Revenue crackdown yields 100 calls a day

THE REVENUE Commissioners has started receiving inquiries at a rate of 100 per day in relation to its latest crackdown on hot money ahead of its September 15th deadline for voluntary disclosures.

A total of 3,500 inquiries have been made to Revenue offices about the deadline for the voluntary disclosure scheme, which was announced in May.

After September 15th, people who owe tax on undeclared sums of more than €100,000 will no longer have the option to make a voluntary disclosure, meaning they could face prosecution if they do not make a declaration.

Writing in The Irish Timestoday, the head of the Revenue's investigation and prosecutions division, Paddy Donnelly, advised people who have not declared past tax liabilities to "contact Revenue before Revenue contacts you".

The deadline was imposed following the introduction of legislation that requires financial institutions to pass on to Revenue the names and addresses of people who had large amounts of money on deposit in 2005 and 2006. Before it receives this information, Revenue is giving people with more than €100,000 of untaxed money in one or more deposit accounts a window in which to declare it.

The new data from banks, building societies and post offices will act as "another piece in the jigsaw" in Revenue's pursuit of tax defaulters.

The data is likely to trigger a new wave of investigations into tax evasion, following on from its clampdown on owners of overseas property and other offshore assets and its inquiry into single-premium insurance policies.

By making a voluntary disclosure, people who did not pay income, capital gains and capital acquisitions taxes due on lump sums held in deposit accounts can avail of "substantially mitigated" penalties for underpaid tax.

Their names and settlement amounts will not be published by Revenue in the quarterly list of tax defaulters in Iris Oifigiúil and the Revenue will not investigate them with a view to prosecution.

The Revenue does not have any official estimate of the value of tax likely to be yielded by the voluntary disclosure scheme. People who avail of the deadline only have to give notice of their intention to make a disclosure by September 15th. The Revenue expects that most of these declarations will come in the final day before the deadline. People who make declarations then have until January 15th, 2009, to pay the tax owed.

The Revenue has recovered €2.45 billion in evaded taxes, including interest and penalties, from special "legacy" investigations since 2000. During the follow-up phases of these investigations, the Revenue has to date identified 10,000 individuals who did not avail of the opportunity to come forward voluntarily.

Due to the number and extent of past inquiries, this latest voluntary disclosure scheme is likely to yield less money than previous investigations, according to Brian Keegan, director of taxation at the Institute of Chartered Accountants in Ireland.