Form 12 - Advice

water-man

Hello,

I'm looking for some advide. I have recieved a Form 12 Tax return for the year 2011.

The letter that came with the form states:
“You hold substational funds in domestic bank accounts. Please state the source of the funds in respect of all accounts operated by you and/or your spouse for the years 2009 to 2012.”

This statement is true. I inhereted some money back in 2007 and the rest of the cash I have saved over the years. I have always been very carefull with money – my cash is in multiple different banks. I do not own a house (the prices back when always where crazy for me) hence the reason I was able to save money and have never had a loan always pay with cash. You would think form this that I am money wise but I am not. I have always been safe.

I do not fear completing the form as all the money has had tax/dirt etc paid on it but am loking for some advise on how to fill it in.I am worried about what happens if I make a mistake.

I also have some money in shares (AIB bought when was Eur16 now its worth what 50ccent?, Elan and maybe 2 other companies) since I bought the shares I've never sold any so don't think I've any CGT on these to worry about. Although I have had dividends but not any big amounts.

My questions:
1) As a PAYE worker (all my life) is there some form I should have been completing (to do with interest earned) every year? I thought that as the cash was in Ireland and I was paying dirt all was ok.
2) Do I need to go to an accountant to complete this form? I don't think so as apart from the shares I have nothing else but cash.
3) How do I find out how much interest I earned in the years 2009 to 2012? Do I need to write to every bank and request an interset statement, no doubt this will cost me. I am always changing accounts to avail of the best rates.Hopefully I can track down the accounts I had then and amounts in each.
4) What I do have is P60 for every year since 2007 and maybe earlier. I have the same for my wife. Will these be enough to submit with the form. I'm guessing not as surely the revenue can see what I've earned so they are looking for something extra. What can this be?
5) My wife was on materenity leave from July 11 to Jan 12. How do I calculate how much money she recieved during tis time?
6) In May 09 I was made redundant (recieved no lump sum as was with the company less than 2 years). Was on JSB until Sept 09 when I went back to College, I signed off and got a grant during this time. Then between June and Aug 10 was on JSB again until I found employment. Will I need to write to Social Welfare to find out amounts recieved during this time?
7) In the secentence above it says “state the source of funds” can I just say inhertenance and working or do I need to provide proof?

Thank you for reading and any help will be much appricated.

water-man

Hi,

Since my inital post I have managed to locate:
1) P60's from 2007 to 2012 for the both of us.
2) P21's from 2007 to 2010 for the both of us.
3) A few interst certs from 2007 to 2012.

I think I still need to locate:
1) more interest certs - have contacted the bank concerened

Does anybody have any advice on what else I might need?

Thanks.

paul71

It is a rather detailed list of questions that you are asking so the first thing I should say is that you should most certainly speak to an accountant, but the only potential issue I see is the dividend income, there is a form of retention tax like DIRT on dividends known as ACT (advanced corporation tax), but unlike DIRT your liability to income tax on Dividends is at your marginal tax rate which may be higher then the amount of ACT pertaining to the dividends so there is potentially a liability (allbeit small if as you state the dividends received are small).

As to your question about a requirement for PAYE workers doing returns, the answer is that they have no responsibilty to do so UNLESS they have non-PAYE income (excluding deposit interest upon which DIRT has been paid), or unless they are requested to submit a return by revenue.

If, as you state you have had dividend income you should have been submitting returns, but I would not be too concerned by this if the amounts involved are small.

As per your other questions, I am not comfortable offering too much advice other then general observations like the ones I have already made on an internet forum, as I do not have a full picture of your circumstances and an omission of fact could cost you money. So I strongly advise you consult with an accountant although technically in order to submit a return there is no requirement to do so.

Alan Shore

paul71 wrote: »

, there is a form of retention tax like DIRT on dividends known as ACT (advanced corporation tax), but unlike DIRT your liability to income tax on Dividends is at your marginal tax rate

It now called dividend withholding tax DWT. But applies the same way so if you have €2,000 in dividend income then the liability could be 41% income tax and 7% USC with a credit of €400.

In 2007 were you required to file a Capital Acquistions Tax return? Who did you get the money from? what was the threshold.

Remember that the Revenue will have heard "I saved it from my PAYE income" before but it should be simple for you to prove that you have X after tax income and your living expenses were Y leaving the balance in savings.

Mr. Incognito

Step one. Ring Revenue. Revenue DO NOT send unsolicited letters.

Step two, if it is genuine, contact a professional.

Thread close. Specific advice banned. Read the charter.