Almost 1,200 firms race to lock in to 0pc tax warehouse
Close to 1,200 companies have agreed repayment plans with Revenue on warehoused tax debt in the last two weeks.
As of last Tuesday, according to Revenue, some 3,941 Phased Payment Agreements (PPAs) had been reached in respect of debts totalling €373m. Almost 90pc of that related to 914 firms who had debts greater than €50,000.
The figures represent a significant uptick in settlements since the end of March, when only 2,760 companies had agreed repayment plans, according to figures released by Finance Minister Michael McGrath on Tuesday. The tax-debt warehousing scheme was introduced in 2020 to help firms get through Covid. It applied to Vat debts, payments due under PAYE and some self-assessed income tax.
Companies now have until May 1 to either pay the debt or make an arrangement with Revenue to pay it off over an agreed period of time.
In a statement to the Irish Independent, Revenue said that PPA applications are being submitted through its online service ROS constantly, and are subject to review and negotiation before agreement. Firms are also engaging via phone and the MyEnquiries online service to discuss their payment options in advance of submitting their payment proposal through ROS.
Revenue says that, as the channels of engagement are varied and the PPA position is dynamic and updating constantly, it is not possible to provide information on the number of customers who have not yet engaged with them to agree PPAs. It noted that, at the peak in January 2022, there was almost €3.2bn of warehoused debt. That figure is now down to less than €1.3bn. Since February, the interest rate on the debt has been reduced from 3pc to 0pc.
“Information received from ongoing outreach campaigns and customer contacts suggests that many customers have financially planned for the payment of the warehoused debt in full on a date closer to 1 May and are maximising the benefit of the 0pc interest rate on the debt until that date,” Revenue said. “In addition to PPAs, there are a number of other payment options available to taxpayers to address their warehoused debt. Where a customer has the financial capacity to do so, they can pay their debt through one of Revenue’s online payment channels in full or in partial payments.
Revenue added that it has a proven track record of supporting customers with outstanding tax liabilities by agreeing payment plans tailored to their individual circumstances and capacity to pay.