Number of firms paying tax by installment rises

Thousands of Irish companies have agreed installment payment plans with the Revenue Commissioners because they are unable to pay their tax bills on time.

In 2009, some 12,500 companies had entered into installment arrangements to pay their taxes. By 2011, that number had risen by 28% to 16,000 companies.

The Revenue Commissioners are entering into agreements in an attempt to keep viable businesses open and maintain employment levels, a spokesperson for the Revenue said.

Chairman of the Revenue Commissioners Josephine Feehily told Accountancy Ireland: “There are people who owe us money who are very viable businesses but have cash flow and liquidity problems, partly because they can’t get their normal tolerances from banks.”

A spokesperson for the Revenue Commissioners said: “Delays in collection of tax revenues properly due adds to the level of Government borrowing and public debt interest and confers an unfair competitive advantage on non-compliant businesses.

“Notwithstanding the prevailing difficult economic and financial environment for businesses, Revenue expects businesses to maintain and organise their financial affairs in such a fashion as to ensure that tax debts are paid as they fall due.”