A question of responsibility

Carbon125

Is it not up to the accountant (rather than me) to sign the Form 11 that he has prepared for me?

jem

No. Its your return of Income.

The_Bot

Carbon125 wrote: »

Is it not up to the accountant (rather than me) to sign the Form 11 that he has prepared for me?

If it's your Form 11 then it's you who have to sign it. It's your tax return no matter who prepares it. From Revenue's perspective you are 100% responsible for the contents of the return and you cannot delegate ultimate responsibility for this to a 3rd party.

If the accountant was negligent in the preparation of the return, then you would take a case against him but does not change your own primary responsibility for what goes in your own tax return.

The accountant is following standard practice by having the client sign his own return. He is correct in asking you to do so.

Carbon125

The_Bot wrote: »

If it's your Form 11 then it's you who have to sign it. It's your tax return no matter who prepares it. From Revenue's perspective you are 100% responsible for the contents of the return and you cannot delegate ultimate responsibility for this to a 3rd party.

If the accountant was negligent in the preparation of the return, then you would take a case against him but does not change your own primary responsibility for what goes in your own tax return.

The accountant is following standard practice by having the client sign his own return. He is correct in asking you to do so.

Thank you. The accountant's negligence has resulted in back tax to be paid to the tune of five figures. It is not clear from Revenue's letter if the demand includes interest or not. Interest is not expressly mentioned, does that mean they have waived the interest?

Carbon125

I find it utterly absurd that I have to sign a tax form that I have not prepared myself. In effect, I am being asked to check up on the work my accountant did and indemnify him against against consequences arising from his mistakes - while opening myself to possible civil penalties and criminal prosecution!

If I was in a position to check up on the accountant's work I would obviously not need an accountant in the first place!

Lockedout2

Can you clarify what the issue is!

The tax code requires self assessed taxpayers to file a tax return. It is their responsibility to do so. They are also responsible for preparing the information that goes into the return. That only makes sense.

The issue you have is that the accountant made a mistake. This can happen. Depending on the nature of the error you may be able to recover something through their PI.

Was the error in the accounts or on the tax return?

Were for example your drawings included in wages? Well you owed the tax anyway but your accountant should cover interest and penalties as they should know better!

Carbon125

Two issues. The first one is clarified now: the taxpayer has to sign the Form 11. Grand. (Well, absurd actually. The taxpayer should be held responsible for the accuracy of the information he gives to his accountant. The accountant should be held responsible for processing this information correctly. Two distinctly separate steps and they should not be conflated.)

Issue two. It is not clear from the Revenue demand letter if their amount includes interests or penalties. Yes, I can ring Revenue, but perhaps one of the posters here can tell me what Revenue's practice is in this regard? Before I go down the rabbit hole...

If interest or penalties are indeed just included without being itemized, then I will need to do the next step, get the actual figures from Revenue and bill my accountant accordingly.

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(The error was made by the accountant on the Form 11. Not even something I would have been able to spot by the way since he only ever sent an excerpt of a few pages which he then wanted signed. When I downloaded a Form 11 from the Revenue website it had 28 pages, not just the 4 or 5 I got to see.)

Lockedout2

But what was the error?

The ROS offline for is approximately 4 or 5 pages long it only contains the sections with information on them.

Revenue don't usually just write to taxpayers saying your return is wrong! And you owe us €10k.

The write to the taxpayer saying that they intend to audit the return and the taxpayer should review the return to ensure its accuracy.

Carbon125

Lockedout2 wrote: »

Revenue don't usually just write to taxpayers saying your return is wrong! And you owe us €10k.

Well, that is exactly what happened.

Although the accountant worked for both me and for my partner and therefore knew exactly that we were living together, ticking or not ticking a checkbox somewhere meant that he had declared us as not living together.

With two kids between us the upshot was that (over the course of several years) my partner, employed, had received tax credits she was not entitled to, amounting to over 7k. And I, self-employed, suddenly owed 4k to Revenue.

Lockedout2

So in effect your accountant claimed that you were a lone parent in your 2013 and 2014 tax returns?

You, as is your option, did not review the computation or return prior to its submission.

What work did your accountant do for your partner of they are an employee?

Carbon125

Lockedout2 wrote: »

So in effect your accountant claimed that you were a lone parent in your 2013 and 2014 tax returns?

Apparently.

Lockedout2 wrote: »

You, as is your option, did not review the computation or return prior to its submission.

Excuse me???


Back to my second issue.

It is not clear from the Revenue demand letter if their amount includes interests or penalties. Yes, I can ring Revenue, but perhaps one of the posters here can tell me what Revenue's practice is in this regard? Before I go down the rabbit hole...

Sophia91

Carbon125 wrote: »

Apparently.


Excuse me???


Back to my second issue.

It is not clear from the Revenue demand letter if their amount includes interests or penalties. Yes, I can ring Revenue, but perhaps one of the posters here can tell me what Revenue's practice is in this regard? Before I go down the rabbit hole...

People might be more willing to offer advice and help you if you weren't so aggressive when they do!!

The_Bot

Carbon125 wrote: »

Well, that is exactly what happened.

Although the accountant worked for both me and for my partner and therefore knew exactly that we were living together, ticking or not ticking a checkbox somewhere meant that he had declared us as not living together.

With two kids between us the upshot was that (over the course of several years) my partner, employed, had received tax credits she was not entitled to, amounting to over 7k. And I, self-employed, suddenly owed 4k to Revenue.

Right, let's break this down.

Firstly, there is no absurdity with your liability to Revenue even where someone else prepares your tax return. The contents of your return is your responsibility alone. You may choose to delegate the preparation of the return but that does not in any way reduce your responsibility for the contents of the return. It is your choice to hire an accountant and your choice to accept in good faith the return he/she prepared on your behalf. You shouldn't confuse your responsibility to Revenue as a taxpayer and the accountants responsibility to you as a professional service provider. These are mutually exclusive responsibilities.

Secondly, if the accountant acted negligently then you should have recourse against him for any loss you suffered. However, you must suffer a loss that would not otherwise occurred. Back taxes correctly owed are not such a loss, you would have had to pay them anyway whether in the past or now. Interest and penalties would potentially be such a loss, provided they are a consequence of negligent acts by the accountant. To clarify, I'm not a lawyer so the ins and outs of tort law is not my area of expertise but this is broad position.

Thirdly, if Revenue assess interest and/or penalties you will be in no doubt that they are. What should happen is that you will get revised notices of assessment/self assessment letters for the tax years concerned. These will detail the amount of taxes owed and may be accompanied by a letter but the assessment is where the action is at. If there is any interest/penalties levied at that time, the assessment should clearly state this. If not, Revenue can seperately assess interest/penalties via letter. If it were me, while I would quantify my potential exposure, I would not be ringing Revenue regarding interest and penalties. They have the right to levy these but it is not incumbent on the taxpayer to offer payment of interest/penalties (outside of a formal audit/investigation process). Of course the outstanding tax liability itself should be settle, assuming correctly owed

CIARAN_BOYLE

Carbon125 wrote: »

Two issues. The first one is clarified now: the taxpayer has to sign the Form 11. Grand. (Well, absurd actually. The taxpayer should be held responsible for the accuracy of the information he gives to his accountant. The accountant should be held responsible for processing this information correctly. Two distinctly separate steps and they should not be conflated.)

(The error was made by the accountant on the Form 11. Not even something I would have been able to spot by the way since he only ever sent an excerpt of a few pages which he then wanted signed. When I downloaded a Form 11 from the Revenue website it had 28 pages, not just the 4 or 5 I got to see.)

Two issues here. One the 4-5 pages is all that contains data as he uses a software package to produce an extract. A longer version would just have blank space. If its on your form 11 filed its on what you signed.

The second is that clients can and do often sit accountants down and go line by line through the material. If you don't understand the form ask for backup of all figures. After all the responsibility remains with you so question your accountant.