Finance Minister Michael Noonan announced yesterday that he will not change the deadlines in 2014, as initially planned. However, he still intended to bring pay-and-file dates forward — via next year’s Finance Bill — starting in 2015, “in order to provide increased certainty around the annual tax take and forecasting process, following the move to an earlier budget day”.
While the postponement was broadly welcomed by lobby groups, there was acknowledgment that it was only putting off potential hardships for SMEs for a year or so.
“Delaying the implementation of a new deadline by a year does nothing to solve the very real problem that businesses will have trying to compute and pay taxes several months in advance. This proposal is utterly unfeasible and must be permanently shelved,” Chambers Ireland chief, Ian Talbot stated.
ISME head, Mark Fielding expressed concern about the potential impact on SMEs of future changes.
“An earlier payment date, in particular, could have disastrous consequences for SMEs already struggling with cash flow issues. This is an important matter and a decision cannot be made in haste. The minister must engage in a full consultation process to ensure that the needs of SMEs are protected,” he said.
Addressing yesterday’s sitting of the Joint Oireachtas Finance Committee, Irish Tax Institute CEO, Mark Redmond said the decision marked “very good news for small business throughout the country”.
However, he warned deadline changes could undermine the already high levels of compliance, impair the quality of the information currently being filed and place greater pressure on already struggling firms, all for more certainty around less than 4% of the State’s total annual tax take.
The Institute of Certified Public Accountants (CPA Ireland) has called for the removal of “draconian” late filing penalties during the 2015 transition period, but overall said the postponement was good. CPA chief, Joe Aherne noted that a moving of pay-and-file return dates was “inevitable”, but a postponement of the change allows for more time for the self-employed to make the transition to the new arrangements.
“In order to meet new eurozone surveillance rules, Budget 2014 was framed without knowing the total amount of tax receipts for 2013. Framing a budget on ‘best guesstimates’ is no way to run a business, let alone a country and cannot become the norm.”