revenue Archives - Pat Carroll PCCO - Chartered Accountants & Tax Advisors

Revenue notifies 3,000 taxpayers of text scam

Fraudsters may have accessed thousands of taxpayers’ Revenue accounts using information provided by them unwittingly.

Revenue has written to around 3,000 taxpayers advising them that their myAccount may have been accessed as part of a scam which was sent via text message.

Revenue’s Chief Information Officer, John Barron, explained that Revenue constantly monitors for suspect online activity on all its services and takes action as soon as such activity comes to light.

“For example, where potential phishing websites are detected, we immediately seek to have them taken offline by reputable hosting services,” he said.

Following an investigation by Revenue’s IT Department into this latest scam, a letter has been sent to approximately 3,000 taxpayers to make them aware of its concerns that their personal details may have been accessed, the possible serious implications for them and to set out some practical things they can do to minimise the extent of any fraud perpetrated against them.

Mr Barron stated that “it is important to note that the security of Revenue’s systems has not been compromised in any way.

However, the nature of this particular type of scam has led to some taxpayers unwittingly compromising the security of their personal myAccount profile details by providing information such as their PPS number, date of birth and myAccount password to fraudsters.

This occurred after the taxpayer clicked on a link, in a text sent by fraudsters, which purported to be the Revenue ‘myAccount’ log-in screen.”

If the details provided after clicking the link are valid, the fraudsters then use these details provided by the taxpayer to access the taxpayer’s myAccount user profile screen.

At this stage they may be able to obtain further information including potentially bank details where the taxpayer has recorded these with Revenue.

Mr Barron confirmed that “in order to mitigate any further threat to the accounts that could have been potentially compromised, we are now contacting each of the taxpayers by letter informing them of possible fraudulent activity that may have affected their account.

The letter notifies the taxpayer that Revenue has temporarily deactivated their myAccount access and advises them of important next steps they should follow.”

Revenue regularly reminds taxpayers that it never sends text messages requiring the provision of personal information via links, pop-up windows, reply text or email. 

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Revenue reveals further cashflow help for businesses

Revenue has announced further measures to help companies with cashflow difficulties through the coronavirus crisis.

The tax collector has suspended the charging of interest on late payments for May and June PAYE liabilities due in June and July from small and medium sized firms (SMEs) with turnover of less than €3m.

It has also suspended late payment interest on May and June VAT liabilities normally due in July from SMEs.

However, while the suspension will be automatic for SMEs, larger businesses will have to request it if they want to avail of it by contacting the Collector-General’s office or by engaging directly with their Large Corporate Division or Medium Enterprise Division branch contacts.

The charging of interest on late payments has already been suspended for January and February as well as March and April VAT as well as February/March and April PAYE (Employers) liabilities. 

The total cost of the deferrals during March and April according to Revenue is more than €1.26bn.

Despite the suspension of the interest, Revenue says it is important tax returns are filed, even where payment or part payment is not immediately possible. 

“Where key personnel are unavailable to compute the tax returns due to the COVID-19 virus, businesses should still file on a ‘best estimates’ basis,” it said in a statement.

“Any subsequent amendments can be completed on a self-correction basis without penalty.”

Revenue also revealed this evening that it will operate the warehousing of deferred tax debts scheme, announced last weekend by the Government, on an administrative basis until the necessary legislation has been enacted.

“In effect the amounts deferred from March will be warehoused,” it said.

“Under the scheme, VAT and PAYE (Employer) tax debts deferred while a business is unable to trade or was subject to restricted trading due to the COVID-19 related health restrictions, as well as debts for an additional two months after the business resumes ‘normal’ trading, will be ringfenced by Revenue.”

“There will be no collection of any of the debt in question during this period and no interest will apply.”

If firms want to avail of the scheme they will have to first quantify the tax debt by filing all relevant returns for the period in question.

Once trading returns to normal, the VAT and PAYE owed will be warehoused for a year.

“However, businesses will be expected to pay current liabilities as they arise during this 12-month period,” Revenue said.

Once the 12 month period is up, the outstanding debt will incur a 3% interest rate until it is paid back.

Normally unpaid VAT and PAYE is charged 10% interest.

A company’s tax clearance will not be impacted if it uses the scheme.

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Revenue urges early engagement if virus causing tax difficulties

Revenue has said it will engage with any viable business that experiences temporary cashflow difficulties as a result of exceptional circumstances such as the Covid-19 outbreak. 

Collector-General Joe Howley said that Revenue is aware that when temporary cashflow issues arise for a business, it can be a worrying time in terms of the ability to keep an otherwise good tax compliance record on track. 

He said that rather than hoping such payment difficulties will fix themselves in time, he strongly encourages affected businesses to take some practical steps.

These include businesses continuing to send in their tax returns on time and to engage early with with Revenue is a business runs into, or faces, difficulty in paying their tax.

Revenue said it works very successfully with businesses that engage early to resolve their tax payment difficulties.

This is evidenced by the fact that, at the end of 2019, over 6,300 businesses had phased payment arrangements in place covering €73m in tax debt.

“It is important that businesses know that we will work with them to resolve their tax payment difficulties,” Mr Howley said. 

“With early and meaningful engagement, we can generally agree payment arrangements that are acceptable to both the business and Revenue. This gets the affected business successfully beyond the payment pressure point and keeps a good tax compliance record on track,” he added.

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Revenue’s PAYE changes will see end of P60

Revenue has today outlined what it has described as the most significant changes to the tax system since 1960 when PAYE was introduced.

The changes are intended to make tax matters easier for the general public by removing much of the paperwork that normally goes in tandem with paying tax. 

The new system will result in the removal of the P45 and P60 systems in the coming weeks and their replacement with a “real time, comprehensive financial summary” of a person’s employment history.

Revenue said the new system will result in significant benefits to the public.

These benefits include greater transparency about the taxes people are paying through their salary, greater transparency to ensure employers are paying the taxes they should and improved access to tax rebates and medical refund claims during the year

The P60 – a certificate detailing total pay and deductions including PAYE, PRSI and the Universal Social Charge – is being replaced by an Employment Detail Summary. 

In preparation for the changes, employers have been providing reports on a worker’s income and statutory reductions to Revenue every time they get paid so they have been building up a real time update of taxes paid. 

By registering for and using the MyAccount option on the Revenue website, PAYE workers can view their deductions as they happen.

They can also make claims for tax refunds, for which there is a four year time limit.

Over 181,600 employers made 6.1 million payroll submissions, reporting gross pay and pensions of over €98 billion in 2019, Revenue said today. 

The total Income Tax, USC and PRSI paid to the Exchequer for 2019 was €31.6 billion. 

Ruth Kennedy, Revenue’s Project Manager for PAYE Modernisation, said the scraping of the P60 is the biggest change to the “pay as you earn” system since the 1960s. 

Ms Kennedy said the changes will ensure people pay the right tax at the right time and get the full benefit of their entitlements throughout the year. 

She also said the changes to the system means that people will be less likely to pay emergency tax if they change job, because employers will be able to access real time tax credits.

The changes will not be more expensive for employers and 89% of surveyed employers said that the new measures make it easier for them, Ms Kennedy added. 

Announcing headline results today, Revenue said it collected total net receipts of €73.9 billion in 2019.

This included €58.4 billion in taxes and duties for the Exchequer and €15.5 billion on behalf of other Departments, agencies and EU member States.

Along with increased Exchequer receipts, Revenue also reported continued very high levels of timely, voluntary compliance.

It said this reflected the fact that the vast majority of taxpayers do the right thing and pay the right amount of tax, on time.

Revenue Chairman Niall Cody said that Revenue is very conscious of the need to support taxpayers to be voluntarily compliant by providing quality service in a timely, cost effective way. 

“We acknowledge and appreciate the engagement of taxpayers, and that of tax practitioners and agents, in the very strong compliance that was a feature of the year just gone,” Mr Cody added.

On Brexit, Mr Cody said that Revenue’s Brexit preparedness and contingency planning is strongly focused on supporting and helping businesses to plan and prepare for the UK leaving the European Union. 

Revenue appointed 586 staff to Brexit-related roles last year. 

“We had significant engagement with businesses that trade with the UK, writing to over 103,000 businesses with Brexit preparatory advice, and contacting almost 29,000 business via telephone,” Mr Cody said. 

“As a result of these engagement programmes, there was a significant increase in customs registrations with over 24,100 businesses acquiring an Economic Operator and Identification (EORI) number in 2019,” he added.

A EORI number is the minimum requirement for businesses to be able to move goods to, from or through the UK after Brexit.

During 2019, Revenue also completed over 567,000 compliance interventions, which yielded €547.6m.

It also seized 259 unlicensed gaming machines, settled 127 tax avoidance cases yielding €29m and secured 15 criminal convictions for serious tax evasion and fraud. 

It published 214 tax settlements in the List of Tax Defaulters and Mr Cody said Revenue continues to target and disrupt all forms of “shadow economy and illegal activity”. 

Last year Revenue seized over 13 million cigarettes worth €8.5m and 3,229 kilos of drugs with an estimated value of over €23.5m.

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Hotels’ costs rising faster than revenues, says report

Hotels’ costs rising faster than revenues, says report

HOTEL insurance rates are rising by 10pc per annum, prompting some operators to rethink how their leisure facilities in particular are used, according to Aiden Murphy, a partner with accountancy and advisory firm Crowe Ireland.

He said one of the options for hotel operators is outsourcing the management of their leisure facilities.

“For most hotels, insurance is up 10pc year-on-year in terms of cost,” said Mr Murphy. “It’s a significant increase and it’s twice the increase hotels have seen in revenue terms.

“It’s growing at a level that is a problem for hotels, and a cost they have to focus more and more on,” he added.

“You could very well see that hotels might outsource their leisure centres on the basis that the insurance premium for that facility may actually fall to a third party, and it may allow the core hotel to bring down its own premium to a more manageable cost,” said Mr Murphy.

Releasing its annual analysis of Ireland’s hotel sector today, Crowe Ireland said that labour costs also remain a significant cost issue for hotels.

“For the second year in a row, payroll costs have also increased at a greater rate than total revenues, placing added pressure on hotels across the country,” the report states.

“Increasing costs relate to salaries and benefits, higher turnover levels and increased training and development in a highly-competitive arena. This will continue to be one of the most challenging areas facing Irish hoteliers in the coming years.”

Utility costs for hotels also rose by 8pc last year, according to the analysis.

“It is becoming harder for Irish hotels to increase profit levels despite reasonable revenue growth, as many costs are now increasing faster than the underlying growth in revenues,” claimed the Crowe Ireland report.

Last year, the firm said an additional 11,000 hotel rooms would be needed in Ireland over the next seven years as tourist numbers continue to increase.

Mr Murphy pointed out that Dublin’s hotel occupancy rate, at 84pc, is the highest of any European city.

If the occupancy level in Dublin eased to 80pc or 81pc due to additional rooms entering the market, he believes, then it might give the capital a “more competitive offering”.

That might also iron out instances where hotel rates spike when certain events are on in the city, claimed Mr Murphy.

“Average room rates in Dublin have grown very strongly – much stronger than in other European cities,” he said.

Crowe Ireland’s report shows the average room rate in Dublin last year was €145.82, which is 6.5pc higher than in 2017.

Nationally, the average nightly room rate also rose – to €118.27 last year – an increase of 6.3pc compared to 2017.

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Revenue intensifies Brexit engagement with businesses

Revenue intensifies Brexit engagement with businesses

Officials from Revenue will be contacting 92,000 businesses around the country as preparations for Brexit continue.

Businesses will receive letters and phonecalls from officials outlining the steps necessary to prepare for Britain leaving the European Union.

The head of Revenue’s Brexit Policy Unit said while businesses should register for an Economic Operators Registration and Identification number, that is only part of the process.

Lynda Slattery said business should also carry out an impact assessment to identify how Brexit can affect their company and supply chain.

She also said that companies should understand who will do their customs declarations and how import duties will affect the commodities they import.

Ms Slattery said that while officials will contact 92,000 businesses over the next eight weeks, this does not mean that all of these companies have not engaged in the Brexit preparation process.

“The 92,000 is the figure identified who had some level of trade with the UK in 2018. Some are registered, some are not. We’re not taking any chances and are contacting everyone. We’ve written to them all and will be ringing them all,”Ms Slattery stated.

Ms Slattery also said that while there is ambiguity about Brexit, Revenue are operating on the basis that Britain will leave the EU on October 31.

She added that Revenue can provide absolute certainty that customs formalities will apply when Brexit happens.

Ms Slattery also said there is support for businesses available through the Revenue and Enterprise Ireland websites, as well as via the Department of Business.

Revenue said that based on the most up to date information available, it is estimated that 33% of businesses in the wholesale and retail trade, and 15% of businesses in the construction industry, who trade with, or perhaps buy supplies on an ad-hoc basis from, the UK have not yet applied for an EORI number.

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Revenue owed €40m in tax, fines and interest by defaulters

Revenue owed €40m in tax, fines and interest by defaulters

More than €39.82m remains unpaid to the Revenue Commissioners in taxes, penalties and interest from published tax defaulters in 2017 and 2018.

That is according to figures provided by Finance Minister Paschal Donohoe which show €15.5m remains unpaid by published tax defaulters in tax, penalties and interest from last year.

In a written Dáil reply to Labour’s Joan Burton, Mr Donohoe confirmed that a further €24.2m remains unpaid in taxes, penalties and interest from the 2017 lists of published tax defaulters.

The figures show that of the 265 tax settlements agreed last year with defaulters, the numbers that remain unpaid amount to 79 or 30pc of settlements.

This compares to 289 settlements agreed for 2017 where 101 settlements remain unpaid or 35pc of the overall total.

Ms Burton said: “I’m very shocked at the level of non-payment of tax settlements.” She said: “It is very unfair on the hard-pressed taxpayer that some of these tax defaulters can seemingly walk away from their obligations.”

A spokeswoman for Revenue said while Revenue vigorously pursues collection/enforcement of unpaid settlements “in some cases, the collection/recovery of the full amount unpaid will not be possible”.

“In some instances for example, a company may have gone into liquidation, while a number of the unpaid settlements in the Tax Defaulters List are as a result of the taxpayer claiming ‘inability to pay’,” she said.

Documentary evidence of inability to pay must be submitted to Revenue, with each case then considered on its own merit, as to whether an ability to pay exists or not.

Revenue currently has 500 people employed in all aspects of debt management.

The spokeswoman said: “In 2018, we collected €211.6m as part of our debt collections and enforcement actions. We can, and do, work very successfully with businesses and individuals who engage early with us to resolve their payment difficulties.”

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Revenue collected 26% more corporation tax last year

Revenue collected 26% more corporation tax last year

The amount of corporation tax collected by the state last year increased by 26% to €10.4 billion, according to the Revenue Commissioners’ annual report.

The increase was driven by higher payments from manufacturing companies and increased payments from big multinational companies.

The report also shows that the share of corporation tax paid by the top ten corporate taxpayers now accounts for 45% of all the corporation tax paid, up from 40% the year before.

Almost €1 in every €5 of tax collected by the Revenue Commissioners came from corporation tax last year – an extraordinarily high proportion by international standards.

The amount paid surged by 26%, underlining again the volatile nature of this tax head and how vulnerable the public finances have become to the risk of a sudden downturn in corporation tax payments.

There are 164,000 companies in Ireland, but just 100 of them pay almost three quarters of the corporation tax collected. Foreign owned companies paid 77% of last year’s corporation tax take.

In total, Revenue said it collected net Exchequer receipts of €54.6 billion for last year, up €4 billion on 2017.

There were increased receipts for almost all taxes and duties including Income Tax, up 6.6%, VAT up 7% and Corporation Tax.

Niall Cody, Revenue’s chairman, said that continued strong levels of timely, voluntary compliance rates of over 90% across all taxes confirm the reality that the vast majority of individuals and businesses pay the right amount of tax, on time.

Mr Cody acknowledged taxpayers’ engagement, and that of tax practitioners and agents, in achieving the very strong compliance rates seen again for 2018.

Today’s report also reveals that 400 additional customs officers have been hired of the estimated 600 required for Brexit duties.

Revenue said the delay to Brexit has enabled them to complete additional training, adding that as Customs and Revenue is an integrated service, staff can be redeployed from one are to another rapidly.

This means that in the event of a sudden Brexit, additional staff can be redeployed to cope.

The Commissioners appealed once again to firms that have not applied for an EORI number – which is free and facilitates customs declarations when trading with the UK after Brexit – to do so.

They warned that Brexit could happen suddenly before the 1 November deadline.

Revenue also said it it was “confident that our systems will successfully handle the increased transaction levels arising as a result of Brexit”.

Last year the authority processed 1.6 million customs declarations through their electronic systems.

It said it believes customs import and export declarations could rise to as many as 20 million a year after Brexit, due to the amount of trade the country has with the UK.

Looking ahead, Niall Cody said that it is very important that Revenue supports compliant taxpayers by identifying risks and tackling non-compliance in all its forms.

“We continue to be alert to, and pro-actively respond to, the risks arising from the changes in economic and business environments both nationally and globally,” he added.

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Revenue officials meeting hauliers in Brexit preparations

Revenue officials meeting hauliers in Brexit preparations

Revenue officers have begun engaging with hauliers at ports in Dublin and Wexford as part of preparations for a no-deal Brexit.

Concerns have been raised about the number of companies trading with the UK that have not yet registered for customs.

Lynda Slattery, head of Revenue’s Brexit unit, said that before Christmas they identified 84,000 companies that may be impacted by Brexit.

However, less than half of those have registered for customs so far. Speaking at Dublin Port this morning, Ms Slattery said they are “really concerned” by these figures.

Revenue officers were at Dublin Port and Rosslare Europort providing information to truck drivers on the impact of Brexit.

Officers are also on board some ferry sailings between Ireland and the UK offering information on the documentation that truckers will be required to have before arriving at ports, as well as the customs routes that they will have to take.

Speaking to RTÉ News, a number of truck drivers at Dublin Port said that this is the first time they have been provided with this information.

One driver, who works for what he said was a small UK firm, said “because we are so small we can’t really afford to just put things in place”.

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New Revenue system to hit SMEs for unpaid tax

New Revenue system to hit SMEs for unpaid tax

The Revenue Commissioners will chase more small companies for unpaid tax following the launch of a new high-tech debt management system.

Revenue’s Debt Management Services (DMS), which was brought in last week, uses technology to deal with a wider range of taxpayers.

This will include those who previously may have been too costly to identify and pursue.

A Revenue spokesman said that it would deliver “improved profiling of cases and deliver significant increased capacity to manage and support compliance and tackle non-compliance”.

“The new debt-management system will enable Revenue to review customers with lower turnovers on a more regular basis.”

Debt to revenue includes annual taxes, such as self-assessed income tax and corporation tax or taxes paid on a periodic basis such as Vat or PAYE.

The technology also offers more flexibility for phased repayments, however.

“The new system is fully online, allowing documentation to be uploaded electronically. It provides much quicker turnaround times for clarifications.

“It also gives customers greater flexibility to manage their payment schedule and make certain alterations to suit their circumstances,” said the spokesman.

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