16 March 2017
What’s the latest Revenue campaign?
Revenue wrote to almost 500,000 tax payers recently alerting them to a new campaign and inviting them to consider their tax returns and consider whether they needed to make a disclosure. This correspondence is part of Revenue’s campaign to alert taxpayers to the fact that it will not be possible to make a qualifying disclosure in relation to offshore matters after 30 April 2017.
The definition of offshore matters is quite broad and does not necessarily refer to sophisticated offshore funds. Income earned abroad from property, employments, directorships and businesses all come under offshore matters. In addition foreign inheritances and investments in foreign property funds and life policies are also considered to be offshore matters. Taxpayers should be aware that the legislation refers to all income and gains arising anywhere outside the Republic of Ireland.
Who does this affect?
The disclosure regime applies to all taxpayers including individuals, corporates and trusts. It is also important to note that new exchange of information rules will vastly increase the data available to Revenue about taxpayers’ offshore interests.
What is the deadline?
The deadline for disclosures on offshore matters is 30 April 2017.
Why are Revenue doing this now?
Revenue are giving taxpayers the opportunity to get their tax affairs in order in relation to offshore matters as Revenue will start to receive bank and other financial account information from over 100 countries globally covering:
What is the downside if I miss the deadline?
After 30 April 2017, the penalties applying to any undeclared or under-declared tax in relation to offshore income and gains will be much more severe. Penalties of up to 100% of the tax due may be sought by Revenue.
In addition, taxpayers who have not come forward by this date may be published in the Tax Defaulters List if their settlement with Revenue exceeds a certain threshold (currently €35,000). They may also be prosecuted.
Furthermore, if an offshore matter has not been dealt with by 30 April 2017, then the taxpayer may be precluded from making future disclosures regarding offshore or domestic matters.
It is crucial to ensure that any offshore matters are fully disclosed to Revenue by 30 April 2017, as it will no longer be possible to make a disclosure after this date without incurring severe penalties.
As always, regardless of this Revenue campaign, if you have any taxes outstanding, these should be declared and paid to Revenue.