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Preliminary Tax and Self Assessment for the first time

  • 14-10-2013 9:28am
    #1
    Cian92
    Registered Users, Registered Users 2 Posts: 827 ✭✭✭


    Hi I have a query about preliminary tax.

    My Uncle earns the vast majority of his income through his employment but takes in about €3,000 in rental income that he first received and declared in 2011 via a Form 12.

    Anyway he got a letter stating that from now on he is self assessed and should complete a Form 11, I have completed this for him. He owes the Revenue about €400 extra for 2012 (all related to his rental income) and his total liability is about €11,000 (all besides the €400 deducted as PAYE from his payslip already). I understand he will not have to pay any preliminary tax this year as it is his first year as a self assessed income tax payer.

    However when he files in October 2014 for the year 2013, am I right in understanding he will have to make a preliminary tax payment for 2014 of €11,000 (if his income stays the same)?

    This would be quite an expense for my uncle as the vast majority of this payment will have been deducted throughout the year on his payslip and he does not have €11,000 handy to give to the Revenue.

    Any help would be greatly appreciated.


Comments

  • #2
    Bold Abdu
    Registered Users, Registered Users 2 Posts: 213 ✭✭Bold Abdu


    He should file F11 for 2012 before 31 October 2013. He should also pay his €400 liability and a further €400 towards PT 2013 before this date i.e you are incorrect in thinking he should pay no PT this year.

    The €11K figure is not relevant, it's only the outstanding liability....in this situation.

    I would suggest having an accountant/tax advisor look over the Rental Accounts & F11 you are submitting.


  • #3
    Cian92
    Registered Users, Registered Users 2 Posts: 827 ✭✭✭Cian92


    Thank you very much for your advice. I have completed the Form 11 and I am ready to file it on his behalf.

    I was just under the impression that if 2012 was his first year as a chargeable person that he would be exempt from paying preliminary tax.

    That's what I gathered from the Revenue's Statement of Practice on the matter, but I could easily be mistaken.
    http://www.revenue.ie/en/practitioner/law/statements-of-practice/sp-it-2-91.pdf


  • #4
    Alan Shore
    Registered Users, Registered Users 2 Posts: 735 ✭✭✭Alan Shore


    Cian92 wrote: »
    I was just under the impression that if 2012 was his first year as a chargeable person that he would be exempt from paying preliminary tax.

    ]

    Exempt as in it's never payable or exempt in the sense that they can pay 100% of the prior year NIL.

    They have not paid prelim in 2012 so now the balance is due.


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