Finance bill

Other measures

PUBLIC SERVICE RETIREES:

Early deadline for cnline filing

SELF-ASSESSED TAXPAYERS filing on paper rather than online will have to calculate their own tax liability or file two months early, under measures in the Finance Bill. The measures effect those who neither use a tax consultant nor Revenue’s Online Service (ROS).

But Revenue will assess the amount due on behalf of paper-filing taxpayer’s behalf if they submit their returns by August 31st each year. This early August filing date would not mean taxpayers paying their Revenue bill earlier than in the past.

Previously those filing returns by paper did not have to correctly calculate their own tax bill and could file up to October 31st. The measures outlined would not come into effect until tax returns due for filing by October 31st 2014.

Retirees given one-off opportunity to cash in

PUBLIC SERVICE retirees whose pension capital is over €2.3 million would be given a one-off opportunity to cash in private pensions in whole or part, under under measures contained in the Finance Bill.

The Bill contains a range of measures to ease the “harsher tax impacts” on those whose pension are subject to significant chargeable excess. It allows this excess to be minimised or avoided in certain circumstances, the department said.

Unlike in the private sector, public servants have no control over the accrual of their pension entitlements, according to the Department of Finance .

Exercising this option will attract a tax rate of 41 per cent plus universal social charge on the rights value. This effectively means that no tax-free lump sum is available.

Athletes get tax relief on retirement income

PROFESSIONAL CRICKETERS will be able to avail of tax relief for certain income on retirement, under measures in the Finance Bill.

Cricket players will be added to a list of specified occupations and profession that are allowed to avail of tax relief on retirement for certain income.

Under the measures professional cricket players can also avail of tax relief on certain pension contributions. Cricketers are added to the existing list of sports professions which includes athletes, boxers, cyclists, footballers, golfers, motor racing drivers, rugby players and swimmers. Revenue said that when the measures were introduced cricket was an amateur sport in Ireland.

Introduction of self-assessment

THE ACT introduces self-assessment into the stamp duty code in common with other taxes. The Act does not contain details of how this self-assessment would operate.

Under this measure instruments (such as property conveyancing) will have to be stamped within 30 days. It abolishes the adjudication procedure and gives Revenue the power to make assessments. It also introduces audit and appeal procedures.

Separately the Finance Bill also contains amendments to improve the functioning of existing Islamic finance provisions.

This includes changing the definition of a finance company to allow it to have other income in addition to specified financial transaction.

Measures target under-reporting

MEASURES TO tackle under-reporting of credit and debit card transactions by retailers allow Revenue to seek information from payment processors, including card payments through terminals in shops as well as transactions processed by third party payment processors like Paypal.

Under the measures Revenue can ask payment processors to file annually on transactions they process for retailers based in the State. Among the information Revenue can also ask the payment processor for are: the retailer’s tax/PRSI number, information on the nature of the business, location of card terminals, contact details of merchants and the account to which payments are transferred.

Non-complying payment processors could face fines of up to €3000.

Levy of €200,000 regardless of citizenship

A CHANGE aimed at ensuring that wealthy people who are non-resident for tax reasons do not avoid the domicile levy by renouncing their Irish citizenship is included in the Finance Bill.

Regardless of citizenship, the €200,000 levy will be payable by Irish-domiciled individuals whose Irish assets exceed € 5million, whose worldwide income exceeds € 1 million, and whose liability to Irish income tax for the relevant year is less than €200,000.

The amendment applies to the levy chargeable for the year 2012 and subsequent years.

The Bill also provides for penalties for those who deliberately or carelessly make incorrect returns.

All the taste and zero fat

PROVISION FOR bagels to once again be categorised as bread qualifying for zero-rate Vat, is made in the Finance Bill. The measures reverse a change by Revenue last year which categorised bagels and other baked goods as non-bread. This increased their Vat rate to 13.5 per cent.

Bagels, burger buns, naan breads and pitta bread are included in the new definition of bread which will be subject to zero-rated Vat.

However brioche croissants, danishes and other products with “excessively high levels of sugar and fat” remain subject to 13.5 per cent Vat rate.