We don’t want you to bore you to death, but sometimes it’s good to grab a little bit of knowledge.
Tax Buddy is a registered TAX Agent (70422V), this means Revenue recognises us as an agent for those individuals who want us to handle their income tax returns. You sign an authorisation form and a couple of days later, we can view your tax details and can also submit a tax return on your behalf – after of course we discuss and you approve the income tax return/s we have calculated for you.
So the Income Tax Act of 1967 is where a lot of the legislation comes from with respect to our taxes. We also have the Taxes Consolidation Act of 1997, the Finance Act 2006 and 2007 right up to Finance Act 2017. Every year we wait with anticipation or dread, particularly in the last couple of years for the budget to be released; then following the
release a frenzy of absorption, review and analysis on how the tax changes will affect the day to day lives of individuals and businesses.
The scope and sphere of rules, conditions, restrictions and anomalies relating to the range of taxes can be daunting. Revenue put the onus on the individual or organisation to ensure they fully declare all taxable incomes and profits to ensure appropriate payment of taxes. While Revenue Commissioners have become far more approachable in the last ten years, it is an area where many people feel more comfortable letting the experts handle their tax affairs, with good reason. If an individual or company understates their tax situation, they may be liable for additional tax liability in the form of interest and penalties.
So who is liable for Tax ?
NEARLY EVERY ADULT in some form or another!
“An individual who is resident, ordinarily resident and domiciled in the State is liable to income tax in respect of his/her total income wherever arising. He/she is entitled, however, to claim certain Tax Credits and deductions.”
The tax that offers some exemptions and reliefs is Income Tax and that is where we come in. If you rented a home, paid tuition fees, had medical bills or paid into a pension. We are very keen to explore the various opportunities to seek a reduction in your tax bill or even better to secure a tax refund.
The main taxes are:
Click on a heading below for more information on each form of tax.
Income Tax - Applicable to Individuals
PAYE taxation is charged at 20% up to an earning level of €33,800, then 40% if single. €42,800 at 20% and then 40% if married. You can also claim various tax credits to reduce your tax liability.
Universal Social Charge - Applicable to Individuals
Payable on Gross pay including pension contributions.
For 2018 (which is the tax year you will be submitting in 2019):
- 0.5% on the first €12,012
- 2% on the next €7,360
- 4.75% on the next €50,672
- 8% on the balance
For 2017 (which is the tax year you will be submitting in 2018):
- 0.5% on the first €12,012
- 2.5% on the next €6,760
- 5% on the next €51,272
- 8% on the balance
11% for Self-employed individuals whose earnings exceed €100,000 – 11% applies to the balance above €100,000
Pay Related Social Insurance (PRSI) - Applicable to Individuals and Companies
Payment to the national social fund to pay for Illness Benefit, Jobseekers benefit, maternity benefit, state pension and others. Employees pays according to level of earnings and employer pays either 8.5 % or 10.75% of their employees income.
Capital Acquisitions Tax - Applicable to Individuals
Inheritance and Gift Tax, Standard Rate is 33% after thresholds.
Capital Gains Tax - Applicable to Individuals
33% rate on disposal of Assets such as property (not principal private residence)
Deposit Interest Retention Tax (DIRT) - Applicable to Individuals
Taxation on bank deposit interest 39% from 2017, 41% for 2015 & 2016.
Dividend Withholding Tax - Applicable to Individuals
Irish Shareholders who receive a year-end dividend pay tax at standard rate of income tax.
Local Property Tax - Applicable to Individuals
Charged on the market value of residential properties. If not paid Revenue notify employer to deduct from pay.
Domicile Levy - Applicable to Individuals
€200,000 levy is applied to those who are Irish-Domiciled and has a world-wide income in excess of €1m, if their property is worth in excess of €5m and have not paid €200K in the year.
Environmental Levy - Applicable to Individuals
22 cent is charged on plastic shopping bags.
Vehicle Registration Tax and Motor Tax - Applicable to Individuals and Companies
VRT is a tax chargeable on the registration of every motor vehicle including motor bikes. It is included in the purchase cost of a new vehicle. Motor tax is paid annually to the relevant county council for the upkeep of roads.
Excise and Licences - Applicable to Companies
Mineral oils, alcohol and tobacco are excisable products and require licences.
Professional Services Withholding Tax - Applicable to Individuals / Self Employed
20% is withheld where professional services are provided (not including construction industry), these monies are then offset against the tax chargeable on profits of the professional services.
Stamp Duty - Applicable to Individuals and Companies
Stamp duty is payable on property transactions, share transfers, bank cards and insurance premiums. Various levels applied.
Value Added Tax - Applicable to Individuals and Company
Vat is charged on supplies of goods and services. The rates are 0%, 9%, 13.5% and 23% and is applied dependent on the service or goods purchased. Individuals bear the cost of VAT on purchases.
The company files usually bi-monthly returns and offsets the VAT paid on purchases against the VAT applied to their sales.
Corporation Tax - Applicable to Companies
Taxation on profits and income – current rate 12.5%.
Relevant Contract Tax - Applicable to Companies
RCT applies to payments made by a principal contractor to a subcontractor under a relevant contract in forestry, construction or meat processing. The gross deduction is dependent on the tax compliant status of the subcontractor. VAT reverse charge can also affect contractors.
Tonnage Tax - Applicable to Companies
Some shipping companies may opt to pay Tonnage Tax rather than corporation tax on profits. Companies still submits a CT1 return.