Reduced frequency of tax returns and payments

Reductions in the frequency of PAYE/PRSI and VAT tax returns and payments for smaller businesses will again be extended to eligible businesses from 1 January 2011. Similar arrangements in respect of RCT will also become available from that date.

• Businesses making total annual VAT payments of less than €3,000 are eligible to file VAT returns and make their payments on a 6 monthly basis;
• Businesses making total annual VAT payments of between €3,000 and €14,400 are eligible to file VAT returns and make their payments on a 4 monthly basis;
• Businesses making total annual PAYE/PRSI payments of up to €28,800 are eligible to make their payments on a 3 monthly basis; and
• Businesses making total annual RCT payments of up to €28,800 will now be eligible to file RCT returns and make payments on a 3 monthly basis.

What are the benefits to businesses?
The benefits for qualifying businesses are two-fold:

• Improved cashflow by only having to make payments at the end of each 3, 4 or 6 monthly period as appropriate.
• Reduced costs of administration through less frequent filing of tax returns.

How will these changes be implemented?
Revenue is now in the course of writing to each eligible business advising them of the reduced frequency of tax returns and tax payments that will apply to them with effect from 1 January 2011.
A copy of the letter will also be sent to the agent or tax practitioner on record for eligible VAT and RCT customers. We are unable to provide a copy of the letter to the agent or tax practitioner on record for eligible PAYE/PRSI customers.
There is no need for businesses to take any action to benefit from these changes. The letter they receive will confirm that the reduced payment and filing frequency is being automatically extended to them from 1 January 2011