Brian Hayes (Dublin South West, Fine Gael) | Oireachtas source

Before the break Deputy Doherty set out his views in connection with amendment No. 7 and I will respond with the agreement of the House. I do not propose to accept the amendment and there are a number of issues arising from this provision. The relationship between the home owner and contractor is important from the outset. Before engaging a contractor, a home owner must ensure the contractor is tax compliant, and the home owner should ask to see the building contractor's up to date notification of determination of relevant contracts tax rate, or RCT rate. This must be zero or 20% in order for the contractor to qualify to carry out the work under the incentive. Alternatively, an in-date tax clearance certificate is also acceptable until the Revenue Commissioners' new on-line system is put in place. If the contractor is not tax compliant, he or she is not eligible to operate under the incentive and any work carried out by the contractor would not qualify.

When a home owner makes a payment to a contractor, he or she is required to provide a receipt or statement showing the amount of payment, and the VAT must also be identified separately. It is important in building a relationship with the contractor that there is a common understanding that in order for the home owner to get relief, a contractor is required to notify the Revenue Commissioners of the works and payments made by the home owner. When the Revenue Commissioners' electronic system comes on-line early next year, it will be possible for home owners to track whether the contractor meets his or her obligations in notifying the Revenue Commissioners of works and payments. This means that cases where a home owner would only become aware at the claim stage that a contractor has failed to meet his or her obligation - the point raised by the Deputy before the break - should not arise, as home owners can track exactly where they are in the process under the on-line system.

Any failure by a contractor to meet his or her obligations is an offence subject to a fine of €3,000. Failure to meet the obligations under this incentive would render the contractor in a position where he or she would not be tax compliant, ruling a contractor outside the terms of the incentive. The party in question would not therefore be in a qualifying contractor position. For these reasons I will not be in a position to accept amendment No. 7.

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