Dáil Éireann debate -
Wednesday, 30 Jan 2002

Vol. 547 No. 1

Written Answers. - Tax Collection.

Sean Fleming

Question:

411 Mr. Fleming asked the Minister for Finance the amounts involved in each of the ten smallest cases of underpayment of preliminary tax on the due date which subsequently led to an interest charge; the amount of interest charged in each case for the past three tax years for which figures are available. [1709/02]

Sean Fleming

Question:

412 Mr. Fleming asked the Minister for Finance the number of cases where the preliminary tax paid was less than the minimum required; and the consequential interest charged in respect of these cases for each of the past three tax years for which information is available. [1710/02]

Minister for Finance (Mr. McCreevy)

I propose to take Questions Nos. 411 and 412 together.

In general, the minimum payment required for preliminary tax, income tax, must not be less than either 90% of the liability for the year, or 100% of the liability for the previous year, or in the case of a person who pays by direct debit, 105% of liability of the pre-preceding year. Under the relevant statutory provisions, payment of an amount of preliminary tax less than the minimum required means that the full tax liability for the tax year in question is regarded as payable on the preliminary tax due date. Interest is liable to be charged from that date.

I am advised by the Revenue Commissioners that interest charges in relation to preliminary tax can arise either in the normal course of the collection of outstanding tax, or from a specific interest campaign. While it is not feasible to tackle all cases each year, Revenue has in recent years devoted resources to conducting a dedicated interest collection campaign targeted at the most serious cases of non-compliance with the preliminary tax rules. The previous history of compliance by the taxpayer as well as any mitigating factors are taken into account. The following table shows the number of cases that have paid an amount of preliminary tax less than the minimum due:

Tax Year	Number who paid less thanthe minimum due
1999-2000	82,420
1998-1999	87,333
1997-1998	85,393

Many of these cases failed to meet the relevant preliminary tax obligations by a marginal amount and in many other cases the overall liability was relatively small. Data are not kept as a matter of course on the number of individual interest charges in cases dealt with as part of the ongoing collection of outstanding tax debt and where the preliminary tax payment was less than the minimum required. Revenue has intensified its work in the area of debt management for all taxes. The total amount of interest collected for the above years for all taxes, excluding DIRT, totalled 91.4million. However, as regards the dedicated interest collection campaigns carried out by Revenue, the following tables set out the number of interest charges raised to date for the years for which data are available and the smallest cases which were included in the campaign. Available case data are based on the total tax liability for the year in instances where the preliminary tax payment is less than a specified proportion of the amount due; overall data on the actual underpayments in individual cases are not maintained.

Income Tax	Number of Interest charges
1999-2000	733
1998-1999	1,783
1997-1998	1,621

The specific campaign for 1999-2000 is ongoing. The final number of cases is expected to be in line with the previous years. The following table sets out the smallest cases under the dedicated interest pursuit campaigns in the year 1999-2000. Equivalent data for other years are not available.

Tax liability	Interest charged
12,698.57	2,171.25
12,703.93	1,476.25
12,709.57	1,397.97
12,778.90	2,071.60
12,716.58	231.50
12,721.25	877.80
12,722.67	1,375.66
12,723.46	2,074.50
12,759.47	1,610.63
12,769.73	474.17

The amount of interest payable can vary even in cases with similar levels of liability for the same year because the actual date[s] of payment of the tax liability by the persons concerned are different.