Who didn't pay their taxes? Disc jockey and log cabin builder among those on Revenue's hit list

A log cabin construction business, a DJ and a Kildare haulier are some of the latest individuals and companies on the new Tax Defaulter list published by the Revenue Commissioners which also reveals the jailing of a tobacco smuggler.

The new Revenue's published List of Tax Defaulters covers the period from  1 July to 30 September 2022. During the same three months nearly 3,500 audits and investigations resulted in more than €81.8 million in tax, interest, and penalties levied on people in Ireland who chose not to pay their way.

The Revenue publishes two lists. 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 is a log cabin builder in Dublin. Loghouse Living Limited, with an address at Office 4, 200 Greenogue Business Park, Rathcoole, Co Dublin is now in liquidation. A Revenue audit case for under-declaration of VAT revealed an unpaid sum of €390,429. Interest amounted to €294,546. Penalties were calculated at €390,429. The total owed is €1,075,404 of which €60,000.

Thomas Coloe, of 10 Sandford Wood, Swords, Co Dublin is also on the List 2. Described as a Disc Jockey, a Revenue Audit Case for Non-declaration of Capital Gains Tax and under-declaration of Income Tax and VAT revealed a sum owed of €74,484. Interest ran to €18,745 while the penalties amounted to €55,863. This revealed a total of €149,092 owed to the State of which €2,500 had been paid by September 30, 2022.

Kevin Judge, of Lowtown, Robertstown, Naas, Co Kildare is also on the List 2. Described as a haulage contractor, a Revenue Audit Case for under-declaration VAT revealed a sum owed of €150,017. Interest ran to €29,573 while the penalties amounted to €45,005. This revealed a total of €224,595 owed to the State. None was  left un-paid by September 30, 2022.

List two is compiled pursuant to Section 1086 of the Taxes Consolidation Act, 1997. A total of 9 cases were published with with the total value of these settlements €2.9m.

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. 

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 are Roman Paszinskiebo Ospinski with and address in 12/6, Goizzow, Wzkp, Poland who was jailed fro 8 months with four suspended for tobacco smuggling.

The biggest penalties in List one were incurred by Gerard Fahy, a wholesale distributor, with address at Lurgan, Killoran, Ballinasloe, Co Galway. He incurred a penalties totalling €21,000 for failure to lodge tax return(s), failure to lodge VAT return(s) and delivering incorrect VAT return(s). 

See FULL PART 1 LIST HERE

These published settlements reflect only a portion of all Revenue audits and investigations. In the 3-month period to 30 September 2022, a total of 255 Revenue audit and investigations, together with 3,180 Risk Management Interventions (Aspect Queries and Profile Interviews), were settled, resulting in a yield of €81.8 million in tax, interest, and penalties.

#EXPLAINER AND FURTHER INFO ON LATEST LIST

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 no such cases in the three month period to 30 September 2022.

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.

61 such cases are published and €168,000is the total amount of the court fines imposed these include:

• 29 cases of failure to file a tax return and delivering an incorrect tax return, in respect of which Court fines totalling €94,250 were imposed;
• 13 cases of misuse of marked mineral oil and 2 cases of failure to hold a current oil licence, in respect of which Court fines totalling €39,000 were imposed;
• 13 cases of excise offences for tobacco smuggling, illegal selling of tobacco and possession of untaxed tobacco for sale. Court fines totalling €25,750, one 8-month sentence (with 4 months suspended) and one 2-month sentence were imposed;
• 2 cases of failing to keep a vehicle stationary, in respect of which Court fines totalling €5,000 were imposed;
• 2 cases of obstruction of a Revenue Officer, in respect of which Court fines totalling €4,000 and one 6-month sentence (suspended for 2 years) were 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:

• 9 cases are published today and €2.8m is the total settlement amount in these cases 
• 7 cases were for amounts exceeding €100,000, of which 2 exceeded €500,000 and of which 1 exceeded €1 million
• 4 are cases in which the settlement was not fully paid as at 30 September 2022 
• €1.4 million was the amount unpaid as at 30 September 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 (e.g. 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.