990 Assessment of tax due

Summary

This section provides that where an inspector or other officer of the Revenue Commissioner has reason to believe that an employer has overpaid or underpaid the tax due to be paid by the employer under the PAYE system for any month, the inspector or other officer may make an assessment of the total amount of the tax so due by the employer. Other than in specific circumstances including fraud or neglect, assessments must be raised or amended within 4 years commencing at the end of the year following the year of assessment in which the employer return for that income tax month is made. An appeal to the Appeal Commissioners against any such assessment may be made by the employer. Where an amount is paid by the employer and the inspector or other officer of the Revenue Commissioners has reason to believe that the original assessment is less than or greater than the amount of tax that the employer is liable to remit, the inspector can increase or decrease the assessment to reflect the correct amount of tax due to be remitted by the employer for that month.

Details

(1) Subsection (1) provides that where an inspector or other officer of the Revenue Commissioners has reason to believe that a return made by an employer does not include the total amount of tax due for a month, or, where a return is due but has not been submitted by an employer, then, the inspector or other officer may make an assessment of the amount which should have been paid by the employer, and may serve a notice on the employer setting out:

• the amount so assessed,
• the amount paid by the employer in respect of the income tax month, and
• the balance of tax outstanding.

(2) Subsection (2) provides that where the inspector or other officer is of the view that the amount of their assessment is less than or greater than the amount of tax that the employer is due to remit, then the inspector can increase or decrease the assessment to reflect the correct amount of tax due to be remitted by the employer for that month.

Revenue will issue a revised notice to the employer, and this notice will supersede the previous notice.

(3) Subsection (3) provides that where Revenue serve a notice on the employer under subsections (a) or (b), the employer may appeal the notice to the Appeal Commissioner within 30 days after the date of the notice.

If no appeal is made or if on appeal the Appeal Commissioners decide against the employer, the balance of tax outstanding (amended as necessary as a result of the Appeal Commissioners’ decision) becomes due and recoverable as if it was an amount of income tax charged on the employer under Schedule E.

(4) Subsection (4) provides that a notice given by an inspector or other officer under this section may cover 2 or more income tax months.

(5) Subsection (5) provides a time limit of 4 years commencing at the end of the year following the year of assessment in which the employer return for an income tax month is made, for the making or amending of assessments by a Revenue officer. This time limit is effective for all income tax month returns from 1 January 2025 onwards.

(6) A number of exceptions are included in subsection (6) to the time limit on making or amending assessments by a Revenue officer. This includes to give effect to a determination of an appeal against an assessment, correct an error in calculation of the assessment, to correct a mistake of fact which is not properly reflected in the assessment and take account of any fact or matter arising by reason of an event occurring after the return is made.

(7) Notwithstanding subsection (5), the 4-year time limit will not be applicable to give effect to a mutual agreement reached between Revenue and a competent tax authority in another jurisdiction.

(8) An inspector or officer, notwithstanding subsection (5), may make or amend an assessment in cases in which fraud or neglect is believed to have occurred. A definition of neglect is included for the purposes of this subsection.

Relevant Date: Finance Act 2024