Ciarán Lynch (Cork South Central, Labour)
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Question 176: To ask the Tánaiste and Minister for Finance the sanctions imposed on tenants who fail to meet their obligation to deduct tax or to provide a certificate to the non-resident landlord of tax deducted; the sanction that applies to a tenant who fails to meet the requirement to make a return and pay to the Revenue Commissioners the tax that they have deducted from the rent due to a non-resident landlord; the number of tenants who have defaulted on the foregoing obligations in each of the past five years; the amount of tax paid to Revenue by tenants on behalf of non-resident landlords in each of the past five years; the number of tenants who have collected tax on behalf of non-resident landlords in the past five years; and if he will make a statement on the matter. [5094/08]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am informed by the Revenue Commissioners that where tenants fail to meet their obligations in relation to the deduction of income tax from payments of rent to non-resident landlords, or of providing Revenue with details of such payments and of the tax deducted, and paying such tax to Revenue, the usual sanctions in relation to the collection and recovery of income tax can be applied, including the imposition of interest and penalties. However, non-compliance by individual tenants can be innocent in some cases because they genuinely may not know the tax residence status of the landlord. This difficulty has been highlighted in the Ombudsman's Report for 1998.

I am further informed by the Revenue Commissioners that they are unable to provide information on the number of tenants who have defaulted on their obligations in this regard for the last 5 years. I am also informed by the Revenue Commissioners that they do not have complete information on the amount of tax paid by tenants on behalf of non-resident landlords and the number of tenants who have collected tax on behalf of non-resident landlords. According to the annual returns of income for non-PAYE taxpayers for the years 2002 to 2005 inclusive, the amount of gross rents payable by taxpayers to non-resident landlords are as follows:

The amount of income tax that may have been withheld by tenants for those years was not separately identified. Revenue does not have similar information for PAYE taxpayers.

Following an amendment to the return of income (Form 11) for the year 2006, non-resident landlords when completing a return of income have to indicate the amount of income tax that was withheld from rents paid by their Irish tenants and the PPSN(s) of tenants who deducted tax from rent payments. Returns for 2006, which had a return date of 31 October 2007 are in the course of being processed. I am advised that the policies and procedures relating to the deduction of tax on rent payable to non-residents have been set out in the Revenue publication "Tax Briefing 42" and that these policies and procedures are being kept under review.