We wish to inform you that Revenue are currently conducting Quality Assurance Reviews on the new electronic RCT system which was introduced on the 1st January 2012.
Our understanding is that Revenue plan to contact the majority of principal contractors over the remainder of 2012 to ensure that they are operating the new electronic system correctly.
The quality assurance review consists of the principal contractor being contacted by letter informing them of a proposed date and time for a meeting with revenue officials from the RCT section.
This meeting is an overview of the new RCT system as Revenue want to ensure that the principal is using the online system correctly. It is important to note that the meeting is not being treated as a Revenue audit or enquiry.
In advance of any meeting it is important that each principal completes an overview of how they have been operating RCT since the 1st January 2012.
Please find below a summary of what is involved in the Quality assurance review :
A meeting will be arranged by revenue at the principal’s place of business or at the office where the RCT system is being administered,
Revenue will ask basic questions about the principal’s business and the type of work involved,
Revenue will ask for feedback on how the principal finds the new system,
Revenue will ask the principal to highlight any areas of problems or difficulty,
Revenue may also wish to sample check the details of contracts and review the payment notifications dates on ROS and compare them to the dates on cheque/payment’s made to the subcontractor.
The most important issue for the principal is to ensure that before making a payment to a subcontractor the principal must inform Revenue through ROS (Revenue online system) of the gross amount to be paid. Revenue will then notify the principal contractor of the amount to be deducted from the subcontractor (either 0%/20%/35%). This confirmation will appear in their ROS inbox and it isonly then that the principal can make a payment to the subcontractor.
The costs to the principal of not operating the system correctly are significant as regards interest, penalties and surcharges. For example, a €100.00 surcharge will apply if a return needs to be amended and additional interest and penalties may also apply.
For more detailed information on the new RCT rules please click on this link to our previous article from earlier this year or click here for a link to the revenue article on the new RCT guidelines