Update: Small Businesses in Financial Difficulty, 24th June 2015

QUESTION NO:   265

DÁIL QUESTION addressed to the Minister for Finance (Deputy Michael Noonan)

by Deputy Bernard J. Durkan

for WRITTEN ANSWER on 23/06/2015  

  To ask the Minister for Finance the extent, if any, to which sympathetic consideration and accommodation continues to be extended to small businesses that may have fallen into financial difficulty in the course of the economic downturn, resulting in arrears of various taxes; if a means will be found to facilitate recovery of outstanding debts over a reasonable period, rather than closure of business; and if he will make a statement on the matter.

REPLY.

The Revenue Commissioners have a strong focus on making sure that every taxpayer and business complies with the obligation to pay the right amount of tax or duty, including any outstanding interest or penalties, in full and on time.   That is an appropriate and correct focus for the Commissioners and one that I fully endorse because timely tax compliance is of critical importance to the Exchequer. Also, persistent late or non-payment of tax can confer an unfair competitive advantage over compliant taxpayers that pay their taxes in full as they fall due.

However, the Revenue Commissioners are also very conscious of the difficult financial climate that still exists for some viable businesses and the challenges that cashflow shortages can pose for timely tax compliance. When such difficulties arise, the Commissioners clear preference is to engage with the taxpayer and agree a mutually satisfactory solution rather than deploying debt collection/enforcement sanctions.

The agreed solution could include a phased payment arrangement or in some limited instances a temporary deferral of the liability. However, any such arrangement will include an interest element and will require a commitment from the business to pay future taxes as they fall due.

Finally, if the Deputy is aware of a particular business that is experiencing tax payment difficulties he should advise the people in question to immediately contact the Revenue Commissioners   to discuss the issue and hopefully agree a mutually acceptable arrangement, thereby avoiding the expense and stress of debt collection/ enforcement action.