TRCN1 form - help

sandra_b · 01-11-2020 07:01PM #1

Hi,

I would appreciate very much of anyone can help me to fill in TRCN1 form.
It seems like I am registered in the wrong group by Revenue. I have received shares from my employer about 10 years ago.
The company I have worked 10 years ago was sold and each employee have received some shares.
I have filled Form 11 that year (as Revenue has sent me after I paid tax), and it seems like I am treated as self employed by Revenue.
Now, I can not claim my medical expenses as I receive the following message:

"You cannot proceed as you (and/or your spouse or civil partner, if applicable) were registered for Income Tax during the year."

I have asked Revenue about this and they have sent me TRCN1 form to fill.
I am employed for a private company and all my tax is paid through payslip.

Apart from my name and PPS number, I don't have a clue what other sections are in this form.

Could anyone help me how to fill in:

-Assets and Equipment
State how disposed ofIf on hand give details and state current value

- Business Premises
State if owned or rented and give details of current position

-Tax Type/Tax Registration Numbers to be cancelled
VAT Income Tax
Corporation Tax Employer
PAYE/PRSI
RCT

-State current means of Livelihood /
Occupation, i.e. Sole Trader /
Rental / Director / PAYE etc.

relax carry on · 01-11-2020 08:00PM

sandra_b wrote: »

Hi,

I would appreciate very much of anyone can help me to fill in TRCN1 form.
It seems like I am registered in the wrong group by Revenue. I have received shares from my employer about 10 years ago.
The company I have worked 10 years ago was sold and each employee have received some shares.
I have filled Form 11 that year (as Revenue has sent me after I paid tax), and it seems like I am treated as self employed by Revenue.
Now, I can not claim my medical expenses as I receive the following message:

"You cannot proceed as you (and/or your spouse or civil partner, if applicable) were registered for Income Tax during the year."

I have asked Revenue about this and they have sent me TRCN1 form to fill.
I am employed for a private company and all my tax is paid through payslip.

Apart from my name and PPS number, I don't have a clue what other sections are in this form.

Could anyone help me how to fill in:

-Assets and Equipment
State how disposed ofIf on hand give details and state current value

- Business Premises
State if owned or rented and give details of current position

-Tax Type/Tax Registration Numbers to be cancelled
VAT Income Tax
Corporation Tax Employer
PAYE/PRSI
RCT

-State current means of Livelihood /
Occupation, i.e. Sole Trader /
Rental / Director / PAYE etc.

N/A for assets equipment and business premises. Tax registration to be cancelled is income tax. Current means of livelihood is PAYE. Ensure its canceled back to the 31st of December in the year you last exercised share options.

sandra_b · 01-11-2020 08:09PM

Thank you so much!

In my current company I also buy shares every 6 months as I have discount.
I don't sell them, but I do pay tax on "gain" (difference on what I paid vs market price). That gain was ~200 euro in April, and ~500 euro in October.
Do I need to include this in Assets section?

relax carry on · 01-11-2020 08:15PM

sandra_b wrote: »

Thank you so much!

In my current company I also buy shares every 6 months as I have discount.
I don't sell them, but I do pay tax on "gain" (difference on what I paid vs market price). That gain was ~200 euro in April, and ~500 euro in October.
Do I need to include this in Assets section?

no. Leave the assets as N/A. How do you pay that tax on the "gain"? Through your payroll? If so that's fine you can deregister. If not and you pay it directly to Revenue (RTSO) then you have to stay registered for income tax. Disposing of the shares at any point may give rise to CGT which again has to be declared. Also any dividends you receive from holding the shares need to be declared also.

sandra_b · 01-11-2020 08:43PM

relax carry on wrote: »

no. Leave the assets as N/A. How do you pay that tax on the "gain"? Through your payroll? If so that's fine you can deregister. If not and you pay it directly to Revenue (RTSO) then you have to stay registered for income tax.

I pay through MyAccount online. There is an option in Payments section - "Relevant Tax Share Option".

I was talking to Revenue on the phone as I didn't know what it means that "I am registered for Income Tax" and I mentioned these shares, but they say I can de-register.
I think the amount I gain is not above certain threshold?

relax carry on wrote: »

Disposing of the shares at any point may give rise to CGT which again has to be declared. Also any dividends you receive from holding the shares need to be declared also.

By disposing shares - do you mean if I sell them?

relax carry on · 01-11-2020 08:55PM

sandra_b wrote: »

I pay through MyAccount online. There is an option in Payments section - "Relevant Tax Share Option".

I was talking to Revenue on the phone as I didn't know what it means that "I am registered for Income Tax" and I mentioned these shares, but they say I can de-register.
I think the amount I gain is not above certain threshold?

By disposing shares - do you mean if I sell them?

As you are exercising share options and paying RTSO on the gain, you are a chargeable person which is why you are income tax registered and must file a Form 11 via ROS every year regardless of the amount of your gain. There is no threshold for this which is daft really. The person in Revenue either did not know this or knows for the most part Revenue don't really make an issue of it for small amounts. So they should not deregister you and you should be filing form 11s all along. You can claim tax relief on your medical expenses via a from 11. Its just a bit of a pain in comparison to using an EForm 12 on MyAccount.

Disposing of the shares is selling the shares. This information should have been provided to you by your employer.

https://www.revenue.ie/en/additional-incomes/employment-related-shares/unapproved-share-options.aspx

sandra_b · 01-11-2020 09:11PM

That is a pain

Why they have never asked me to fill in Form 11 since 2011?

In 2011 I have received letter from the Revenue and I submitted it. I didn't have any shares until last year when I started this company scheme.
I have never submitted Form 11 since. Also, I claimed medical expenses on MyAccount in usual way 3-4 years ago. Only this year I got an error message I am registered for income tax?
Also, other people in my company are buying shares with discount and no one is submitting Form 11?

We had presentation at work about share options and no one ever mentioned Form 11, we were told we have to pay tax on the gain through MyAccount.

I thought there is threshold as I found this:

https://www.revenue.ie/en/gains-gifts-and-inheritance/transfering-an-asset/how-to-calculate-cgt.aspx

"If you are an individual, you have a personal exemption of €1,270 each year. If your chargeable gain is less than this, you will not have to pay any CGT."

Uh .... this is so complicated....I remember filling in that Form 11 was huge pain, I would prefer not to do it again

relax carry on · 01-11-2020 09:31PM

sandra_b wrote: »

That is a pain

Why they have never asked me to fill in Form 11 since 2011?

In 2011 I have received letter from the Revenue and I submitted it. I didn't have any shares until last year when I started this company scheme.
I have never submitted Form 11 since. Also, I claimed medical expenses on MyAccount in usual way 3-4 years ago. Only this year I got an error message I am registered for income tax?
Also, other people in my company are buying shares with discount and no one is submitting Form 11?

We had presentation at work about share options and no one ever mentioned Form 11, we were told we have to pay tax on the gain through MyAccount.

I thought there is threshold as I found this:

https://www.revenue.ie/en/gains-gifts-and-inheritance/transfering-an-asset/how-to-calculate-cgt.aspx

"If you are an individual, you have a personal exemption of €1,270 each year. If your chargeable gain is less than this, you will not have to pay any CGT."

Uh .... this is so complicated....I remember filling in that Form 11 was huge pain, I would prefer not to do it again

You only file a form 11 in the years you exercise share options. For the years you haven't exercised share options you were fine to file a normal EForm 12 via MyAccount. With share options you pay the tax to Revenue within 30 days of exercising the options and you file a from 11 the following year to match up with the money you paid.

CGT is separate to the RTSO you paid on the gain. If you sold all the shares on the day you exercised them you probably had no CGT to pay as the purchase price and the sale price would be pretty much the same. If you held on to the shares however and they increased in value and you then sold them later then you may have a CGT liability as well.

The link I posted earlier explains it. There is also a manual in that link as well with examples etc.

It would be so much easier for the company to just pay you a bonus and have the tax issues sorted through payroll.

sandra_b · 01-11-2020 09:49PM

Thank you so much for your help.
I have never sold any shares in my current company, I have only bought them (but I had a discount so I paid a tax on the difference between a price I paid vs market price on that day).
Does it mean I "exercised share options"? I thought exercise share options means to sell shares?

I am actually buying shares through payslip, it is deducted from my salary on payslip - does it make a difference?

relax carry on · 01-11-2020 10:32PM

sandra_b wrote: »

Thank you so much for your help.
I have never sold any shares in my current company, I have only bought them (but I had a discount so I paid a tax on the difference between a price I paid vs market price on that day).
Does it mean I "exercised share options"? I thought exercise share options means to sell shares?

I am actually buying shares through payslip, it is deducted from my salary on payslip - does it make a difference?

Income tax obligations.

Exercising share options is you purchasing the shares at your discounted price. The "gain" is the discount. You pay income tax (RTSO) on the "gain" within 30 days to Revenue. You now own the shares. If you hold onto the shares and the shares happen to generate dividend income then you must declare this on your annual tax return. Regardless of any dividend income you must file a form 11 tax return to match up with the RTSO the following year. So if you exercised share options in 2019 you'll file a from 11 in 2020 for the tax year 2019.

Capital Gains tax obligations

If you sell the shares on the same day you purchase then your purchase price will most likely equal the sale price so there will be no capital gain and there will be no capital gains tax due. If you hold onto the shares and then sell at at later date and the shares have increased in value then you have a capital gain and you may have a capital gains tax liability.

TRCN1 form - help

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