January tax news: new year tax updates

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PAYE tax return for 2015
The Form 12S, the simplified tax return, for the year 2015 for employees, pensioners and non-proprietary directors is now available on the Revenue website.

Electronic tax clearance facility
You may have seen the new electronic tax clearance (eTC) system which went live in December. As of 1 January 2016 all new applications for tax clearance are through the new eTC system.  This means that processing of tax clearance applications, certificates issued by the Collector General and verification is all in electronic format via MyAccount or Revenue Online Service (ROS).
It is worth noting that:
  • Paper tax clearance certificates issued since 1 April 2015 have different expiry dates depending on when the certificate issued.  It is important that you check the expiry date noted on any paper certificates you are relying on.
  • As a third party user you can verify an eTax Clearance Certificate (eTCC) via ROS.  You can verify a single case or a list of cases using the ROS bulk upload facility.
  • Connected parties are taken into consideration when accessing the tax clearance status of the taxpayer. The PPSN/tax reference number of the connected party will have to be provided at the application stage.
  • Notification will go to the ROS inbox/MyAccount to tell you that you have eTC correspondence.  This is particularly relevant if the taxpayer’s tax clearance status is rescinded.
  • Clearance is reviewed twice yearly, this automatic review takes place from the date tax clearance is applied and not on a specific date for all taxpayers.
  • The tax clearance number will only change if the taxpayer loses their tax clearance status.  A new number will issue when the taxpayer is granted tax clearance status. The Revenue’s manual on the eTC system may be helpful.

Benefits to employees
The Revenue’s benefits in kind guide is updated to include the increased €500 small benefit exemption which was introduced in Finance Act 2015 and applies from 22 October.  The guide also covers the general tax treatment of benefits in kind which you may find helpful as you prepare the annual P35 return which is due to be filed on or before 15 February 2016.

New Earned Income Tax Credit
The new earned income tax credit was introduced in Finance Act 2015 and provides for a maximum tax credit of €550 in respect of an individual’s earned income – that is earned income not subject to PAYE.   This new credit is available to proprietary directors and applies for 2016 and following years. Revenue published new guidelines as part of their Tax and Duty Manual (Part 15-01-44) on the new “Earned Income Tax Credit” which you may find helpful

Affected by flooding?
Local property tax for 2016 may be deferred in certain cases to ease the burden on taxpayers impacted by flooding according to Revenue.  If business taxpayers are receiving help from the Red Cross through the Government Support for Small Business Fund they can contact the Collector General to look for more time for filing and payment. These administrative arrangements for taxpayers impacted by flooding are detailed on the Revenue website.

eRCT payments to subcontractors for 2015
Until the end of this month you can view or download in Revenue Online Service (ROS) records of the payments made to your clients who are subcontractors in the 12 month period from 1 January 2015 to 31 December 2015.  This payment information might be of assistance when you are preparing the 2015 income tax return (Form 11) for your client.  You must download/record this information before 31 January 2016. You can read further information on downloading the payment information inRevenue eBrief No. 02/16.

Revenue Online Service digital certificate
You may have been prompted recently to renew your ROS digital certificate when you logged in to Revenue Online Service (ROS).  A notice on the Revenue website states that ROS Digital Certificates must be renewed every two years for security reasons. When you renew you are receiving a new version of your certificate.  You should save a copy of this new certificate on your computer so that you can continue to access ROS – if you do not have this file, you will have to obtain a new certificate.

Legislation update
Finance Act 2015 was signed into law by the President on 21 December 2015 (Act No. 52 of 2015).  The Finance (Local Property Tax) (Amendment) Act 2015 (Act No. 50 of 2015) was signed on 20 December 2015 and the Finance (Tax Appeals) Act 2015 (Act No. 59 of 2015) was signed on 25 December 2015.