Ultimately the obligation for submitting a return/making the claim for repayment has to rest with the taxpayer.
Slightly off to one side on this one Graham, but did the guy not have pink slips from the principal? If not then the principal is surely guilty of an offence...
A bit off thread but a colleague told me of a case recently. Taxpayer was owed a refund of tax for 2005 , they also owed Revenue a balance for 2004 and were further owed a refund of tax for 2009. The refund for 2005 was disallowed under the 4 year rule. The liability for 2004 ( also outside the 4 years but irrelevant ) was collected by reducing the 2009 refund and the taxpayer got the balance. Try explaining the logic of that to the taxpayer he said to me.
Section 865 TCA deals with repayments of taxes ! not offsetting taxes !
you should of asked for the 2005 refund to be offset against the 2004 liability first of all and then you would of getting the refund for 2009.
if you appeal this assessment and tell the revenue that you have studied section 865 and no were does it mention not allowing offsetting taxes ie the 2005 refund then the revenue would have to do this as i have done it with a few clients and they have allowed it
A query on this issue which I would be grateful for advice on:
In April 2010, myself and my wife received a series of balancing statements for the years 2006 through to 2009 whereby we were notified and reimbursed for overpayment of income tax in these years. Upon enquiry with our local tax office, we were advised that a tax allowance had erroneously never been credited to my wife when we got married which resulted in the overpayments of tax and subsequent reimbursement.
I know that Revenue normally does not examine matters more than four years previous to the current tax year. However, given that the tax allowance error was made in the first jointly assessed year, we could not have been aware of the mistake and as such assumed that our tax credits and allowances were correct. In effect we had no correct reference with which to compare the amount of tax paid.
We got married in 2002 and as such think we overpaid tax for 2003 to 2005.
Sorry for being so longwinded but does anyone think that Revenue will entertain us by asking to go back so far in time?
Section 865 TCA deals with repayments of taxes ! not offsetting taxes !
if you appeal this assessment and tell the revenue that you have studied section 865 and no were does it mention not allowing offsetting taxes ie the 2005 refund then the revenue would have to do this as i have done it with a few clients and they have allowed it
On reading the above, it seems to me that the prohibition relates solely to Revenue making a repayment. If a taxpayer had overpaid more that 4 years ago, what's to stop them asking the Revenue to offset the overpayment against their future tax liability e.g. by increasing their tax credits for the current year if they are a PAYE taxpayer?
On reading the above, it seems to me that the prohibition relates solely to Revenue making a repayment. If a taxpayer had overpaid more that 4 years ago, what's to stop them asking the Revenue to offset the overpayment against their future tax liability e.g. by increasing their tax credits for the current year if they are a PAYE taxpayer?
My suggestion that you might be able to offset was based more on hope than expectation. I imagine that if there a loophole that big in the legislation, people would have figured out how to exploit it by now.
However, I think a strong case can be made for offsetting overpayments against prior year underpayments and I would be interested to see how that pans out.
Section 865 TCA deals with repayments of taxes ! not offsetting taxes !
if you appeal this assessment and tell the revenue that you have studied section 865 and no were does it mention not allowing offsetting taxes ie the 2005 refund then the revenue would have to do this as i have done it with a few clients and they have allowed it
I don't mean to be smart Homer, but those two paragraphs totally contradict each other - yes, surely if there was a loophole it would by now be widely exploited, and would have been closed off. This would suggest there is no case for offsetting overpayments, full stop. Revenue do offsets as a matter of mutual convenience, but they are in fact repayments and subject to S.865 (just my understanding, totally open to correction!)
Going from Ants post above there would appear to be some wriggle room on this with at least some tax districts.
As far as I know there is no mechanism by which a persons tax credits can just be adjusted upwards.
We're talking about a computer system with controls in place, for example to ensure that staff can't just give their favourite uncle an unspecified €10k tax credit!
If you look at your cert of tax credits each credit is specified, and make up a total.
So there is no override to just manually increase a customer's tax credit next year.
Of course, the credits can be manually reduced, but that's for the taxpayers benefit, where it facilitates collection of an earlier underpayment...
Credits can actually be increased by putting on "EXPENSES". Any figure can be input, normally expenses would be quite small (eg nurses about eur700) but are allowed at top rate of tax so putting on expenses of 10,000 would reduce the tax bill by 4,200. That would be a seriously favorite uncle. Obviously the Revenuer who did this would be in serious trouble.
Sybil
Credits can actually be increased by putting on "EXPENSES". Any figure can be input, normally expenses would be quite small (eg nurses about eur700) but are allowed at top rate of tax so putting on expenses of 10,000 would reduce the tax bill by 4,200. That would be a seriously favorite uncle. Obviously the Revenuer who did this would be in serious trouble.
Sybil
I don't mean to be smart Homer, but those two paragraphs totally contradict each other - yes, surely if there was a loophole it would by now be widely exploited, and would have been closed off. This would suggest there is no case for offsetting overpayments, full stop. Revenue do offsets as a matter of mutual convenience, but they are in fact repayments and subject to S.865 (just my understanding, totally open to correction!)
I don't see how the two paragraphs contradict each other. In the first paragraph, I was talking about offsetting overpayments against subsequent underpayments. In the second paragraph, it was against prior underpayments.
I think that a legitimate argument could be made for someone who owes money to Revenue being allowed to regard payments subsequently made to Revenue as being made towards the arrears that they owe. It's a fairly limited case and does not necessarily open the floodgates for taxpayers to backdate indefinitely.