If you are late with your payment, you had better act now, advises Noel Corcoran, because, like the banks, the Revenue Commissioners charges interest by the day.

For the first time, October 31st was a major tax deadline for the self-employed. Discussions I have had with members of the Institute of Taxation show that enormous efforts have been made to facilitate clients wishing to ensure their tax obligations are met. But the volume of cases means some taxpayers will have missed the deadline. So what can they do?

Despite the pressure, my advice is: don't panic. The Institute of Taxation was to the fore in negotiating an extension to the October 31st deadline with Revenue.

If the payment of tax was made before that date, tax returns can still be submitted to Revenue without penalty before November 21st.

If the payment has yet to be made, it can still be made to Revenue on the internet, through Revenue's Online Service (ROS), again before November 21st.

The tax return will still have to be submitted before that date, either "traditionally" on paper or via the internet.

And finally, if the liability is not too high (€5,000 or less) both payment and filing can be completed before November 21st and still avoid the penalty.

Be aware that if you fall into the last category, you have to make the payment through what Revenue calls the Single Debit Authority. This is similar to a bank giro, and the form you need to use for it is printed as part of the tax return.

Second, if you have missed the deadline, act now. Even if you do not fall into any of the extension categories, you will still save yourself interest charges by acting sooner rather than later. Revenue, like the banks, charges interest by the day.

The fewer days you are late, the less you may have to pay.

The income tax due on October 31st is an amalgam - it is any balance due for the previous tax year (typically around 10 per cent of the total), along with any tax on capital gains made in the previous year, plus an estimate for the current year. Calculating this estimate can cause problems.

An estimate is required because the current tax year has yet to expire. Tax years run from January to December; previously they ran from April 6th to April 5th.

The estimate should be accurate. If it is not, the taxman will not only seek to recover the balance due, but also levy interest on the shortfall at a rate of about 12 per cent (if Shylock were still around he might be envious).

To bring more certainty, a payment for the current year can be based on the full amount for the previous year, and thus the potential interest penalty is avoided.

This system is called Pay and File, as the taxpayer must provide a return of income for the past tax year along with the payment.

In future, when the system has bedded down, there will be advantages to this new approach as it will serve to simplify the administration of tax compliance.

The difficulty in 2002 is that Pay and File is not the only change that affects people's tax situation this year.

As well as this being the first time of operation of the Pay and File system, it is the first time the system operates with the tax year running from January to December. A further complicating factor in compiling the tax return for this year is the euro's introduction and the special transitional arrangements that operate once off as a consequence.

When I was a trainee, a wise man in the office I worked in always maintained that tax advisers acted for the client, not for the Revenue.

Revenue assesses and collects the tax, and polices the system. The division of work between Revenue and the taxpayer has changed dramatically. There is now a huge onus on the taxpayer to comply on a voluntary basis.

This change in emphasis has led to a gradual transfer of the bulk of the compliance burden from the Revenue official onto the taxpayer. In very many cases, this ultimately means the burden rests on taxation advisers.

The difficulty with this situation is that the requirement to meet deadlines, ensure accuracy, and pay on time has become a one-way street.

Failure to comply in any respect results in interest charges and/or penalties being applied to the taxpayer. On the other hand, Revenue staff when dealing with their now reduced part of the compliance burden have no such time deadlines, or penalties for errors, delays or mistakes.

This imbalance must be corrected if people are to accept the system as fair and reasonable. No regulation by the State can work unless there is an objectivity and equality for all involved.

In general, the institute welcomes Pay and File.

But it is necessary, particularly in this introductory year, for Revenue to apply commonsense when dealing with taxpayers who fail to file under the time constraints and by the required dates.

There has been so much change this year; the euro's introduction and the short tax year resulting in a second filing during 2002 have combined to put strain on the system and on the taxpayers and their advisers complying with their statutory obligations. People who evade their legal responsibility have no such stresses as they have chosen to ignore the deadlines.

The Institute of Taxation believes that Revenue should turn its attention to these individuals rather than to the compliant taxpayers who may need an extra number of days to fulfil their obligations.

Noel Corcoran is president of the Institute of Taxation in Ireland and principal in Noel M Corcoran and Associates.