Tuesday, 10 June 2014

Questions (271)

Thomas P. Broughan


271. Deputy Thomas P. Broughan asked the Minister for Public Expenditure and Reform the level of scrutiny which takes place within his Department to monitor the compliance of tenderers for public procurement contracts with tax laws; and if his Department ensures that subcontractors employed by successful tenderers are also subject to review to ensure that they are tax compliant. [24503/14]

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Written answers (Question to Public)

The management of the tendering process for a public contract is a matter for each contracting authority.  It is the responsibility of each contracting authority to ensure that tenderers comply with all the requirements of the process. 

Prior to the award of a public contract of a value of €10,000 (inclusive of VAT) or more within any 12-month period, the successful applicant will be required, in line with Department of Finance tax clearance procedures, to produce to a contracting authority either a current Tax Clearance Certificate or demonstrate a satisfactory level of subcontractor tax compliance in the case of the construction, forestry or meat processing sectors subject to Relevant Contracts Tax (RCT).  The same tax clearance requirement applies to any non-resident contractor being awarded a public contract.  Where a relevant contract (i.e. a contract that is subject to RCT) has been awarded to a subcontractor, the contracting authority or principal contractor must notify Revenue of the relevant contract online under Section 530B Taxes Consolidation Act 1997.

In the case of subcontractors employed on any public sector contract of a value of €10,000 (inclusive of VAT) or more, they must produce a tax reference number to the contractor where payments exceed €650, a record of which must be kept by the contractor and be available for inspection where requested by the Revenue Commissioners. Where payments exceed €2,600 in any 12 month period the subcontractor will be required to either produce a current tax clearance certificate, or, demonstrate a satisfactory level of subcontractor tax compliance as appropriate.