The medical profession has attracted a lot of attention from officials in the Revenue lately. The growing number of settlements agreed between the tax authorities and doctors or companies controlled by doctors suggests there has been a mini crackdown of sorts on the profession.
This week, Revenue revealed details for settlements agreed in the second quarter of 2021, from April to June. The largest was for €1.5 million with a Northern Ireland-registered company controlled by high-profile maternity doctor Hugh O’Connor (58) of Ailesbury Road, who practices at the Coombe and St James’s.
Three other doctors or companies run by doctors also agreed settlements during the quarter, including Blackrock Clinic orthopaedic surgeon Paul P Nicholson, who owed €62,000. In the first quarter of the year, Revenue agreed six such settlements, including €393,000 with a company controlled by Beacon oncologist Ray McDermott, and a further €1 million with him personally.
For all of 2020, there were nine such settlements with doctors. Revenue has already surpassed last year's total in the first six months of this year. Prakash Madhavan, a vascular consultant at the Hermitage and Beacon clinics, agreed an €80,000 settlement last December, while a company connected to him agreed to pay a further €271,000.
In one of the biggest audit cases, Limerick-based consultant Kevin Hickey agreed a settlement for almost €600,000 last June, and a further €1.2 million was agreed for a company connected to him.
The awards were all agreed following Revenue audits for income and corporation tax, as Revenue pulled apart the corporate structures that many private consultants use to hold their income.
The huge scale of some of the settlements also suggests that the under-declaration of taxes in those instances must have been occurring for a considerable period of time. More generally, it suggests there are reasonable questions to be asked about the level and quality around the financial advice that some doctors have been receiving.
