Self-Employed? Find Out How to File Your Tax Returns

Filing your tax returns can seem like a daunting prospect—there is much conflicting information online about self-employed tax returns. In fact, it can be difficult to know the circumstances under which the law stipulates that you need to file your own tax return.

You want to ensure that you are paying the amount of tax required by law at the right time. It’s also important you don’t end up paying too much tax or too little tax.

In this post, you’ll learn how to properly file a tax return. You’ll understand the conditions that require people to file their own self-assessed tax returns. You’ll get an overview covering how to file self-employed tax returns, and you’ll understand the implications of not filing your taxes on time.

filing form 11

Do I need to file a tax return?

When trying to understand whether you need to submit a tax return, it’s helpful to have clearly defined conditions. Unfortunately, the disparate variety of sources related to filing tax returns are often anything but clear.

Below are some examples that tell you when to file your own self-assessed tax return:

• You must file a tax return if you are self-employed. 

• You must file a tax return if you earn non-PAYE sources of income, examples of which include rental income, foreign income including foreign pensions, and investment income.

• You must file a tax return if you profit from share options or share incentives.

• You must file a tax return if you are proprietary director.

• You must file a tax return if you are approved for SARP (Special Assignee Relief Programme).

You do not need to file a tax return if your income is solely taxed under PAYE with the exception of SARP relief.

How to File Self Employed Tax Returns

If you meet the requirements for submitting a self-assessed tax return, such as when you are self-employed or are in receipt of rental income, it’s imperative that you know how to submit your returns and when to submit them.

The filing of Irish tax returns operates through Revenue’s Pay and File system, which outlines the following requirements and rules.  Should you require assistance, tax returns can also be filed using a qualified professional service such as Tax Return Plus (from just €249 (VAT incl.)):

• The rules for Pay and File state that as a chargeable person (legal obligation to file an income tax return), you must submit an income tax return by October 31st in the following year.

• You also need to pay any outstanding balance of income tax due and preliminary tax on or before  same date.

Note that Revenue imposes a four-year time limit on claims for the repayment of tax. This means that if you are owed or you think you are owed any tax back from Revenue, you must submit a claim for the repayment of this tax within four years of the relevant year.

For example, claims for repayment of tax for the year ended 31st December 2018 must be submitted no later than 31st December 2021.

Another important point of note is that Revenue does not require supporting documents to back up your tax self-assessment details unless such documents are specifically requested by Revenue. However, you must keep supporting documents for six years in the event of a Revenue audit.

irish tax return deadline

What happens if I don’t file taxes on time?

Failure to file income taxes on time under the self-assessment rules leads to a significant surcharge to your tax liability, depending on how late you submit the income tax return as follows:

• If you submit within two months after the deadline passes (31st October each year), a surcharge of 5% of your liabilities applies.

• For tax returns submitted later than two months after the October 31st deadline, you pay a 10% surcharge on your tax liability.

• The Revenue may also impose interest and penalties for the late filing of your tax return.

Key Points

The importance of submitting your tax returns on time cannot be overstated—hefty surcharges apply that can dramatically increase the liabilities owed by you to the Revenue Commissioners. The longer you leave it before submitting your tax returns, the more likely you’ll have to pay the higher surcharge of 10 percent along with any interest and penalties the Revenue may impose.

Whether you are a self-employed person, a landlord, or you meet any other criterion that requires you to file an annual self-assessed income tax return, the team at Tax Return Plus can help take the stress out of filing your taxes accurately and on time.

A standard tax return with us starts from just €249 (VAT incl.). Fill out our simple form to get a quote, or contact our expert team today to ensure you pay the taxes you owe and no more.