Revenue to enforce collection of €100m in warehoused tax debt after support scheme ends

Revenue to enforce collection of €100m in warehoused tax debt after support scheme ends

Revenue will now pursue €100m in unpaid taxes that had been part of the Government scheme which allowed struggling businesses to restructure tax debt payments. 

The Tax Debt Warehousing Scheme, that was introduced for businesses following the pandemic. It was intended to help businesses experiencing cash flow problems, by allowing them to defer paying some tax liabilities until they were in a position to deal with the debt.

Finance Minister Michael McGrath announced today that the scheme had come to an end and that 93% of the €3.2 billion peak warehouse debt has now been paid, secured under phased payment arrangement or under final negotiations/approval. 

The remaining €100m that remains will now be subject to the normal procedures for tax collection.  The relevant businesses had until 1 May of this year to “engage meaningfully” with Revenue and discuss arrangements to pay their warehoused tax liabilities. A demand notice was then issued on 8 May to the 11,724 customers who had not engaged with Revenue by that date, offering one final opportunity to address their warehoused debt and continue to avail of the 0% interest rate on that debt.  

A total of 7,042 businesses did not engage with Revenue following this notice and so their debt is now subject to standard collection and enforcement at the standard interest rates of 8% and 10%.

Minister McGrath said that people who have agreed phased payment agreements (PPAs) should note that the 0% rate only applies if they file their taxes on time and complete their monthly payments. He said that businesses experiencing cashflow problems that impact their tax payments should contact Revenue as soon as they can.

“On a case-by-case basis this may include options such as a payment deferral or a payment break, rather than deploying debt collection and enforcement options.”