PAYE taxpayers must disclose any non-PAYE income they earn to Revenue by 31 October.

Recently we are seeing more examples of PAYE taxpayers with various types of non-PAYE income. Irrespective of the source, if you earn income outside of the PAYE system, you must declare it to Revenue and pay the appropriate taxes. 

For example, a PAYE taxpayer who lets out a room in his house would be liable to pay income tax at the appropriate marginal rate plus Universal Social Charge and PRSI.

Other examples of non-PAYE income include foreign pensions, dividends and rental income.

If you are in any doubt about your tax liabilities, it is a good idea to get professional advice as underpayment and/or errors on tax returns can result in interest charges or penalties.

Am I a PAYE taxpayer?

A PAYE taxpayer is someone:

• whose main source of income is taxed through the PAYE system, and

• whose annual net non-PAYE income is less than €5,000 (€3,174 for years up to and including 2015).

Certain social welfare payments and legally enforceable maintenance payments are excluded when calculating net non-PAYE income.

Provided your net non-PAYE income is below €5,000, this is taxed through the PAYE system by reducing your tax credits and/or adjusting your tax rate band. You are responsible for telling Revenue about your non-PAYE income. You can do this through Revenue's 'my account' service or by filing Revenue Form 12 before the 31 October deadline.

Am I a ‘chargeable person’?

Revenue considers a PAYE taxpayer with net non-PAYE earnings over €5,000 to be a ‘chargeable person’. This means you must self-assess your income tax and file a tax return (Form 11). The filing deadline is 31 October. 

Remember when working out your net non-PAYE income that you may be able to claim back certain expenses. It is important to calculate the taxes due correctly as errors can prove costly. 

Should you require assistance, Brady & Associates offer a €300 tax return service.  Contact us today to find out more about how we can help.