December 5, 2018by admin admin No Comments

PAYE Modernisation – What you need to know

PAYE Modernisation comes into effect on the 1^st January 2019.

Employers will be obliged to report their employee’s pay and deductions to Revenue when/before they are paid.

Employers will be required to electronically submit a file called a PSR (Payroll Submission Request) to Revenue each time there is a payroll run. This will inform Revenue where an employee is working and how much they are earning in real time and also avoid overpayments/underpayments of tax by allocating the correct tax credits to the employee.

Retrieval of tax credits and cut offs for employees will also be automated using RPN (Revenue Payroll Notification) which employers will need to check before each payroll run. Revenue will then issue a monthly statement to employers based on the payroll submission received. There is no change to payment due dates.

There are also new Emergency tax rules from 1^st January 2019.

The first four weeks of pay will be taxed at the standard rate up to emergency cut off point and the high rate above the emergency cut off point. No tax credits will be applied. After the first four weeks, all pay will be taxed at the higher rate.

The rate of Emergency USC is 8% on all earnings. These rules should be applied where an employer makes a payment to an employee and they have not received a retrieval of tax credits from Revenue. The Emergency rules should also be applied if a PPSN has not been obtained for a new employee. Where there is no PPSN for an employee all pay should be taxed at the higher rate. Employers will only be able to process pay for an employee without a PPSN for three months.

Paye Modernisation will allow employees greater visibility through ‘My Account’ on ros.ie as pay will be reflected in real time. This will also replace the need for employers to issue P60’s at the end of the year and P45’s upon an employee leaving an employment.

Why not also read our blog on Legal and Tax Implications of Director’s Loan here

November 15, 2018by admin admin No Comments

Revenue advising taxpayers to claim their entitlements before 31 December Deadline

Revenue has written to over 125,000 PAYE taxpayers

that have not claimed any additional tax credits/reliefs in the previous four years, reminding them to claim their entitlements for the year 2014 before 31^st December 2018.

As you may be aware, there is a four-year time limit on claiming tax back on for example; medical expenses,

tuition fees and for claiming tax credits/reliefs on, for example, home carer’s credit.

If you have a claim for 2014, you need to submit this by 31^st December.

Generally, Revenue are issuing refunds within 5 days so there is still time to claim yours before Christmas!

Why not avail of our ClaimMyTaxBack.ie service for PAYE only?

We can review the last four years for you and calculate if you are entitled to a refund for any of those years.

This review is undertaken on a No Refund/No Fee basis. Therefore, if you are not due a refund, no fee applies

If a refund is due, our fee is 10% of your refund (minimum of €35) per year.

Should you wish to avail of this service, please request an application form at taxback@claimmytaxback.ie or visit our website www.claimmytaxback.ie

Should you have any queries on this issue, please contact us on 01 5397999

October 10, 2018by admin admin No Comments

Getting tax back on your Pension Lump Sum

As the October 31^st tax deadline races towards us, you may want to consider topping up your pension, as this is the deadline for claiming any tax relief this amount for the 2017 tax year.

You can make lump sum payments to your private pension or an AVC (Additional Voluntary Contribution) to your occupational pension.

If you ‘top up’ your pension by 31^st October 2018, you are entitled to claim tax relief on that ‘top up’ amount against the tax paid in 2017.

Let us show you an example;

Ann ‘tops up’ her pension	*€1,000*
Ann claims tax relief on €1,000 @ her marginal rate (40%)	*€400*

In the above example, Ann has ‘topped up’ her pension by €1,000 but the real cost to her was €600 as she claimed back €400 tax relief.

Remember

Your pension ‘top-up’ needs to be paid by 31^st October and your return completed.

Should you have any queries on this issue, please contact us on 01 5397999 or request our application form here

September 25, 2018by admin admin No Comments

Rental Income including Airbnb

There has much press coverage of Revenue investigating tax affairs of homeowners, in particular, those letting rooms through the Airbnb website, as previously highlighted by us here.

A press release issued by Revenue on 18^th September (read it here) has now directly referenced the recipients of Airbnb income. They state they are writing to 12,000 people, as a reminder to include this income in the yearly tax return.

In reference to this, we highlight the main areas you need to be aware of when receiving rental income –

If you receive rental income from renting out a property

If you are renting out a property and your profits exceed €5,000 per year, you will need to register for Income Tax. Each year you will need to file your Income Tax Return by 31^st October through a Form 11.

If this rental income is less than €5,000 per year, then you are not required to register for Income Tax but you are still liable to be taxed on this income. You will need to file this yearly through a Form 12.

If you are renting out a room in your home (long term)

If you are renting out a room for a long period of time and your income exceeds €14,000, you will need to register for Income Tax. Each year you will need to file your Income Tax Return by 31^st October through a Form 11.

If your rental income is less than €14,000, you may be eligible to apply for rent-a-room relief.

Rent-a-room Relief

This allows a homeowner to earn rental income tax free, you much meet the following criteria to apply;

Rental income does not exceed €14,000 in the tax year
The property must be in Ireland
The property must be your sole residence during the tax year
This relief only applies to residential and not to short term or temporary lettings i.e Airbnb

If you are renting out a room in your home (temporary/short term)

If you are renting out a room in your home or the entire property temporarily (i.e Airbnb) you are not eligible to apply for rent-a-room relief.

If this rental income is less than €5,000 per year, then you are not required to register for Income Tax but you are still liable to be taxed on this income. You will need to file this yearly though a Form 12.

Airbnb Rental Income

If you are in receipt of rental income through the Airbnb website, your rental income will be subject to 20% or 40% depending on your circumstances. This income has been split by Revenue;

Trading Income

Rental income exceeds €5,000 in that year or
You rent a room or property on 6 or more occasions per year or
Host for 30 or more nights in that year or
The property is available for renting all of the time
You will need to register for Income Tax. Each year you will need to file your Income Tax Return by 31^st October through a Form 11.

Other Income

Rental income does not exceed €5,000 in that year
You are not required to register for Income Tax but you are still liable to be taxed on this income. You will need to file this yearly through a Form 12.

Renting to family members

Read our recent blog post on this here

Remember, you can offset a number of rental expenses which must be included in your rental return and keep a record of all invoices and receipts of expenses incurred. These include;

Mortgage Interest (80% for 2017, 85% for 2018)
Bank Charges
Letting Expenses
Insurance & Mortgage Protection premiums
RTB Registration Fee
Accountants Fees
Utilities
Advertising Expenses
Repairs & Maintenance
Wear & Tear

Why not also read our Pre-Letting Expenses blog here

Should you have any queries on this issue, please contact us on 01 5397999 or request our rental income form and application here

PAYE Modernisation comes into effect on the 1st January 2019.