Q&A Dominic Coyle

When paying one's LPT online by credit card I note, with some displeasure, that Revenue sees fit to impose a charge because of doing so by this method.

Is this not in contravention of European rules that imposing a credit card charge is impermissible? There is no mention by Revenue that such a charge will be incurred until one finds it in their acknowledgment of the transaction. Sneaky.

Mr D G, Waterford

There are two things here – is Revenue entitled to make the charge and is it transparent enough in doing so? The answer is, respectively: yes and no.

There is nothing in “European rules” preventing anyone making a charge for use of a credit card service, nor is there any plan to do so.

What is coming into Irish law – I gather it must be in place legislatively by the end of this year and in operation from June 2014 – is a stipulation that a service provider can charge no more for processing credit or debit card payments than that service actually costs. So, if it costs Revenue, or an airline for example, €1 to process a credit card payment, that will be the maximum it can charge.

This measure comes in under an existing consumer rights directive. Minister for Jobs, Enterprise and Innovation Richard Bruton was bullish last year about bringing in this measure ahead of deadline, with an initial commitment to have the legislation in place by the end of last year. As with so many aspirations of government, this has been somewhat overtaken by other priorities.

In any case, it is still entitled to charge for processing credit card transactions.

Could Revenue have been more upfront about it. Yes, of course it could. As with the issue of cheque payments, Revenue has been quite precise on its website about it – if you know where to find it.

If you go to the Revenue homepage and click on the “About LPT” link, you will find a link in the text to a “range of payment options are available for paying the tax” which stipulates, in part: “Please note that if you pay with a Mastercard credit card or Visa credit card there will be an additional service charge of 1.49%.”

That’s pretty straightforward. Why it did not put that same information in the booklet sent out to all homes – where it merely states: “You may choose to pay your LPT on a phased basis by cash or using a debit/credit card through a number of approved Payment Service Providers. The Payment Service Provider will charge a fee for this service” – is a mystery.

The same is true of the hotly- contested issue of cheque payments. The information is on one of the “Frequently Asked Questions/ FAQs” sections of the website – but not on others.

As to when you’re alerted to the charge, my understanding is that people filing online certainly should be told of the charge before they hit the final “Pay Now/Complete/Finish” button, not in some subsequent transaction acknowledgement or receipt. And in my view it would be far fairer – and waste less time – if Revenue gave this information as soon as the credit/debit card option is chosen (where they already tell you in a pop-up window that the money will be taken immediately).

Is Revenue being sneaky? Disorganised more like it. This has been a massive logistical exercise. Never before has the Irish Revenue sought to introduce a self-assessed tax structure across everyone in the State – and most taxpayers have no familiarity with self- assessment, which traditionally affects only the self-employed. I think it was simply too many people putting together different elements of the information and not enough joined-up thinking. There are certainly lessons here for Revenue – even its helpline has been a hit-and- miss affair in terms of providing real helpful guidance.

Immediate
withdrawal on credit card option
I went to register my LPT and proceeded to payment only to discover that if you choose a credit/debit card method, the payment is immediately deducted despite the last payment date for LPT being July 21st.

Of course, there are other options including income deduction and direct debit which default to July 15th, unless another date is chosen.

They confirmed to me they rely on the use of the word “return” in the legislation as a legal basis for this.

I have no doubt it will be a surprise to many hard strapped taxpayers to find this is the case and that by selecting credit or debit card method Revenue get paid two months in advance (close of registration being May 28th and last payment before July 21st) in such cases. They categorically state you cannot pay be cheque.

Would I be naive to assume they want our bank details for other record purposes?

Mr TB, Dublin

Deadline day for the local property tax is here and we are still seeing confusion on the issue of credit card payments.

At least you are not maintaining that you weren’t told such payments would be taken immediately – unlike those who filled in paper returns. As you say, on choosing credit card payment, a pop-up window online tells you such payments are taken immediately.

I continue to be gobsmacked by the number of people who think you can pay by “post-dated” credit card or debit card instruction. No one has yet given me a single instance in the history of credit and debit card payments where such payments are not billed on the day they are made.

Sure banks bill these items and set a monthly charge date, but the billing date is still the transaction date, and banks do not have systems in place to allow a chargeable date two months or more down the line.

As you point out, there are several other payment options which allow you ensure your money is not taken – either in a lump sum or in instalments – until at least July 1st. Direct debit payments will be drawn down on July 15th and the single electronic payment not before July 21st, so I’m not sure what the difficulty is.

You are correct that cheque payment is not available for online users.

The explanation you say you received justifying the credit card drawdown (which I have had to edit out for space reasons) makes no sense. But that’s nothing new for the Revenue helpline, unfortunately.

You say you were told Revenue was relying on the term “return” in the legislation. You are obliged to file a return – ie, a registration form by May 28th, if registering online, and must use this channel if you have multiple properties – but that has nothing to do with actual payment.

On seeking your bank details, sure Revenue can take the money from your wages or certain welfare payments. It doesn’t need your bank details for this or any other reason. To be fair, Revenue is offering a fairly wide range of payment options: it’s your choice.

This column is a reader service and is not intended to replace professional advice. Please send your questions to Q&A, c/o Dominic Coyle, The Irish Times, 24-28 Tara St, D2, or to dcoyle@irishtimes.com