independent

Wednesday 26 September 2018

What you need to do for the October deadline

Business Q&A

A FILING an annual tax return is a necessary task for every self-employed person in Ireland. In preparation for filing tax returns, there are key dates and deadlines that you need to keep in mind.

If you're under self-assessment, either on or before October 31st you must…

- Make your tax return for the 2016 tax year.

- Pay any balance of tax due for 2016.

- Pay Preliminary Tax for 2017.

What you need to do? Right now! If you've not already contacted your accountant and provided the information they need to prepare your accounts and tax return, then you should do so right now. This will make sure you get enough notice as to the amount of tax you'll need to pay.

Financial Documents for your Accountant: Firstly, you should ensure to gather all of your relevant financial documents for your Accountant. Information required would be receipts, purchases invoices, sales invoices, expenses, payroll details, vat details, register of assets and bank statements for the previous tax year.

Over the next few weeks…Consider your cashflow to make sure that you'll have the funds on hand to make your tax payment. Ideally you should be setting aside a portion of your weekly earnings to build up a tax reserve that will cover your tax payment and possibly cut back on expenditure. This means you don't have to worry when tax day comes as the money will already be there.

PAY AND FILE TAX RETURN DEADLINES EXPLAINED

You must file your tax returns, complete a self-assessment and pay the balance of the tax outstanding for the previous year, while at the same time paying the preliminary tax for the current year by October 31st 2017.

This filing date can be extended until 14th November 2017 if you file your tax return online through the Revenue Online System (ROS).

The amount of preliminary tax paid must be equal to or exceed the lower of: 90% of your final liability for the tax year, or

100% of your final liability for the previous tax year, or

105% of your final liability for the pre-preceding tax year (only available where preliminary tax is paid by direct debit and does not apply where the tax payable for the pre-preceding year was nil)

WHAT HAPPENS IF YOU MAKE A LATE PAYMENT?

If you make a late payment on your preliminary tax or do not comply with your direct debit arrangements, you will be liable to pay interest. The amount of interest you are charged depends on how late the payment was made. You are charged at a rate of 0.0219% for each day or part of the day you were late.

If you make a late payment on your income tax return a surcharge is added to the tax bill for the year. The surcharge is broken down in the following ways:

5% of the tax up to a maximum of €12,695 where the return is made within 2 months of the deadline

10% of the tax up to a maximum of €63,485 where the return is made more than 2 months after the deadline

Need help filing tax returns? Contact Jim Doyle on 053 9170507 or email jim@rda.ie

I am self-employed and need to file my tax return for 31st of October, can you give me some information to ensure I am ready for the deadline?

Wexford People

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