potentially face a fine.