tax overpayment query

cliona8969

Sorry I meant to say tax UNDERpayment query...
Im just wondering lets say a person underpays tax and they ring up revenue thinking maybe they are due a tax refund but revenue tells them they underpaid tax and owe the tax office money. can the tax office directly take money from a persons bank account? in fact can anybody directly withdraw from your bank account without your permission?

donalg1

cliona8969 wrote: »

Sorry I meant to say tax UNDERpayment query...
Im just wondering lets say a person underpays tax and they ring up revenue thinking maybe they are due a tax refund but revenue tells them they underpaid tax and owe the tax office money. can the tax office directly take money from a persons bank account? in fact can anybody directly withdraw from your bank account without your permission?

I asked for a copy of my P21 from the last four years and in 2009 it said I underpaid by about €70 so I didnt say anymore to the revenue about it, I submitted my MED1 this year and got a P21 back and it said I overpaid by €80 which I havent received yet, however the money I claimed in Medical Expenses was returned to me by Cheque two days later, so I am now confused about whether or not they will send me another Cheque for the overpayment or will hold onto it and use it against the underpayment in 2009.

Hungrycol

cliona8969 wrote: »

Sorry I meant to say tax UNDERpayment query...
Im just wondering lets say a person underpays tax and they ring up revenue thinking maybe they are due a tax refund but revenue tells them they underpaid tax and owe the tax office money. can the tax office directly take money from a persons bank account? in fact can anybody directly withdraw from your bank account without your permission?

As far as I know they need a court order to access money in your bank account. Depending on how much you underpaid if you're still working they'll likely amend your allowances for 2012 like they did with all the Pensioners recently. Look for a P21 balancing statement from them for the year in question and you can see where the underpayment lies. Maybe the Revenue don't have the whole story!

Hungrycol

donalg1 wrote: »

I asked for a copy of my P21 from the last four years and in 2009 it said I underpaid by about €70 so I didnt say anymore to the revenue about it, I submitted my MED1 this year and got a P21 back and it said I overpaid by €80 which I havent received yet, however the money I claimed in Medical Expenses was returned to me by Cheque two days later, so I am now confused about whether or not they will send me another Cheque for the overpayment or will hold onto it and use it against the underpayment in 2009.

Best to offset it against your liability, it will never just "go away"! They may have sent the P21 on the back of the MED1 claim. Liklely the P21 refund = the MED1 refund and unlikely they will send you another cheque.

smeharg

If you've previously given Revenue permission to take payments from your bank account it may still be in place, in which case may be technically revenue could take the funds from your account.

I think the more likely outcome though is that your tax credits for 2013 (and beyond if necessary) will be reduced to recoup the amount owed.

cliona8969

smeharg wrote: »

If you've previously given Revenue permission to take payments from your bank account it may still be in place, in which case may be technically revenue could take the funds from your account.

I think the more likely outcome though is that your tax credits for 2013 (and beyond if necessary) will be reduced to recoup the amount owed.

when would somebody have previously given revenue permission to access their account?

BohsCeltic

cliona8969 wrote: »

Sorry I meant to say tax UNDERpayment query...
Im just wondering lets say a person underpays tax and they ring up revenue thinking maybe they are due a tax refund but revenue tells them they underpaid tax and owe the tax office money. can the tax office directly take money from a persons bank account? in fact can anybody directly withdraw from your bank account without your permission?

It will be taken out of your tax credits, happened to a few people i know but it was a relatively small amount. It is much quicker to use the PAYE online system to request a P21 balancing statement. You can also claim for the likes of health expenses, bin charges e.t.c from the past four years.

Shane732

Ok just to get a few things straight -

In the situation mentioned by the OP the Revenue Commissioners first have to raise an assessment for the tax liability, in this instance I assume it will be by means of P21 balancing statement.

Once the P21 balancing statement is raised the Revenue then have to "collect" the tax depending on the liability. This may be by means of cheque or through your tax credit certificates. Depending on the liability and your own personal tax affairs it may be possible to enter into an installment arrangement with the Revenue to pay off the tax liability. Although for small liabilities collecting through tax credits is the best outcome for taxpayers as it's essentially an interest free loan.

In relation to the Direct Debit Scheme (RDI) any arrangement entered into with the Revenue Commissioners is subject to the Direct Debit Guarantee Scheme. There's no need for scaremongering in relation to the Revenue taking money from someones bank account.

relax carry on

To clarify further regarding PAYE underpayments, the P21 showing the underpayment will tell you what's happening to it. Look at the bottom of page 1.

It will be one of three things:

Underpayment will not be collected at this time (too small to worry about, so will stay on file to be offset against some future repayment.

Collected by reducing your tax credits by x over x number of years (max 4 years)

A demand for payment, usually in very large underpayments (over 4000 euro)

mrscat

I submitted an online request for a P21 and Med1 expenses online last week. We got a letter (married couple jointly assessed) saying we had been 'selected for verification'. Is this something to worry about, has anyone ever heard of it, or is it just random? they asked for P60 documents.

BohsCeltic

mrscat wrote: »

I submitted an online request for a P21 and Med1 expenses online last week. We got a letter (married couple jointly assessed) saying we had been 'selected for verification'. Is this something to worry about, has anyone ever heard of it, or is it just random? they asked for P60 documents.

It's just random. Happened to a friend of mine the first time he submitted a request. Make sure you get your health expenses receipts together aswell as any other receipts that you might have claimed such as bin charges.

mrscat

BohsCeltic wrote: »

It's just random. Happened to a friend of mine the first time he submitted a request. Make sure you get your health expenses receipts together aswell as any other receipts that you might have claimed such as bin charges.

ok, thanks for that. I had hoped it was just random, but you just never know! I am collecting my health receipts at the moment.