Archive for the ‘Tax Returns’ Category

A common assumption is that only business owners need to file a personal tax return. In fact, quite a number of other people must complete a return.

Basic Rule

You must file a return if your non-PAYE income is higher than can be catered for by Revenue adjusting your credits and allowances. In practice, this is about €3,510.

Certain categories of people must always file a return, regardless of amount e.g.

1. Proprietary directors owning over 15% of a company even if paying PAYE
2. Employees who receive share options.

Some other examples of income which can mean your having to file a return are

Dividends

1. Business profits
2. Deposit Interest
3. Loan interest receivable
4. Rental Income
5. Mutual Funds
6. Capital Gains

If you need help with a tax return you should get professional advice

Revenue are increasingly querying the status of self-employed contractors such as

• Consultants
• Tradesmen
• Locum doctors, opticians, pharmacists

Why is this happening?

Revenue prefer employee status. They can collect tax easier through PRSI

Some self-employed schemes were shams used for tax avoidance

Employees pay higher PRSI

What does it mean to you?

As a business owner you need to be careful in this area. If you treat someone as self-employed and revenue deem it an employment

1. You could be assessed for PAYE and PRSI on top of previous payments
2. The “employee” might acquire rights like redundancy .

How is the issue decided?

There are no set rules. Each case is decided on its own facts. The legal basis is whether the person is in fact “in business on their own account” The main guidelines are

• Previous cases decided
• Guidelines issued by the Committee on the Status of Employment. Key Factors

 If faced with a challenge on these issues you should consult your tax adviser for support