Penalties amounting to €2.46 million were determined by the courts in Ireland last year.
Self-assessed taxpayers in Ireland who have yet to submit their pay and file details have been urged to act immediately to mitigate against forthcoming penalties that could cost them “a small fortune”.
Experts from Taxback.com are warning taxpayers who fall into the category to act swiftly as a damage limitation exercise against surcharges of 5-10% that are on the way for some self-assessed taxpayers.
“If you haven’t submitted by now then you will have missed the November 16 deadline and unfortunately Revenue will penalise you as a result,” said Barry Flanagan, Senior Tax Manager with Taxback.com.
“But how much they penalise you by is still in your hands. Even if you feel you are not in a financial position to meet your tax obligations this year, you should still come forward as soon as possible – you will be in a worse position if you don’t.”
Taxback.com say that every year, hundreds and sometimes thousands of self-assessed taxpayers fail to meet the deadline for a variety of reasons.
Some, for example, such as people renting out a room on Airbnb, will find themselves in the position whereby they will have to file a return this year for the first time and in the experience of Taxback.com, people don’t know that both the penalty and interest can increase incrementally after the return deadline.
A self-assessed taxpayer with a tax liability of €10,000, for example, who failed to file their return before the November deadline, may now face a potential surcharge of 5%, i.e. €500.
If the same taxpayer delays filing their tax return until the New Year it will be more than two months’ late, thereby facing a potential surcharge of 10%, i.e. €1,000. There is also the possibility that Revenue will charge an amount of interest, per day, on the overdue tax.
In 2016, 341 taxpayers were published on the tax defaulters list. Tax settlements amounting to €63.48 million were agreed with 315 taxpayers in these cases and penalties amounting to €2.46 million for 26 taxpayers were determined by the courts.
“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. This is never the case,” Flanagan added.
“Revenue is fastidious when it comes to self-assessed taxpayers filing tax returns and the late filing surcharge is automatically applied by ROS. It is in the interest, therefore, of all self-assessed taxpayers that they address their tax affairs as soon as possible and limit their potential exposure to surcharges and interest.
“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.”
For more information, check out Taxback.com.
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