Who didn't pay their taxes? Laois companies on latest list as Revenue rakes in nearly €130 mill

A Portlaoise medical provider and a Crettyard contractor are among the companies individuals outed in the new Tax Defaulter lists published by the Revenue Commissioners which reveals that nearly €130 million was recouped by the tax office between October and the end of December last.

The new Revenue's published List of Tax Defaulters covers the period from 1 October 2022 to 31 December 2022.

During the same three months, a total of 14,225 tax interventions resulted in €127.36 million in tax, interest, and penalties recouped from people in Ireland who did not pay their way according to Ireland's tax rules.

The Revenue publishes two parts. 

Revenue also publishes a Part 1 list which includes persons in whose case the Court has determined a penalty relating to a settlement, or has imposed a fine, imprisonment or other penalty in respect of a tax or duty offence.

Details are published when the Court determined penalty exceeds 15% of the total tax (where the total amount of tax only exceeds €50,000) and a qualifying disclosure has not been made.

Among those on the list is Ebuchi Medical Service Ltd with an address at 1 Rossdarragh Hill, Rathevan, Portlaoise, Co Laois.

Revenue reports that the medical staff provider was fined €24,447. It the penalty was determined by the courts relating to to an under-declaration of PAYE/PRSI/USC in the amount of €81,491.

Also on List 1 is Edward McDonald, with an address at Dunnane, Crettyard, Co Laois. The contractor was fined €1,250 for one charge of failing to produce books and records. He was also fined €3,750 on three charges of delivering incorrect tax returns.

The biggest tax offender in the latest round of information published by the Revenue Commissioners is a company director who is named on List 1. Bansal Harish, Harish of 7, Glencairn View, The Gallops, Leopardstown, Dublin 18 was hit with a fine of €1,349,466. The company director was penalised following a courts determination relating to the under-declaration of income.

It is unusual for the biggest tax offenders to be on the Part 1 list. They are usually on Part 2 list which normally has a small number of firms or individuals who have been audited with large amounts unpaid.

TO SEE FULL PART 1 LIST TAP HERE.

List 2 includes settlements when the extensive voluntary disclosure options are not availed of and the default arises because of 'careless or deliberate behaviour' by those investigated.

Top of that list was a fuel retailer and convenience store called Dominian Services Ltd with an address at Drumganus, Broomfield, Castleblayney, Co Monaghan. A Revenue Investigation Case for under-declaration of excise duty and VAT revealed unpaid taxes of €146,197. Interest ran to €115,563 while the penalties amounted to €65,121. This revealed a total of €149,092 owed to the State of which all had been paid tor Revenue by the end of the year.

Another big offender was Clara Medical Limited, with an address at 44 Coopers Grange Old Quarter, Ballincollig, Co Cork. A Revenue audit case for under-declaration of PAYE/PRSI/USC revealed an unpaid sum of €€99,691. Interest amounted to €56,855. Penalties were calculated at €29,907. The total owed is €186,453. None had been paid by December 31 last year.

Of the six debtors named in Part 2, three had not paid any of what they owed by the end of the year. Just two had fully cleared their debts

Part 2 is compiled pursuant to Section 1086 of the Taxes Consolidation Act, 1997. A total of six cases were published with the total value of these settlements  €1.1 million. 

Where a taxpayer has failed to pay or failed to enter into an arrangement to pay the full amount of the settlement, the amount unpaid as at 30 June 2022 is indicated in the list.

The Revenue say Part 2 settlements are not published where the taxpayer has made a qualifying disclosure relating to undisclosed tax, as defined in Section 1077E (1) of the Taxes Consolidation Act 1997, where the settlement amount does not exceed the relevant threshold, currently €35,000, or where the amount of fine or other penalty does not exceed 15% of the amount of tax.

See FULL PART 2 LIST HERE. 

These published settlements reflect only a portion of all Revenue Compliance Interventions.  In the 3-month period to 31 December 2022 a total of 14,225 Revenue Compliance Interventions were settled resulting in a total yield of €127.36 million.

#EXPLAINER AND FURTHER INFO ON LATEST LISTS

Part 1: Court Determinations

Court Determination of Penalty: Subject to certain criteria, in settlement cases where there is no agreement to a penalty, or a person fails to pay an agreed penalty, the Court determines the penalty. Details are published when the Court determined penalty exceeds 15% of the total tax (where the total amount of tax only exceeds €50,000) and a qualifying disclosure has not been made:

There were three such cases in the 3-month period to 31 December 2022, with fines totalling €1,417,218. 

Court-imposed fine, imprisonment or other penalty: Details are published when a fine or other Court penalty is imposed in respect of tax or duty offences. Court penalties may include imprisonment, partly suspended or suspended sentences, community service in lieu of imprisonment, and closure orders.

There were 86 such cases published and €202,100 is the total of court fines imposed.

These include:

• 29 cases relating to failing to lodge tax returns, failing to produce proper books and records, and delivery of incorrect returns. Court fines totalling €71,250 were imposed;
• 31 cases of misuse of marked mineral oil, in respect of which Court fines totalling €85,500 were imposed;
• 25 cases of excise offences for tobacco smuggling, illegal selling of tobacco and possession of untaxed tobacco for sale. Court fines totalling €42,850, two 4-year sentences (fully suspended), two 2 years and 6 months sentences, one 20 day sentence, and 840 hours of community service, in lieu of imprisonment, were imposed; 
• 1 case of possession of untaxed alcohol for sale, in respect of which a Court fine of €2,500 was imposed.

Court Determination of Penalty: Subject to certain criteria, in settlement cases where there is no agreement to a penalty, or a person fails to pay an agreed penalty, the Court determines the penalty. Details are published when the Court determined penalty exceeds 15% of the total tax and the total of the tax, interest and penalty is more than €35,000 and a qualifying disclosure has not been made: 

Part 2: Settlements

Settlements are published when the extensive voluntary disclosure options are not availed of and the default arises because of careless or deliberate behaviour:

• 6 cases are published today and €1.1 million is the total settlement amount in these cases.
• Of which, 5 cases exceeded €100,000.
• 4 are cases in which the settlement was not fully paid as at 31 December 2022. 
• €528,874 was the amount unpaid as at 31 December 2022.

Revenue says it vigorously pursues collection/enforcement of unpaid settlements. In some cases, collection/recovery of the full unpaid amount will not be possible (for example, company liquidation).

Background

Revenue says its compliance programme is carried out under the "Code of Practice for Revenue Audit and other Compliance Interventions" (the Code). The significant benefits of making a ‘qualifying disclosure’ are set out in the Code and include availing of reduced penalties, avoiding publication in the List of Tax Defaulters, and avoiding possible prosecution.

Publication

Revenue says it publishes the List of Tax Defaulters under the provisions of Section 1086 of the Taxes Consolidation Act, 1997, as amended. The list is published in two parts:

Part 1: Court Penalty Determinations and Court imposed fine, imprisonment or other penalty

Court penalty determinations are published where a taxpayer has not made a qualifying disclosure, the Court determined penalty exceeds 15% of the total tax, and the total of the tax, interest and penalty is more than €35,000.

All cases where a fine, imprisonment or other Court penalty is imposed by a Court, in respect of a tax or duty offence, are published.

Part 2: Accepted Settlements (and Settlements deemed to be agreed due to full payment)

Where a taxpayer has voluntarily furnished complete information relating to undisclosed tax liabilities and paid the tax and interest due (made a qualifying disclosure of tax defaults), settlements are not published.

Since 1 May 2017, significant changes and restrictions have come into effect where the case involves matters outside the Republic of Ireland, or 'offshore matters'. These changes limit the opportunity to make a 'qualifying disclosure' and coincide with increased international co-operation whereby Revenue gets more and more information automatically from other jurisdictions.

Legislation introduced in the Finance Act 2016 obliges Revenue to identify settlements where the person has failed to pay within the relevant period. 

Settlements are not published where the taxpayer has made a qualifying disclosure relating to undisclosed tax, as defined in Section 1077E (1) of the Taxes Consolidation Act 1997, where the settlement amount does not exceed the relevant threshold, currently €35,000, or where the amount of fine or other penalty does not exceed 15% of the amount of tax.

Calculation of Penalties

Where a qualifying disclosure has not been made, Revenu say penalties between 15% and 100% are applied, depending on the category of default and whether or not the taxpayer has cooperated fully with Revenue in the course of enquiries. The categories of default are Deliberate Behaviour or Careless Behaviour.

• Deliberate Behaviour involves either a breach of a tax obligation with indicators consistent with intent on the part of the taxpayer or a breach that cannot be explained solely by carelessness
• Careless Behaviour involves lack of due care, which results in the incorrect declaration of tax liabilities by a taxpayer, or which results in the making of incorrect repayment claims. The level of penalty may be further reduced having regard to the level of cooperation provided by the taxpayer once the default is uncovered.

Full details of the level of penalties applicable to audit settlements are set out in Penalty Table 1 (Paragraph 5.6.2) of the Code.

Innocent errors and adjustments due to different interpretations of legislation

Penalties are not applicable where a tax default is not deliberate or is not attributable in any way to the failure by a taxpayer to take reasonable care to comply with his or her tax obligations. Neither is a penalty applicable where an adjustment to liability arises from differences in the interpretation or the application of legislation, and the taxpayer could reasonably have considered her/his interpretation to be correct.