MOST taxpayers in Ireland are unsure as to how much tax they hand over to Revenue each month. This is according to the first instalment of the year of the Taxback.com Taxpayer Sentiment Survey Series.
The tax refund specialists asked more than 3,000 taxpayers throughout the country, from their customer database, how well they know their own tax affairs and whether or not they would like to learn more. The findings revealed a dearth of knowledge on the subject, but also a big appetite to learn.
Highlights from the Taxback.com survey revealed 34% said they had “no idea” what rate of tax they’re paying Just 12% know exactly what they pay 46% do not understand their payslip – but the majority said they would like to know more A whopping 89% of respondents said they could see real benefits from an employer roll-out of a financial education programme.
Marian Ryan, Consumer Tax Manager at Taxback.com, commented on the findings: “Just over one-in-10 respondents said they were completely sure of what how much tax they pay. This leaves an awful lot of people who could be in the dark when it comes their taxes.
"In many ways, the findings are understandable – tax is just a given for most people – PAYE employees don’t even see it come out of their wages as it is deducted at source – so for them, it’s income they never had. What’s more, our experience would suggest that people just don’t know who to ask about general finances. But it’s very important to know about your personal tax affairs.
"Although your employer is responsible for deducting your taxes from your income, Revenue will always state that it is each individual’s own responsibility to ensure their tax affairs are in order and they are receiving all tax credits they are entitled too.
"Your employer will deduct tax based on your Tax Credit certificate, but only you can add additional tax credits to this.”
Taxback.com report that, when compared with a similar 2016 survey, it appears the number of those who don’t have any idea about their tax rate is actually growing, increasing from 26% to 34%.
Ms Ryan continued: “This knowledge gap needs to be addressed – perhaps by way of a public information campaign rolled out by Government or Revenue. Employers too could have a role to play.”
The Taxback.com survey asked respondents whether they would like their employer to provide a resource for greater education around personal finance and taxation, so they could have a better understanding of things like their payslip, tax bands, and tax reliefs. Support for such a programme was huge, with 89% agreeing that such a measure would be of benefit.
70% said that it would be of direct and personal benefit to them and 19% agreed it would help other colleagues.
Ms Ryan commented: “Our survey reveals a desire for employers to take an active role in educating their workforce on personal finance and tax matters. For many years, this hasn’t been something that employers even considered – not due to an unwillingness to look at these types of initiatives, but simply because it wasn’t on their radar. But these findings show that employees would really welcome this additional benefit to their employment.
"We have been working with a number of employers in recent months on similar initiatives, whereby we have been giving workshops to employees en masse via zoom, to help them better understand the jargon surround things like tax bands, reliefs, and refunds, the TWSS, and its impact on them from a tax standpoint.
"The feedback we’ve received has been hugely positive. The more we know on the topic, the more empowered we can be to take greater control over our tax affairs and ensure we make the most of all reliefs and refunds we are entitled to.” The Taxback.com survey also queried attitudes towards payslips, and whether people felt comfortable interpreting the information they contained.
“It’s notable that 35% of people would like to know more about their payslip and the workings of it. These people probably just don’t know who to ask. Perhaps if the information and advice was more accessible, then people may actively engage with their finances and taxes a bit more. We’re reluctant in this country to claim the reliefs and refunds owed – which is a shame, because many households throughout the country could really benefit from that added cash injection.”