Dinny McGinley (Donegal South West, Fine Gael)
Link to this: Individually | In context

Question 23: To ask the Tánaiste and Minister for Finance if his attention has been drawn to reports of under-claiming by tenants of rent relief and under-returning by landlords; and if he will make a statement on the matter. [7814/08]

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

On the question of under-claiming by tenants of rent relief, I am advised by the Revenue Commissioners that they have taken a number of initiatives to encourage taxpayers to claim their full entitlements. Extensive advertising took place in 2006 and 2007 covering the most common tax credits, which specifically included rent relief. There was also a targeted advertising campaign in autumn 2007 to encourage the uptake of rent relief. Revenue is including an information leaflet with the 2008 tax credit certificates, which are currently being issued to some 2.2 million PAYE taxpayers. This leaflet gives information on the most common credits available, including rent relief, and encourages the making of claims where due.

As regards reports of under-returning of rental income by landlords, the position is that all taxpayers, including landlords, are obliged to make accurate returns under the self-assessment system and are liable to Revenue audit in the normal way. I am assured by Revenue that the audit of landlords is an ongoing aspect of its work. For example, in 2006, the latest year for which full data are available, audits were concluded in 527 cases where rental income was the main source of income returned. The yield from these cases was €4.7 million in tax, interest and penalties. Cases where rental income is a secondary source are, of course, also included in Revenue audit programmes. Cases are selected for audit on the basis of perceived risk including, in the case of landlords, consideration of information from tenants or third parties where this has been successfully matched.

The Revenue Commissioners are satisfied that this risk-based audit approach, combined with information matching wherever possible, is the appropriate strategy for tackling under-reporting of income by landlords. I also point out that since 2006 relief for interest payable on borrowed money applied in the purchase, improvement or repair of rented residential premises is conditional on compliance with the registration requirements of the Private Residential Tenancies Board. Furthermore, tenants must identify their landlord when claiming rent relief. These measures should help to ensure compliance.

Richard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

Is the Minister aware that the Revenue Commissioners have recently admitted to the Committee of Public Accounts that they are not aware whether tax has been paid on some €200 million paid by the State to landlords under rent supplement and they admit to significant gaps in their information on payments by the State to landlords, let alone payments made where the State is not involved in any way in the transaction? Is he aware that the Revenue Commissioners estimate rent relief will be claimed this year on 120,000 premises but the CSO calculates there are approximately 250,000 rented properties? If this is the case, it suggests as many as half of rented properties are not providing relief to the tenants — while I admit some of those might be on rent supplement, the figure is not anything close to 120,000. Will the Minister ask the Revenue Commissioners, the CSO and the Department of Social and Family Affairs to undertake a serious examination of the position of both tenants and landlords so we can have confidence that taxpayers are getting fair refunds and that landlords are paying their fair share?

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

As I stated in my initial reply, there have been some moves in that respect. Regarding the number availing of rent relief, the figure I have for last year was 215,786.

Richard Bruton (Dublin North Central, Fine Gael)
Link to this: Individually | In context

That is not the figure issued by Revenue.

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

In any event, I can have that checked for the Deputy. It is important to bear in mind that some of those taxpayers who request an end-of-year review of their tax liability prefer to claim the rent relief as part of that process. Accordingly, as there is a four-year rule for requesting such reviews, final figures for the years from 2004 onwards will not be available until that time limit has expired. It is expected that when final figures are available, the numbers claiming rent relief will increase substantially. Approximately 98% of those claiming the relief are aged under 55. I will check the point made by the Deputy.

Joan Burton (Dublin West, Labour)
Link to this: Individually | In context

Will the Minister agree to introduce a system whereby all landlords who receive rent payments from the State must supply a full PPS and tax number and that this tax number is made available to the Revenue Commissioners, that landlords who are obliged to register with the Private Residential Tenancies Board should also have to include a tax number on their registration, as they are meant to do, and that those tax numbers would be made available to the Revenue Commissioners? This would ensure that all landlords who are liable to pay tax on their earnings would be made to pay it.

Brian Cowen (Laois-Offaly, Fianna Fail)
Link to this: Individually | In context

I undertake to take up the point raised by the Deputy with Revenue to ascertain its views on it.