a revenue guide to professional services withholding tax (pswt) for accountable persons and...

Upload: tere1330

Post on 03-Jun-2018

223 views

Category:

Documents


0 download

TRANSCRIPT

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    1/26

    RPC004311_EN_WB_L_1

    IT 61

    A Revenue Guide to

    Professional Services Withholding Tax

    (PSWT) for Accountable Persons

    and Specied Persons

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    2/262

    Summary of Guide 3

    Part 1 - Outline of PSWT 4

    1.1 What is PSWT? 4

    1.2 Who must operate PSWT? 4

    1.3 Rate at which PSWT is deducted 4

    1.4 From which payments should PSWT be deducted? 4

    1.5 Excluded payments 5

    1.6 Amount from which PSWT is deducted 5

    1.6.1 Treatment of expenses 5

    1.6.2 Treatment of late payment interest 5 1.6.3 Treatment of VAT, Stamp Duty and certain other fees 5

    Part 2 - Accountable Persons 6

    2.1 Who is an Accountable Person? 6

    2.2 Registration of Accountable Persons 6

    2.3 Mandatory e-ling 6

    2.4 Obligation on accountable persons to deduct PSWT 6

    2.5 Obligation to remit PSWT to Revenue 6

    2.6 Payments by Accountable Persons to non-residents 7

    2.7 Payments made between Accountable Persons 7

    2.8 Payments by Accountable Persons to charities 7

    2.9 Payments made by a foreign-based branch or agency of an accountable person 7

    2.10 Inter group payments 8

    Part 3 - Specied Persons 9

    3.1 Who is a Specied Person? 9

    3.2 How does a Specied Person get proof of PSWT deducted? 9

    3.3 Credit/refund of PSWT to Specied Person 9

    3.4 Preliminary Tax 10

    3.5 Interim Refunds 11

    3.6 What to do where form F45 is lost, destroyed or incorrect 12

    3.7 Where to claim credit/refund of PSWT 12

    Part 4 - Professional Services 13

    4.1 Services covered by PSWT 13

    4.2 Services which are not regarded as professional services for the purposes of PSWT 13

    4.3 Services of employee 14

    Part 5 - Administration of PSWT 15

    5.1 PSWT forms 15

    5.2 Form F45 15

    (a) General 15

    (b) Partnerships 15

    (c) Security numbers 16

    (d) Continuous/laser stationery forms F45 for completion using a computerised system 16

    (e) Forms F45 for manual completion 17

    (f) Completion of form F45 by Accountable Person 17

    5.3 Form F43 17

    5.4 Form F30 (monthly return) 18

    5.5 Form F35 (annual return) 18

    (a) General 18

    (b) Details to be returned on form F35 18

    (c) Schedule to accompany form F35 19

    5.6 Requests for forms and security numbers 19

    5.7 Irish version of PSWT forms 19

    5.8 Rectifying errors 19

    (a) PSWT deducted in error 19

    (b) Excess PSWT deducted 20

    (c) Insufcient PSWT deducted 20 (d) Payment made twice 20

    (e) Payment made to the wrong person 20

    (f) Error made in one tax year and rectied in a subsequent tax year 21

    Appendix 1 - Revenue Opinions regarding Professional Services 22

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    3/263

    Summary of Guide

    Part 1 Contains an outline of the PSWT scheme. It gives an overview of the circumstances in

    which PSWT applies, summarises how it operates and how credits and refunds can be

    claimed.

    Part 2 Contains information relevant to those who are required to deduct PSWT, known as

    accountable persons. It advises of the types of bodies that are accountable personsand how they should register with Revenue. It also outlines the obligation on accountable

    persons to deduct PSWT from payments for professional services and sets out limited

    circumstances in which that obligation does not apply.

    Part 3 Contains information that is relevant to persons from whom PSWT has been deducted,

    known as specied persons, including how they can get credit for, or refunds of, PSWT.

    Part 4 Provides information on the services to which PSWT applies. A summary of Revenue

    opinions relating to the applicability of PSWT to payments for various types of services is

    also included in Appendix 1.

    Part 5 Gives details of the administrative procedures in place for the PSWT scheme. It includes

    information on the use and completion of various PSWT forms by accountable persons.

    Contacting Revenue

    Contact details for all Revenue ofces can be obtained using the Contact Locator on the Revenue

    website,www.revenue.ie

    Forms and leaet service

    All forms and information leaets referred to in this guide are available from the Revenue website,

    www.revenue.ieor from the Revenue Forms and Leaets Service at LoCall 1890 306 706

    (ROI only) or + 353 1 702 3050 (from outside Ireland).

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    4/264

    Part 1 - Outline of PSWT

    1.1 What is PSWT?

    Chapter 1, Part 18 of the Taxes Consolidation Act 1997 provides for a withholding tax to be

    deducted from payments made by certain bodies in respect of professional services. The tax is

    known as Professional Services Withholding Tax (PSWT).Accountable Personsare required to deduct PSWT from Relevant Paymentsmade by them to

    Specied Personsin respect of Professional Servicesand to remit the amounts deducted to

    Revenue.

    PSWT deducted is, in general, available for offset against the specied persons nal income tax/

    corporation tax liability for the period within which the relevant payment is charged to tax. Pending

    offset against a specied persons nal tax liability, a claim for an interim refund of PSWT may,

    in certain circumstances, be made during the year in which it is deducted (see Part 3 for further

    details).

    1.2 Who must operate PSWT?

    PSWT must be operated by each of the bodies listed as accountable persons in Schedule 13 to

    the Taxes Consolidation Act 1997. In general terms, these are State and Semi-State bodies (see

    Part 2 for further details).

    Authorised health insurers are accountable persons and payments made by them to registered

    medical or dental practitioners or their employers under contracts of insurance are relevant

    payments for PSWT purposes.

    1.3 Rate at which PSWT is deductedThe rate at which PSWT is deducted is the standard rate of income tax in force at the date on

    which the relevant payment is made. The standard rate of income tax is currently 20%.

    1.4 From which payments should PSWT be deducted?

    Subject to certain exclusions (see section 1.5), PSWT should be deducted from all relevant

    payments. Relevant payments are payments made by accountable persons in respect of

    professional services.

    A relevant payment need not necessarily be in respect of services provided directly to the

    accountable person. PSWT applies where an accountable person makes a payment in respect ofa professional service, whether it is provided to the accountable person or to another person.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    5/265

    1.5 Excluded payments

    There are certain payments from which PSWT should notbe deducted. These include:

    payments which come within the scope of the PAYE system (generally a contract of service).

    Information on the difference between a contract of service and a contract for services is

    contained in the Code of Practice for Determining Employed or Self-Employed Status of

    Individuals, available on the Revenue website or from Revenue Forms and Leaets Service. payments which come within the scope of the Relevant Contract Tax (RCT) scheme,

    certain payments between accountable persons (see section 2.7),

    payments by an accountable person to a charity that has been granted an exemption from

    income tax by the Revenue Commissioners (see section 2.8),

    where the payment is made by a foreign-based branch or agency of an accountable person

    (see section 2.9),

    certain inter group payments (see section 2.10).

    1.6 Amount from which PSWT is deducted

    Where an accountable person makes a relevant payment to a specied person, the accountable

    person is obliged to deduct PSWT at the standard rate of income tax from the total amount of the

    payment being made, subject to the following.

    1.6.1 Treatment of expenses

    Where PSWT applies to a relevant payment, it applies to the entire payment, including any

    element in respect of the reimbursement of expenses incurred by the specied person. This

    continues to be the position where expense items are isolated for separate payment or where

    the expenses are separately invoiced. Examples of expenses include costs incurred for travel,subsistence, postage, printing, stationery, secretarial services, advertising, and payments by the

    specied person to third parties engaged by the specied person in connection with the delivery of

    the service to the accountable person.

    1.6.2 Treatment of late payment interest

    With effect from 7 August 2002, it is an implied term of every commercial contract that interest is

    payable if debts are not paid on time. Therefore, where interest is payable on a payment in respect

    of a professional service, PSWT should also be deducted from the interest. (See Tax Brieng,

    Issue 52 - May 2003, available on the Revenue website).

    1.6.3 Treatment of VAT, Stamp Duty and certain other fees

    VAT charged by the specied person should be excludedfor the purposes of calculating the

    amount of PSWT that is to be deducted. In addition, the following fees paid by the specied person

    to the appropriate authorities should also be excluded where they are invoiced to the accountable

    person:

    Stamp Duties

    Land Registry fees

    Deed of Registration fees

    Company Ofce fees

    Court fees

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    6/266

    Part 2 - Accountable Persons

    2.1 Who is an Accountable Person?

    For the purposes of PSWT, accountable persons include the following:

    Government Departments and Ofces

    Local authorities

    The Health Service Executive

    Authorised Health Insurers

    Commercial and non-commercial semi-State bodies and their subsidiaries.

    A list of accountable persons for PSWT purposes is set out in Schedule 13 to the Taxes

    Consolidation Act 1997. In addition to the bodies listed on Schedule 13,

    any subsidiary of a body listed on Schedule 13 and

    any body, while not owned 51% by one accountable person, which is under the control ofmore than one accountable person i.e. a joint venture

    is also an accountable person for the purposes of operating PSWT.

    2.2 Registration of Accountable Persons

    Accountable persons must be registered with the Revenue Commissioners for the purposes of

    operating PSWT. Where a body/organisation is unsure whether or not it is an accountable person,

    it can obtain advice from the Revenue ofce dealing with its tax affairs.

    On registration for PSWT, arrangements are made to supply the accountable person with the

    forms required to operate the scheme. Information in relation to PSWT forms is set out in Part 5.

    2.3 Mandatory e-ling

    With effect from the 1 January 2010, accountable persons are required to le all tax returns

    (including PSWT returns), and make payment to Revenue, by electronic means using the

    Revenue On-Line Service (ROS). The regulations giving effect to mandatory e-ling and

    information on how to register for ROS can be accessed on the Revenue website.

    2.4 Obligation on accountable persons to deduct PSWT

    In general, accountable persons must deduct PSWT from all payments made in respect of

    professional services. However, there are certain exceptions to this rule and these are outlined in

    sections 2.7 to 2.10.

    To avoid misunderstandings, accountable persons are advised to inform specied persons at

    contract stage that PSWT is deductible from relevant payments to be made under the contract

    involved.

    2.5 Obligation to remit PSWT to Revenue

    Accountable persons are responsible for the deduction and remittance of PSWT to Revenue. If anaccountable person refuses or neglects to remit PSWT, the Revenue Commissioners can raise

    assessments for the PSWT on that accountable person.

    The Revenue Commissioners also have the powers necessary to carry out on-site audits of

    accountable persons.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    7/267

    2.6 Payments by Accountable Persons to non-residents

    With the exception of specically excluded payments, an accountable person must deduct PSWT

    from all relevant payments. This obligation remains where the specied person is non-resident

    even though they may be entitled to a refund of the PSWT deducted as they are not subject to

    Irish income or corporation tax on that income.

    For details on how non-residents can make a claim for a refund of PSWT deducted, please seePart 3.

    2.7 Payments made between Accountable Persons

    Certain payments made by one accountable person to another are specically excluded from the

    obligation to deduct PSWT, namely:

    payments made by one accountable person to another accountable person in re-imbursement

    of payment for professional services, and

    payments made by one accountable person to another accountable person where, under the

    Tax Acts, the income of the accountable person receiving the payment is exempt from incometax or corporation tax.

    Where payments between accountable persons fall within the second category above, the payer

    should obtain conrmation in writing from the payee that they are in fact covered by this exclusion.

    2.8 Payments by Accountable Persons to charities

    PSWT does not apply to payments made by an accountable person for professional

    services provided by a charity that has been granted an exemption from tax by the Revenue

    Commissioners. Charities that have not been granted an exemption from tax by Revenue continue

    to be subject to PSWT on all relevant payments received from accountable persons.

    Again, where an accountable person is making a payment to a charity, the payer should obtain

    conrmation in writing from the payee that they are in fact covered by this exclusion.

    2.9 Payments made by a foreign-based branch or agency of an accountable

    person

    PSWT need not be deducted from a payment made by a foreign-based branch or agency of an

    Irish resident company that is an accountable person where all of the following conditions apply:

    the payment is made abroad by the branch/agency, the payment is for professional services provided abroad to the branch/agency, and

    the person providing the professional service (the payee) is resident abroad.

    In all other circumstances, PSWT should be deducted by accountable persons from payments to

    non-residents.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    8/268

    2.10 Inter group payments

    The Revenue Commissioners accept that PSWT does not have to be deducted by a company that

    is an accountable person from a payment in respect of professional services where such payment

    is made:

    to a subsidiary of the company,

    by a subsidiary to its parent company, or

    by one subsidiary to another subsidiary of a common parent company.

    Subsidiary for these purposes means a 51% subsidiary.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    9/269

    Part 3 - Specied Persons

    3.1 Who is a Specied Person?

    Specied persons can be individuals, companies or persons operating in partnership.

    Subject to the specic exclusions referred to in Part 2, an accountable person must deduct PSWT

    from relevant payments made to all specied persons, including specied persons who arenon-resident. While specied persons providing services to government bodies may be required to

    produce a Tax Clearance Certicate this does not negate the obligation on the accountable person

    to deduct PSWT.

    Where a relevant payment is made to a partnership then each person who is a partner in the

    partnership is a specied person. For administrative purposes, the accountable person can

    make a relevant payment to a partnership. Where a relevant payment is made to a partnership

    the principle partner in turn apportions both the payment and the PSWT deducted between the

    partners.

    3.2 How does a specied person get proof of PSWT deducted?

    When making a relevant payment, the accountable person must give the specied person a formF45 conrming the amount of the payment made and the amount of PSWT deducted. Howeverin order that the accountable person may issue form F45, the specied person must provide theaccountable person with:

    in the case of an individual, his/her Personal Public Service Number (PPS No.),

    in the case of a company, its tax reference number and

    in the case of a partnership, the partnerships tax number.

    If VAT is included in a relevant payment, the VAT registration number must also be provided, if

    different from the PPS No. or tax reference number outlined above. Non-resident persons are

    required to state the tax reference that applies to them in their country of residence. Form F45

    can not be issued in the absence of a tax reference number (see also 5.2).

    3.3 Credit/refund of PSWT to Specied Persons

    Apart from a situation where an individual commences business, PSWT deducted by an

    accountable person from a relevant payment is available as a credit against the gross amount of

    income tax or corporation tax chargeable on the specied persons income for the period in which

    the relevant payment is charged to tax. Therefore, it will (together with any other credits to whichthe specied person is entitled) reduce the amount of tax payable by the specied person for the

    period.

    For individuals assessable to income tax, credit for PSWT deducted from a relevant payment is

    normally given against the amount of income tax chargeable for the tax year in which the relevant

    payment is chargeable to tax. For companies assessable to corporation tax, credit for PSWT

    deducted from a relevant payment is given against the amount of corporation tax chargeable for

    the accounting period in which the relevant payment is chargeable to tax.

    For an individual commencing business, credit for PSWT deducted in the rst year of business

    will not normally be given until the second tax year. This arises because the prots shown in the

    rst 12 months accounts may form the basis of a charge to income tax for the rst two tax years.In such circumstances, the PSWT deducted is deemed to be deducted in the basis period for the

    second tax year. However, such an individual may qualify for an interim refund (see section 3.5).

    An accountable person, on making a payment from which PSWT is deducted, gives the specied

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    10/2610

    person a form F45. The information recorded on form F45 includes:

    the amount of the relevant payment,

    the amount of PSWT deducted, and

    the tax reference number of the specied person who provided the professional service.

    A form F45 is evidence that the specied person has had PSWT deducted from a relevant

    payment. Accordingly, it is a valuable document and should be retained carefully by the speciedperson, as it must be presented to Revenue in support of any claim for credit or refund, if

    requested. Specied persons can claim a credit of PSWT relating to a tax year/accounting period

    by completing the relevant section of their tax return for that year/period. Where such claims

    result in an overpayment of tax, the excess is, subject to any other outstanding tax liabilities of

    the specied person, available to be refunded by Revenue provided that the claim is made within

    relevant time limits.

    Where an accountable person makes a payment to a partnership they should issue the form F45

    in the name of the partnership and must quote the tax number of the partnership (see section 5.2).

    The precedent partner must then apportion the payment and the associated PSWT between each

    of the partners and provide them with a copy of the form F45 and a statement showing their shareof the payment/PSWT. These documents are then used by the partners, as specied persons, to

    claim credit/refunds for PSWT suffered.

    3.4 Preliminary Tax

    Under the Pay & File system, preliminary tax in respect of a tax year or accounting period is

    payable by a specied person directly to the Collector General by reference to the amount of tax

    payable(tax payable is the gross amount of tax due (i.e. amount chargeable) less any credits

    to which the person is entitled) by the specied person for that tax year or accounting period.

    However, in order to avoid interest charges, a certain minimum amount of preliminary tax must be

    paid for the tax year or accounting period involved. In the case of an individual liable to income

    tax, the amount of preliminary tax to be paid must be equal to or exceed the lower of:

    90% of the amount of tax payablefor the tax year,

    100% of the amount of tax payablefor the previous tax year, or

    105% of the amount of tax payablefor the pre-preceding tax year. (This nal option is only

    available where preliminary tax is paid to the Collector General by direct debit and does not

    apply where the tax payable for the pre-preceding year was nil).

    As indicated earlier, PSWT can be taken into account as a credit against the amount of tax

    chargeablefor a tax year or accounting period in computing the amount of tax payablefor the

    year or period.Example

    An individual estimates that the amount of income tax chargeablefor the tax year 2012 to

    be 40,000 and has PSWT of 10,000 available as a credit against the amount of income tax

    chargeable for that year. Therefore, the amount of income tax payableby the individual for the

    year 2012 is 30,000.

    For the tax year 2011, the income tax chargeableon the individual was 25,000 and PSWT of

    15,000 was available as a credit against the amount of income tax chargeable for that year.

    Therefore, the amount of income tax payablefor 2011 was 10,000.

    If the individual wishes to pay preliminary tax for 2012 by reference to the 90% rule, then the

    amount to be paid directly to the Collector General is 27,000 (i.e. 30,000 x 90%). If theindividual wishes to pay preliminary tax for 2012 by reference to the 100% rule, then the amount

    to be paid directly to the Collector General is 10,000 (i.e. 10,000 x 100%).

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    11/2611

    Regardless of which option the individual takes, the PSWT of 10,000 that was deducted in 2012

    may not be treated as a payment (or part payment) of the preliminary tax that is required to be

    paid directly to the Collector General.

    3.5 Interim refunds

    Rather than waiting to have PSWT credited against the amount of income tax or corporation tax

    chargeable on a specied persons income for a tax year/accounting period, the specied personmay make a claim during the year/period for an interim refund. Certain conditions must be satised

    before an interim refund claim is allowed. In general, the following three conditions must be met

    before an interim refund may be made:

    i. the prots for the period immediately preceding the period of claim have been nalised,

    ii. the tax payable for that preceding period has been paid in full, and

    iii. forms F45 for the PSWT in question are provided to the taxpayers Revenue ofce.

    Example

    PSWT is deducted from a relevant payment made on 1 July 2012. Accounts of the specied

    person are made up to 30 September each year and the relevant payment will be taken into

    account in computing the prots for the year to 30 September 2012.

    In the case of an individual, in order to qualify for an interim refund, the prots of the basis

    period for the tax year 2011 (i.e. prots for the year ended 30 September 2011) must have

    been nalised and the tax payable for the tax year 2011 must have been paid. In the case of a

    company, in order to qualify for an interim refund, the prots of the accounting period ended

    30 September 2011 must have been nalised and the tax payable for that period must have

    been paid.

    From the PSWT deducted, an amount equal to the tax liability at (ii) above is retained. In

    addition, an amount equivalent to any outstanding liability is retained. The balance of PSWT

    deducted, if any, is then available to be refunded to the specied person.

    In cases of particular hardship, some or all of the above conditions may be waived where amounts

    of PSWT withheld are substantially in excess of likely nal tax liability and failure to meet the

    conditions would not permit an interim refund in certain circumstances, such as:

    a once-off or unusual receipt, a once-off or unusual reduction in income, or a

    demonstrable permanent reduction in income, or

    if, through no fault of the taxpayer, there is a delay in nalising liability to tax for a

    particular year due to illness or other exceptional circumstance, or

    if income tax liability (net of PSWT credited) paid in a period of claim together with PSWT

    deducted in that period exceeds an amount arrived at by multiplying the taxpayersincome for the period by the higher rate of tax which applies for that period.

    A person who has recently commenced business may wish to apply for an interim refund. Because

    such a person would be unlikely to satisfy the three conditions outlined above, Revenue applies

    special treatment whereby likely tax liability of the rst tax year or accounting period is estimated in

    calculating whether an interim refund arises.

    All claims for interim refunds should be made to the specied persons Revenue ofce using form

    F50 and should be supported by relevant forms F45/F43. Further information on interim refunds

    is contained in Statement of Practice SP IT/3/90, available on the Revenue

    website and from Revenue Forms and Leaets Service.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    12/2612

    3.6 What to do where a form F45 is lost, destroyed or incorrect

    Form F45 lost/destroyed

    Specied persons should retain forms F45 carefully. Where, exceptionally, a form F45 is lost or

    destroyed, the specied person should inform the accountable person from whom they received

    the form F45 and request the accountable person to issue a form F43.

    Incorrect form F45

    Where the information contained on form F45 is incorrect, the specied person should return the

    original form F45 to the accountable person and request that a form F43 be issued. The most

    common errors relate to:

    the amount of the relevant payment stated on the form F45, or

    the amount of PSWT stated on the form F45.

    Tax Brieng 28 (October 1997, pages 3-4), available on the Revenue website, claries the

    circumstances in which a form F43 can be sought from an accountable person.

    3.7 Where to claim credit/refund of PSWT

    General

    Apart from charities and non-residents (which are dealt with below), claims for credit or interim

    refunds of PSWT are dealt with in the Revenue ofce dealing with the tax affairs of the specied

    person.

    Charities

    Claims for refund of PSWT by specied persons who are charities should be made to:

    Charities Section,

    Collector-Generals Division,Government Ofces,

    Nenagh,

    County Tipperary.

    Tel: 1890 666 333 (ROI only) or + 353 67 63 400 (from outside Ireland)

    Email: [email protected]

    Non-residents

    Where a non-resident is not chargeable to tax in the State for the year/period in which PSWT is

    deducted, repayment of the PSWT should be claimed from:

    International Claims Section,

    Collector-Generals Division,Government Ofces,

    Nenagh,

    County Tipperary.

    Tel: 067 63 400 or + 353 67 63 400 (from outside Ireland)

    Email: [email protected]

    Non-residents claiming repayment of PSWT must complete claim form IC11 and separate

    questionnaire (available on the Revenue website) and send them together with relevant forms F45

    to the above address.

    Where a non-resident is chargeable to tax in the State for the period in which the PSWT is

    deducted, claims for credit or for interim refund of PSWT should be made to the Revenue ofcethat deals with the tax affairs of the non-resident. A non-resident is chargeable to tax in the State

    for the period in which the PSWT is deducted, if during that period the non-resident carries on

    business through a permanent establishment situated in the State.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    13/2613

    Part 4 - Professional Services

    4.1 Services covered by PSWT

    PSWT applies to payments made for the provision of professional services. Section 520 of the

    Taxes Consolidation Act 1997 lists certain services that come within the meaning of professional

    services. The term professional services includes: services of a medical, dental, pharmaceutical, optical, aural or veterinary nature,

    services of an architectural, engineering, quantity surveying or surveying nature, and related

    services,

    services of accountancy, auditing or nance and services of nancial, economic, marketing,

    advertising or other consultancies,

    services of a solicitor or barrister and other legal services,

    geological services.

    The above is not an exhaustive list. A summary of the Revenue position in relation to theapplication of PSWT to various services is set out in Appendix 1.

    It should be noted that a service, which is not professional in nature, may be subject to PSWT

    where it forms part of a wider contract for professional services. In those circumstances, all

    payments under the contract come within the scope of PSWT. For example, a printing service on

    its own is not regarded as a professional service. However, where a printing service is provided as

    part of a wider design or consultancy service, payment for the entire service, including the printing

    element, comes within the scope of PSWT. This applies even when elements of the service are

    separately invoiced.

    4.2 Services which are not regarded as professional services for thepurposes of PSWT

    Revenue does not regard the following services as professional services for the purposes of

    PSWT:

    teaching, training or lecturing services,

    translation services including services of an interpreter,

    proof-reading services,

    services of stenographers,

    setting and assessing oral, aural or written examinations,

    contract cleaning services,

    maintenance and repair work.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    14/2614

    4.3 Services of employee

    PSWT is deducted from self-employed persons who provide professional services. It does not

    apply to employees as payments to employees fall within the PAYE system. Employers must

    operate PAYE on payments to employees and ofce holders (e.g. board members) even if the

    duties performed are professional in nature. Employers may not deduct PSWT as an alternative.

    In this regard, the following are available on the Revenue website: Code of Practice for Determining Employed or Self-Employed Status of Individuals, and

    Article on the Taxation of Part-Time Lecturers/Teachers/Trainers in Tax Brieng 28 - October

    1997 (pages 19/20).

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    15/2615

    Part 5 - Administration of PSWT

    5.1 PSWT forms

    The forms used in the administration of PSWT are:

    Form F45 - issued by an accountable person on making a relevant payment to a specied

    person,

    Form F43 - issued by an accountable person to a specied person only where form F45 is (i)

    lost or destroyed or (ii) where the details on the form F45 are found to be incorrect,

    Form F30 - is the monthly return made to Revenue by an accountable person of the total

    amount of PSWT deducted from all relevant payments made by the accountable person in the

    preceding month,

    Form F35 - is the annual return, made by an accountable person declaring their PSWT liability

    for the tax year. It is accompanied by a schedule giving details of the total relevant payments

    made to, and the total PSWT deducted from, each specied person in the tax year.

    5.2 Form F45

    (a) General

    Forms F45 are available for completion either manually or by way of a computerised system. On

    registration for PSWT, accountable persons should indicate if they intend to use manual forms F45

    or a stationery version of the form F45 for completion using a computerised system.

    Form F45 is a valuable document as it provides documentary evidence of the amount of PSWT

    deducted from a relevant payment as well as the amount of the payment and of VAT charged,

    if applicable. A form F45 must be issued by the accountable person in respect of each relevantpayment made.

    An accountable person can only issue form F45 in circumstances where they have been provided

    with the specied persons tax reference number. In the case where an Irish tax number is

    provided, the accountable person can seek conrmation from the specied persons that the

    tax number provided by them is the correct tax number for the specied persons concerned.

    The accountable person can also seek conrmation regarding the validity of an Irish tax number

    directly from the Revenue Commissioners.

    A second form F45 should never issue in respect of a relevant payment. Therefore, where a

    form F45 issued to a specied person is lost or destroyed or where the details entered require

    amendment, a form F43 should be sought from the accountable person.

    Specied persons must retain forms F45 for inspection as they may be required by Revenue

    to support an application for credit of PSWT deducted. Claims for interim refunds must be

    supported by the relevant forms F45 at the time of the claim.

    (b) Partnerships

    In the case of payments made to a partnership, the accountable person may issue the form F45

    to the partnership rather than to the individual partners. In these cases, the precedent partner is

    responsible for furnishing the accountable person with the partnerships tax number. As in the case

    of payments to individuals/companies, the accountable person can ask the precedent partner toprovide evidence of this number or, in the case of an Irish partnership, they can ask Revenue to

    conrm that the tax number provided is related to that partnership.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    16/2616

    (c) Security numbers

    Each form F45 issued by an accountable person must contain a security number. Security

    numbers comprise of six digits preceded by a separate dedicated alpha character. Manual forms

    F45 incorporate the security number. Where Revenue approval is given for the use of a stationery

    version of the form F45 for completion with a computerised system, a range of security numbers is

    supplied by Revenue for use with that stationery.

    A register is maintained by Revenue of the range of security numbers issued to each accountable

    person. Accountable persons are required to put measures in place to ensure that only security

    numbers from the range supplied to them by Revenue are used. The accountable person must

    ensure that a separate security number from this range appears on each form F45 issued via the

    computerised system. A security number can be used only once.

    (d) Continuous/laser stationery forms F45 for completion using a computerised system

    Revenue approval

    An accountable person wishing to use continuous/laser stationery for the completion of forms F45

    must rst get approval from their Revenue district. Where an accountable person seeks Revenueapproval to use continuous/laser stationery for the completion of forms F45, the accountable

    persons computer system must be capable of:

    issuing a form F45 in respect of each relevant payment made,

    printing a security number, from the range of numbers supplied by Revenue, on each form

    F45 issued,

    agging, that the range of security numbers assigned by Revenue are coming to an end,

    in order that a further range of security numbers may be requested from Revenue. (It is

    important not to exceed the range of security numbers assigned by Revenue as this

    can result in security numbers being duplicated),

    retaining a detailed record of each relevant payment made, including a record of the security

    number assigned to that payment.

    In addition, where the computer system also calculates:

    the monthly remittance/return of PSWT to Revenue, the system must be capable of altering

    the monthly remittance, to take account of any payment errors made and corrected in relation

    to previous months in the tax year,

    the annual PSWT liability of the accountable person, the system must be capable of producing

    an end of year schedule, which takes account of any payment errors made and corrected in

    the tax year.Continuous stationery forms F45 (supplied by Revenue)

    Where following Revenue approval (as referred to above), an accountable person opts to use the

    continuous stationery version of form F45 Revenue will supply the stationery to the accountable

    person.

    Laser stationery approved by Revenue

    Revenue has also approved a laser stationery version of form F45 for completion using a

    computerised system. It is sourced separately from Revenue, from an approved source. For

    information regarding laser stationery, accountable persons should contact their local Revenue

    ofce.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    17/2617

    (e) Forms F45 for manual completion

    Manual forms F45 have a security number printed on each form. Revenue maintains a register

    of all manual form F45s issued to each accountable person. These forms should be stored in

    a secure place by the accountable person to whom they are assigned, as, once received from

    Revenue, they become the responsibility of that accountable person.

    When a relevant payment is being made, part 1 of form F45 should be given to the specied

    person and part 2 retained by the accountable person as a record of:

    the relevant payment made and PSWT deducted, and

    the security number related to the form F45.

    (f) Completion of form F45 by Accountable Person

    All sections of form F45 should be completed in full. Particular points to note are:

    Specied Person Details

    Specied persons must supply their tax reference number to the accountable person. Failure to

    do so will mean that the accountable person is unable to issue the specied person with form F45.Without a form F45 the specied person cannot obtain any credit for, or refund of, PSWT.

    Specied persons who are not resident in the State and who do not have an Irish tax reference

    number must supply the accountable person with the reference number they use in their home

    country.

    Relevant Payment details

    At A1, insert the gross amount of the payment inclusive of the VAT attaching thereto.

    At A2, insert the amount of VAT. [VAT is excluded from the charge to PSWT].

    At A3, insert the amount of PSWT deducted. This is calculated by excluding the VAT element from

    the gross payment and applying the standard rate of tax, as follows:

    (A1 - A2) x standard rate of tax

    Amounts shown on form F45 mustbe in Euro. Where a payment is made to a person resident

    outside the State, the equivalent foreign currency amounts may be shown in brackets beside the

    Euro amounts.

    As forms F45 are issued in respect of relevant payments made by an accountable person, there

    are nocircumstances where a form F45 with nil payment can be issued.

    5.3 Form F43Form F43 is the only evidence that will be accepted by Revenue in the absence of form F45.

    Similar to forms F45, each form F43 has a pre-printed security number assigned to it and

    should be stored in a secure place as, once received from Revenue, these forms become

    the responsibility of the accountable person. A form F43 should be issued in exceptional

    circumstances only. Tax Brieng 28, available on the Revenue website, contains an article that

    claries the circumstances in which forms F43 should be issued by accountable persons.

    A form F43 should only be issued by an accountable person where the original form F45 which

    was issued:

    is lost or destroyed and a duplicate, or alternative evidence of payment and PSWT deduction,is requested by the specied person (in such circumstance, the accountable person should

    request written conrmation from the specied person that the form F45 is lost or destroyed),

    or

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    18/2618

    is incorrect (in such circumstance, the accountable person should ensure that the original form

    F45 is retrieved from the specied person before the Form F43 is issued).

    Where the form F45 is lost or destroyed, the accountable person must include the details from the

    original form F45 on the form F43 and tick the duplicatebox on the form F43. Where the form F43

    is issued as an amendment, i.e. the form F45 issued was incorrect, the accountable person must

    include the correct details on the form F43 and tick the amendmentbox on the form F43.

    The security number of the original form F45 must be stated on the form F43 in the space

    provided. A form F43 is invalid where this is not done.

    When issuing a form F43 because the amount of the relevant payments on the original form F45

    was incorrect, the accountable person must ensure that the corrected gures are included in the

    relevant monthly and annual return forms (form F30 & form F35).

    As with form F45, there are nocircumstances where a form F43 with nil payment can be issued.

    5.4 Form F30 (monthly return)

    Form F30 is a monthly return that each accountable person is required to make to Revenue. It isa declaration of the total amount of PSWT deducted by an accountable person from the 1st day

    of an income tax month to the last day of the same income tax month. Form F30 must be led

    electronically (see section 2.3) and payment of PSWT deducted made within 14 days from the end

    of each income tax month. For example, the form F30 for the month of March in any year must be

    led, and the relevant PSWT payment made to Revenue, by 14 April of that year. Where no PSWT

    is deducted by an accountable person in a month, a NIL return mustbe led.

    5.5 Form F35 (annual return)

    (a) GeneralThis is an annual return made by an accountable person declaring their PSWT liability for a tax

    year and must be led electronically (see section 2.3) by 15 February following the end of the tax

    year to which it relates. Where an accountable person deducts no PSWT in a tax year, a NIL

    return mustbe led for that year.

    (b) Details to be returned on form F35

    Details to be returned on the form F35 are as follows:

    total PSWT liability for a tax year in respect of all relevant payments made by an accountable

    person in that year. Where a form F43 was issued during the tax year to amend the amount

    of a relevant payment or the amount of PSWT deducted on an original form F45, the

    accountable person must ensure that the corrected gures are reected on the form F35,

    total PSWT already paid to Revenue for the tax year through the monthly form F30 return

    procedure,

    the difference, if any, between the total PSWT liability for the tax year and the total amount

    of PSWT paid to Revenue throughout the year. Where a balance of PSWT is owed, payment

    of the balance of PSWT should be made electronically to Revenue at the time the form F35

    is submitted. Where an excess amount of PSWT has been paid, Revenue will liaise with the

    accountable person.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    19/2619

    (c) Schedule to accompany form F35

    A schedule giving details of the total relevant payments made to, and the total PSWT deducted

    from, each specied person in the tax year must accompany the form F35. The schedule must be

    completed under the ve headings listed on the form F35, as follows:

    Name of Specied Person

    AddressPPS Number/Tax reference number

    Total of Relevant Payments from which PSWT was deducted

    Total PSWT deducted

    Queries regarding forms F30/F35 should be made to:

    Services and Transactions Taxes Unit,

    Collector-Generals Division,

    Government Ofces,

    Mill Lane,

    Listowel,

    County Kerry.

    Phone: 068 56936 or + 353 68 56936 (from outside Ireland).

    5.6 Requests for forms and security numbers

    All requests by accountable persons for forms, stationery and security numbers should be made

    to the Revenue ofce dealing with the accountable person. Accountable persons must provide the

    following information with their request:

    the name of the individual making the request,

    the name, address and telephone number of the accountable person,

    the Tax Reference Number of the accountable person,

    the type and the quantity of forms (or security numbers) required and, in the case of form F45,

    whether manual or continuous stationery version is required.

    5.7 Irish version of PSWT forms

    Form F45 (Manual), form F43, form F30 and form F35 are available in Irish.

    Accountable persons wishing to use the Irish version of the above PSWT forms should inform theirRevenue ofce in writing.

    5.8 Rectifying errors

    (a) PSWT deducted in error

    Where PSWT has been deducted in error and remitted to Revenue, the accountable person

    should provide written conrmation to this effect (indicating the reason for the error) to the

    specied person. The specied person should forward this written conrmation, together with

    the relevant form F45, to the Revenue ofce that deals with the specied persons tax affairs.

    Revenue will, if appropriate, refund the PSWT deducted in error to the specied person.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    20/2620

    Where the PSWT has been deducted in error but has not been remitted to Revenue, the

    accountable person should retrieve the form F45 from the specied person and refund the

    relevant amount to the specied person. Both parts of the original form F45 should be marked

    cancelled and retained by the accountable person.

    (b) Excess PSWT deducted

    Where it is found that excess PSWT has been deducted, the accountable person should: retrieve the form F45 that issued when the relevant payment was made,

    issue form F43 showing the correct details of PSWT deducted,

    refund the excess PSWT deducted to the specied person, and

    reduce the next monthly return (form F30) of PSWT made to Revenue by the amount of the

    PSWT overpaid in respect of the error.

    Where the next monthly return falls into a different tax year, please refer to paragraph (f) below.

    (c) Insufcient PSWT deducted

    Where it is found that insufcient PSWT has been deducted, the accountable person should:

    retrieve the original form F45 that issued when the relevant payment was made,

    issue form F43 showing the correct details of PSWT deducted, and

    remit the additional PSWT due on the payment with the next monthly return (form F30) of

    PSWT made to Revenue.

    Where the next monthly return falls into a different tax year, please refer to paragraph (f) below.

    (d) Payment made twice

    Where a relevant payment is made twice in respect of the same transaction, the accountableperson should:

    retrieve the duplicate payment and the form F45 in respect of that payment from the specied

    person,

    mark both parts of that form F45 as cancelled and retain them together,

    reduce the next monthly return of PSWT made to Revenue by the amount overpaid to

    Revenue in respect of the error.

    Where the next monthly return falls into a different tax year, refer to subparagraph (f) below.

    (e) Payment made to the wrong person

    The accountable person should:

    recover the payment and the form F45 that was issued to the wrong person,

    mark both parts of the form F45 as cancelled and retain them together,

    issue a form F45 together with the payment to the correct specied person.

    While, in this instance, no amendment is required to the remittance of PSWT to Revenue, care

    should be taken to ensure that the schedule accompanying form F35 (annual return) accurately

    reects payments made to all specied persons. However, if the payment to the correct person is

    made in a different tax year to the earlier payment, please refer to paragraph (f) below.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    21/2621

    (f) Error made in one tax year and rectied in a subsequent tax year

    Where a PSWT error relating to a tax year is discovered after form F35 for that tax year has been

    led, the error cannot be rectied by adjusting the next monthly remittance to Revenue.

    Instead, an amended form F35 should be completed and submitted electronically to Revenue.

    Where the amended form F35 results in an additional liability to PSWT, payment of that amount

    should be submitted electronically to Revenue. Where the amended form F35 results in an

    overpayment of PSWT by the accountable person, Revenue will liaise with the accountable

    person.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    22/2622

    Appendix 1 - Revenue Opinions regarding Professional Services

    1 Advertising Services

    Subject to the comments below in relation to advertising space or time, payments for advertising

    services are subject to PSWT. Advertising services include services involved in:

    designing an advertisement, and

    conducting an advertising campaign.

    Advertising services can involve the use of many other services. For example, they may involve

    the services of photographers, models, graphic art designers, commercial artists, freelance writers

    and printing. Where an advertising service is provided by an advertising agency, PSWT is to be

    deducted from the total payment (for all component services) by the accountable person to the

    agency.

    It should be noted that outside of the scenario outlined above, services such as photography,

    modelling, graphic design, commercial artistry, freelance writing and printing are not of themselves

    generally professional services for the purposes of PSWT. Accordingly, where an accountable

    person makes a payment for any such individual service directly to the person providingthe service, the payment is not subject to PSWT unless such service forms part of a wider

    consultancy.

    Advertising Space or Time

    Where advertising space or time is provided as part of an overall professional service, e.g. by an

    advertising agency as part of an advertising service, the total payment for the service (including

    the advertising space or time) is subject to PSWT. Payments made to:

    an advertising medium (e.g. a newspaper), or

    a person acting as an agent for an advertising medium (e.g. an advertising agency) in order to

    obtain advertising space or time are not generally subject to PSWT.

    2 Archaeology

    Payments in respect of archaeological consultancies are subject to PSWT. In general, payments

    in respect of archaeological digs or excavations are not subject to PSWT. However, where

    archaeological digs or excavations form part of an overall professional service, for example, an

    archaeological consultancy, the full amount of the payment is subject to PSWT.

    3 Auctioneers/Estate Agents/Valuers

    Payments in respect of an auctioneers, estate agents or valuers fees are subject to PSWT.Where the fee includes advertising costs, the full amount of the fee (including advertising costs) is

    subject to PSWT.

    4 Bank Charges

    Payments in respect of fees, commissions and charges for banking transactions are subject to

    PSWT. However, the charge imposed by a bank for the ordinary servicing of a customers current

    account, which is debited to the customers current account, is not subject to PSWT.

    5 Board Members/Chairpersons

    Payments made to chairpersons and individuals who sit on boards and committees are generallyemoluments from an ofce chargeable to tax and subject to the operation of PAYE/PRSI.

    Accordingly PSWT does not apply to such payments.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    23/2623

    6 Computer Services

    Payments for independent advice on the installation, development (including the development

    of a web site) or running of computer systems are subject to PSWT. Payments in respect of the

    following services are not subject to PSWT:

    the sale of computer hardware and software packages

    the sale of software packages developed by the seller. This continues to be the position wherethe cost of the hardware or software package includes an element of service which is not

    charged separately to the customer, for example:

    - initial analysis of the work to be computerised

    - development of a hardware or software package for the customer

    - provision of training and other back-up services

    maintenance of computer software.

    7 Consultancy

    Payments in respect of any type of consultancy are subject to PSWT. Note that a service, whichinvolves the provision of advice, is a consultancy.

    8 Costs of Acquisitions/Disposals of Land or Property

    General

    Payments in respect of professional costs associated with the acquisition or disposal of property

    or land other than under a compulsory purchase order (see below), including payments made

    in respect of the professional costs of a person other than the accountable person, are subject

    to PSWT. Payments in respect of professional costs incurred prior to the formal conrmation of

    a compulsory purchase order are also subject to PSWT unless they are part of an out of court

    settlement (see Opinion 9 below).

    Property/Land Acquisitions by Compulsory Purchase Order

    Where property is acquired by compulsory purchase order, the following are subject to PSWT:

    conveyancing costs,

    payments made by the accountable person in respect of the accountable persons own costs.

    Where property is acquired by compulsory purchase order, the following are not subject to PSWT:

    professional costs awarded by an arbitrator. Examples include the vendors legal costs,

    auctioneers fees, estate agents fees, valuers fees, etc., professional costs incurred in reaching agreement, prior to arbitration, where such costs could

    have been awarded by an arbitrator.

    9 Costs of Legal Actions

    Where, under a ruling of a court, tribunal or similar body which is legally empowered to award

    costs, an accountable person is required to make a payment to a person in respect of professional

    costs incurred by that person, the payment is not subject to PSWT. This also applies where the

    payment is made directly by the accountable person to the person who provided professional

    services.

    The reason for not applying PSWT in these circumstances is that, once awarded, the costs areregarded as a compensation payment made by the accountable person and not a payment in

    respect of professional services.

    PSWT applies to payment of the accountable persons own costs, including any payment out of

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    24/2624

    costs awarded to the accountable person.

    Payments made to a person in an out of court settlement towards the professional costs of that

    person are not subject to PSWT if the action was one in respect of which an order for costs could

    have been made by the court, tribunal etc.

    In all other cases, PSWT must be deducted from payments made in respect of the costs of a

    person other than the accountable person.

    10 Debt Collection

    Payments in respect of a debt collection service are subject to PSWT. However, where no

    payment is actually made but instead a percentage of the amount recovered is retained by the

    debt collector, PSWT does not apply.

    11 Dental Technicians

    Payments in respect of the supply by a dental technician of goods such as dentures, dental braces

    and other prosthetic appliances (which are manufactured by the dental technician), directly to an

    accountable person, are not subject to PSWT.

    12 Employment/Recruitment Agencies

    A service involving the interviewing, screening, or selection of candidates for a job is regarded as a

    consultancy service and, accordingly, payments for such services are subject to PSWT.

    Payments to employment or recruitment agencies simply for the placement of individuals are not

    subject to PSWT.

    13 Films/Radio/Television Programmes

    Payments made directly to actors, producers and directors and for post-production facilities solely

    for the purposes of making a lm, radio or television programme or series are not subject toPSWT.

    Where accountants, solicitors, etc. are engaged to provide professional services for the purposes

    of making a lm, radio or television programme or series, payments made by an accountable

    person for such services are subject to PSWT.

    14 Insurance

    Payments in respect of insurance consultancy services are subject to PSWT. Examples of such

    services include loss adjusting, identication/assessment of risk exposure, marketing risks, policy

    design, actuarial advice and claims analysis.

    Payment of excesses under insurance policies are not subject to PSWT.

    Payments of insurance premiums to brokers for transmission to an insurance company are not

    subject to PSWT. However, where a broker charges a separate fee for his services, PSWT should

    be deducted from the brokers fee. Such a fee could be in the form of an annual management fee

    or a fee charged in relation to a specic transaction.

    15 Laboratory Tests

    Payments in respect of laboratory tests are subject to PSWT where the tests involve a service

    which is a professional service. For example, payments in respect of medical tests such as blood

    tests and biopsies are subject to PSWT because the service is of a medical nature.Payments in respect of laboratory tests are not subject to PSWT where the test is not a service

    which is a professional service. For example, a payment in respect of a test to measure the level

    of pollution in water is not subject to PSWT.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    25/2625

    16 Medical Appliances

    Payments in respect of the supply of articial limbs, articial eyes, surgical and medical appliances

    including any incidental service of tting are not subject to PSWT. However, where a separate

    fee is charged for tting, the fee is subject to PSWT as the payment is for a service of a medical/

    optical/aural nature.

    17 Medical Costs incurred in respect of EmployeesWhere, as part of their conditions of employment, the employees of an accountable person are

    entitled to submit bills for medical treatment incurred by them for payment by the accountable

    person, payments made by the accountable person to its employees in reimbursement of those

    expenses are not subject to PSWT.

    Where, the accountable person pays a medical practitioner directly for the provision of medical

    services to the employee, PSWT applies to the payment.

    18 Opticians/Optometrists

    Where opticians/optometrists receive payments from the Department of Social Protection or from

    the Health Service Executive, the cost of goods provided may be excluded from the amount to be

    charged to PSWT where the fee and the cost of the goods are shown separately.

    Opinion 16above applies as regards payments in respect of optical appliances.

    19 Printing

    A printing service is not of itself a professional service within the terms of PSWT. Accordingly,

    payments in respect of services that involve printing and nothing else are not subject to PSWT.

    Where printing forms part of an overall professional service provided to an accountable person, it

    is an expense incurred in the provision of that service. The full amount of the payment in respect of

    the service including the printing of forms is subject to PSWT. For example, where an accountableperson commissions a specied person to design and print a brochure, the entire payment for the

    production of the brochure is subject to PSWT.

    20 Quality Control

    A quality control service is not of itself a professional service within the terms of PSWT.

    Accordingly, payments in respect of quality control services are not subject to PSWT where the

    service provided has no professional element. For example, payments in respect of examinations

    to determine whether a quality control level is achieved are not subject to PSWT.

    Where a quality control service includes a professional element, the entire payment is subject to

    PSWT. For example, payments in respect of a quality assurance consultancy, i.e. the provision of

    advice on quality control matters are subject to PSWT.

    21 Retail Chemists

    Payments made to retail chemists are subject to PSWT. However, the cost of goods supplied and

    containers may be excluded from the amount to be charged to PSWT if these costs are separately

    identied.

    22 Training

    Payments in respect of training consultancy services are subject to PSWT. Examples of a training

    consultancy service are:

    the provision of advice on training requirements, and

    the design/development of a course, syllabus or programme.

  • 8/11/2019 A Revenue Guide to Professional Services Withholding Tax (PSWT) for Accountable Persons and Specified Persons

    26/26

    Payments in respect of the following services are not subject to PSWT:

    teaching, training or lecturing services (see article on the taxation of part-time lecturers,

    teachers and trainers in Tax Brieng No. 28 October 1997 pages 19/20 available on the

    Revenue website.),

    speeches/lectures given by guest speakers,

    the provision of material for open and distance learning courses including any element ofprofessional service involved in preparing or developing such courses which is part of the

    overall package of the provision of the material and which service is not charged separately to

    the customer.

    23 Video Production

    Payments for the production of a video by a specied person are not subject to PSWT provided:

    there is no element of consultancy included in the service provided by the specied person

    and,

    the video is subsequently sold by the specied person as a nished product to the

    accountable person.

    Where there is an element of consultancy involved in the service provide by the specied person,

    PSWT applies to the full amount of the payments.