VAT

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Income Tax Receipts Higher than Forecasted

As reported in the Irish Times, 03.03.2020, the latest exchequer returns show the Government received income tax of €3.97 billion for the months of January & February, 3.3% lower than forecasted but up over 14% based on previous years.

VAT income was up by 4%, generating over €3 billion, with Corporation Tax at €583 million from the start of the year, 117% above forecast.

In total, €9.2 billion in tax was collected, €285 million more than expected.

Revenue have stated that the total received in the last 2 months generally account for less than 2% of a full year of overall receipts.

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Pre-Budget 2020

Ever wondered what taxes are financing government coffers?

Source: Irish Tax Institute Pre-Budget 2020 Briefing Papers 2019

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Revenue 2018 Annual Report

Revenue issued their 2018 Annual Report on 09th May confirming Revenue collected net Exchequer receipts of €54.6 billion last year.

Chairman, Niall Cody stated that;

‘when compared to 2017, net Exchequer receipts increased by €4 billion. There were increased receipts for almost all taxes and duties including Income Tax, up 6.6%, VAT up 7% and Corporation Tax up 26.7%.’

Mr Cody acknowledged taxpayers’ engagement, and that of tax practitioners and agents, in achieving the very strong compliance rates seen again for 2018. 9,000 businesses and individuals had phased payment arrangements in place by the end of 2018 covering €93 million in debt. For taxpayers that refuse to pay their tax or liase with Revenue, Niall Cody explained that;

‘we undertake a range of debt collection and enforcement actions to collect tax debt. In 2018, we collected €211.6 million as part of our debt collections and enforcement actions.’

Mr Cody also went on to say;

‘it is very important that we support compliant taxpayers by identifying risks and tackling non-compliance in all its forms. We continue to be alert to, and pro-actively respond to, the risks arising from the changes in economic and business environments both nationally and globally.’

The new arrangements for PAYE reporting with PAYE Modernisation came into force on 01st January 2019. Revenue received 1.4 million payroll submissions as of 31st March 2019 from almost 157,000 employers for more tan 2.6 million employees and pension recipients totalling almost €24 billion.

Mr Cody added;

‘with real-time reporting now in place for employers, we have turned our focus to the benefits of this new system for employees. From 15 May, all employees will be able to view their payroll details, as reported by their employer, through myAccount. Further improved services through myAccount will follow later in the year.’

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Capital Gains Tax on rental properties

Interesting article issued in The Irish Times today regarding selling a rental property in negative equity.

A reader asks –

is there any capital gains tax due if mortgage was paid off and sold at a loss?

Let’s clarify, there is only Capital Gains Tax (CGT) due if there is a gain on the sale of property, which in this case would be zero. The gain is simply the sale price, less the cost price including other allowable expenses and reliefs. Any outstanding mortgage is irrelevant.

There will be no capital gains tax to pay and you will have a loss that can be offset this year against any gains you may make on the sale of other assets.

This loss can also be carried forward and offset against any future gains.

Regarding VAT, this area depends on a number of factors and each case needs to be reviewed in order to evaluate.

Read more on this article here

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