Advice on how to proceed

FatFrog87

I have recently received a letter from the revenue saying a fairly large sum of interest is owed, slightly less than 2,000euro. That the capital gains was not paid in time.

Two properties were sold in 2011. I informed the accountant by email,when one had sold in April and enquired about capital gains tax.

The second property sold during the summer and when he asked for figures to calculate income tax, I again asked about capital gains tax on the two properties stating they had to be declared. We spoke afterwards by email and he never mentioned capital gains.

In February 2012 I asked about the capital gains tax again, giving figures for how they were bought and sold for.Received no response. At the end of the year I forwarded it to him again and he calculated tax owed and was paid December 2012. I was never told it had been paid late and interest may be owed.

I naively presumed, it must just be declared and paid a year later. Like how income tax you pay a preliminary sum and settle up a year later. I have all the evidence of email correspondence between us with proof of asking him about capital gains tax. I have tried to get the accountant on the phone and have been unsuccessful to date. Said by email, he would contact me next week by phone after ringing his office that day. Mentioned the interest charge in the email so he knows what its in regard to.

So am I fully at fault here or should the accountant take the blame here. In my eyes it is the accountant who fully screwed up. Doubtful the accountant will accept responsibility for this though. So hoping to talk to accountant start of next week. If he is of no help, do I have any recourse? Any help would be appreciated. I do not want to share the emails in this thread but could do by pm, if someone is willing to have a look and help.

mark_m360

FatFrog87 wrote: »

I have recently received a letter from the revenue saying a fairly large sum of interest is owed, slightly less than 2,000euro. That the capital gains was not paid in time.

Two properties were sold in 2011. I informed the accountant by email,when one had sold in April and enquired about capital gains tax.

The second property sold during the summer and when he asked for figures to calculate income tax, I again asked about capital gains tax on the two properties stating they had to be declared. We spoke afterwards by email and he never mentioned capital gains.

In February 2012 I asked about the capital gains tax again, giving figures for how they were bought and sold for.Received no response. At the end of the year I forwarded it to him again and he calculated tax owed and was paid December 2012. I was never told it had been paid late and interest may be owed.

I naively presumed, it must just be declared and paid a year later. Like how income tax you pay a preliminary sum and settle up a year later. I have all the evidence of email correspondence between us with proof of asking him about capital gains tax. I have tried to get the accountant on the phone and have been unsuccessful to date. Said by email, he would contact me next week by phone after ringing his office that day. Mentioned the interest charge in the email so he knows what its in regard to.

So am I fully at fault here or should the accountant take the blame here. In my eyes it is the accountant who fully screwed up. Doubtful the accountant will accept responsibility for this though. So hoping to talk to accountant start of next week. If he is of no help, do I have any recourse? Any help would be appreciated. I do not want to share the emails in this thread but could do by pm, if someone is willing to have a look and help.

Unfortunately, ultimate responsibility for your returns falls on you, not the accountant.

Even if he accepts responsibility for returning it late, the interest liability remains with you and he will not pay you for any of it.

Your best option is to bring your correspondence with you when you meet him next week. You could negotiate with him with regards to reducing your accountant fees and/or also negotiate on your behalf with Revenue in an attempt to bring the liability down, therefore regaining some of your trust.

Alan Shore

I think you need a new accountant.

If you were in a position to pay the tax when it was due in Oct 11 and effectively your accountant was not bothered to deal with it on your behalf.

While responsibility for the returns is with the client, proper advice on the due dates of taxes is what the client is paying for.

FatFrog87

Yeah it kind of what I thought. Seems strange accountant can mess up like that without facing any consequences, financial or other. I had guessed ultimate responsibility falls on me though. I will hopefully get to speak to him next week and show him the emails and see what comes of it. Is there any realistic possibility or some of the interest being waived? Seems that is of no benefit to the revenue to do something like that.

mark_m360

FatFrog87 wrote: »

Yeah it kind of what I thought. Seems strange accountant can mess up like that without facing any consequences, financial or other. I had guessed ultimate responsibility falls on me though. I will hopefully get to speak to him next week and show him the emails and see what comes of it. Is there any realistic possibility or some of the interest being waived? Seems that is of no benefit to the revenue to do something like that.

First of all the consequence to your accountant is losing your fee and his reputation being reduced. I know that is of no help to you though. You have to push your point for him to do what he can to fix your situation, that may include waiving your fee or a proportion of it.

Revenue is always willing to negotiate. Once Revenue sees a person wanting to make a payment in some form or another, they will speak with you. Whether they reduce your interest penalty depends completely on your negotiation skills. Or else a payment plan could be set up where you wouldn't pay the full €2k up front. Generally a lump sum with weekly payments thereafter is the best method.

The one thing you can learn from all of this is to make sure you follow up with your accountant especially where tax deadlines come in (ring everyday if necessary) or else get a new accountant as the one you have does not seem to be competent in relation to tax issues.

dbran

Hi

Officially revenue cannot waive the interest penalties by statute. Unofficially they may do so depending on the circumstances.

Usually in cases where clearly 1) the accountant has made an error, 2) it is no fault of the taxpayer. 3) the interest will cause hardship, they may consider whether or not the reduce or waive the interest.

You will need to write a letter and enclose copies of the emails and other correspondence with your accountant as evidence to show that you had reason to believe that it was being dealt with appropriately.

As regards changing accountants I would see how the meeting goes and then decide if you still have confidence in his ability to manage your tax affairs going forward. If not you may consider a change.

dbran

FatFrog87

dbran wrote: »

Hi

Officially revenue cannot waive the interest penalties by statute. Unofficially they may do so depending on the circumstances.

Usually in cases where clearly 1) the accountant has made an error, 2) it is no fault of the taxpayer. 3) the interest will cause hardship, they may consider whether or not the reduce or waive the interest.

You will need to write a letter and enclose copies of the emails and other correspondence with your accountant as evidence to show that you had reason to believe that it was being dealt with appropriately.

As regards changing accountants I would see how the meeting goes and then decide if you still have confidence in his ability to manage your tax affairs going forward. If not you may consider a change.

dbran

So you suggest best to deal with revenue directly and not bother trying to get the accountant to sort something out? Thanks for all the replies so far

dbran

I would think give them the chance to sort it out first. If they cannot then that is the next move.