selected for audit, now paye, little bit of freelance few years ago

redness

Hi everyone, not sure if this is right forum, please move it not. Basically I'm getting audited, need to send personal bank account and any invoices which were sent from any of my business for a particular tax year. Thing is I don't have businesses and never really properly have.

I'm PAYE now, but a couple of years back, including the audit year (2009) in question I was out of regular 9-5 work for medical reasons for about two years but managed to get a bit of work through home, more so doing a favour for someone really, no more than 10,000 euro in total for that year.

I didn't think I had to pay income tax on this as it's low enough so didn't write to revenue about it. I wasn't taking job seekers or anything while I had this income. I had no other income. If I didn't have this little bit of work I most likely would have to have gone on job seekers.

I never really had a business as such as in a Ltd. I just sent a crappy Microsoft word invoice to the person I did the work for and she transferred into my main personal bank account. I never attempted to use other bank accounts or never requested she pay in cash.

I'm thinking this persons business accounts have been audited and that's why revenue have selected me.

so my question is, how much is this going to hurt? Have I been careless or broken law outright? Will tax people look to issue financial penalties to me for not declaring even though I wouldn't have had much liabilities if I did.

I don't have any of the invoices anymore, but can get past bank statements which I will be able to tell exact amount of 'freelance' income from. Also the letter requests all personal bank account records for the year in question. Does this basically mean bank statements?

Your advise is appreciated, how do I make this as painless as possible? How much in fees am I looking at?

nompere

You need professional assistance.

A decent tax consultant will be able to prepare figures to minimise the tax, and to mitigate any penalties. He will also know how to keep Revenue focussed. I've seen Revenue auditors threaten taxpayers with 70% penalties - and have to back down (gracelessly) when the relevant parts of their own guide are quoted to them.

Itchianus

nompere wrote: »

You need professional assistance.

A decent tax consultant will be able to prepare figures to minimise the tax, and to mitigate any penalties. He will also know how to keep Revenue focussed. I've seen Revenue auditors threaten taxpayers with 70% penalties - and have to back down (gracelessly) when the relevant parts of their own guide are quoted to them.

It'll take a good spin doctor to argue that this is anything other than deliberate default - the taxpayer consciously failed to declare a trade or file a return declaring the income from that trade. That would put it squarely in the 75% category, unless a prompted disclosure was made.

Fermatslast

Hi

I'm a tax consultant and you can contact me if you'd like to have a chat about it but it would be useful to read the revenue code of practice on revenue audit.

http://www.revenue.ie/en/practitioner/audit-code-of-practice/index.html

redness

Thanks for all the replies folks, I've been reading a lot about this.

I've organised to speak to a tax professional. I'm going to seek an extension to disclose. Looks like I might only have a bit of PRSI to pay, + the penalites/interest of course.

Does anyone know if I've been audited for year X, I can make a prompted disclosure as I've been told about it but say I wanted to disclose for a different year that is not at this stage being explicitly audited would/could that be deemed unprompted disclosure as it was a non audited year?

Alan Shore

Any disclosure should be complete and cover all outstanding taxes for all years.

Jonathan222

On the same issue, anyone know if you challenge a figure from the revenue, are you more likely to be audited? Sent in my self assesment with payment and got a request for more money back. I know their calculations are wrong but afraid they will audit me as I had the cheek to challenge them.

Citizenpain

Notices of assessment are often incorrect and amended through a phone call .... Nothing to stop them asking for more information though

Just out of interest - why would you fear an audit?

Jonathan222

I suppose 'afraid' was the wrong word. Just concious that if you challenge a figure from the revenue, they may try and make an example of you. Paranoia more than anything I suppose. Nothing to hide in any event.

Citizenpain

Jonathan222 wrote: »

I suppose 'afraid' was the wrong word. Just concious that if you challenge a figure from the revenue, they may try and make an example of you. Paranoia more than anything I suppose. Nothing to hide in any event.

Dont worry --- They are used to queries - I assume you sent in a "paper" F11 -- ROS would have calculated the liability if you did it online

Jonathan222

Yup, F11 submitted as Laptop would not 'certify' ROS on time. Online next year.
Cheers