The self-assessment tax system is based on giving taxpayers control and responsibility for their tax affairs. The self-assessment system applies uniformly to all self assessed taxpayers. Revenue provides comprehensive assistance to taxpayers in complying with the self-assessment obligations.
Every business sector, including farming, has a requirement to keep full and accurate records of their business; which are sufficient to enable them to make a proper return of income. Changing the basis of taxation for a lower income cohort of one particular business sector would give rise to inconsistent treatment between, either different categories of self-assessed taxpayers, or self-assessed taxpayers with different levels of income. Additionally, a system on the lines suggested by the Deputy based on an average gross margin could result in certain taxpayers paying a higher amount of tax than they would be otherwise due to pay. Having different bases of calculating tax for different sectors would give rise to confusion for the taxpayers concerned and a need for additional support in understanding the requirements.
I am aware that Revenue has in place a range of supports to assist taxpayers making their tax return including the ongoing development of the Revenue Online Service (ROS) and the pre-population of certain information onto the taxpayer's online return. I understand that nearly 90% of farmers use ROS for filing their tax returns.
For taxpayers not registered for Revenue's online services, there are a number of simplified paper income tax returns available, which aimed at reducing the administrative burden on any taxpayer whose tax affairs are not overly complex. The Form 11S is a short income tax return and I understand from Revenue that 5% of farmers are provided with the Form 11S. Additionally, for lower income taxpayers, Revenue makes available a two-page paper tax return (a Form 11P) including, where possible, certain pre-populated information. Some 20% of the cases to whom a Form 11P is sent are farmers.
Finally, I am also advised by Revenue that they are working on expanding the range of information that is pre-populated in taxpayer returns to include information about payments from the Department of Agriculture, Food and the Marine. This work will be particularly useful to the farming community and it is expected to be available for the 2016 annual tax return which is due to be filed in 2017.
