Borrowing 110k to pay tax

D

DeeKie

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I have to pay 150k in tax in November and I won't have it. How easy is it to borrow this sort of money? I am leaving a partnership and while i have this money in a partnership account, and more, they don't have to pay it to me until 2018. I am not sleeping and don't know what to do. I'm a very cautious person but not good at financial planning. I'm leaving my job, the current partners are not happy, do I can't see them agreeing to acceleration. Help. Does anyone loan this sort of money for this?
 
You'll have to explain the situation to Revenue - they'll charge you interest for the late payment of the tax. The rate is 0.0219% per day for income tax.
 
I think you misunderstood my question. I don't want to default. Is there a way of borrowing funds from a bank or similar?
 
Hi Dee

Don't look at it as default as such.

Revenue is used to such situations. You will be making a full income tax return on time. That is one of their key requirements.

If you have plenty of equity in your home, Pepper might give you a mortgage to pay your tax. But, it would be a very expensive way to solve a short term problem.

So talk to Revenue. They will understand. They charge you 8% a year. So if you pay it three months late, it will cost you €3k. If you pay it 6 months late, they will charge you €6k.

Not paying tax on time is not default. You will not appear on the list of tax defaulters. Your ICB record will not be affected.

Go back to sleep and don't worry about it.

Brendan
 
Banks will lend if you need to borrow for tax. You have to repay over 10 months.


As long as you file on time, you'll be ok regarding the Revenue. Loads of people don't have the income to pay the full amount.

Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)
 
Thanks everyone. I feel much better. I will see if I can get a better facility at a better rate but I'm most pleased to know I can manage it.
 
Deekie three accountants have explained to you that you're not breaking the law. They know what they are talking about. Revenue are very approachable. Have a chat with them and you'll see that there's no need for you to worry about this.
 
DeeKie said:
Also I would be ashamed to break the law.
Click to expand...

Do you always go 50kph in a 50 zone?

If you don't have the money, don't worry about it. File your return and talk to the revenue to arrange a payment plan. It happens all the time. And no one needs to know.

Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)
 
Deekie, all the advice above is sound.

But can I ask what gave rise to the tax liability - leaving the partnership? I have a fear that as you may not have received advice re the paying of interest etc on the liability, you also may not have advice on the transaction/circumstances giving rise to the liability.

(If you have had advice and are happy; ignore my comments)
 
Deekie, absolutley file the return and then discuss payment method with Revenue. They are very accommodating. Also, I don't know if borrowing to pay debt is a good idea or if banks will do this.
 
Banks have traditionally been highly reluctant to lend money for tax bills as they always fear that there are further undisclosed tax liabilities down the line which would scupper repayment capacity.

If the OP has a tax bill as high as €150k, they should in the normal course of events be getting some level of professional advice on the issues giving rise to it and financing the payment of the liability should be part of that.
 
Setanta12 said:
I have a fear that as you may not have received advice re the paying of interest etc on the liability, you also may not have advice on the transaction/circumstances giving rise to the liability.
Click to expand...

Very good point.

Even if it is an ordinary tax liability, at this level you should be taking tax planning advice anyway.
 
I'd echo the good advice given here. Revenue will facilitate a payment plan at a rate of 8%; this is not a default or illegal in any way. But separately, I'd seek professional advice regarding the genesis of the liability.
 
Thanks to everyone. Basically it's ordinary tax. I can't wait to get out of this partnership. I worked very hard there but it's an awful culture. I'm moving to a top 3 firm. Hopefully it'll be better.

You've all been brilliant. I was really worried about it all. Not sleeping. Now I just need to figure out if there's a way of beating Revenues interest rate through another lender. I'll start with Bank of Ireland as they know I've been a good bet for years and it's a cash flow issue which won't last long.

Thanks again. Thanks
 
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