Revenue has made further improvements to its internet service which make it easier to pay tax online, writes Eamon McGrane

Few things can freeze the blood more than the thought of tax returns. With the end of October fast approaching, all self-employed people will be either tackling their finances themselves or having a tax agent or accountant do it for them in an effort to pay and file by the deadline.

Customers of the Revenue Online Service (Ros) will have until November 16th to cough up.

Ros has become one of the most effective services in the entire e-citizen area and the service is expanding with the addition of more online elements. The aim is to reduce the amount of paper the Revenue has to deal with and to make the process easier for employers, the self-employed and, of late, PAYE workers.

While it might be a stretch to say that the Revenue has gone from being the wolf at the door to the fairy godmother courtesy of Ros (after all, it still wants your money), its efforts in the online arena to cut the hassle out of tax has been recognised worldwide, with a constant stream of international officials visiting its offices to see how the system works and to study the attendant benefits.

To that end, Ros has won several local and international awards. It was awarded an e-Europe award last year for the impact that the service has had internally and on its customers.

In an effort to streamline the service further, Ros has already phased out the use of diskettes for employers' P35 end-of-year payroll returns. Essentially, filing it using a diskette and on Ros were the same, so the Revenue decided to cut out one option.

The second diskette that is coming to the end of its life is for tax credit certificates that employers receive for their staff. From February 2007, employers will receive tax credit information on paper or online through Ros.

The self-employed have already been using either Ros or paper returns. Last year, 65 per cent of self-employed people filed through the online service.

This worked out at more than 200,000 individuals, most of whom (approximately 98 per cent) filed through a tax agent or accountant. Looking at the bigger picture, in 2005 more than 1.56 million returns were filed on Ros, with more than €12.1 billion in payments accounting for more than 27 per cent of all taxes paid during the year.

The filing statistics for Form 11 reflects the growing trend towards electronic filing, with 9 per cent of timely income tax returns filed electronically in 2002, 40 per cent in 2003, 53 per cent in 2004 and 65 per cent in 2005.

Despite its best efforts, it is unlikely that the Revenue's office will eventually bid adieu to paper. This is for both practical and customer-friendly reasons - not everyone has a computer. "I can't see it ever being totally paperless," says Conor Hegarty, Ros marketing manager.

"We have to cater, for example, for the trader on Moore Street who comes in and files a tax return. Paper is always going to be there. Nonetheless, we are looking at a target for next year of 75 per cent for online tax returns."

Ros is also looking at getting 85 per cent of corporation tax, 95 per cent of customs and 98 per cent of vehicle registration tax (VRT) returned online by the end of 2007.

The Revenue plans to have more elements online in the near future, including what it calls P45 part three, wherein the employer can file a new employee's details online and upload them instead of posting the information.

PAYE workers are also set to benefit; in fact, the PAYE service was set up in June this year (see panel).

"We want to extend that and get more people using it - that would be a big thing," says Hegarty.