Revenue have announced that they will be writing to 40,000 PAYE taxpayers requesting them to complete a Form 12 to declare any additional income outside of their regular PAYE income. Whilst this is nothing new, it may be the first time many of you have even heard of a Form 12, let alone filled one out!
So, I thought I’d answer some of the commonly asked questions about Form 12’s to help guide you through the process.
Firstly, let’s start with the basics – what is a Form 12?
The Form 12 is for people who have other income outside of their main PAYE income. This form is used to declare this additional income to Revenue for tax purposes if your additional income is less than €3,174.
If your additional income is more than €3,174, you will be required to do a self-assessment via the Form 11.
Why did I receive one?
This could be for a variety of reasons, but in this current drive, Revenue are targeting people with additional income from bank deposits, dividends and rental income. They are also including teachers doing grinds and PAYE workers moonlighting as taxi drivers, according to the Irish Independent.
Revenue receive their information from a variety of sources, but mainly they are tipped off by information from banks about deposits and details of pension payments from Social Welfare.
What type of income do I include on the Form 12?
You should include any additional income outside of your PAYE income on the Form 12 – so long as it doesn’t exceed €3,174. This can include income such as
- Income from a trade or profession – e.g. farming, labour, freelance work
- Dividend income
- Rent income
- Foreign income from rentals or dividends
It is important to note that there are different rules that apply for how these various income types are taxed – which can get a little tricky.
For example, with rental income, it can be difficult to ascertain whether some expenses can be claimed in full each year, or if should they only be claimed over an 8 year period as capital allowances. That’s where an expert can help to make sure you claim everything that’s right.
I haven’t received a Form 12, but have additional income. Should I ignore it this year?
No! Just because you haven’t been flagged on Revenue’s system this year, doesn’t mean they won’t catch up with you in the future. Revenue are becoming more and more strict with this sort of thing, so it’s best to get into a good habit now.
The onus is on you to declare your additional income – and not receiving a form from Revenue is NOT an excuse.
What is the deadline for completing the Form 12?
The deadline for declaring additional income in 2013 is 31st October 2014, so there’s still plenty of time.
Can I do it myself?
Yes – you can. But it’s not as straightforward as Revenue would like you to believe. The form will not explain what you can claim or need to declare.
If you understand your taxes and what can be claimed and declared, the new Form 12 will help you perform what you are already doing better. To submit online, you can access the form via the “eForm 12” link on Revenue’s website – using your PAYE Anytime PIN to gain access.
However, the new online system does assume a certain amount of tax knowledge. Trying to muddle your way through could result in your entering something wrong against your tax record. So, it can help in these situations to have an expert cast their eye over the details.
Is this all I need to do to get my taxes balanced?
No. Although, most of the common tax credits can be claimed through the Form 12, it is still not possible to claim tax credits for some expenses, such as medical expenses and tuition fees.
Where can I get help?
If you have small amounts of extra income and wish to declare it, there’s lots of places you can get help!
1. Contact Revenue
You can always contact your local Revenue office if you have any questions – and while away some time listening to their lovely hold music!
2. Ask for advice
Post your questions here and we will help you out the best we can.
3. Get someone else to do it!
If you just want to hand it all over for someone else to worry about, then you can apply here and we’ll help you get it sorted.
Written by John O’Connor
I’m the brains trust behind Red Oak Tax Refunds and started the company in 2009 because I thought there had to be an easier option for people wanting their taxes reviewed. My job is to make sure our team of Tax Agents have the latest information to help ensure our customers get the best possible refund outcome. I love numbers, but realise not everyone does!