The Revenue Commissioners is expecting millions of euro to be handed over by holders of 13,500 bogus non-resident account holders next week. The Revenue has given account holders until December 17th to settle their tax liabilities.
To date, these individuals have paid €50 million to the Revenue. This is in addition to the €227 million collected from bogus non-resident account holders who availed of the November 2001 amnesty, which offered reduced interest and penalties for those making a voluntary disclosure. The State's tax-collection agency expects the €50 million figure will rise substantially by the December 17th deadline.
Many of these accounts were opened in the 1970s and 1980s and the individuals concerned face huge penalty and interest payments, in some cases amounting to more than twice the amount initially deposited in these accounts.
Details of settlements of more than €12,700 will be published in the Revenue Commissioners' tax defaulters list.
Some sources have suggested that a large number of payments have been made ranging from €250,000 to €900,000.
Some account holders are believed to be awaiting confirmation from their accountants of the final amount due to the Revenue Commissioners.
A Revenue spokesman said there was a high level of activity in the run-up to the deadline with account holders and their accountants in discussions with its officials. Individuals who were contacted by the Revenue in October were told to settle their affairs by this deadline or face prosecution. These account holders are expected to make a full disclosure and final payment by Tuesday.
The Revenue is also preparing to send a further 25,000 to 30,000 registered letters to individuals associated with further bogus non-resident accounts in January. They too will be given 60 days to make a full settlement or risk prosecution.
The letters are being issued on a phased basis on foot of fresh information being handed over to the Revenue by Irish banks and building societies. To date, 17 High Court orders covering 23 financial institutions have been granted to the Revenue and one further order is before the courts. By trawling through this data and matching it against the findings of the Revenue's audit of financial institutions, it has identified thousands of individuals who have still not come forward to settle their affairs.
In October, the Revenue contacted 30,000 individuals who were linked with 13,500 bogus non-resident accounts according to bank records. Financial institutions have been contacting customers as their names are being handed over to the Revenue. Most of the account holders who must come forward by next week's deadline are believed to have been customers of AIB.
The Republic's biggest bank made the largest settlement with the Revenue in relation to unpaid Deposit Interest Retention Tax (DIRT). In 2000 it paid €114.3 million to the Revenue, which included €41.7 million in unpaid DIRT tax plus €68 million in interest and penalties. Overall, the Revenue collected €220 million from the financial institutions in unpaid DIRT.
A reaction group has been established by a number of former AIB bank staff to help individuals who are being contacted by the Revenue. It is exploring the possibility of taking legal action against Irish financial institutions on the basis that their staff encouraged and advised customers to put money into bogus non-resident accounts to evade tax.
The group has received thousands of calls from account holders and claims that many are elderly people who are facing financial ruin as a result of the settlements they will have to make.
