Tom Parlon (Laois-Offaly, Progressive Democrats)

This recommendation seeks to amend the provision of a new section being inserted in the Taxes Consolidation Act which imposes a statutory obligation on an individual wishing to claim a tax relief for a particular year to keep all such records as are necessary to prove the claim. The particular provision which the Senator seeks to amend requires taxpayers to keep those records for six years after the end of the year to which the claim relates and he is proposing to increase the retention period to ten years.

In placing an obligation on taxpayers to keep documentation, there is a need to strike a balance between Revenue's right to investigate a claim and the placing of too heavy a compliance burden on the taxpayer. Ten years is considerably longer than the period in which the taxpayer may make the claim or the period in which Revenue may normally investigate a claim. Four years from the end of the year in question in both instances is the case. It would also contrast sharply with the retention period, for tax purposes, of six years in respect of business records. The fine of €1,520 to which Senator Ryan referred does not apply if the taxpayer produces other evidence to confirm that the information which the records, if retained, would show. In the circumstances the recommendation is opposed.