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Form 12 vs declaring on Revenue.ie

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  • 26-01-2021 5:30pm
    #1
    atahuapla
    Registered Users Posts: 82 ✭✭


    I'm a PAYE worker with a very modest side hustle (€1,000 profit in 2020).

    I declared this on revenue.ie in Jan 2021 by reviewing tax year 2020 and entering the additional income as trading profit.
    I got my updated statement of liability a week later with the underpayment amount stated. It says underneath this will be paid by reducing my credits for 4yrs.

    Am I done now or do I still have to fill out a Form 12?

    Many thanks.


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    #2
    Geuze
    Registered Users Posts: 13,072 ✭✭✭✭Geuze


    atahuapla wrote: »
    I'm a PAYE worker with a very modest side hustle (€1,000 profit in 2020).

    I declared this on revenue.ie in Jan 2021 by reviewing tax year 2020 and entering the additional income as trading profit.
    I got my updated statement of liability a week later with the underpayment amount stated. It says underneath this will be paid by reducing my credits for 4yrs.

    Am I done now or do I still have to fill out a Form 12?

    Many thanks.

    A Form 12 is the name for the old paper form.

    That has been replaced by doing tax returns online, which you have done.

    Submitting the Form 12 leads to a P21 balancing statement being generated.

    It seems the P21 is now replaced by the SoL.


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    #3
    atahuapla
    Registered Users Posts: 82 ✭✭atahuapla


    Geuze wrote: »
    A Form 12 is the name for the old paper form.

    That has been replaced by doing tax returns online, which you have done.

    Submitting the Form 12 leads to a P21 balancing statement being generated.

    It seems the P21 is now replaced by the SoL.

    Many thanks! I holding cash expecting to use the payments feature on revenue.ie but it works out even better that it's just gonna taken back as tax credits.


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    #4
    Saudades
    Registered Users Posts: 378 ✭✭Saudades


    atahuapla wrote: »
    It says underneath this will be paid by reducing my credits for 4yrs.

    Just curious, will they reduce starting from this year, or will they reduce starting from 2022?


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    #5
    Stratvs
    Registered Users Posts: 958 ✭✭✭Stratvs


    Saudades wrote: »
    Just curious, will they reduce starting from this year, or will they reduce starting from 2022?

    They have said 2022.


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    #6
    Saudades
    Registered Users Posts: 378 ✭✭Saudades


    Stratvs wrote: »
    They have said 2022.

    Handy. And the USC and PRSI? Do you just pay in a one-off payment before October 31? Or do Revenue also offset these against future tax credits?


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    #7
    pancake12
    Registered Users Posts: 28 ✭pancake12


    Hi @atahuapla

    I came across your post as I was looking for some information myself and I am in a similar situation.

    Do you know, or does anyone know how to claim back some expenses for the side hustle if you are a PAYE employee?

    Many thanks in advance.

    https://www.boards.ie/discussion/2058153772/form-12-vs-declaring-on-revenue-ie




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    #8
    relax carry on
    Registered Users Posts: 4,072 ✭✭✭relax carry on


    https://www.boards.ie/discussion/comment/121477752#Comment_121477752

    You don't claim back expenses on your non PAYE income. You calculate your taxable profit after allowable deductions just like any other income form a trade/profession. So for example, gross non PAYE income of 4000 less allowable expenses of 300 euro gives 3700 taxable non PAYE income. You complete all the relevant sections of the tax return you file on your Revenue Myaccount.



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    #9
    pancake12
    Registered Users Posts: 28 ✭pancake12


    Thank you very much , one last question as I have never done this before. How do I know what expenses are allowed to be deducted from my profit. Is there a list or how? Thanks again. Appreciate it.



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    #10
    Geuze
    Registered Users Posts: 13,072 ✭✭✭✭Geuze


    Found within one minute:

    https://www.revenue.ie/en/starting-a-business/claiming-a-deduction-for-expenses/index.aspx


    What expenses can be claimed?

    The expenses that you can claim for are those that are directly related to the running of your business such as:

    • the purchase of goods for resale
    • employees' pay
    • rent and bills for your business premises
    • running costs for vehicles or machines that you use in your business
    • lease payments for vehicles or machines that you use in your business
    • accountancy fees
    • interest payments for money you borrowed to finance your business.

    You may also claim for expenses you had before your business started trading such as the cost of preparing business plans. See the Relief for pre-trading expenses manual for more information.

    If you are registered for Value Added Tax (VAT), the amount that you claim for expenses should not include the VAT amount.

    What expenses can not be claimed?

    You can not claim expenses for any item that is not fully related to the running of your business such as:

    You cannot claim a deduction for capital expenditure when calculating your profit. Capital expenditure is money you spend on buying or maintaining land, property or equipment for your business. You may be able to claim capital allowances on some of this expenditure.

    Expenses that are for both business and private use

    If you spend money on something that is for both business and private use, you can claim a deduction for part of the expense. This would include items such as phone bills, motor expenses and rent. You must work out how much of the expenditure was for business purposes and claim a deduction for that amount only.



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