Underpayment of Tax in 2005 - Revenue's Fault

[FiveFingers]

We received a balancing statement for 2005 after we discovered my husband wasn't claiming credits for trade union subscriptions. To our shock, Revenue calculated that we had underpaid tax in that year to the tune of €2164.67 .

I tried to figure out what went wrong that year and after much digging, cursing and hair-pulling, I realised that we changed over to joint assessment in that year and I transferred all my Personal Tax Credits to my husband. However, it appears that Revenue only informed my husband of this and his employer and no amended tax certificate was sent to me or, more importantly, my employer. Revenue can't confirm this because they only keep notifications of tax credits from 2006 onwards but the person I was talking to is pretty sure that's what happened.

Is there any recourse in a situation like this? I realise that the tax is still due but I'm not happy about the fact that it's Revenue's fault that we're in this situation .

FiveFingers

 

[papervalue]

We received a balancing statement for 2005 after we discovered my husband wasn't claiming credits for trade union subscriptions. To our shock, Revenue calculated that we had underpaid tax in that year to the tune of €2164.67 .

I tried to figure out what went wrong that year and after much digging, cursing and hair-pulling, I realised that we changed over to joint assessment in that year and I transferred all my Personal Tax Credits to my husband. However, it appears that Revenue only informed my husband of this and his employer and no amended tax certificate was sent to me or, more importantly, my employer. Revenue can't confirm this because they only keep notifications of tax credits from 2006 onwards but the person I was talking to is pretty sure that's what happened.

Is there any recourse in a situation like this? I realise that the tax is still due but I'm not happy about the fact that it's Revenue's fault that we're in this situation .

FiveFingers

I think the above is more common than people realise. Lots of people under paye/prsi have got away with it by not filing a tax return. I am certain if revenue did a balancing statement on all married people over the last 10 years they would recoup a large amount.

In your situation i dont think their is anything that can be done. The revenue certaintly will not take any blame.

Maybe agree to pay over 5 or 6 cheques. or reduce credits going forward

sorry for your trouble.

My advise to any paye worker is to double check their tax computation before filing a return. To a cost benefit analysis of what revenue if any you would get

 

[dereko1969]

did you not notice at the time that you weren't paying any extra tax? your tax bill should have gone up substantially at the time.
having said that i would seek to pay revenue over the course of the year or even into next year. they were also at fault.

 

[Bronte]

You will not get out of paying tax owing. But you may be able to negotiate how and when you pay it.

 

[FiveFingers]

Thanks for the responses. I'll pay them in full now. I don't like the idea of being in debt to the Revenue over a period of time.

 

[simplyjoe]

In my practice we monitored the PAYE returns/appraisals that we done over a 12 month period. In 85% of cases a refund was due. In most of these the refunds were over €500. In some thousands were repaid. Our largest refund was €16k over the 4 year period.

 

[allthedoyles]

I think the above is more common than people realise. . The revenue certaintly will not take any blame.

Maybe agree to pay over 5 or 6 cheques. or reduce credits going forward

As far as I know , the tax office will reduce your tax credits automatically over the next few years to re-coup this tax liability, unless you inform them otherwise ..............

Now that you innocently decided to claim for Trade Union subscriptions in 2005 and owed over 2k ..............mkae sure have also claimed all your other paye entitlements for that year .........check if these should be included :

• Medical expenses ( all the family )
• service charges ( wheelie bins )
• Home improvement interest relief
• Work expenses ( both of you )