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Cancellation of Income Tax – Chargeable Person – Tax Agents and Tax Advisors

From 10^th February 2023 the Revenue Commissioners are posting out letters to taxpayers who are currently registered for Income Tax but who have not submitted Income Tax Returns for years of assessment up to and including 2021.  The individuals affected are those who are currently registered for IT but have not filed Form 11 Tax returns for years up to and including 2021.  The Revenue Commissioners are now notifying them of their filing obligations as “chargeable persons” under the self-assessment rules.  For further information on chargeable persons, please click: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-41a/41a-01-01.pdf

The letters state:

“Based on a review of your Income Tax records, you have not filed any self-assessed Income Tax returns for years up to and including 2021.”

Taxpayers should start receiving such letters from 13^th February onwards.

Please be aware that your Tax Agent won’t receive a copy of this notice.

What are you required to do?

In the event that the taxpayer is no longer deemed to be a “chargeable person” and, therefore, is no longer required to file an Income Tax Returns, he/she/they should cancel the Income Tax registration.

The term “chargeable person” applies to an individual who:

1. Is self employed or
2. Is a Director of an Irish company or
3. Has other sources of income in addition to a PAYE salary.

An individual who is in receipt of PAYE income as well as non-PAYE income will not, however, be regarded as a “chargeable person” provided:

1. the total gross income from non-PAYE sources is less than €30,000 and
2. the net assessable income is less than €5,000 and
3. the tax is collected by reducing his/her/their tax credits through the PAYE system.

A chargeable person is obliged to file an annual IT Return through the self-assessment system.

How can you cancel your IT registration?

This can be done online via ROS or by completing a Form TRCN1 which is available on the Revenue website.

What happens if you are considered to be a “Chargeable Person”?

If the taxpayer is considered a “chargeable person” but has not filed Income Tax Returns up to 2021, the letter is deemed to be a Final Reminder to file all outstanding income tax returns.

If the taxpayer does not file the outstanding IT Returns or cancel the registration within 21 days of the letter, Revenue will cease the IT registration without further notice.

Once the Income Tax registration is ceased, if the taxpayer wishes to re-register for IT he/she/they will be required to submit an online application via ROS.

Final Points

The Notice states:

“You should note that, where further information comes to Revenue’s attention that you were a chargeable person for any relevant tax year, Revenue reserves the right to reinstate your Income Tax registration.

The non-filing of a required tax return by chargeable persons can result in further contact from Revenue, including a follow-up compliance intervention. Non-filing of a return where required is also an offence for which a person can be prosecuted.”

For further information, please click: https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-38/38-01-03c.pdf

If you have received a Cancellation of your Income Tax Registration Notice and you require assistance filing outstanding Income Tax Returns, please contact us at queries@accountsadvicecentre.ie

Please be aware that the information contained in this article is of a general nature.  It is not intended to address specific circumstances in relation to any individual or entity. All reasonable efforts have been made by Accounts Advice Centre to provide accurate and up-to-date information, however, there can be no guarantee that such information is accurate on the date it is received or that it will continue to remain so.. This information should not be acted upon without full and comprehensive, specialist professional tax advice.

Ireland/US DTA. US/Switzerland DTA. Information Exchange. Taxes

On 17th July 2019, the U.S. Senate approved the 2019 Protocol to amend the Switzerland USA Double Taxation Agreement (DTA).  Formally, the protocol will enter into force on the date the instruments of ratification are exchanged.  The core element of the protocol of amendment is the exchange of information.

The protocol provides for the following changes:

• Currently there is no differentiation between tax evasion and tax fraud in Switzerland. This was in line with the international standard on information exchange. Switzerland applied this to in excess of one hundred jurisdictions however, the United States was not one of them. The protocol will erase this difference within the context of administrative assistance in relation to the U.S. It will also apply to other categories of information requests.
• For pillar 3a solutions (i.e. dividends paid to individual retirement arrangements), it will provide for an exemption from the source country (i.e. the Us) withholding 15% tax on cross border dividends from 1st January 2020 provided the protocol of amendment comes into force in 2019.
• Mandatory binding arbitration of unresolved competent authority cases will be implemented where the competent authorities cannot reach agreement in the mutual agreement procedure. This will eliminate exposure to double taxation.
• Under the new provision, the United States will be able to make group requests under the FATCA Agreement. The IRS will submit the group requests to the Swiss Federal Authority. The affected Swiss financial institutions will have ten days to deliver the required information on receipt of the request from the Swiss Federal Authority.

This milestone in the Switzerland and USA tax relationship is likely to make Switzerland far more appealing to U.S. multinationals.

For further information, please click: https://www.state.gov/switzerland-19-920

Please be aware that the information contained in this article is of a general nature.  It is not intended to address specific circumstances in relation to any individual or entity. All reasonable efforts have been made by Accounts Advice Centre to provide accurate and up-to-date information, however, there can be no guarantee that such information is accurate on the date it is received or that it will continue to remain so. This information should not be acted upon without full and comprehensive, specialist professional tax advice.