tax problem

jd06

hi all, my elderly uncle told me he has not submitted accounts or paid tax inover 20 years, he used to submit but his accountant at the time told him not to bother any more, he farms 50 acres, 15 cows 40 ewes and all that goes with it. he wouldn be intensive by any means. he collects the sfp dis adv andso on. he wouldnt be turning over big money. just wondering is everything above bord or should he be submitting accounts, all replies welcome thanks

whelan1

go to a different accountant, afaik, anyself employed person should be submitting accounts every year and paying tax if needs be

leg wax

i know whelan is right but if they dont know by now let it alone.

pakalasa

I think they officially turn a blind eye to it.
Why have an old guy like this, that's earning very little, pay an accountant a lot of money to do his accounts when he won't be paying tax anyway.

Grecco

I though you didn't have to submit accounts if you were below a certain threshold?

Oldtree

Take it from me the tax man is interested and will be more interested in his estate and do an estimate on taxes owed. If there is not enough money to cover the bill and inheritance tax in the estate the farm will be sold. In the long run it is better to get it sorted out now. leaving it will cost more money.

Can't say I've heard of a threshold for not submitting forms?

whelan1

if you go to them before they go to you it will be better in the long run , i think

Chevy RV

Hello There,


I had a similar situation myself covering Six years. The chances are that he would have been below the threshold for paying tax. Go back to the accountant who said not to bother and ask him for a fee to update your uncle to date. He may still not be liable to pay tax but it is best to have the returns up to date anyway.

There MAY well be an opportunity to do tax planning for your uncle to seriously reduce any future Inheritance Tax liability as part of this catch up process depending on his circumstances in terms of allowances that can be claimed.
PM if you need more details on this.


Regards,




Chevy RV

locky76

jd06 wrote: »

hi all, my elderly uncle told me he has not submitted accounts or paid tax inover 20 years, he used to submit but his accountant at the time told him not to bother any more, he farms 50 acres, 15 cows 40 ewes and all that goes with it. he wouldn be intensive by any means. he collects the sfp dis adv andso on. he wouldnt be turning over big money. just wondering is everything above bord or should he be submitting accounts, all replies welcome thanks

Get a good accountant and get it sorted, sort out the PRSI contributions and your uncle will be entitled to a contributory pension.
I got something similar sorted for my parents, PM me if you need more info;)

jack77

Threshold is e3750 profit, you don't have to register to pay tax if your below that, can claim vat back thru unregistered vat on some items, if you dont think hes above this most years it wont do any harm ringing them. maybe thats why the accountant said no need to put in recipts?

pakalasa

I know one of the guys on here regularly is an accountant. Can't remember the name.
Maybe they could shed some light on this...

jd06

thanks all for your replies, there very helpful.ill try bring up the subject with him, mightn be easy!! hes 80 now and as far as i know hes getting half pension, we.ll see how it goes thanks again

razor8

i knew a guy that unfortunetly passed away and hadnt made tax returns since 1973. he hadnt made a will either so the land went up for sale. when it did the tax man claimed the most of the sale money

so my advice would be to sort it

KCTK

jd06 wrote: »

hi all, my elderly uncle told me he has not submitted accounts or paid tax inover 20 years, he used to submit but his accountant at the time told him not to bother any more,

Hi, only way you don’t have to submit a tax return if you are self employed is if you are notified by the Revenue that you are not required to make a tax return (e.g. due to insufficient income). Maybe the accountant got that notification for your uncle way back? 20 years is definitely a long time ago and it might be worth checking on this.
Even if your uncle had no tax to pay in last number of years if it’s the case he should have submitted tax returns there can be fines applied for failure to make the returns (even with no tax due).
Under Irish tax rules the personal representatives of a deceased person are liable to account for income tax on all income of the deceased up the date of death, including arrears, so before your uncles holding could be transferred after his death (hopefully not for a good while yet!) revenue will look at all his affairs to ensure they were up to date.
Hopefully he has a proper will and tax planning looked at on what he plans to happen to farm after he is gone or person getting it could be in for an unpleasant surprise..

keep going

i think its lackhill farm is the accountant here

KCTK

keep going wrote: »

i think its lackhill farm is the accountant here

Maybe there is more than one!!!!

lakill Farm

Dont ignore the outstanding tax returns. Its best to put all the stuff together and get it sorted, i know its hassle ad expensive until the fines and interests are applied.

Normally the fine is €750 if a single Form 11 tax return isnt returned

Fines could be 100%

Interest 11% PA

But if you actually go to them and state your case, and you get to speak to an understanding revenue person it maybe you get away with a 10% surcharge and maybe up to a few months to sort it.

I had a lad call my colleague a few weeks ago who was 10 years o/s accounts and tax.

PM sent also:D

lakill Farm

im just one in a big pond, , but if anyone ever has any questions do PM me ill try and give the best advice possible.

But one thing you should query your accountants. Have they ever been to your farm? i go to my clients on a 1 - 3 year cycle and "talk the talk" and its so interesting over a cuppa what little bits of advice can be given. No 2 irish farmers are the same, thank god.

reilig

Its funny when you read about something here and then the next day someone asks you a question. A work colleague asked me about tax returns yesterday.

A similar situation. A very small farm, he has been farming for 14 years. Its basically a hobby farm - he has never submitted a tax return. Income per year of approx €6000 in the last 5 years. €4000 per year for the 8 years before that. He has spent all the income every year on fencing, roadways, fertilizer and drainage. Has spent a lot of money on the farm every year - never made a profit - put a good bit of money from off farm income into it.

I told him that it is likely that he could be due a tax refund if he had proper accounts.

He doesn't have all the receipts that he should have - How would he work out things in this case? I suppose his biggest issue is not having receipts for work done.

Maybe that pm would be somewhat relevant to him too.

lakill Farm wrote: »

Dont ignore the outstanding tax returns. Its best to put all the stuff together and get it sorted, i know its hassle ad expensive until the fines and interests are applied.

Normally the fine is €750 if a single Form 11 tax return isnt returned

Fines could be 100%

Interest 11% PA

But if you actually go to them and state your case, and you get to speak to an understanding revenue person it maybe you get away with a 10% surcharge and maybe up to a few months to sort it.

I had a lad call my colleague a few weeks ago who was 10 years o/s accounts and tax.

PM sent also:D

lakill Farm

Reilig - 14 years :rolleyes:.

reilig wrote: »

Its funny when you read about something here and then the next day someone asks you a question. A work colleague asked me about tax returns yesterday.

A similar situation. A very small farm, he has been farming for 14 years. Its basically a hobby farm - he has never submitted a tax return. Income per year of approx €6000 in the last 5 years. €4000 per year for the 8 years before that. He has spent all the income every year on fencing, roadways, fertilizer and drainage. Has spent a lot of money on the farm every year - never made a profit - put a good bit of money from off farm income into it.

I told him that it is likely that he could be due a tax refund if he had proper accounts.

He doesn't have all the receipts that he should have - How would he work out things in this case? I suppose his biggest issue is not having receipts for work done.

Maybe that pm would be somewhat relevant to him too.

reilig

lakill Farm wrote: »

Reilig - 14 years :rolleyes:.

I think the land is in his mother's name since his father died. She hasn't made a return on it since it went into her name. Just to complicate it a bit further for you!

lakill Farm

HAHA - Said the blind man :rolleyes:.

PM sent .

reilig wrote: »

I think the land is in his mother's name since his father died. She hasn't made a return on it since it went into her name. Just to complicate it a bit further for you!

jd06

thanks lakill for your advice, another quick question my uncle was wondering should transfer the farm now or should it be done when he passes
assuming all his paper work was in order!!! which option would be best for all concerned. i know there will be tax implications either way, thanks

lakill Farm

Very welcome.

jd06, it depends on who its been transferred to (to your uncles son or daughter, nephew or niece), green certs, age of the person receiving the farm, value of the land, and there are different farm tax reliefs.

*** make sure at worst case he has it willed to the person, 'just in case'

jd06 wrote: »

thanks lakill for your advice, another quick question my uncle was wondering should transfer the farm now or should it be done when he passes
assuming all his paper work was in order!!! which option would be best for all concerned. i know there will be tax implications either way, thanks

jd06

well lakhill, its being left between me and my brother, we;re both under 35 but im de only one with a green cert, roughly 50 acres of average land with no machinery or housing to speek of, the land andstock has been valued 280k, and its our uncle thats transferring it or willing it to us

lakill Farm

So is that 25 acres each at approx value of €140k or €5,600 per acre?

Sorry for all the details requested, pm me if you require with more details and we can put up a summary later on for others.

jd06 wrote: »

well lakhill, its being left between me and my brother, we;re both under 35 but im de only one with a green cert, roughly 50 acres of average land with no machinery or housing to speek of, the land andstock has been valued 280k, and its our uncle thats transferring it or willing it to us