It's an awful pity the tax system wasn't more simple so people could easily figure it out. Why isn't there in this day and age a computer programe that one can log onto at revenue.ie and type in income and hey presto it calculates the tax, prsi, levies etc. Don't revenue have a system like that for themselves?
Under payment of tax by OAP's
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It's an awful pity the tax system wasn't more simple so people could easily figure it out. Why isn't there in this day and age a computer programe that one can log onto at revenue.ie and type in income and hey presto it calculates the tax, prsi, levies etc. Don't revenue have a system like that for themselves?
mandelbrot
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Yes it's called ROS Offline - it doesn't come any simpler than that, inside or outside of Revenue AFAIK.
But if it's a bog standard PAYE case there are any number of online calculators that will do it - though IMHO anyone who has basic English comprehension skills, and is capable of adding, subtracting, dividing, and multiplying, should be able to work out their tax in 2 minutes on a piece of paper.
First €x @ 20%
Remainder @ 41%
Less Credits
Less Tax paid
= Tax due / refund due
It only gets remotely complicated if there's other sources of income, such as rental etc...
And what about marginal relief, PRSI, social charge etc. If it were so easy how come so many people can't understand the way it works.
Must agree with Mandeltrot. I feel most people, including myself, just dont bother trying to figure out their tax. As Mandeltrot indicated it is fairly easy to estimate what your income tax will be. I just think a certain mystery has built up in some of our minds re the complexity whereas when you sit down and think about it its fairly simple.
mandelbrot
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So, are you saying you'd prefer if there was no marginal relief?
In the context of pensioners, where this difficulty has arisen, there is no PRSI or USC on income from social welfare.
As far as I'm concerned the tax system is as complex as it is, due to case law and successive legislation over time - as a direct result of people wanting to find loopholes and weasel their way out of paying. Human nature being what it is, it's very naive to suggest that a tax code could ever be truly simple.
T McGibney
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The Corporation Tax code is remarkably simple, and I would suggest that this blows the above argument out of the water. Unless perhaps companies like paying tax more than individuals?
The blame clearly lies with the fact that the system has been allowed to develop on an ad-hoc basis, with annual Budgets and Finance Acts and countless Revenue pronouncements and precedents in between, but with little long-term planning and co-ordination. The only area where there has been any long-term policy planning has been in the area of Corporation Tax.
I am an OAP (prefer the term Senior Citizen) and receive the contrib OAP without deduction of tax. I have an occupational pension from which PAYE is deducted. I have some PAYE income from a part-time position. I have some non-PAYE income from contract work. I should be the perfect target for the Revenue letter of 2 weeks ago - but I have not received any!!!! Why??
P.S. I am fully tax compliant via ROS
P.S. I am fully tax compliant via ROS
mandelbrot
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I'm not sure I'd agree entirely with that explanation - all legal systems evolve on an ad-hoc basis, they have to simply because the world doesn't stand still, and you can't keep going back and rewriting the whole rulebook every time a new issue emerges.
Correct me if I'm wrong (I wasn't even born, and Wikipedia is offline!) but my understanding was that Corporation tax was introduced in the mid or late 70s, before which companies were liable to income tax plus some kind of add-on tax/charge? So the policy makers / legislators had the relative luxury of a blank canvas to do their long-term planning and coordination at that time, as they were introducing a completely new tax.
I would imagine that politically it was a lot easier to deal with a lobby group that consisted of what the general population consider "the elite". Even numerically, up to the mid 70s I think there had only been a total of about 50,000 companies registered since the creation of the state, so any change was going to directly affect a smaller number of taxpayers.
Contrast that with trying to start with income tax again from scratch, I wouldn't fancy it, would you?!
mandelbrot
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Do you file a Form 11 / Form 12?
I suspect you've answered your own question there anyway,
So your returns filed match the Revenue / DSP record of your income.
T McGibney
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Well if Charlie McCreevy (to his credit) was able to turn the income tax code upside down in 2001 by switching to a calendar-year basis and replacing allowances with credits, it shouldn't have been beyond the policymakers at the time to set out a clear vision of a simplified flat-tax-type income tax system and implement this on a phased basis. Unfortunately the opportunity to do this has now disappeared with the crisis in the public finances.
mandelbrot
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Out of interest, what country's (or countries') income tax code would you model ours on, if you were going to do an overhaul Tommy?
A flat tax system would be quite a radical departure from our current system, and that of the rest of Western Europe! How is it working out in the countries that do have it in place I wonder (again without Wikipedia I'm a bit snookered, but several of the former communist bloc countries have it I think? Not sure if that instils me with confidence TBH!)
Was such a system ever even on the agenda for discussion in Ireland though? It'd probably be political suicide for whoever tried to push it through - you can just see the sensationalist headlines "Everyone is going to pay tax, no matter how little they earn! Tax rate will be halved for high earners!" etc...