Written Answers - Tax Yields.
Kathleen Lynch
Ceist:
84
Kathleen Lynch
asked the
Minister for Finance
the average tax taken from the PAYE sector; farmers and the self-employed for the most recent year for which figures are available; the number of random audits carried out for the same year; the percentage of each group assessed as having no tax liability; and if he will make a statement on the matter.
[2634/96]
Following is the information requested:
|
Year
|
Average tax payment made by
|
|
(a)
|
(b)
|
(c)
|
|
PAYE
|
Farmers
|
Other self-employed
|
|
£
|
£
|
£
|
|
1995
|
4,087**
|
1,031**
|
3,795**
|
**Provisional — subject to revision.
According to the Revenue Commissioners, random audits are selected from within the self-assessment system applying to companies and self-employed individuals. Each such audit includes a comprehensive examination of the liability to other taxes such as PAYE, VAT and capital gains tax in addition to income tax and corporation tax. It is not possible to distinguish any additional tax yield which may arise in these audits between the different taxes. The results of the random audit programme for 1995 to date are incomplete. In the interest of completeness, the figures supplied relate to audits initiated in both the years 1994 and 1995. The number of random audits initiated in those years was 184. These included some companies but the bulk related to self-employed persons. The number of those audits completed to date are 119, with just over 70 per cent assessed as having no additional tax liability. These figures include the results for farmers which are 27 audits completed to date with 85 per cent found to have no additional tax liability.
Notes on table
Column (a)
(i) The average tax payment is obtained by dividing the net receipt of PAYE tax in the calendar year by the number of taxpaying units effectively liable to tax in the income tax year in which the calendar year ends, e.g. the 1995 net receipt is divided by the estimated number liable to tax in 1995-96.
(ii) The figures in column (a) of the table are based on income tax collected through the PAYE mechanism which covers more than income tax on ordinary wages and salaries. It includes tax paid by directors of close companies who are akin to the self-employed as well as tax on "other income" of employees such as rent and other investment income. It also includes the tax paid under PAYE on the income from employment of farmers and other self-employed individuals.
Column (b)
(i) In calculating the figures in this column the estimated net receipt of income tax paid by full-time farmers in the calendar year has been divided by the number of full-time farming tax units which were formally assessed for tax on their farming profits in the year of assessment in which the calendar year ends, e.g. the 1995 receipt is divided by the estimated number assessed for the year 1995-96, irrespective of whether tax was actually payable in all cases.
(ii) The current figure for average tax payment does not take into account the tax attributable to the farming profits of farmers who, or whose spouses, carry on another trade or profession. Farm tax represents a fraction of their overall tax liability and the emerging average farm tax payments could not be regarded as representative of the normal average tax yield from the farming sector.
(iii) Income tax on farming profits is collected with Schedule D tax generally and the figures show for tax payments by farmers are, to some extent, estimated.
Column (c)
The figures contained in this column are obtained by dividing the estimated net receipt of income tax in the calendar year from tax units whose main sources of income is from self-employment, other than full-time farming, by the estimated number of those units assessed to tax in the year of assessment in which the calendar year ends as explained in note (i) for column (b).
General Notes
(i) A married couple who has elected or has been deemed to have elected to have the income of both spouses assessed on the husband is counted as one tax unit.
(ii) Receipts of deposit interest retention tax and tax deducted by building societies under the former composite rate arrangements are not included in the calculations. Basic data are not available which would enable the amounts of these taxes referable to interest paid or credited to particular classes of taxpayers to be ascertained.
