Revenue has confirmed that the deadline for those who file their 2012 income tax return and pay their 2012 balance and 2013 preliminary tax through ROS is Thursday, 14 November 2013.
CAT filings for gifts or inheritances with valuation dates in the year ended 31 August 2013 can also avail of this extended deadline where both return and payment are made through ROS.
So, the Revenue Commissioners have announced a review of ”the tax affairs of companies and their directors, where the main source of income is a contract or contracts “for service” with a larger company or companies (directly or through intermediaries), the company in question does not appear to have a substantial business separate from these contracts, and in most cases the director(s) are the only employees of the company and pay tax through PAYE”.
Revenue have “established that in many cases there are deficiencies in accounting for input costs and expenses, with the result that there has been a significant understatement of tax liability to the benefit of the director(s)”.
In other words, Revenue believe contractors are over claiming expenses relative to their work profile.
It is our understanding that Revenue are also examining the Umbrella/Managed company status of many contractors. There is real concern that the PRSI class applicable to many contractors operating through Managed companies is incorrect and substantial liabilities may exist.
This review is being carried out in the Revenue South West region incorporating Cork, Limerick, Kerry & Clare.
At Noone Casey we look after the tax affairs of many hundreds of contractors using our real time online accounting tool I-Finance. We ensure only appropriate expenses are claimed thus avoiding the issue of underpayment of taxes.
I-Finance is structured so that you
• Operate as a proprietary director of your own limited company. Why is that important?
o You have greater control over your own money – no 3rd parties controlling the bank account.
o You have no exposure from Revenue should they move against the umbrella/composite company structures.
o You can maximise simple tax saving techniques which are not available in a Sole Trader/Umbrella Company structure.
• We process all the financial administrative tasks relating to your contract – which gives you more time to focus on the things you want to do.
• We prepare and issue all your client-approved invoices.
• You dictate how much you want to be paid, we process the payroll for you and make sure all your PAYE/PRSI is correctly deducted and returned on your behalf.
• We monitor your company bank account and assist you execute a ‘same day payment’ model via online banking into your personal bank account.
• We offer you up-to-date advice on all allowable business related expenses.
• We prepare and file all your annual returns (both personal and company related).
• We advise you on how to financially plan for the future and assist you in selecting the best savings and investment options for you personally.
If you are operating as a contractor in the Munster region and have concerns over the expenses you have claimed and /or your Managed company structure, contact me today acasey@noonecasey.ie or 01 6766476 to discuss your affairs.
We will advise you on the correct route out of your potential difficulties.
Noone Casey sponsored last night’s Irish Web Awards Best New Web App category. We are pleased to announce the winner is FixMyStreet.ie
Congratulations to all the Award winners and well done to Michelle and Damian for organising another great night.
We are delighted to be sponsoring the Best New Web Application/Serviceat tonights Irish Web Awards in the Mansion House.
The finalists in our category are
learnupon.com
Rentview.com
cityhook.com
fixmystreet.ie
abartaaudioguides.com
streamglider.com
militaryarchives.ie
converser.io
beta.typecastapp.com
Best of luck to all finalists.
Come up & say hello if you are there tonight.
The Revenue owes around 70% of PAYE workers hundreds of millions of euro and would like to pay up but very few individuals ever come forward to claim it, according to The Sunday Business Post.
Where The Sunday Business Post employs the trick approach to the Halloween deadline, over at the Sunday Times they prefer to concentrate on the treat. It appears the annual deadline could become a cause for celebration, rather than fear of the boogieman.
About 20% of self-employed taxpayers are likely to miss the impending pay-and-file deadline and will have to pay penalties as a result, The Sunday Business Post reports.
Anyone planning to change their working arrangements after the birth of a child should recognise the likely tax implications, according to a report in The Sunday Business Post.
The Revenue has established a dedicated network of advisers to deal with queries about new tax rules for people in civil partnerships and co-habiting relationships, according to The Sunday Business Post.
The R&D tax credit has been around since 2004 but judging by poor take-up rates Irish firms remain remarkably unaware of its existence and potential, according to a report in The Sunday Business Post.
Many IT, Engineering and other Professional Contractors who use composite company structures may be facing large PRSI liabilities as Revenue and DSFA challenge the PRSI status of such contractors.
Contractors who hold only15% of the shares in a composite company may not be entitled to Class S PRSI status; employers PRSI of 10.75% will fall due in those circumstances. Class S status is only applicable to those shareholder/employees who control their companies. A 15% shareholding with up to 6 other contractors who may not know each other does not suggest control.
Noone Casey has developed I-Finance an online realtime accounting solution for professional contractors to address this concern & to legitimately maximise the tax advantages of contracting.
Have a look at our short video here to get a better understanding of the issues involved. If you feel this affects you, contact Noone Casey for an independent assessment of your position.
I-Finance uses the Limited Company type structure thus avoiding the employers PRSI issue. The table below gives you an idea of how each of the common contracting structures compare.
| Company Structure Type | Limited Company | Umbrella Company | Composite Company |
|---|---|---|---|
| Ownership | You own 100% of your own company | You have no ownership | You own 15% of an externally controlled company |
| Directorship | You and your appointee are directors of your own company | You have no directorship | You and up to 6 others are directors of the company. You may not know the other directors. |
| Employment | You are the employee of your own company | You are an employee of the umbrella company | You are an employee of the composite company |
| Expenses | You are entitled to tax deductible expenses through your own company | You are not entitled to any expenses | You may be entitled to a lesser amount of expenses |
| Tax planning | You can use your own company to assist in appropriate tax planning opportunities | You cannot use the umbrella company to assist in your tax planning | You cannot use the composite company to assist in your tax planning |
| Tax appropriateness | We ensure you manage your affairs in full compliance of all taxation and PRSI legislation | You are treated as an employee and have taxes deducted appropriately | The Revenue Commissioners are examining the appropriateness of the PRSI structures of composite companies |
This week the Revenue is due to release the latest module in its comprehensive programme of mandatory electronic payment and filing of taxes – and it will have a profound effect for the almost 50% of businesses who still shy away from ROS.
The Eircom Employee Share Trust (ESOT), which owns 35% of the telco, is in talks with the Department of Finance to extend its tax breaks that are due to expire in 2014, according to The Sunday Times.