Asked to file Form 11 and not Form 12 - I made error on Form 12

E

easy rider

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Hi All,

First off I am a recent(ish) landlord and recently completed my first Form 12 online for 2013.

I rented out my place at the start of September 2013, essentially for €1,200 over the 4 months, as such to a total of €4,800 for 2013.

Expenses (maintenance, new fridge, cleaning etc) was €1,441. My mortgage for that time is €970.65, so €3,882.60, 75% of which is €2,911.95 for the year. As such I thought it would work out like this:

€4,800 (Rental Income) - €2,911 (75% of Mortgage Interest) + €1,441 (expenses) = €448 profit, of which I am liable for tax.

Am I right in the above?

Reason I ask is they have written to me saying I owe around €1,600. And that I should have filed a Form 11 as I had rental income above €3,174. Obviously I messed up on the Form 12 and did not enter my Mortgage or did and removed it by mistake, not really sure. What is my comeback on this, just want to make sure I am understanding it before I talk to them. Thanks
 
I don't agree that you have a file a Form 11. You are being told that you a chargeable person yet your non-PAYE income is only €448. Do you have any other income that is not liable to PAYE? If so that might be the reason. They may be saying that because your rental profit is not coded into your tax credits and collected this way.

Under the Revenue's own rules you are required to file a Form 11 (and be in self assessment and that brings) if your non-PAYE income exceeds €3,174. This figure is taxable earnings and not your gross rental income. For your reference I've attached below the situations in which you need to file a Form 11. These are copied directly from the front of the 2013 Form 11. They may try and hit you with a surcharge if you file a Form 11 as the filing date was 31 October for paper filers.

Regarding your €1,600 liability you should find out how this arose - it may be tax arising from previous years etc. The only thing I can say about your computation on the basis of your note is a that a fridge is not an allowable deduction. A fridge is an asset and you will need to write that off evenly over 8 years at 12.5% per year. Take a look the Revenue rental income note on their website as it gives a good overview.


1. An individual who is a ‘chargeable person’ for the purposes of Income Tax Self-Assessment should complete a Pay and File Income Tax
Return Form 11E or Form 11.
2. An individual with a PAYE source of income and with total gross income from all non-PAYE sources (including income subject to DIRT), of
€50,000 or more is regarded as a ‘chargeable person’ for Self-Assessment and must file a Form 11 for that year.
3. An individual with a PAYE source of income and with net assessable non-PAYE income (including income subject to DIRT) of €3,174 or
more is regarded as a ‘chargeable person’ for Self-Assessment and must file a Form 11 for that year.
4. An individual with a PAYE source of income and net assessable non-PAYE income (due to losses, capital allowances and other reliefs) is
less than €3,174 and the income is coded against PAYE tax credits or fully taxed at source, is not regarded as a ‘chargeable person’.
 
Ring the PAYE Helpline. Whether you are a chargeable person (and therefore required to file Form11) or not depends on your net income - so yeah you obviously filled the form in wrong.
Is you mortgage interest figure 75% of the mortgage interest for the Sept to Dec period? Whilst PRTB registered.
 
Thanks for the replies.

I will give them a call. I'm pretty sure I left out the mortgage by looking at the figures, not sure how, may have input it on the form but removed it by accident.

Yes I am on the PRTB from the start of the rental. Its calculated as the 4 months, September to December.
 
My wife and I have non PAYE income in form of UK social welfare pensions (slightly greater than €3174) and revenue are agreeable to filing form 12S through my local tax office. The local office adjust our credits so that the tax on the pensions are paid through the year. Any adjustment is paid early in next year. The moral of the story is talk to them.
 
HELP

I filled in Form 12 online and got a letter on 19th December saying that as my non-PAYE income exceeded €3174 (My gross interest for year was €4,277) I was a chargeable person.

I am jointly assessed with my wife who I have now worked out has an underpayment of €4038 in 2013, whereas I am owed money.

If I do not pay this by 31st December I will have a 10% rather than 5% surcharge. My wife is a teacher and the underpayment may have arisen because of an error in Department of Education.

I find Part O section 934 of Form 11E difficult, but have calculated based upon format of P21 balancing statements.

Feel I have to put a cheque in post before end of year.

Any advice?

Should I pay 5% surcharge?
 
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