Accountants failure to submit forms to Revenue

D

Daddy Ireland

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My father died a few years ago and left the farm to a brother of mine. The accountant told my brother afterwards that no inheritance tax was due. Anyway a month ago the Revenue sent him a notice that CAT forms were not submitted and that he had 4 weeks to submit forms. He sent this notice to his accountant. Now in the last few days my brother has received a notice of assessment for CAT on the inheritance as the Revenue state failure to submit forms. A substantial six figure sum is involved.
Does the accountant have any responsibility for his failure to contact Revenue in the past ? My brother now has to pay the assessment within 30 days while at the same time lodging an appeal. Do accountants have insurance to cover their negligence ? Thanks for any advice that can be offered.
 
It is a persons own responsibility to file their tax returns. Revenue are not concerned what arrangements a person may have with an agent to act for them.

Did your brother sign a letter of engagement with the accountant or otherwise instruct the accountant to file the tax return.

While you don’t say exactly how long ago the death took place Revenue are generally patient with inheritance matters. Has your brother contacted them to say that he thought this had been dealt with and he will resolve it as soon as possible. I would expect Revenue to allow some time on that basis.

Any questions about the accountants liability or negligence should wait until after the immediate Revenue issue is resolved.

It is unlikely that the accountant could be liable for your brothers failure to make his tax return.
 
How much was the farm worth?

Was the accountant formally engaged or did he merely provide a steer over a pint?

With Agricultural Relief (90% reduction in the deemed value of the asset) and the Group A threshold (circa €300k), perhaps the accountant was correct?
 
Thanks for the replies. I will check with him re letter of engagement/instruct the accountant to file. The farm was worth 1.2 million so is this correct calculation.
1.2 million x 90% = 1.08 million
1.2 million less 1.08 million = 120k
120k below the 300k threshold
Therefore zero inheritance tax liability.
 
Are you sure he was entitled to the agricultural relief, its not as simple as just being a farmer.
 
the key thing is to get the assessment appealed within 30 days. After that file the tax return and this will/should displace the assessment raised by the Revenue. There are the first priorities as if the assessment isn't appealed case closed and the tax is due.

Any matter after that can be sorted. Its up to yourself if you want to use the same accountant or a different one - however make sure the assessment is appealed correctly.
 
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