How to resolve late tax payment with revenue

tringlarido

Hi all,

I wonder if people here can help me or if I'll need to speak to a consultant..
might be a very easy question

I received share options under ESPP back in 2011.
Taxation is : "You will pay Income tax, USC and Employee PRSI on the amount of the discount.
"
https://www.revenue.ie/en/additional-incomes/employment-related-shares/employee-share-purchase-plans.aspx

So little did I know, I didn't pay the tax back then. Also I'm not sure if I received rent tax credits back then..

Today I would like to resolve that issue. Took me ages to understand.
I'm able now to count the tax I owe for each set of shares purchased. and I was about to submit them.

However I read the following:

"Where RTSO is paid late, there is provision for the imposition of interest at 0.0322 per cent per day" https://www.revenue.ie/en/tax-professionals/tdm/share-schemes/chapter-03.pdf

Which means if I owe let's say 300e of tax for a set of shares, then possible my fees could be
365*8*(0.0322*300)=28 207e !!??!

So my question is, if I submit my payment and form11 to them, will I then be forced to pay 30k for every set of shares.... ( obviously I can't pay these fees)

many thanks,

Sonny noggs

0.0322 is 3.22% not 0.0322%?

tringlarido

according to the link it is 0.0322%.

Also I want to add that revenue never contacted me to pay these taxes ( even if I asked them how to pay them.. )

brownej

ESPP and share options are two different things!

ESPP you are using your own money to buy shares in a tax efficient manner and you are buying up front. In my experience working at a multinational they usually administer the scheme and deduct the purchase from payroll after the relevant taxes are paid. (USC, PRSI, relevant income tax). The company normally does this as there are limits both on an individual basis and the company basis of how much can be invested in these schemes.
The shares are then held for 3 years and you just pay the relevant amount of capital gains tax when you sell them after you deduct the capital gains allowance.

Options are a quantity of shares you have an option to buy at a future date at a set price. You only pay tax (RTSO) when or if you exercise these options.
RTSO is payable on the difference between the grant price and the sale price. Normally you buy and sell at the same time and realise the cash gain. And then pay your tax on the benefit.

tringlarido

aaah oups, ok forgot the /100.. phewwww...
ok so that would only be 282 euros..

would revenue still ask to pay all these fees after all this time... ?

brownej

tringlarido wrote: »

according to the link it is 0.0322%.

Also I want to add that revenue never contacted me to pay these taxes ( even if I asked them how to pay them.. )

This isnt how this sort of tax works.
You earn money outside of the PAYE system it is up to you to declare and pay the taxes.

tringlarido

brownej wrote: »

ESPP and share options are two different things!

ESPP you are using your own money to buy shares in a tax efficient manner and you are buying up front. In my experience working at a multinational they usually administer the scheme and deduct the purchase from payroll after the relevant taxes are paid. (USC, PRSI, relevant income tax). The company normally does this as there are limits both on an individual basis and the company basis of how much can be invested in these schemes.
The shares are then held for 3 years and you just pay the relevant amount of capital gains tax when you sell them after you deduct the capital gains allowance.


Options are a quantity of shares you have an option to buy at a future date at a set price. You only pay tax (RTSO) when or if you exercise these options.
RTSO is payable on the difference between the grant price and the sale price. Normally you buy and sell at the same time and realise the cash gain. And then pay your tax on the benefit.

thank you,

Yes it is ESPP.

I said share options, as this is the field revenue said I should fill out in the form11 for my ESPP...
Another time, they said I should fill out RTSO1 form also.

as for me, I had to pay tax on the discount given to buy the ESSP shares. Taxes were not paid automatically.

tringlarido

would revenue still ask to pay all these fees ... ? it's been 8 years, and I don't think I got rent tax credits, which can't be asked anymore for that year..

relax carry on

tringlarido wrote: »

would revenue still ask to pay all these fees ... ? it's been 8 years, and I don't think I got rent tax credits, which can't be asked anymore for that year..

Interest is statutory and cannot be mitigated unless provided for under legislation.
The 4 year time last limit on claims for credits/reliefs is well established at this stage and means anything you should have claimed 8 years ago is not available to you now.

tringlarido

relax carry on wrote: »

Interest is statutory and cannot be mitigated unless provided for under legislation.
The 4 year time last limit on claims for credits/reliefs is well established at this stage and means anything you should have claimed 8 years ago is not available to you now.

thank you
interesting that there is a 4 year limit on credits, but not on interest