Taxpayers with offshore assets ranging from foreign properties to deposit accounts or structured investments are being urged to get their affairs in order ahead of a May clampdown by the Revenue Commissioners – even if they believe themselves to be compliant.
“It is likely that taxpayers who do not regularise their affairs by May 1st, 2017 will face significant sanctions including 100 per cent penalties, publication on the tax defaulters list and potentially criminal prosecution. Revenue has been very upfront about this,” said Aidan Byrne, tax partner with RSM Ireland, adding that those who refuse to take this final opportunity would have “the full rigour of the law applied to them”.
"A bit like Liam Neeson in Taken, if you're not compliant, it has vowed to look for you, and to find you!" he warns.
Criminal offence
In the October budget, Minister for Finance Michael Noonan took aim at the use of offshore accounts to avoid tax, pledging to make it a criminal offence to fail to disclose accounts or other assets held in tax havens from next year.
The Government estimates the yield from this clampdown will be some €30 million. However, Mr Byrne notes that in 2015 alone the yield from offshore investigations by revenue amounted to over €60 million.
Mr Noonan said he would restrict the opportunity for offshore defaulters to use the voluntary disclosure regime after May 1st, 2017. So taxpayers have six months to ensure compliance.
Mr Bryne said those with assets offshore, be it a deposit account in Switzerland, an apartment in Spain, or a trust somewhere else, should ensure they are compliant before the Revenue starts sending out its letters.
“If you go to them before they come to you, it’s just a process that will be painful in the context of your bank account. But if they find you afterwards, and find you’re non-compliant, or involved in evasion, we’re led to believe that they will be taking prosecutions.”
Even for those who don’t believe they have an exposure, undertaking a review would be wise, Mr Byrne said. That way, when Revenue do make contact, “the information and confirmation of compliance will be to hand, ending the need for an investigation by revenue”.
