self employed and paye problem

DAS***

Hi, i know this guy who has worked and been taxed as a PAYE worker but at the same time has been self employed and getting cash in hand since 2005. Problem is he hasnt filed his tax returns for his self-employment. The cumulative earnings for both every year though from my albeit amateur calculations still fall under his tax credits and so he doesnt pay tax with his officical work and possibly also his self-employment? My question is how do i go about this with the revenue. He has to fill in a TR1 form but on it it asks from when he started working.

Rofl Lundgren

Can you clarify what the question is? If he's registering for self-assessment for income tax with the TR1, he doesn't need to specify when he started working. He needs to complete just Part A1 and B of the form.

I'd recommend using the ROS Offline program to work out his liability for each of the years 2005 to 2009, that way you can be certain if his credits cover the income. Also, you'll be able to use to use the program without having to register first. Might as well have your figures straight before going to the Revenue.

Form TR1: www.revenue.ie/en/tax/vat/forms/formtr1.pdf
ROS Offline Application: http://www.ros.ie/PublisherServlet/info/install

DAS***

Great thanks for that. My main concern i guess is if there will be any penalties for not disclosing his income from 2005.

Rofl Lundgren

The late filing surcharge is 10% of the tax liability in each year in this case, as well as interest. You can appeal the surcharge, sometimes the Revenue can be lenient.

The Grinch Lady

Yes he needs to fill in his start date as a self employed person and then he needs to return the income for the periods since he commenced as a self employed person and complete accounts in relation to this employment. If he has a liability there would be a surcharge but he would also be deducting any expenses incurred in relation to this employment

dbran

Hi

If your income from self employment is a small amount, (from memory about 3,125 income pa) then you are not subject to self assessment. You do not need to register as self employed.

You do however need to make a return on a Form 12 every year to revenue and you should bring your affairs up to date using this form and NOT Form 11. As you say the income will be covered by tax credits there will be no tax to pay and the tax will be colllected and dealt with through the PAYE system.

You cannot file a Form 12 over ROS, it needs to be filed manually.

Hope this helps

dbran

EDIT: You WILL be subject to late filing surcharge of 10% if you use a Form 11 and register as self employed, you wont if you use form 12. Don't forget that there will be PRSI owing on the additional income also.

DAS***

Dbran thanks! He is under the 3k for 2007 and 2009 should i file a return with the form 12 for noth years for this do u think? Or is it too late?

Ricosruffneck

you're grand man, deal with it every day. just send in the return of your own accord.

plain sailing after.