Self-Assessed Tax Return

Who needs to file Self-Assessed Income Tax Return?

Do you have additional sources of income on top of your employment earnings? If the answer is Yes, there is a high chance you may need to file a Tax Return (form 11) under the Self-assessment system. Read on if you want to avoid any tax issues and late filing penalties!

What qualifies as additional sources of income (Non-PAYE income)?

Additional sources of income are any other sources different to employment income. These could include self-employment, rental income, dividends and deposit interests. Excluded from the definition of “non-PAYE income” are Social Welfare Payments or Pensions and Legally enforceable maintenance payments received.

Who needs to file a tax return?

  • Anyone with gross non-PAYE income of EUR 50 000 or more (even when this income has been reduced to NIL or a negligible amount due to deductions, losses, allowances and other reliefs);
  • Anyone with gross non-PAYE income of less than EUR 50 000 but net non-PAYE income of EUR 3174 or more;
  • Anyone whose non-PAYE income (regardless of amount) has been reduced to NIL: the reason for this is that NIL income cannot be coded against your PAYE tax credits so you will be obliged to file a Tax Return;
  • Proprietary directors – all proprietary directors (any director of a company who has more than 15% of the ordinary share capital of the company) are charged under the SA scheme and required to file a SA Tax Return. Where joint assessment applies, their spouse is also brought under the SA provisions;

The EUR 50 000 limit applies to income from all non-PAYE sources and not separately from each source. Where an individual has various non-PAYE sources of income, all of those should be added together when determining the EUR 50 000 threshold.

A married couple or civil partners, who are jointly assessed, are entitled to earn a total of EUR 3174.00 before the assessable spouse is brought under the SA scheme and required to file a tax return.  However, you may opt for separate assessment or single treatment in which case each spouse will have a limit of EUR 3174.00.

Once you become a “chargeable person” (a person required to file a tax return) and provided you continue to have the Non-PAYE sources of income in future years, you will be required to file a Tax Return for those years, regardless of the amount of the income.

Tips and tricks

If you fall into one of the categories above and you are required to file a tax return under the SA system, make sure you do it on time to avoid any late filing surcharge. You should submit your tax return for each tax year before 31 October of the next year. So, this means that your tax return for 2016 will be due before 31 October 2017.

You do not need to file a Tax Return if:

  • Your gross non- PAYE income is less than EUR 50 000
  • Your net non-PAYE income is less than EUR 3174
  • Your non-PAYE income has been coded against your PAYE tax credits or taxed at source

If you are still unsure whether you need to file a tax return, contact us and we will review your situation to figure this out. If form 11 is required, one of our tax technicians will guide you through everything to ensure you’re not missing a trick that could save you hundreds of euro in taxes.