The tax deadline for self-assessed taxpayers is at the end of the month.
It is that time of the year for self-employed and other self-assessed taxpayers to get their affairs in order before the October 31 filing deadline.
Unlike Brexit, it is a firm deadline, unless you are filing online in which case the deadline is November 12.
There are three steps that self-assessed taxpayers should take to kick-start the pay-and-file process:
- Consider all your sources of income. If you have income that was not subject to PAYE or DIRT, it is likely you will need to declare it via your tax return. You should contact Revenue to see whether you need to register as self-assessed.
- Consider what deductions may be available and check if you are claiming all your allowable expenses and deductions.
- Check whether there are any other reliefs or credits, such as for medical expenses, flat-rate expenses, or college or training fees.
Joanna Murphy, CEO of Taxback.com, said the number of people filing a self-assessed tax return has grown by 112,000 people in the last five years alone.
“While maintaining an efficient tax regime can be challenging for any business, we find this is particularly the case for new business owners and traders that may lack experience in managing their own tax and filing a self-assessed return,” she said.
The tax experts believe that the growth in recent years in the number of self-assessed taxpayers is down to several contributing factors.
“These days there are more and more ways for people to diversify their income,” Ms Murphy said.
“Ireland’s ‘sharing economy’ has exploded in recent years through activities such as Airbnb, which has become a significant income generator for a growing number of people, some of whom have made a full-time business from hosting via the platform. In addition, Instagram has facilitated the development of whole new entrepreneurial sectors and new income streams for ‘influencers’ who can earn an income promoting products and services online for big brands,” she explained.
Another significant contributing factor to the growth in the numbers of new registrations could well be the stringent enforcement of tax-compliance by Revenue, who are now tougher than ever in their collection of tax.
As a result there is much greater awareness of tax compliance among the public, and the focused clampdown of Revenue on non-compliance throughout the country has had significant impact in recent years.
Ms Murphy said, “If people do find themselves with additional income, perhaps outside of their PAYE employment, they are required to file a tax return. If you have earned more than €5,000 net untaxed a year, you will need to register as a self-assessed individual with Revenue by completing a TR 1 form (you will only need to do this once). You’ll then need to file a Form 11 tax return and make a tax payment by October 31 each year for the previous year’s earnings.
“If you earned less than net €5,000 in the year you will still need to file a return by submitting a Form 12. Similarly to Form 11, your earnings from the previous year will be relevant when completing a Form 12,” she explained.