The Minister for Finance, Michael McGrath, has confirmed that Revenue will refund €487,500 in warehouse debt interest payments made by 475 customers.
Earlier this month, Mr McGrath announced that the interest rate applied to warehoused debt was to be reduced to zero and that Revenue would issue refunds of any interest at 3 per cent already paid by businesses on such debt.
The tax debt warehousing scheme was introduced in May 2020 to provide liquidity support to businesses from the outset of the Covid-19 pandemic. At the end of January, a total of €1.7 billion remained warehoused for 57,244 taxpayers with 70 per cent of the taxpayers concerned having outstanding liabilities of less than €5,000.
In a Dáil reply to a question from Independent TD Thomas Pringle on the issue, Mr McGrath stated that €487,500 would be refunded in interest payments to 475 customers, an average of just more than €1,000 per customer.
[ Revenue signals ‘total flexibility’ on payment for warehoused pandemic tax debtOpens in new window ]
Mr McGrath stated that, in addition to this, there were almost 2,200 customers who were currently involved in active Phased Payment Agreements (PPAs) for warehoused debt of an aggregate €169 million.
The Minster stated that when the PPAs were agreed, the 3 per cent interest rate was included in the monthly payment calculations.
[ Revenue urges businesses to pay €1.8bn in warehoused Covid debtOpens in new window ]
[ Interest on warehoused business tax eliminated, benefiting 57,000 companiesOpens in new window ]
“To ensure that these customers benefit from the interest rate reduction, the schedule of future monthly payments for each arrangement will be recalculated and adjusted downwards to reflect the interest rate reduction,” he said.
“Therefore no refund of interest is required for these customers as they will receive credit for the interest through adjustment of their ongoing payments arrangements.”
Mr McGrath provided figures showing that of the €1.7 billion, there were 27 taxpayers classified as high-wealth individuals who had warehoused a total of €7 million. The Minister said that such taxpayers were admitted to the scheme after being approved subject to certain criteria.
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