There are less than two months to get your tax back for the year 2010 and tax experts at www.taxback.com are advising people that they may be letting go their claim to hundreds of euro in tax refunds for a year that saw some of the bigger tax reliefs still in place. Taxback.com’s average PAYE worker tax refund is €840 and the experts contend that while the tax credit for water charges paid won’t be available until 2016, there is still a long list of tax reliefs available to people that could result in savings of hundreds of euro - but many of these go unclaimed every year either due to a lack of awareness or apathy on the part of the taxpayer.
According to Barry Flanagan, tax consultant with www.taxback.com, “Austerity budgets may be over but there’s no doubt that the last few years have seen people pay more in taxes, stealth or otherwise, than ever before. This should really bring it home to people that they absolutely should claim back their entitlements from these years. Although there have been a variety of cuts to tax reliefs in recent years many people are unaware of the fact that you can still reclaim tax as far back as 2010 (if the claim is lodged prior to December 31 ) when the tax reliefs were perhaps more generous.” Taxback.com say that many people still find applying for a tax refund confusing or complicated, resulting in them paying more tax than is necessary and losing out on entitlements. Revenue has made attempts to educate taxpayers as to their entitlements to tax credits and reliefs. However, despite this they believe that there are still millions of Euro going unclaimed each year.
Barry continued, “By way of advice I would begin with telling people to be sure to keep doctors receipts, tuition receipts, and any correspondence from Revenue - all of these will make the tax reclaim process so much easier. Also, there is no need to delay. Obviously you have to wait until after December 31, 2014 to claim any tax refunds for this year. But you can retrospectively look at your entitlements from 2010, 2011, 2012, and 2013.
It’s so much easier than people think. In order to assess an individual’s position you just need your PPS number and some personal details. Depending on their circumstances you may also need copies of certain receipts.
There are a variety of taxes and credits that can be claimed back - relief for 2010 service charges (based on amounts paid in 2009 ) and trade union membership fees can still be claimed although this is the last year to do so. Refunds from people working abroad are also very common and potentially very lucrative - be sure to get claim these if you have either left or returned to Ireland within the last four years.” Taxback.com say three main reliefs have been changed in the last few years - but can still be claimed for:
· While the rate at which tax relief can be claimed on medical expenses has been slashed from 41 per cent back in 2008 to 20 per cent, the relief is still available and can be claimed on most unreimbursed medical expenses incurred and on qualifying non-routine dental expenses.
· The tax credit for tuition fees is still available. For 2010 the max tax credit available was €1,000. A change was introduced in the 2011 tax year where the relief does not apply to the first €2,000 of qualifying fees or, if less, the full amount. Similarly, for part-time courses the first €1,000 is disregarded in respect of each claim. These amounts were increased to €2,750 and €1,375 respectively for 2014/2015. The maximum limit on qualifying fees remains capped at €7,000 so the maximum credit available has been effectively reduced from €1,000 to €850.
· The rent credit has been reduced to €160 for a single person in the year 2014 (€320 for married persons ) and the tax credit is set to be phased out by the end of 2017. However, taxpayers still have an opportunity to claim the rent credit back to 2010 (for 2011 and subsequent years the relief will only apply if you were in rented accommodation on 07/12/2010 ) and should take advantage of this.
Barry went on to say, “Overpaid tax is also an area which results in many people receiving much welcomed refunds from the Revenue. This can occur inadvertently - especially if you have changed employment during the year. Individuals should look back on their income levy and USC payments to ensure that they have not overpaid such payments in prior years and should claim a refund before it’s too late.”
Other tax reliefs and incentives which have remained available are:
· Rent a room relief
· Flat rate expenses for certain trades and professions
· Exemption on income earned from caring for children in your own home
· Employment and Investment incentive (EII ) scheme
· Film relief is still available
· Capital losses are still allowable
· In 2016, up to 20 per cent of the amount paid for water charges in the prior year can be claimed as a credit but this is capped at €100 per household.
Barry concluded, “In terms of timing - the length of time it take to get a refund is really dependent on how much information the person can give the Revenue from the onset - receipts, etc. Generally it takes anywhere from two to six weeks to claim a refund.”