Third Party Returns (Form 46G) to the Revenue Commissioners

Annual report

By virtue of section 889 & 894 TCA 1997:

(a)         Solicitors, auctioneers, accountants, trustees and stockbrokers and other professional advisers;

(b)        Bankers; and

(c)         Ordinary business and, in certain circumstances, institutions such as government departments, semi-state bodies and charities;

are obliged to report annually to the Revenue Commissioners on certain payments made, payments received and transactions carried out in the course of their business.

Third Party Returns are returns to the Revenue Commissioners of payments made to anyone for services rendered in connection with a trade, profession or business.

Legislation now requires this return, each year, from all businesses. It is due in respect of payments to any person in excess of €6,000 per annum for services rendered. Receipts of payments subject to capital gains are not included in the reporting requirements and only the receipts of payments which are income are to be reported on.

Information required

The return will include commissions, fees and expenses paid (or other valuable consideration given) for services rendered by persons ordinarily resident in the State. The information required in respect of such payments is as follows:

• Name.
• Address (business or private).
• Income Tax Number (PPS number or VAT registration number).
• Amount (VAT exclusive).
• Nature of the service rendered.
• Nature of consideration, if not money.
• Period over which services provided.

The Revenue Commissioners administration burden of matching tax reference numbers with names is thus being transferred to the taxpayer. The recipients tax number on this return provides the Revenue with a direct link between the expense in one trader’s records and the income in another’s.

Excluded

The following payments need not be included in the return:

• Payments totalling less than €6,000 per year to any one person.
• Payments for services in which the value of any goods provided as part of the service exceeds two-thirds of the total charge.
• Payments from which tax is deductible (e.g. salaries and wages, payments to subcontractors, fees paid subject to withholding tax).
• Purchase of goods.
• Payment to utilities such as ESB, telephone, water.
• Bank interest and charges.
• Payments to persons not resident in the State.

For individuals and bodies of persons other than companies, a Third Party Return is required in respect of payments up to 31 December each year or, if more convenient, up to the date on which accounts of the trade are normally prepared. Third Party Returns must be made up annually before 31 October following the end of the tax year to which the return is prepared.

For companies, Third Party Returns must be made not later than nine months from the end of the accounting period.

You should note that it is your responsibility to ensure that you make a return where necessary irrespective of whether the Revenue have requested you to make a return.

To avoid penalties accruing the return should be submitted to your Revenue office by the return filing date – see above.

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