Tuesday, 11 March 2014

Ceisteanna (106)

Róisín Shortall

Ceist:

106. Deputy Róisín Shortall asked the Minister for Finance the procedure in respect of a person who, on a once-off basis, marginally exceeds the €3,174 low-income threshold that is generally applied by the Revenue Commissioner, where that income arises from interest on savings and investment and who wishes to ascertain whether or not there is a liability for PRSI and if so, to make arrangements to settle this liability. [12193/14]

Amharc ar fhreagra

Freagraí ó Béal (1 píosaí cainte) (Ceist ar Finance)

€3,174 is the amount of other income which a taxpayer, whose main source of income is taxable through the PAYE system, can earn, in certain circumstances, before becoming a chargeable person. In this regard, the Deputy's question appears to relate to an individual aged under 66 whose main source of income is from employment that is taxable through the PAYE system, who does not have income from a trade or profession and who is not, therefore, in the self-assessment system, but who is going to exceed the threshold of €3,174 in relation to income from investments for the first time and on a once-off basis.   

In this situation, there is no liability to PRSI if the income from investments was earned in the tax year 2013.  As regards 2014, the individual will be liable to PRSI on this income and he or she must, therefore, pay and file for 2014 and 2015 under the self-assessment system even if the income earned from investments falls back below the threshold in 2015 because it was earned on a once-off basis.  However, he or she will not have to pay and file as a self-assessed individual for 2016 if the income from investments remains below €3,174 for 2016 and the individual's original income status is resumed.  

In order to pay and file for 2014 and 2015, the individual must register as a self-assessed taxpayer and meet the various payment obligations associated with being a self-assessed taxpayer.  These obligations are set out on the Revenue website at http://www.revenue.ie/en/business/self-assessment.html. It should be noted however, that if the individual is aged 66 or over, he or she is not insurable, and therefore has no liability to PRSI.