06 November 2009

Reduced frequency of tax returns and payments for Employers PAYE/PRSI and VAT – extension to newly eligible customers

A reduction in the frequency of tax returns and payments for smaller businesses was introduced during 2006 and 2007:

• Businesses making total annual PAYE/PRSI payments of up to €28,800 became eligible to make their payments on a quarterly rather than monthly basis;
• Businesses making total annual VAT payments of less than €3,000 became eligible to file VAT returns and make their payments on a 6 monthly basis; and
• Businesses making total annual VAT payments of between €3,000 and €14,400 became eligible to file VAT returns and make their payments on a 4 monthly basis.

These simplified arrangements are being further extended to include newly eligible customers from 1 January 2010.

What are the benefits to businesses?

The benefits for qualifying businesses are two-fold:

• Improved cashflow by only having to make payments at the end of each quarter, 4 monthly period or 6 monthly period as appropriate.
• Reduced costs of administration through less frequent filing of tax returns.

How will these changes be implemented?

Revenue is now in the course of writing to each eligible business advising them of the reduced frequency of tax returns and tax payments that will apply to them with effect from 1 January 2010.

There is no need for businesses to take any action to benefit from these changes. The letter they receive will confirm that the reduced payment and filing frequency is being automatically extended to them from 1 January 2010

For businesses to which the simplified arrangements for VAT returns and payments apply, a copy of the letter will also be sent to the agent or tax practitioner on record. We are unable to provide a copy of the letter issued to businesses to which the simplified arrangements for PAYE/PRSI returns and payments apply.

Source: Revenue Commissioners. www.revenue.ie. Copyright acknowledged.