Revenue announces deposits initiative

The Revenue Commissioners has announced a voluntary disclosure deadline of September 15th for people who hold deposits of more than €100,000 on which they have not previously paid tax.

In a new Revenue clampdown on "hot money", holders of large-scale deposits will be encouraged to declare before this date any sums held in bank, building society and post office savings accounts on which they have not paid income tax or any other tax due on the money.

From September 15th, the Revenue will automatically receive the names and addresses of all holders of Irish bank, building society and post office accounts on which interest of more than €635 was paid in a year, dating back to January 1st, 2005.

The new data will be "another piece in the jigsaw" for the Revenue in its pursuit of tax evaders.

Although the scheme is not a tax amnesty, voluntary disclosure gives people who have tax issues relating to money on deposit the opportunity to receive "substantially mitigated" penalties for underpaid tax.

Their name and settlement amount will not be published by Revenue in the quarterly list of tax defaulters in Iris Oifigiúil and the Revenue will not investigate the person with a view to prosecution.

After September 15th, the opportunity to make a voluntary disclosure ceases for people who have €100,000 or more in one account or spread among several accounts.

Revenue officers are meeting members of the Irish Banking Federation (IBF) this afternoon to discuss the details of the automatic interest reporting scheme. Based on average interest rates, it will receive details of accounts where more than €20,000 is held on deposit.

It plans to extend the automatic reporting scheme to the insurance and funds industries in the coming years so that tax evaders are left with nowhere to hide undisclosed income.

To prevent savers from splitting their money between accounts so that their details won't be reported to the Revenue, all financial institutions will have to give the Revenue the names and addresses of all holders of deposit accounts for the year in which they were opened, regardless of how much interest was earned.