Richard Bruton
Question:180 Mr. R. Bruton asked the Minister for Finance the details of the bringing forward of the payment dates for corporation tax; and the impact on expected income from this source over the years. [22258/02]
Written Answers. - Tax Yield.
In the last budget I announced that the payment dates for preliminary tax payable by companies were being brought forward to one month before the end of the accounting period. This is being introduced over a five year transition period and will be fully effective for accounting periods ending after 2005 when 90% of final liability will be payable one month before the end of the accounting period. During the transition period, preliminary tax will be payable in two instalments, the first due one month before the end of the accounting period and the second within six months after the end of the accounting period. The amount of the first instalment will be: for accounting periods ending in 2002, 18% of the final liability, but in the case of a small company, the payment can be based on 20% of the previous year's liability; for accounting periods ending in 2003, 36% of final liability, but in the case of a small company, the payment can be based on 40% of the previous year's liability; for accounting periods ending in 2004, 54% of final liability, but in the case of a small company, the payment can be based on 60% of the previous year's liability; for accounting periods ending in 2005, 72% of final liability, but in the case of a small company, the payment can be based on 80% of the previous year's liability. In the case of an accounting period which is less than one month and one day in length, the first preliminary tax instalment will be due on the last day of the accounting period. In the transition period the second instalment should bring total preliminary tax payments for the accounting period up to 90% of the final liability for the accounting period.
The figures published in the budget 2002 booklet were as follows:
|
Year |
Advance Preliminary Tax Yield(€million) |
|
2002 |
792 |
|
2003 |
821 |
|
2004 |
945 |
|
2005 |
1,073 |
|
2006 |
1,124 |
An updated estimate will be given in budget 2003 to reflect the lower than anticipated corporation tax yield.
Richard Bruton
Question:181 Mr. R. Bruton asked the Minister for Finance the details of the bringing forward of the payment dates for self-employed income tax; and the impact on expected revenue from this source over the years. [22259/02]
The new pay and file arrangements for self-assessed taxpayers, which were provided for in section 78 of the Finance Act, 2001, were introduced this year. They represent a major change in the arrangements under which self-assessed taxpayers file an annual return and pay the tax due. The new pay and file arrangements will bring major advantages and simplification to the self-assessed system and will streamline filing and payment obligations for the self-assessed taxpayers and their agents. They bring together into one date, 31 October, the payment of tax and the filing of returns. It means that preliminary tax for one year and final tax for prior years are being paid as one.
For the current tax year 2002, the due date for payment of balances of 2001 self-assessed income tax was brought forward from 30 April 2003 to 31 October 2002. This was part of a number of changes involved in the move to the calendar year which gave rise to cash flow losses and gains in several areas in both 2001 and 2002. At the time, it was estimated that the change in the due date in the case of self-assessed income tax would produce a once-off cash flow yield in 2002 of €95 million.
Richard Bruton
Question:182 Mr. R. Bruton asked the Minister for Finance the estimated cost in 2002 of the reduction in corporation tax made in the year; and the estimated cost in 2003 of completing the move to a uniform 12.5% tax rate. [22260/02]
The full year cost of reducing the standard rate of corporation tax from 20% to 16% is estimated at €329 million. It is tentatively estimated that the portion of this full year cost affecting the 2002 calendar year, including the impact on the first instalment of preliminary tax brought forward from 2003 into 2002, is approximately €65 million. The full year cost of introducing a 12.5% rate of corporation tax for profits earned on or after 1 January 2003 is currently estimated at €305 million. It is tentatively estimated that the portion of this full year cost that will affect the 2003 calendar year, including the impact on the first instalment of preliminary tax brought forward from 2004 into 2003, will be in the region of €100 million.