In trouble with revenue, undeclared rental income

[poppie]

Oh dear folks this is exactly why I am not ashamed to confess that I’m clueless about tax. I find it all very scary and just way beyond my knowledge! Not to mentioned the figure of 4k !!! And once again WHAT IS NPPR!?? I’ve never heard of this! Don’t know about ye but I certainly don’t have that kind of money lying around!
I started sifting through all my paper work this morning. I had a closer look at TRS bill, and yes its backdated 2011 and 2012. Would it count in my favour if I ring TRS today ask them to back date a bill to 2009 and at least have that in place by the time I figure out what to send into revenue. In regards with property tax at least that is the one thing I did pay.
The letter from revenue is dated 29th of May so if I were to respond within the 14day period requested that only leaves me till next Wednesday the 12th of May to sort this out. That’s only 6 working days. And as of yet I have no accountant to help me with this. Are you sure I can’t twist your arm on this T McGibney??
I did actually ring my current accountant this morning to inform him of the revenue letter. I also explained very politely that I feel he has given bad advice in the past and that I feel I should seek the help of a tax consultant who deals with resolving revenue disputes and can he recommend anyone? His advice....sure just write a letter stating all your rental income, expenses, interest etc and they will do a tax assessment based on that. He said there are some guys in Dublin that could help but they will charge me a lot of money and will give me exactly the same advice as he did. He was kind enough to say not to worry Revenue just “tying up loose ends”. When questioning him about PRTB, he suddenly had a client at the door and he recommends I research it online and get back to him. So there you go!
Off course as my anxiety spirals out of control here the next thing I’m worried about is my maternity benefit, will I even get any!
I'm trying my best to be pro active about his. I have started doing up statements of rental income, expenses ect so that when I do meet with an accoutant at least I have figures (backed by paperwork) to work from. Once again I put in a desperate plea for a recommended good accountant, anyone??

 

[T McGibney]

The letter from revenue is dated 29th of May so if I were to respond within the 14day period requested that only leaves me till next Wednesday the 12th of May to sort this out. That’s only 6 working days. And as of yet I have no accountant to help me with this. Are you sure I can’t twist your arm on this T McGibney??

If you'd like to talk today, email me at [email protected] and I'll send you my mobile number. Tried to PM you but it didn't work.

 

[Bronte]

Poppie, your accountant should be sued. Suggesting you just pop a letter off to revenue with your income and expenses and letting them figure it out, this is very odd behaviour. And referring you to the internet to find out about the PRTB.

You don't need a tax consultant, just a competant accountant who knows how to do tax returns for landlord and knows how to deal professionally with revenue. A lot of people don't need an accountant but you certainly do.

Firstly you've to stop stessing about the time limits. You need to take things easy and one step at a time. Because of your condition here's my best shot at the steps you have to take

1. Backdate PRTB registration - priority no 1.
2. Forget about the NPPR for now, ditto the household charge
3. None of this will affect your maternity benefits, you're entitled to them and that's something not to worry about.
4. Calculate all rent back to Nov 2009, amounts per year
5. Cancel TRS with revenue
6. Write a letter to revenue, explain you are pregnant and request an extension of 2 months. This shouldn't be a problem.
7. Buy a binder, put all receipts into it, per year. Go back through your bank accounts and cheque book and see what you purchased for the property.
8. Calculate what value you are putting on the fixtures and fittings, to figure our your W&T allowance (wear and tear)
9. Read here on AAM the threads about landlords and rental income
10. Calculate how much interest you paid on the mortgage for each year since 2009.
11. If you do up a very basic income, mortgage interest, expenses and W&T for each year it will be easy to roughtly calculate if you're going to be in much hot water or not. Post the rough figures on her, per year.
12. Calculate how much TRS you claimed since 2009 (see your mortgage bank statement)
13. What date in November was the property rented from.

Just curious, how much did you pay your accountant to do your returns?

Google NPPR, it's the non principal private residence tax, the problem with it is that the cost of it is relatively low, it's big kick is the penalties for not paying on time. But for the current problem with revenue you don't have to deal with that right now.

 

[Nige]

write to the Revenue stating that you will be making a qualifying disclosure and you are therefore seeking an additional 60 days to respond to them.

Did the letter you received state that this is a Revenue audit? or mention audits?

 

[T McGibney]

You don't need a tax consultatant, just a competant accountant who knows how to do tax returns for landlord and knows how to deal professionally with revenue. A lot of people don't need an accountant but you certainly do.

Firstly you've to stop stessing about the time limits. You need to take things easy and one step at a time. Because of your condition here's my best shot at the steps you have to take

1. Backdate PRTB registration - priority no 1.
2. Forget about the NPPR for now
3. None of this will affect your maternity benefits, you're entitled to them and that's something not to worry about.
4. Calculate all rent back to Nov 2009
5. Cancel TRS with revenue
6. Write a letter to revenue, explain you are pregnant and request an extension of 2 months. This shouldn't be a problem.
7. Buy a binder, put all receipts into it, per year. Go back through your bank accounts and cheque book and see what you purchased for the property.

Excellent advice all round.

 

[Bronte]

Excellent advice all round.

Well she is 36 weeks gone. I'm still working on it, did I forget anything?

Tommy I'm afraid to mention stamp duty clawback. What's the rule for renting in 2009 if you purchased in 2007?

Somethings not making sense to me, if you have an accountant why would he allow you to 'pretend' you were in the rent a room scheme when you were married and clearly renting - I mean that's absolutely crazy.

 

[T McGibney]

Well she is 36 weeks gone. I'm still working on it, did I forget anything? Tommy I'm afraid to mention stamp duty clawback. What's the rule for renting in 2009 if you purchased in 2007?

Yes, it could be an issue. Clawback period cut from 5 to 2 years with effect from 5 December 2007, so there may be an exposure based on dates etc, however this shouldn't be the most immediate priority for the OP just now.

 

[Bronte]

write to the Revenue stating that you will be making a qualifying disclosure and you are therefore seeking an additional 60 days to respond to them.

That's excellent advice Nige. Poppie you should write that in your letter requesting an extension. In basic terms what it means is that you are going to 'come clean' declare everything, and by stating this 'qualifying disclosure' clause it means that they you will avoid some penalties - though we don't know yet if you own much or any tax but it gives your further cover for dealing with them.

 

[T McGibney]

That's excellent advice Nige. Poppie you should write that in your letter requesting an extension. In basic terms what it means is that you are going to 'come clean' declare everything, and by stating this 'qualifying disclosure' clause it means that they you will avoid some penalties - though we don't know yet if you own much or any tax.

The OP should not inform Revenue of intention to make a qualifying disclosure without first understanding, via a professional advisor, exactly what a qualifying disclosure entails.

 

[Bronte]

The OP should not inform Revenue of intention to make a qualifying disclosure without first understanding, via a professional advisor, exactly what a qualifying disclosure entails.

Ok you're the accountant. So she should seek an extension due to her personal circumstance (pregnancy), so she has time to get professional advise, that's sounds about right.

She might not be too bad if the mortgage interest is very large and if her expenses are high.

I don't understand how people can still not know what the PRTB is and the NPPR etc. Message on property tax, based on compliance rates seems to have sunk in though.

 

[Sweep]

Hi Poppie,
Just wondering if you got this sorted? I am now in a very similar situation myself. Some great advise on this thread. I hope you managed to resolve everything and it was not too stresfull for you.