# Penalties and interest due on late payment of CGT



## rabbit (15 Nov 2007)

A friend has been billed by the Revenue commissioners for late payment of capital gains tax. The tax was paid a year late, ( it was paid as soon as the taxpayer got the money and was in a position to pay ) but the taxpayer has been billed a high penalty charge ( about 10% I think ),*and *a high interest charge ( over 10% I think ) *and* the years interest on the penalty - even though the penalty was paid promptly( within a few weeks of being notified of the penalty. Also the revenue had the cheque for a week before they lodged it...is the revenue commissioner entitled to charge interest to the day it hit the taxpayers account ?
His accountant said some people escape having to pay penalties + interest. Anyone any experience here?


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## z103 (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*

Who makes up these charges and interest rates? Where can I get 10% on my money?

This attitude doesn't surprise me. How else are we going to pay for berties wages?


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## mf1 (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



rabbit said:


> A friend has been billed by the Revenue commissioners for late payment of capital gains tax. The tax was paid a year late, ( it was paid as soon as the taxpayer got the money and was in a position to pay ) but the taxpayer has been billed a high penalty charge ( about 10% I think ),*and *a high interest charge ( over 10% I think ) *and* the years interest on the penalty - even though the penalty was paid promptly( within a few weeks of being notified of the penalty. Also the revenue had the cheque for a week before they lodged it...is the revenue commissioner entitled to charge interest to the day it hit the taxpayers account ?
> His accountant said some people escape having to pay penalties + interest. Anyone any experience here?



I rather think that after the scorn you've hurled at the Accountants who give general advice freely on the Board, you'll be lucky to get any sensible help with your query. Just an observation.  

mf


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## bacchus (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



rabbit said:


> A friend has been billed by the Revenue commissioners for late payment of capital gains tax. The tax was paid a year late, ( it was paid as soon as the taxpayer got the money and was in a position to pay )


 
Would you mind to clarify the above please...
how can one get a CGT bill while not having got the money , e.g. no gain yet, especially considering that GCT is a self-assessment tax afaik? 
it is that the "gain" money had been used for something else before the bill arrived and therefore no available anymore for paying it?


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## rabbit (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



bacchus said:


> Would you mind to clarify the above please...
> how can one get a CGT bill while not having got the money , e.g. no gain yet, especially considering that GCT is a self-assessment tax afaik?
> it is that the "gain" money had been used for something else before the bill arrived and therefore no available anymore for paying it?


 

The capital gain was on an asset someone had. The asset was gifted to someone else.  No money changed hands but yet Capital Gains tax had to be paid by the initial owner.   CGT has been paid - its just that the scale of the penalties and interest seem excessive, especially when his accountant never warned him of this.  Also there are reports of some people who have escaped being charged penalties + interest on late payment of some amounts.  It seems a bit unfair.


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## ubiquitous (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



mf1 said:


> I rather think that after the scorn you've hurled at the Accountants who give general advice freely on the Board, you'll be lucky to get any sensible help with your query. Just an observation.
> 
> mf



Your observation is 100% correct as far as this poster is concerned.


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## rabbit (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



mf1 said:


> I rather think that after the scorn you've hurled at the Accountants who give general advice freely on the Board, you'll be lucky to get any sensible help with your query.


 
I did not hurl scorn at "accountants who give advice freely on the board" ....lol...in fact I was not aware who - if any - of the other posters were accountants. If they were so busy, at this tax deadline time of the year ( yesterday + today is a tax deadline) , what are they doing posting on here ? Like leghorn, I merely gave you some of my experience of the accountany profession , as someone who has been invoiced many thousands of euro by them over the past number of years, and I make the suggestion that it is worth shopping around.

In actual fact I did not expect any "sensible help" from an accountant - this is what one firm was paid to do but they failed. I wrote that "some people seem to escape having to pay penalties + interest. Anyone any experience here?"
​


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## rabbit (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



leghorn said:


> Who makes up these charges and interest rates? Where can I get 10% on my money?
> 
> This attitude doesn't surprise me. How else are we going to pay for berties wages?


 
Spot on leghorn.   No wonder Bertie can pay himself more that the UK President, UK Prime Minister or the P.M. of France gets paid.
Its not just 10% - the penalties and interest total over 20% just for being a year late.


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## Satanta (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



leghorn said:


> Who makes up these charges and interest rates? Where can I get 10% on my money?


I assume, I'm not an accountant so can't give a professional opinion  , that the figures have been selected to provide a deteriant to future late payments. If people think that they'll be hit with 20% additional costs (or greater depending on how late) it should act to ensure that more people complete the payments on time (and save vast sums and time for Revenue on the identification of late payers or tax evadors).

This doesn't help the OP identify how others have achieved having the penalties and interest waived, but possibly might explain some of the thinking behind the additional costs.


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## Stifster (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



rabbit said:


> Its not just 10% - the penalties and interest total over 20% just for being a year late.


 
Only a year, yeah i see your point, they should have given him 5....


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## mf1 (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*

"Its not just 10% - the penalties and interest total over 20% just for being a year late."



Just for being a year late? You are deffo trolling. 

mf


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## rabbit (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



Stifster said:


> Only a year, yeah i see your point, they should have given him 5....


 
The taxpayer physically had no money to pay before he did so.  He was not trying to evade paying the CGT, he paid as soon as he could.    He did not expect to be hit with a bill for over 20%.


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## Clarkey (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



rabbit said:


> The taxpayer physically had no money to pay before he did so. He was not trying to evade paying the CGT, he paid as soon as he could. He did not expect to be hit with a bill for over 20%.


 
He could have filed the return on time and avoided the 10% surcharge. Then he would only have been caught for the interest of approx. 10% per annum


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## Ravima (15 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*

the receipient should also make sure that their Capital Aquisition Tax position is in order.


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## Bronte (16 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*

OP, I have had dealings with the revenue whereby they waived interest & penalties.  I won't go into the details here but I know for sure in the past they had some discretion.  This may not be true nowadays.  But just look at Bertie/Haughey et al to see how they seem to not pay fair penalties/interest etc.  I also believe accountants and revenue have a kindof 'friendly' relationship.  This is why it is often beneficial to have an accountant.    

Not having the money is not a reason not to pay a tax.  The money could have been borrowed at much less cost then the interest charged by the revenue.  Or the asset could have been sold to pay the tax.  

Can you clarify something for me please.  Did this person have an accountant fill out the Capital Gains form for them.  And at what stage in the process was this done as I find it hard to believe an accountant did not point out there would be penalties & interest for not filing on time.


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## Stifster (16 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



rabbit said:


> The taxpayer physically had no money to pay before he did so. He was not trying to evade paying the CGT, he paid as soon as he could. He did not expect to be hit with a bill for over 20%.


 
He chose to make the gift.


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## rabbit (16 Nov 2007)

*Re: Penalties and interst ue on late payment of CGT*



Bronte said:


> Can you clarify something for me please. Did this person have an accountant fill out the Capital Gains form for them.


 
Yes.  The person was very elderly, had some health problems and like most of us did not understand all the ins and outs of tax legislation.   He left this tax issue to the accountant, who incidentally charged a number of thousand for filling out and submitting the cpt form.


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## Bronte (16 Nov 2007)

Rabbit are you saying the accountant was late sending in the CGT form?  At what stage in the process did the elderly person call an accountant.  Can you give dates please as it's a little bit confusing to me.   Also is there a possibility that the elderly person was told that there would be penalties if late with payment but they chose not to do so as they didn't have the money to do so?


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## rabbit (16 Nov 2007)

Bronte said:


> Rabbit are you saying the accountant was late sending in the CGT form?
> At what stage in the process did the elderly person call an accountant.


 
Nobody else sent in the CGT form but the accountant.   The accountant was responsible for filling out the CGT form and sending it in.    I do not know if the accountant was late sending it in or not.   Does the penalty only apply if the form is submitted late ?   I thought the penalty was for late submission of the money, not for the late submission of the form.   The elderly person called / appointed the accountant early in the tax year in question, well before the deadline


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