capital gains late late payment

delta_charlie

Registered User
Messages
8
looking for advice on what to do here
I sold shares in 2013 and made gains of 24k
and sold shares in 2014 and made gains of 22k
none of this was declared for CGT , I used the money to clear my mortgage.
obviously its only a matter of time before the dreaded letter comes through the door
between the CGT fee , late fee and penalties , I dread to think what I will owe
would I be better off waiting for the dreaded letter , or would there be any benefit in me contacting revenue before they contact me ?
 
Interest is charged on late payments, so generally better to pay sooner rather than later.

Any chance you've got previous capital losses to offset any of the gain?
 
Unfortunately no , and I understand it would make sense to pay sooner, problem is if I contact revenue now , the gains I had were used to clear mortgage, and with penalties/interest etc there is no way I could raise such a large amount of money to pay the bill.
 
I dread to think what I will owe

(€24k x 33%) + 10% interest for 5 years, plus (€22k x 33%) + 10% interest for 4 years = €23.6k (of which €8.3k is interest).

That would be approximately the position at the start of 2019, assuming they only charge interest and not penalties, which may be more likely if you make a voluntary disclosure.
 
(€24k x 33%) + 10% interest for 5 years, plus (€22k x 33%) + 10% interest for 4 years = €23.6k (of which €8.3k is interest).

That would be approximately the position at the start of 2019, assuming they only charge interest and not penalties, which may be more likely if you make a voluntary disclosure.

Thanks for that , that's some hole I dug myself into , dammed if I do and dammed if I don't .what a mess .
 
Taking Dub-nerd's figures above of 15k tax and 8.5k interest, you then add a 10% surcharge for late filing, which is another 1.5k. Your bill to sort it now is 25k. It's only going to increase over time, and if you wait for them to come find you and are subject to audit, then you can add at least a further 30% (4.5k) in penalties to the bill.

If you can't borrow to finance a repayment in full, then Revenue may give you an instalment arrangement, and while they'll charge you interest, it would be on the 15k of tax only, not on the interest or penalty.
 
(€24k x 33%) + 10% interest for 5 years, plus (€22k x 33%) + 10% interest for 4 years = €23.6k (of which €8.3k is interest).

That would be approximately the position at the start of 2019, assuming they only charge interest and not penalties, which may be more likely if you make a voluntary disclosure.

Small addition - you've got a €1270 personal exemption each year (2013 & 2014), so you can reduce that calculation slightly.
 
looks like I need to a 25k loan , would have been cheaper paying the mortgage .
Is it 100% they will find me ? clutching at straws I know.
 
would have been cheaper paying the mortgage .

Yes. That was weird strategy to pay down a cheap mortgage with money which did not belong to you which will cost you a lot more in the longer term.

You have got good advice here. Engage with Revenue and pay off what you owe.

Is it 100% they will find me ? clutching at straws I know.

Askaboutmoney is not a forum for providing advice on tax evasion which is illegal.

Brendan
 
Yes. That was weird strategy to pay down a cheap mortgage with money which did not belong to you which will cost you a lot more in the longer term.

You have got good advice here. Engage with Revenue and pay off what you owe.



Askaboutmoney is not a forum for providing advice on tax evasion which is illegal.

Brendan
Thanks for the advice , nothing weird about it actually , silly/naïve for sure , as already mentioned I don't have it to pay what I owe , anyway lesson learned. cheers.
 
Get a mortgage to pay the tax bill?

Agree with others, get it sorted sooner rather than later. While costly now, the costs will continue to mount
 
On a positive note the first 1,270 of a gain arising in each year is exempt. If you haven't provided for this in your gains above that's a saving on the liability, late payment interest and penalties should Revenue choose to apply same. Are you sure you've calculated the gains correctly? Would indexation relief for example have applied to increase your base cost? When did you buy the shares? Had you made any capital losses previous to the disposals which you haven't used?
 
You can rent a room or rooms out in your home for up to 14k tax free annually. You could use this as a revenue generating means to fund repayment if no other options
 
You can rent a room or rooms out in your home for up to 14k tax free annually. You could use this as a revenue generating means to fund repayment if no other options

Hi that would definitely be an option and one I never considered up till now thank you.
Thanks for all the advice everyone very much appreciated , it was a silly mistake I made
but it will be sorted cheers.
 
Revenue will facilitate a payment plan. Typically 25% up front and then the rest over up to four years at a rate of 8% (the rate is 8% rather than 10%).
 
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