Revenue clampdown on building contractors

A new system allowing the Revenue to identify all contractors on every building site in the Republic is likely to increase the tax collected from the construction industry.

The Revenue has introduced site identification numbers that will oblige contractors to identify each development they are working on and detail all payments connected with each one.

More tax collected

Ivor Feerick

, head of accountancy firm

BDO

Ireland’s contracts tax practice, said the new system should increase tax collected from builders as it will give the Revenue more information than previously on the money that each contractor receives for work.

“It enables them to carry out a detailed examination of the contracts on a particular site from the top down,” Mr Feerick said. He added that this would allow them to identify where there are risks of tax evasion and to follow up with focused audits or other action.

The new legislation came into force this month. Companies have to fill in details on the Revenue online service as soon as possible after receiving it and there are penalties if they don’t comply.

Principal contractors have to give the site identification number to sub-contractors who in turn must notify the Revenue of those contracts.

The tax collectors are clamping down with unannounced site visits, gleaning more information from suppliers of goods and services and liaising with UK counterparts.

“The Revenue is very aware of the potentially very significant tax contribution from the construction sector in the coming years ,” Mr Feerick said.