Your Money

Late tax return filers warned to come forward to avoid fines

Reasons include disorganisation, not realising they owe tax or a lack of ability to pay

Revenue’s push of e-filing has resulted in more than 90.5 per cent of those who filed using the online system. Photograph: iStock
Revenue’s push of e-filing has resulted in more than 90.5 per cent of those who filed using the online system. Photograph: iStock
Fri Nov 11 2016 - 13:54

People unable to meet their tax liabilities for 2015 should make themselves known to Revenue to mitigate potential penalties, an expert said following the income tax deadline at midnight on Thursday.

Every year hundreds, even thousands, of people do not file their returns on time and face potential surcharges from 5 per cent of the amount of tax due to 10 per cent if the return is more than two months late.

According to Taxback.com, the reasons can be disorganisation or being unable to pay. Sometimes people are unaware of their obligations, for example if they have rented out a room on Airbnb.

On Friday, Revenue said more than 444,000 returns were filed for 2015 through ROS (the Revenue Online Service). But many probably missed the deadline.

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“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,” said Barry Flanagan, senior tax manager at Taxback.

Head in the sand

“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.”

The vast majority of Irish income-tax payers have switched to Revenue’s online system, with the number making electronic payments up by 24.6 per cent on last year. It is estimated that over 90.5 per cent of those who have filed used ROS.

Mr Flanagan said people are often unaware that late filings can result in increased penalties and interest payments.

In one example, a self-assessed taxpayer with an outstanding 2015 liability of €10,000 who has not filed the return may face an immediate surcharge of 5 per cent, or €500. If they delay, this can rise to €1,000.

“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,” Mr Flanagan said.

“This is never the case. 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.”