Who files a self-assessment tax return?
- The self employed, proprietary directors (those who own more than 15% of a company) and people with non-PAYE income are required to file self assessment tax returns under the Pay and File system with Revenue
- Employees and Directors in occupational pension schemes can also reduce their 2017 tax bill if they pay an AVC single premium on or before 21st October 2018 and file a return by 31st October 2018
How to avoid interest & surcharges
By 31st October/14th November 2018 you must:
– File a 2017 Income Tax Return
– Pay any balance of income tax outstanding for 2017
– Pay preliminary income tax for 2018
Tax Saving Opportunities – For the Self Employed
If you are self employed, you must calculate your tax liability and make a payment by 31st October 2018 in respect of your:
- Final Tax Assessment for 2017
- Preliminary Tax for 2018
Good news:
- You can reduce your 2017 Final Tax Liability and your 2018 Preliminary Tax liability by making contributions to a Personal Pension Plan or to a PRSA plan by 31st October 2018 (or 14 November 2018 for ROS users) and also by these respective dates electing to backdate the tax relief to 2017.
- Your pension contributions are subject to the age-related limits shown below:
| Age Band | % of Net Relevant Earnings |
|---|---|
| 60 and over | 40% |
| 55-59 | 35% |
| 50-54 | 30% |
| 40-49 | 25% |
| 30-39 | 20% |
| Up to age 29 | 15% |
Example:
- John is self employed
- Aged 45 years
- Net Relevant earnings for 2017 were €80,000.
- He has paid €18,000 Preliminary Tax in 2017
- Total tax bill for 2017 is €25,000.
- This leaves him owing €7000 for 2017.
- He does not currently pay pension contributions.
- The two scenarios below show just how a lump sum pension contribution can save John lots of money!
If you need any advice, please contact us today by clicking on Contact Us at the top of this page, or click here
Thanks for reading!
Karen