TALC Update and Representations – TaxFax 23 June 2023
At meetings of the TALC Collections and TALC Audit Sub-committees this week, Revenue provided a number of clarifications and responses to Institute representations, which we have outlined below to inform members of important or imminent developments on a timely basis.
Income Tax Returns: Employment Detail Summary (EDS) issue – retaining access to the underlying payslip information for the year
Revenue recently amended how the EDS is accessed through PAYE Services. An unintended consequence of this change means it is currently not possible to continue to view the weekly/monthly payslip figures for the year once an EDS is created. (On creation of an EDS you will be brought directly to a PDF of the EDS in ‘MyDocuments’).
We queried the reason for the change and highlighted that tax agents often view the taxpayer’s weekly/monthly payslip information when preparing an income tax return, for example when calculating pension top-ups. We sought restoration of the access previously available.
Revenue noted the change to the EDS was made to ensure it would remain accessible after 4 years and the impact on access to payslip information was not intended. Revenue plans to restore the access previously available, however, the timeframe for delivery of the required IT development is unclear.
Members preparing tax returns who wish to retain access to the underlying payslip information should NOT create the EDS (or ensure they view/print the payslip information they require before the EDS is created). We have requested Revenue to note this ‘workaround’ in the ROS Form 11 2022 Manual which is currently being finalised, and to reference the issue on the PAYE webpage containing information on the EDS.
Upcoming developments to simplify the nomination of bank accounts for refunds/payments
Revenue will shortly release enhancements to make it easier to nominate the same bank account for multiple tax heads and for tax refunds. The Institute sought a more straightforward mechanism for taxpayers to select to use the same bank account for tax payments and refunds. This would help lessen the time spent on entering the same bank account details multiple times and reduce the instances where tax refunds are delayed because the taxpayer had omitted to nominate a bank account for a tax refund. The relevant IT updates to simplify the process are scheduled for June and July. We will update members on developments when they are released.
Temporary Business Energy Support Scheme (TBESS)
Revenue highlighted the recent enhancements to the TBESS including its extension to 31 July 2023, the reduction in the ‘energy cost threshold’ from 50% to 30% and the increase in the payment that can be claimed from 40% to 50% of eligible costs. All claims must be made by 30 September 2023.
Revenue encouraged eligible businesses to review the recent enhancements and to submit a claim, if appropriate. A summary of the enhancements is outlined on the Revenue website here.
According to the latest statistics, 29,549 businesses have registered for the scheme as at 22 June. 25,208 of these have commenced the claim process. 18,335 businesses have fully completed claims and 6,873 have claims in process. Approximately €100 million has been paid out in claims to date.
Revenue has been conducting some outreach activities to businesses who commenced but did not complete the claims process, to identify any difficulties they may be having with the process.
Debt Warehousing Scheme (DWS)
Approximately 61,000 taxpayers are currently participating in the DWS, 65% of whom have warehoused debt of less than €5,000. The bulk of the warehoused debt of €1.78 million is owed by approximately 6,000 businesses with debts in excess of €50,000.
There was keen interest and engagement on the DWS at the Joint Conference in May, as members considered how to tackle the volume and differing complexity of their cases in the lead up to 1 May 2024 and we will update members further on this topic. The Collector-General’s Division is also working on additional information resources for the Revenue website which we will highlight as it becomes available.
Tax refunds are not currently offset against warehoused debt, however, Revenue confirmed at TALC that taxpayers can request that a refund is offset against the balance warehoused, if they wish to do so.
Revenue noted the flexibility available in Phased Payment Arrangements (PPA). For example, businesses that do not have the cash-flow to fund a sizeable downpayment or to start making instalments now could apply for a PPA with a minimal downpayment to activate the arrangement and request a payment break upfront. There is also flexibility available in the level of downpayment required where tax clearance is needed. Revenue will review PPA applications received and consider these on a case-by-case basis. Supporting documentation may be sought by Revenue to agree a PPA in some cases.
Interest is already accruing (at 3% per annum) meaning businesses with the capacity to start paying their warehoused debt before 1 May 2024 may wish to do so to minimise interest charges.
Revenue reiterated the critical importance of timely filing and payment of taxes to retain access to the DWS and its benefits. Loss of access to the DWS would also result in the debt becoming subject to Revenue’s standard debt collection and enforcement procedures.
Vacant Homes Tax (VHT)
Section 96 of Finance Act 2022 legislated for a new Vacant Homes Tax (VHT) with the first returns due on 7 November 2023. At TALC Collections, Revenue provided an overview of the VHT including a suggested step-by-step approach to determine whether VHT arises. A copy of Revenue’s slide presentation is available here.
Work is underway to prepare for the administration of VHT, including development of a VHT register and a ROS portal to facilitate compliance. We will update members further on the VHT as developments arise.
Tax Defaulters List
At a meeting of the TALC Audit Sub-committee, we asked Revenue about its review of the recent European Court of Human Rights decision concerning Hungary’s public tax defaulter list (L.B. v Hungary) and any conclusions from this review regarding Revenue’s publication of tax defaulters’ details.
Revenue advised that there are significant differences between the Irish and Hungarian provisions governing the publication of tax defaulters, which may have a bearing on how the Irish publication system is viewed under the European Convention on Human Rights.
Revenue is legally required to compile and publish lists of certain tax defaulters, currently in accordance with section 1086A TCA 1997. Any change to the current publication regime would require a legislative amendment. This would be a policy decision for Government.
According to media reports in recent months, the Tánaiste, Micheál Martin T.D. and a number of other Government ministers have noted their support for retention of the publication regime.
Business Division compliance interventions on VAT postponed accounting
At a Branch Network meeting last December, Revenue’s Business Division noted that VAT postponed accounting was an area of focus for the division having identified a pattern of incorrect entries in VAT returns. At the TALC Audit meeting this week, an official from Business Division advised that interventions will be initiated under both Level 1 and Level 2 of the Compliance Intervention Framework. Level 1 interventions will be initiated in respect of incorrect entries for postponed accounting on the VAT returns, with Level 2 initiated where risks are identified.
Revenue Business Division personnel authored an article about VAT postponed accounting and completion of VAT returns in Issue 3:2021 of the Irish Tax Review. Revenue’s Manual on postponed accounting is available here.
Decommissioned regional phone numbers
We reported previously in TaxFax that Revenue is decommissioning old regional numbers for the Business and Self-Assessed Helpline, following a review of lesser used phone numbers. The phone numbers listed below are now no longer in operation. Tax agents ringing the Services for Business Taxes phoneline can phone 01 7383697. This number allows agents to bypass certain prompts on the main phone line 01 7383630.
BMW: 01 7383611
DUB: 01 7383612
ESE: 01 7383613
SW: 01 7383614