Income Tax and Investment Property – Why Place it on the Long Finger?

The phone call

One lunch time while sitting down to have a well deserved cup of freshly ground coffee, my phone rang. I answered it and I started a conversation with a young man who was obliviously uncomfortable with the whole idea of dealing with a tax advisor. Let’s call him ‘M’!

M had come to me as a referral from existing income tax client. He owned an investment property and didn’t know how to deal with the tax situation. He searched on the internet and visited all the chat rooms and got a list of different answers as long as his arm. The pinnacle came when a colleague from work, some years older than himself heard about his situation and informed him that, “he’d have to pay a bucket load of tax…” Of course, this response led him to a number of sleepless nights until a friend (my client) gave him my number and told him to go and have a chat with me.

The above is a classic situation of numerous phone calls that I receive. Where people have worried themselves and missed numerous hours of sleep worrying about a situation that can be rectified (almost!) by a phone call to a friendly tax advisor or accountant. The hardest thing is making that call!

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Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010

On the 1st February 2011 the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 came into law.

Seven days later on the 7th February two men became the first couple under Irish law to be registered as civil partners.

So, where does this leave the happy couple from a tax point of view?

At present, nothing has changed and at the time of writing, they will still be treated as single persons and possess single tax allowances and credits. The change legislation has been drafted however, but the tax changes have been deferred until the formation of the new government, which, as it happens, is today! So as we listen from our new offices on Nassau Street to the chanting of the Social Party marching with their new members to the Dáil, we await the passing of this long awaited bill to give equal rights to all. It’s not perfect but it’s a big step in the right direction.

We are eagerly awaiting more information on the changes from the Departments of Finance and as soon as they are available we will pass them on. If you, the reader needs to speak with us in person, we would be delighted to sit down and talk you and your partner through it.

Go n-eírí an bother libh le chéile.

 

VAT 3 Returns

All VAT Registered persons, whether they are Sole traders, Partnerships or Limited Companies and who are required to submit a VAT Return for the period 1st January 2011 to February 28th 2011 (VAT 3 Form) have until March 19th to submit this return.

This VAT Return details the VAT charged on their Sales (Output VAT) and the VAT paid on their Purchases (Input VAT). They are also required to disclose the amount of Sales of Goods to other EU countries, together with Purchases from Other EU countries.

By subtracting the Input VAT from the Input VAT, the amount of VAT to be paid/ refunded is calculated. This payment must be made by March 19th. In the event of a repayment, there is an option to have the amount refunded to your bank account or to have it offset against other Tax Liabilities, e.g. Employers Returns (P30).

Depending on a taxpayers circumstances this is often a good idea as by leaving money ‘on account’, it will reduce future liabilities. For example, if you are an Employer and you often struggle to make your P30 payment it may be a good idea to request the Revenue Commissioners allocate a VAT refund to your future PREM liability.

If you have any queries, please don’t hesitate to contact the office and we will be happy to advise you. All our staff are fully qualified accountants as we don’t employ trainees. This ensures that the quality of our advice is second to none.

Managing Your VAT to Improve Your Cash Flow

In today’s market where cash is king it’s important to have a greater control over your cash flow and to look at ways to improve it. One way to improve cash flow is to look at your system of recording and paying VAT.

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Tax Return Season – The Worst Thing To Do Is Nothing!

It comes but once a year and no, it’s not Christmas! Yes, tax season is upon us once again. This is the time when all proprietary directors must file a form 11 by the 31st October 2010 for the tax period ending 31st December 2009. However, this is not just limited to proprietary directors! Anyone with additional income will need to file a tax return also. This includes rental income and even if you believe you have made a loss on the rental property, you must still file a return by the deadline. Also included are deposit interest and all worldwide incomes. So, if you have a U.S or European bank account accruing interest, you’ll need to make a return for this also.

Where Do I Start?

You can start today by sending us your contact details and a brief summary of your investments. We will return to you within a few hours. If you own investment property or possess high interest bank accounts, THE WORST THING YOU CAN DO IS NOTHING! Contact us today and give yourself peace of mind.

Income Tax Deadline… What are you waiting for?

October 31st 2010 is the deadline for the self employed, Directors and people declaring other forms of income outside of PAYE, for example, Investment rental properties!

The reason why I’m writing this article is as follows, I have been a practicing accountant for over eight years and every year I am baffled by the amount of people that come to me in a panic on or around the 31st Oct, needing to complete their tax returns from the previous year. Yes, you read correctly, from the previous year!

This means that the 31st Oct 2010 is the deadline for all worldwide incomes to be declared to the Revenue Commissioners for the year ending 31st December 2009. Therefore, you have ten months to get your act together.

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