Revenue reminds businesses of Debt Warehousing scheme
Revenue has written to over 100,000 taxpayers confirming that their
tax debts totaling €2.2 billion are eligible for Debt Warehousing.
The Debt Warehousing Scheme allows VAT and PAYE (Employer) debts
incurred by businesses during the period of restricted trading caused by
Covid-19 to be ‘parked’ on an interest free basis for 12 months
following the resumption of trading. At the end of the 12-month
interest free period, the warehoused debt may be paid in full without
incurring an interest charge or paid through a phased payment
arrangement at a significantly reduced interest rate of 3% per annum.
This compares to the standard rate of 10% per annum that would otherwise
apply to such debts.
The letters which issued this week explain the benefits of
warehousing and confirm for each individual business the exact amount of
debt that has been warehoused. In some cases where returns are
outstanding, the businesses are requested to file these returns within
28 days in order to continue availing of the benefits of debt
warehousing.
Revenue is reminding any other businesses who have not received a
letter and who wish to avail of the Debt Warehousing Scheme to contact
the Collector-General’s office to apply for the scheme. There are
certain straightforward steps to be completed to ensure that debts are
properly warehoused.
Collector-General, Joe Howley, said, to avail of the Debt Warehousing
Scheme, businesses need to file all relevant tax returns for the
restricted trading periods so that the exact liability can be quantified
and included in the scheme. “Businesses that may have made a best
estimate return of liability while Covid-19 restrictions were in place
need to file the return so that the full liability can be quantified and
warehoused.
Businesses that have additional tax liabilities that have not yet
been declared to Revenue in the appropriate tax return, due to error or
omission, must self-correct or make an unprompted disclosure. Completing
these steps will ensure businesses can avail of this significant
support during an extremely challenging time.”
Budget 2021 provides for the extension of the Debt Warehousing Scheme
to the recovery of any overpayments arising from the Temporary Wage
Subsidy Scheme. The Budget also extended the warehousing facility to
self-assessed 2019 income tax and 2020 preliminary tax liabilities.
With the pay and file deadline of 10 December fast approaching, Mr
Howley said the extension of the scheme announced as part of last
month’s Budget gives self-assessed taxpayers the option to warehouse the
balance of their 2019 income tax and 2020 preliminary tax liabilities.
“When filing their 2019 Form 11 income tax return, self-employed
taxpayers can make a declaration that their total income for 2020 is
expected to be at least 25% less than their total income for 2019 due to
Covid-19. Once 2019 preliminary tax obligations were fully met, Revenue
will warehouse these tax debts under the expanded scheme.”
Article Source: Revenue reminds businesses of Debt Warehousing – RTE
