Watchdog says State bodies can share data
THE DATA Protection Commissioner says he has no issue with the sharing of social welfare records between the Department of Social Protection and the Revenue Commissioners.
A spokesman for commissioner Billy Hawkes said the sharing of such information between State bodies was acceptable, so long as standard guidelines were followed.
He was responding to the revelation that 115,000 pensioners have been issued with increased tax demands after Revenue reviewed their cases using data obtained from the department. Those affected are people who are receiving both a State pension and a secondary private pension or salary of which Revenue was unaware.
The department said yesterday it also exchanges data with the prison service, third-level colleges, the UK pension authorities, the General Register Office, the Probate Office and the Commission on Taxi Regulation.
A total of 150,000 pensioners have been written to by Revenue in recent days on foot of the new information from the department. Revenue found that 115,000 taxpayers were liable to pay more tax in 2012 either because they had never previously declared their State pension to Revenue; had under-reported their pension; or because the taxpayer’s circumstances had changed.
Another 20,000 received letters saying they paid too much tax.
In the remaining cases, Revenue’s records differ from those held by the department and clarification is being sought.
Speaking yesterday, tax commissioner Declan Rigney would not rule out back-taxing those liable for past missed payments. “This is not an amnesty, let me be clear on that,” Mr Rigney said.
He said Revenue was analysing data it received from the Department of Social Protection that allowed it to match those who have been receiving both a State and private pension, or an additional source of income.
“We need to do the analysis, we need time to do that,” Mr Rigney told RTÉ’s Morning Ireland. “My point is, right now, it’s about sorting it, going forward as best we can.”
Mr Rigney advised that, in many cases, liability would be modest. “The variety involved in this is immense. It may be that somebody has a very modest increase in their tax.
“It may be something as small as €1 a week,” he said.
However, in some cases where the pension was not previously on record and a pensioner’s second income brought them into the 41 per cent tax bracket, the annual additional liability could reach €4,400 for a single person and €8,800 for a couple.
According to Revenue, it found at least 2,500 instances where pension recipients were in receipt of annual incomes in excess of €50,000.
A range of benefits payable under the Social Welfare Acts are taxable but anyone over 65 whose annual total income is less than €18,000 for a single person or under €36,000 for a married couple is exempt from income tax.
Fianna Fáil spokesman on social protection Barry Cowen described the situation as “gross mismanagement”.
He called for clarity on the suggestion that the demands may be backdated for a number of years and asked Minister for Finance Michael Noonan to explain when he became aware of the issue.
Mr Cowen also called on Minister for Social Protection Joan Burton and the Revenue Commissioners to outline what efforts were being made to allow any extra payments to be made on a “phased and manageable” basis.
PENSIONERS RESPOND 'THE WHOLE COUNTRY IS IN TERROR'
I was very surprised to get the letter because they had my full details on record there. I couldn’t see how I could be at fault. In the first paragraph they said that I was in the wrong. I was on to them today and I cleared it up over the phone. They said they were very sorry and I asked if I could speak to the person that was at fault. They said no. but I got a fright when I got the letter; the whole country is in terror.
The letter said something about being due to pay . . . to be honest I didn’t really absorb it. They should have informed the people, it’s their duty to inform the people about tax. I’ll do nothing about it until they get in touch with me. I probably do owe extra tax, but they never told me when I was retiring when I got the social welfare pension; it’s up to them to inform you.
I haven’t heard anything yet, but I do pay tax on my occupational pension and get a State pension. There may be some justice on their side, I don’t know, but it’s very concerning since it’s just out of the blue. They haven’t prepared the public for this at all, it’s the first anybody’s heard of it . . . I do some work at present, but the thing that bothers you when you’re older, if your financial circumstances change there is very little you can do about it because you’re out of the workforce.
I got a letter this week and I can’t understand it because my circumstances haven’t changed over the years and they know all about my financial affairs. So why this should suddenly happen me I don’t know. I retired in 1996 and I have a State pension and a small private pension. I’m going in to have a word with them and thrash it out face to face.
I got a letter yesterday, but I couldn’t understand it. I’ll get my daughter-in-law to tell me. I did and I didn’t [get a fright] when I read it. For the last year we were paying the universal social charge and I don’t think we have to pay that now, so that’s something. But then they’ll put on something else. Your husband dies and he thinks he’s leaving you to the good; they’d turn in their graves if they only knew now.