Business

Revenue to refund almost €500,000 in warehouse debt interest payments to 475 entities

Minister for Finance Michael McGrath confirms repayments, following recent revision of terms of scheme that reduced interest rate to zero

Revenue will refund interest payments by 475 entities relating to a warehoused debt scheme introduced during the Covid-19 pandemic. Photograph: Laura Hutton/RollingNews.ie

Gordon Deegan
Fri Feb 16 2024 - 17:17

The Minister for Finance, Michael McGrath, has confirmed that Revenue will refund €487,500 in warehouse debt interest payments made by 475 customers.

Earlier this month, Mr McGrath announced that the interest rate applied to warehoused debt was to be reduced to zero and that Revenue would issue refunds of any interest at 3 per cent already paid by businesses on such debt.

The tax debt warehousing scheme was introduced in May 2020 to provide liquidity support to businesses from the outset of the Covid-19 pandemic. At the end of January, a total of €1.7 billion remained warehoused for 57,244 taxpayers with 70 per cent of the taxpayers concerned having outstanding liabilities of less than €5,000.

In a Dáil reply to a question from Independent TD Thomas Pringle on the issue, Mr McGrath stated that €487,500 would be refunded in interest payments to 475 customers, an average of just more than €1,000 per customer.

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Mr McGrath stated that, in addition to this, there were almost 2,200 customers who were currently involved in active Phased Payment Agreements (PPAs) for warehoused debt of an aggregate €169 million.

The Minster stated that when the PPAs were agreed, the 3 per cent interest rate was included in the monthly payment calculations.

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“To ensure that these customers benefit from the interest rate reduction, the schedule of future monthly payments for each arrangement will be recalculated and adjusted downwards to reflect the interest rate reduction,” he said.

“Therefore no refund of interest is required for these customers as they will receive credit for the interest through adjustment of their ongoing payments arrangements.”

Mr McGrath provided figures showing that of the €1.7 billion, there were 27 taxpayers classified as high-wealth individuals who had warehoused a total of €7 million. The Minister said that such taxpayers were admitted to the scheme after being approved subject to certain criteria.

Gordon Deegan

Gordon Deegan

Gordon Deegan is a contributor to The Irish Times

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