I am advised by Revenue that 386 of the disclosures received under the Foreign Income and Assets Disclosure initiative concerned offshore matters relating to the United States of America and had a declared value, in terms of tax, interest and penalties, of some €10.5 million. 32 of those disclosures concerned bank accounts, with a declared liability of €740,079.
Because of significant changes introduced by the Finance Act 2016, tax defaulters are precluded, since May 2017, from making a qualifying disclosure in respect of tax liabilities concerning offshore matters. Such persons now face penalties of up to 100% of the tax evaded, publication in the Quarterly List of Tax Defaulters and possible criminal prosecution. In November 2017 Revenue confirmed that, following the May 2017 deadline, an enquiry is underway to identify and pursue taxpayers engaged in offshore tax evasion and avoidance.
I am advised also that Revenue view identifying and confronting non-compliance as a core element of their work, and that tackling tax evasion is always high on their agenda. Revenue’s compliance framework is risk-focused and recognises the serious risk to the Exchequer associated with the use of offshore accounts and structures to evade tax. Against a background of increasingly close cooperation between tax authorities worldwide targeting those who seek to hide their profits or gains offshore, more information is becoming available to Revenue through new information exchange mechanisms. The automatic exchange of information between jurisdictions, under arrangements such as FATCA (an inter-governmental agreement to share information with the United States of America), DAC (a number of EU Directives on Administrative Cooperation) and CRS (the OECD’s Common Reporting Standard), is providing tax authorities with greater visibility in relation to the offshore assets and income of their residents.
It is fundamental to Revenue’s way of doing business to ensure that the best use is made of all data at their disposal to identify and tackle failures to comply with tax obligations. I understand that they are focussing in on the information becoming available to them under information exchange agreements, to pursue those who have sought to use offshore means to escape their obligations. Data analytics is central to this work and involves matching the new data against Revenue’s taxpayer records and cross-checking against the taxpayer’s prior returns to determine whether all relevant income and assets have been fully and properly declared. The new data is also used in Revenue’s social network analysis and anomaly detection tools, to identify cases that could pose a risk from a compliance viewpoint. Where issues are identified, the appropriate Revenue intervention is undertaken. In this overall context, Revenue are writing to taxpayers by reference to a number of criteria, including information provided by the United States of America under FATCA, and follow-up action will be taken as appropriate to the circumstances of particular cases. As regards records supplied or received under the Ireland-USA treaty, this information exchange is subject to strict data confidentiality provisions and no further information can be provided.
