Learn to Love your Tax Return!
Fenero | Contracting & Personal Tax Solutions
Multi-Award Winning Tax Experts delivering market-leading Customer Experience
Do you dread tackling your income tax return? Who doesn’t! But showing your tax return some love could help save you money and make smart plans for the year ahead.
OK, maybe it’s a stretch to see your tax return as your new best friend. Not everyone loves tax returns like we do at Fenero! But you can certainly see it as a tool to help you:
? check you’re claiming all the income tax credits and reliefs you’re entitled to
? identify areas where you’re not making the most of tax-saving opportunities right now, but could think about for the future.
Check out these tips and pointers from our experts to guide you through your tax return this year:
? Don’t miss the deadline
It’s important to act promptly if you want to avoid penalties and surcharges for late filing and payments.? The deadline for filing a paper return is 31 October, or 15th November for online filing. If you are using the online filing deadline however, remember that you must also pay online in full by that date also!
? Has your personal or family situation changed?
It’s worth claiming any tax credits that might apply, depending on your personal and family circumstances. There’s a full list here:
For some of these credits (e.g. the single person child carer credit and incapacitated child credit), you first need to fill out a separate form before claiming them on your tax return for the first time. You can fill out these forms through your MyAccount on Revenue. If you try to claim these tax credits on your income tax return without having first completed these separate forms, Revenue will not process the tax relief so it's important to do this extra piece of admin!
If you go through a major life event, such as separation, divorce or bereavement, tax may not be top of mind. But it’s important to inform Revenue straightaway. This will ensure you’re not paying too much tax, or and help avoid penalties for claiming credits that no longer apply to you.
Happy events have tax implications too. Newly-weds can claim a ‘year of marriage review’ and transfer one spouse’s unused tax credits and standard rate band to the other, if that would result in a tax saving. Access this through MyEnquiries on the Revenue website or claim it via your tax return.
? Have you claimed tax credit on earnings?
Earned Income Tax Credit is available to self-employed people and company directors. In tax year 2022 (the year which the fast upcoming deadline relates to!) it is €1,700 or 20% of your earned income, whichever is lower. If you’re also employed and claim Employee Tax Credit on those earnings, the total amount you can claim is capped at €1,700.
? Do you pay rent?
The Rental Tax Credit was introduced in 2022. For 2022 tax returns, you can claim up to €500 tax credit if you rent the home you live in, pay rent for your child’s college accommodation, or if you need to rent accommodation to attend your work. To qualify, the tenancy must be registered with the Residential Tenancies Board (RTB); however this may not be the case if the landlord lives in the same property as the tenant. Renting a room from a family member doesn’t qualify, and the landlord mustn’t be claiming housing supplement.
In good news for renters, Budget 2024 increased the value of the Rent Tax Credit to €750 - find out more at: https://www.fenero.ie/budget-2024-what-does-it-mean-for-individuals/
? Have you claimed for health expenses?
If you’ve had to pay for healthcare in the past year, either for yourself or a family member, ?claiming tax credits on qualifying expenses can help ease the pain a little. Tax credit is available at 20% (the standard rate) of any amount not reimbursed by your medical insurance company.
A wide range of medical expenses qualify for tax credit, from doctors’ fees and prescriptions to non-routine eye care and dental work. There’s more information about claiming for healthcare and nursing home expenses here.
? Are you due a tax refund?
Good news: if you were entitled to a tax credit in previous tax years, but didn’t claim, you can go back four years to claim a refund of overpaid PAYE or income tax.
? Have you claimed tax relief on your work expenses?
If you’re employed (on PAYE) your job may well entitle you to claim ‘flat-rate expenses’ at your highest PAYE rate if you have to pay for things like stationery, tools, or uniforms from your own pocket to carry out your work.
There’s a full list of which jobs qualify, and how much you can claim, here.
? Have you worked from home?
If you’re employed, full-time or part-time, and are required to work from home most of the time, you can claim ‘remote working relief’. For 2022/23, you can claim 30% of your heat, light and broadband costs.
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Note: if your employer is already paying you the €3.20 per day ‘e-allowance’, this will reduce the amount you can claim relief for.
? Have you claimed all your expenses to reduce your taxable profits?
If you run your own business, your taxable profit is calculated after ‘allowable expenses’ are deducted from your sales. (Note: even if your business made a loss, you still need to do your accounts and send in an income tax return).
In Revenue-speak, an expense you can claim must be ‘wholly and exclusively’ needed to generate a sale for your business. For some outgoings – business stationery, your professional indemnity insurance – the whole amount is allowable. You can claim a proportion, but not all, of your expenses in running your home or family car, as you use these for personal as well as business purposes.
If you’re a landlord, many of the costs of renting out your property are tax-deductible, but some are not, such as Local Property Tax, so if in doubt, take advice.
? Have you maxed your pension?
It’s not too late to boost your personal pension for this year; you have until 15 November to make a contribution and claim the tax relief in the 2022 tax return.
Our Personal Financial Planning team in our sister company Guardian Financial Services are available to get you through your options if you need help before the tax return deadline! Contact Karena Duane on [email protected]
Explore your options for the year ahead
When completing your tax return, you might wonder if there are opportunities you’re not yet taking advantage of, that would either help you save tax or keep more of your earnings in future years. Here are a few of the ways you could do just that:
? Protect your income
If you don’t yet have insurance to protect your income if you can’t work because of illness or accident, you can claim tax relief on premiums, as long as your plan is from an approved provider.??(Our colleagues at Guardian Financial can help here too!)
? Rent a room
Did you know you can earn up to €14,000 a year in rent, tax-free, by letting a room in your home? Note: the tax relief only applies if you live there too, you’re not renting out the whole property, and your lodger stays at least 28 days.
? Take a course
If you’d love to retrain or boost your qualifications, you can claim tax relief on your college fees, on amounts above €3,000 for a full-time course, or €1,500 for a part-time course.
? Be creative
Are you a talented writer, musician or artist? If Revenue agrees that your work is of national,?cultural or artistic merit, you may be able to protect up to €50,000 of profits you make from your work from income tax.
? Go greener
If you’re investing in your business in the coming year, check out the Sustainable Energy Authority of Ireland (SEAI) website https://www.seai.ie to see which types of capital spending, for example electric vehicles, may qualify for a full tax deduction in the year of purchase.
Make income tax less taxing
The tax experts at Fenero can help take the stress out of filing your return and sorting out your income tax. We’ll prepare a draft tax return for you, based on an online questionnaire we've created which is personally tailored to your circumstances. We’ll also work out exactly how much tax you owe (or are owed). Once you’ve approved the return, Fenero will submit it to Revenue and process any payments or refunds.
Get in touch
At Fenero, we just love tax returns! We take care of thousands of clients’ tax returns – and much more besides – to help them plan their finances and maximise their income. It’s our mission to help our clients – contractors, sole traders, landlords and freelancers – manage their finances in the way that works best for them, helping them to enjoy the journey as they achieve their goals. Contact our friendly team of experts today on [email protected] to find out more about how we can help you achieve yours.
Or reach out directly to Sam Armstrong Fenero's Personal Tax Division Manager or Brenda Swords our Head of Tax! Both will be delighted to help!