If you are self-employed in Ireland you will be required each year to submit a Tax Return by 31st October (manual filing) or if filing online there may be an extended filing date. This is announced each year by the Revenue Commissioners and is normally at some date in early November following the end of the previous tax year. At this date, you are also required to pay to the Collector General in Limerick the balance of tax you owe for the tax return you are submitting and also make payment towards the current tax year – known as preliminary tax.
If you avail of the extended online filing date you must also pay any tax due online also.
If you operate through the medium of a limited Company in Ireland the payment date for corporation tax has become more streamlined and all small companies (where the company’s corporation tax liability for the prior year was < €200,000) will be required to have paid either 90% of their expected corporation tax liability for the current period or they can pay 100% of the prior year liability by the 21st of the month prior to the end of their accounting date to the Collector General. If the company is a large company (where the company’s corporation tax liability for the prior year was > €200,000) then the payment is due in instalments. The First Instalment is payable in the 6th month of the accounting period by the 21st of that month and should be 50% of Corporation Tax liability for the preceding accounting period or 45% of Corporation Tax liability for the current accounting period. The Second Instalment is due payable on the 21st date of the eleventh month of the accounting period and the amount payable will bring the total preliminary tax paid to 90% of the Corporation Tax liability for current accounting period.
The balancing payment of Corporation Tax for all companies is due to be paid to the Collector General by the 21st of the ninth month after the year end.
If you are deemed to be providing a professional service in a close company (i.e. a company under the control of 5 or fewer participators) then you may be liable to an additional surcharge on certain undistributed income, it is important to seek advice to determine if you fall within the definitions of a professional service before commencing trade.
If you open a branch in Northern Ireland, UK corporation tax will be payable in respect of branch profits. Credit will be available in Ireland in respect of UK tax suffered but it is restricted to the lower of the two taxes.
The UK corporation tax will have to be paid electronically to the Collector of Taxes in Shipley, Bradford. UK corporation tax is generally payable 9 months and 1 day after the company’s year end, however, special rules apply to large companies / branches where quarterly payments on account must be made.
Payments on account are generally made in four equal instalments with the first payment due 6 months 13 days after the start of the accounting period. The second and third payments on account are due respectively 9 months 13 days and 12 months 13 days after the start of the company’s accounting period. The final payment is due 3 months 14 days after the end of the accounting period. Each quarterly payment should represent 25% of the company’s corporation tax payable for the accounting period.
If you open an establishment in Northern Ireland but not through the medium of a Company you will come within the self-assessment arrangements and will be required to submit a UK tax return by 31 October (for manual returns) or 31 January (for online returns) following the end of the tax year (5 April) and pay any tax becoming due to the Collector of Taxes.
Tax in this instance is paid on 31 January and 31 July of each year with January being the time for paying the balance of tax for the previous year and also the 1st payment on account for the current tax year. The July payment is the 2nd payment on account for that tax year. Payments on account are calculated at 50% each of the previous year’s tax liability. These payments can be reduced if you know your tax bill will be less than in the previous year.
Credit will be given in Ireland for any UK tax paid.