New Tax Administration online services

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New Tax Administration online services
January 1, 2009
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The IRD is moving towards online services

• The Department will be offering a number of
  Internet services that will be
• secure,
• safe,
• fast,
• convenient,
• straightforward.

 
The new system will become operational on January
1, 2009
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New Tax Administration System

• Taxpayers will be able to use the Internet
  to
• Get a unique user
• identification number
• and a password,
• Register,
• Update Identification
• information,
•  

• Prepare and file their tax (individual income
  tax, corporation tax, reverse tax credit,
  partnership etc.) and information returns,

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New Tax Administration System

• Authorize their accountants or tax agents to file
  returns and complete services on their behalf,
•  

• Request Tax Clearance
• Certificates,
• File objections and query the
• status of their returns,
• Obtain services and file returns from the comfort
  of their home, work or from any location (with
  access to the Internet) that is convenient to
  them and more

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Attachments and the New Tax Administration
System

• No attachments will be sent
• to the IRD with returns,
• whether filed electronically
• or on paper
• Taxpayers must retain all supporting
• documents for presentation to the IRD if
  required (audit)

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PAPER! Much less paper!

• Although discouraged
• traditional paper filing
• and services will remain

• File Electronically
• Save Time
• Save Paper

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Benefits and Advantages

• Faster processing of taxpayers' returns,
• Faster refunds,
• Faster Reverse Tax Credits,
• More efficient tax administration,
• Save time, money and paper,
• System performs many calculations,
• Avoid transposition and arithmetical errors,
• Check account status online,
• Immediate confirmation of return filed status 

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Third Party Information
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Third Party Information and Tax Administration

• Tax related information regarding a taxpayer,
  provided to the tax administration
• by someone other than the
• taxpayer him/herself
• The third party information
• is used by the tax
• administration to cross-reference and
  validate tax related information provided by the
  taxpayer

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Third Parties and the new tax administration
system
Many institutions and organizations will be
providing their client information to the IRD
including

• Employers,
• Insurance and mortgage companies,
• Credit Unions, banks and other financial
  institutions,
• Pension plan providers,
• Securities Stock Exchange,
• Co-operative societies,
• Registered Trade Unions,
• Government departments,
• National Insurance Scheme (NIS)

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Examples of third party information

• Statements of remuneration paid and deductions
• Statements of payments for the supply of goods
  and services
• Statements of amounts withheld (new)
• Interest
• Mutual fund early redemption
• New shares in public company early redemption
• Tax deductible contributions (new)
• News shares in a public company
• Residential (Owner occupied) mortgage interest
• Insurance premiums on residential property
• Miscellaneous Income (new)
• Superannuation/Pension payments
• Taxable NIS benefits

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Third Party Information Cross-Reference and
Validation Process
Tax Return
Examination Contact Reassessment
Validation
Valid?
No
IRD Data Base
Yes
Third Party Information
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Statement of Remuneration Paid and Deductions
A47009 Income Tax Deducted 500
Tax Return Income Tax Deducted 1,000
Examination/Contact - Reassessment or Adjustment
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PAYE
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Pay As You Earn (PAYE)

• Employers provide the
• largest amount of third
• party information to the
• IRD

• Most important element
• to cross reference employment income and tax

• deductions on individual income tax returns with
  corresponding information provided by employers

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Specifications for the transmission of PAYE
(A47009) information to IRD

• Four options will be available to file year-end
  information returns with the IRD
• Internet File Transfer - directly to the IRD over
  the Internet via XML schema (preferred option)
• Web Forms file information directly to the IRD
  using a web form template
• Electronic filing - (XML schema) by CD or
  diskette
• Manual filing, Traditional preparation of
  information return on paper and filing with the
  IRD

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PAYE Requested Information

• All the required forms have been redesigned and
  the following information will be filed for each
  employee.

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PAYE Requested Information
Employers
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PAYE Requested Information
Employers
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PAYE Requested Information
Employers
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(No Transcript)
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The NRN key to e-filing
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NRN and the IRD

• The IRD uses the National Registration Number
  (NRN) as a Taxpayer Identification Number (TIN)

Taxpayers are encouraged to provide their
correct NRN to their employers and other
third party information providers to ensure that
they get proper credit for taxes deducted, income
earned and tax deductible contributions made. The
NRN is the key to cross referencing information
and identifying taxpayers
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NRN and the IRD

• Electronic filing enables the IRD to efficiently
  process income tax returns and issue refunds
  considerably faster than paper filing.

However, the presence of invalid NRNs
jeopardizes this efficiency. In these cases, the
IRD will have to suspend return processing and
undertake investigation to validate NRNs before
processing the Income Tax Return.
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How Does the IRD Utilize the NRN?
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Thanks
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IRD Contacts
http//www.barbados.gov.bb/ird/
Marvin Ishmael Project Manager ishmaelmarvin_at_gmail
.com Phone [phone]
Dennis Brereton Elson Browne PAYE
Audit denbrer_at_hotmail.com enalbrowne_at_hotmail.com P
hone 430 3157/ 3174