Marc MacSharry (Sligo-Leitrim, Fianna Fail)
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243. To ask the Minister for Finance the tax implications for Irish citizens living here that held property abroad (details supplied); if an amnesty is still available to such persons to retrospectively comply with their obligations without penalties and interest; if so, the details of such amnesty; if not, his plans to re-establish such an amnesty to permit the substantial number of persons that wish to meet retrospective tax liabilities which arise from rental income from property in other countries; and if he will make a statement on the matter. [46818/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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I am advised by Revenue that the provisions relating to penalties for failing to make a correct tax return where one is required are set out in section 1077E of the Taxes Consolidation Act (TCA) 1997. This section provides that the applicable penalties may be mitigated in specific circumstances where the taxpayer makes a “qualifying disclosure”, that is a full disclosure of all information relating to a liability made before an inquiry into the liability is commenced by Revenue. This was not an amnesty, the full tax liability, statutory interest and penalties were payable.

However, section 56 of Finance Act 2016 introduced a new provision which excluded any tax defaults relating to offshore matters from the qualifying disclosure regime with effect from 1 May this year. As a result any tax defaults which have not yet been declared cannot avail of the mitigation in penalties. 

These changes were introduced as part of Ireland’s fight against offshore tax evasion, and following increased levels of international tax transparency and data exchange. Under international exchange of information agreements Revenue are now receiving information relating to Irish taxpayers from over 100 countries, and are working with other jurisdictions to maximise the use of this information. As a result of these developments Revenue have increased capabilities to identify offshore tax defaulters, and to carry out audits and investigations into outstanding liabilities.

Following the enactment of Finance Act 2016 those with outstanding offshore tax liabilities were given a window of opportunity to avail of reduced penalties under the qualifying disclosure regime before the 1 May deadline. As this deadline has now passed, persons with outstanding offshore tax defaults will not be able to avail of the reductions of penalties provided under the qualifying disclosure regime.  However, where a taxpayer has an offshore liability it is still in their interest to come forward to Revenue to regularise their affairs in order to avoid the risk of an investigation leading to a criminal prosecution, and to avail of the reduced penalties that are offered to taxpayers that fully cooperate with Revenue as set out the Code of Practice for Revenue Audit and other Compliance Interventions.

I am further advised that tax defaults, whether they relate to offshore or domestic liabilities, are subject to statutory interest under section 1080 TCA 1997.