Businesses and self-employed people with outstanding warehoused tax debts are being urged to contact the Revenue Commissioners before the May 1st deadline to work out a payment plan to address their liabilities.
Rolled out during the Covid-19 pandemic in response to the closure of businesses due to public health restrictions, warehousing allowed qualifying companies to defer VAT, employer’s PAYE and certain self-assessed income tax liabilities to a later date.
There is €1.65 billion of warehouses debt outstanding, the Department of Finance said on Wednesday. While around 70 per cent of 55,490 individual taxpayers with warehoused debts owe less than €5,000, some €1.41 billion is owed by slightly more than 5,000 customers with outstanding balances greater than €50,000. The total amount owed under the scheme has decreased by €1.5 billion since January 2022.
Under the scheme businesses have until the May 1st deadline, which the Government has repeatedly extended, to either pay the full amount of warehoused tax debt or come to a payment arrangement with Revenue.
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Minister for Finance Michael McGrath, who earlier this year reduced the annual rate of interest charged against warehoused taxes from 3 per cent to zero, is now calling on businesses to contact the tax authority before the deadline to discuss their outstanding liabilities.
He said “many” of the more than 55,000 customers with outstanding debts have already engaged with the tax authority, but for those who have not done so “the key message is that they should engage with Revenue now to avail of the ‘flexibilities’ on offer”.
“It is important to note that businesses are not required to pay all of their warehoused debt by May 1st, 2024,” the Minister said in a statement. “However, in order to avail of the 0 per cent interest and flexible payment options they are required to engage with Revenue to make arrangements to pay the debt over an agreed period of time, based on their individual circumstances and capacity to pay. A key condition of the scheme is that taxpayers continue to file their current tax returns on time and meet their current tax liabilities as they fall due.”
Separately, a majority of Irish SMEs polled by peer-to-peer lender Linked Finance are confident they can meet the additional costs associated with new mandatory minimum wage hikes and other expenses linked to staffing.
The Linked Finance SME Confidence Index points to a rise in sentiment across the SME landscape despite concerns raised by industry groups in recent months in a campaign of lobbying around rising business costs.
Some 58 per cent of the 357 businesses who responded to the Behaviours & Attitudes survey indicated confidence in their ability to meet the new requirements. Close to 60 per cent, meanwhile, indicated a higher or similar operational profits in the final quarter of last year compared with the same period in 2022.
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