Query about preliminary income tax

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backfire

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I was wondering if I could get some advice please.

I've been using the same accountant for many years now and have run into a problem regarding payment of preliminary income tax to the Revenue - I'm a sole trader / small business. I only ever made a preliminary income tax payment which was in my first year of business (as advised by my accountant) and then made a loss or very little profit for several years running... however upon making a profit in subsequent years the accountant *never* advised about making a preliminary income tax payment as part of the tax return (or anything about the possible negative outcomes of not making it).

Last month I got letter from the Revenue with a significant fine for "interest charge on late payment of preliminary income tax". I rang my accountant about it at the time and he washed his hands of it and said it was my problem (and ultimately it is, of course) - his take on it is that I've been in business for a good few years now and should know about these matters.
So my question is, the accountant does my tax returns...preliminary tax is part of that process as far as I'm concerned, does he not have responsibility in this area?
 
Do you still use the same accountant now or are you saying when you stopped using him he should have warned you about the future ? Genuine question btw.
 
I only use him for tax returns - so I haven't taken any action yet, as I I only contact him once a year around October time
 
No point tackling your guy. Check prices with rival accountants and ask that they quote for full income tax payment and filing advice and services, and VAT payment and filing advice.

Once you have your quotes, ask your guy how much to ensure you are fully advised, compliant etc. Then compare.

(Interestingly I know other sole-traders who made a nominal small payment of preliminary tax every year as they couldn't afford an effective double payment if they were to finally do it correctly.)
 
I was wondering if an accountant doesn't advise their client about paying preliminary income tax - then isn't this within their area of responsibility? Do I have any recourse with them or with the Revenue? Should I write a letter to the Revenue saying that my accountant didn't advise me correctly? I have already paid the fine mind you.

There is also a second problem - the Revenue can also issue a fine for the subsequent tax year as the same problem exists there too :(
I could stick my head in the stand and maybe the Revenue won't issue me with a fine - or if I proactively write to them about it, they may issue me with the fine anyway, it might be like kicking a hornet's nest.
 
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What services does your engagement letter with your accountant outline? That would decide if you should have any grievances. You say you have paid the fine? I presume this is interest? But have you paid the PT?

Who filed the return on ROS? I thought you had to deal with PT in doing that so it shouldn't have been missed?
 
I don't think I have an engagement letter with him.

Sorry it's interest - I've been describing it as a fine. And yes I paid it immediately as I thought everyday I waited it was continuing to get grow. At the time I didn't fully understand the mechanics of what it was for. I was kind of panicking

> But have you paid the PT?
The interest was for 2017 tax year - I have paid the income tax for that year (in November 2018) so the PT is no longer relevant.

The same problem exists for 2018 tax year and since it's in the past there's no way of changing that....so the Revenue are entitled to hit me up with an second interest charge for that year, which is a similar amount.

For the 2019 tax year no PT either - when I rang the Revenue they suggested I paid that straightaway even though it was after the deadline. So I did that in mid-December.

A good outcome would be for the Revenue not to hit me up for the late interest payment of PT for 2018 (I'd have to suck up the interest I've already paid).
A great (and very unlikely) outcome would be the above plus something back or in lieu for the interest payment I've already made.
 
I found [broken link removed] on the Revenue site which shows the screen that my accountant filled - with which he definitely chose to enter 0 for the preliminary tax amount without consulting me. Thank you @Fergal19 for highlighting this for me.

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Does anyone know in what manner the Revenue will treat this if I approach them and explain my case? My fear is that I will make things worse and they will hit for me with an interest charge for 2018, on top of the 2017 one I've already paid.

Has anyone any experience with these kind of dealings with the Revenue? How reasonable and fair are they likely to be if I'm trying to deal with this proactively. Thanks in advance for any advice
 
Revenue are not interested in "I was badly advised" that is between you and the accountant.

If you have now paid your 2018 liability in full and appropriate preliminary tax for 2019 then there is nothing else you can or should do. There is no case for you to explain.

It is possible that Revenue will charge you interest for late payment of preliminary tax in 2018, I would advise against contacting them about it, what would you say, other than "pretty please don't charge me, I'm a nice guy really".

If a Revenue official has to open a file on your late payment of 2018 preliminary tax that increases the likelihood of your being charged interest. As things stand it is very possible that you will hear no more about it.
 
This is an interesting conversation. I have a limited company. My accountant handles the end of year accounts, but I look after VAT3, P30 etc. Regarding preliminary, I always know to contact him near Halloween, and ask him to recommend a figure, and I do the form on ROS myself, and pay the money. I have never assumed it's his job to deal with preliminary other than giving me a ballpark figure
 
@cremeegg Thanks for the advice

I have never assumed it's his job to deal with preliminary other than giving me a ballpark figure
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This was always the way my accountant managed it for me - he did the return and made payment. He never gave me the option of managing the sign/submit/make payment steps myself in ROS.

Overall it feels like I'm being punished for something that wasn't my fault - sure, ignorance is no excuse but that's why I paid a professional to manage this aspect of running the business. Going legal on the accountant sounds like a world of pain and stress and solicitors fees. It would be great if there was some other avenue available to me rather than having to just suck it up! For the record, what I've lost so far is about 5k with potentially another 5k of interest charges for 2018 waiting for me - so 10k in total :(
 
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