Self­Assessment Tax Returns

In Ireland, you must file what is called a ‘self­assessed tax return’ to report any income not taxed at source via pay as you earn (PAYE). All income that is not taxed at source must be reported to the Irish Revenue by filing a tax return under the Pay and File system This includes the self­employed, sole traders, and contractors, directors of Irish companies, and anyone else who has earned other taxable income that has not been taxed at source

Capabilities

Outbooks’ team of bookkeepers and accountants will provide the expertise and know­how to assist you throughout the process of filing your self­assessment tax returns in Ireland for income tax purposes Outlined below are some of the main features of self­assessment We hope this will help you either navigate the system yourself or seek the expert advice of Outbooks

Who should register for self­assessment?

Registration for income tax self­assessment is mandatory for:

Self­employed taxpayers

Directors of companies operating in Ireland

Taxpayers whose main source of income is, or

Taxpayers whose main source of income is, or who earn income from other sources where tax has not been collected through PAYE, including: rental income investment income foreign income including foreign pensions maintenance payments fees and other income not paid through PAYE profits from share options or share incentives

How do you register for self­assessment?

You can register for self­assessment by using the eRegistration service or completing parts A and B of Form TR1 for resident taxpayers or TR1(FT) for non­resident individuals

For more information about registering your business with Revenue, see registering for tax as a sole trader. Once registered, your Personal Public Service Number (PPSN) should be used for all correspondence with tRevenue in relation to your business.

Once registered, returns and payments are made using Revenue Online Service (ROS)

Your business trading name

You may wish to trade under a different name to your family name or surname In this case, you must register your business name with the Companies Registration Office (CRO) by completing form RBN1 and filing it You must do this within one month of adoption of your business name

When is the filing deadline for selfassessment?

You must complete the annual self­assessment tax return to calculate any income tax due and then file it before or by the ‘common date’: this is 31 October each year The return you file each year will relate to the previous financial year to which the tax relates, so the tax return you filed on 31 October 2022 will have reported income earned in 2021

What is the deadline for paying whatever you owe?

The amount of tax you owe must also be paid online under a system known as Pay and File. Taxpayers are given 30 days grace from the date of filing to pay what they owe for the previous tax year and may also need to pay a sum known as ‘preliminary tax’ against the following year’s tax bill if applicable

What is preliminary tax?

Preliminary tax is an estimate of what you are likely to owe in income tax, pay related social insurance (PRSI), and the universal social charge (USC) in the following tax year It must be paid by insurance (PRSI), and the universal social charge (USC) in the following tax year. It must be paid by 31 October of the current tax year.

Preliminary tax can be paid using VISA or MasterCard credit or debit card

How is preliminary tax calculated?

The calculation for preliminary tax is either:

90% of the tax due for that year

100% of the tax due for the preceding year

105% of the tax due for the pre­preceding year (if paid by direct debit; it is not applicable if no tax was due for the pre­preceding year)

Example

Your last three years’ tax bills are:

€2,000 in year one

€3,000 in year two

€4,000 in year three

It is time to file your tax return for year two (due on 31 October in year three), so you need to decide how much preliminary tax to pay in respect of year three You could decide to pay:

€3,600 (90% of the tax due for that year, year three)

€3,000 (100% of the tax due year two)

€2,100 (105% of the pre­preceding tax year, year one)

Then, when it is time to file your tax return for year three (by 31 October of year four), having calculated your tax bill for the year, the preliminary tax you paid in year three is less than the amount of your tax bill This means you will have to pay the balance But had it been more than the preliminary tax you paid, you would have been entitled to a refund

What taxes and charges do you pay in Ireland?

Typically, the taxes and charges in Ireland include:

Income tax (IT)

Pay­related social insurance (PRSI)

Universal social charge (USC) on your employment income

See more about what you pay in the tax rate band and tax credits sections of Revenue website

What are the income tax rates in Ireland?

The tax you will pay depends on:

Your residence status, which is dependent on the number of days you are present in Ireland

Your residence status, which is dependent on the number of days you are present in Ireland during the tax year (1 January to 31 December)

Your personal circumstances

Where your income comes from

Where you carry out the duties of your trade, profession or employment