Revenue parks almost €3bn of tax debt linked to Covid restrictions

Businesses hit by Covid restrictions will be able to continue to avail of the Debt Warehousing Scheme for the first quarter of 2022

Revenue has said there are currently more than 100,000 Covid restriction-impacted businesses and individuals availing of its Debt Warehousing Scheme, with nearly €3bn of tax debt currently parked.

Nearly €3bn of corporate and private tax debt – linked to more than 100,000 businesses and individuals financially affected by Covid restrictions – is currently being parked by Revenue via its debt warehousing scheme.

The scheme – which has been extended to cover the first three months of this year – allows Revenue to park Vat and payroll tax payments due from Covid-hit companies and individuals. 

It also covers self-assessed income tax debt, Employment Wage Subsidy Scheme (EWSS) overpayments and tax liabilities of certain self-assessed income taxpayers with employment income.

The phased lifting of public health restrictions last summer – coupled with the high vaccination uptake – saw the economy recover and businesses begin to trade without the support of the Covid Restriction Support Scheme, before the latest wave of the pandemic hit, Revenue chairman Niall Cody said.

“The emergence of the Omicron variant of Covid-19 has brought further disruption to businesses; in particular those in the hospitality sector such as bars, restaurants and hotels as well as indoor entertainment venues,” Mr Cody said.

“For these businesses, we have reopened the claim portal for the Covid Restriction Support Scheme. Additionally, such businesses will be able to continue to avail of the Debt Warehousing Scheme for the first quarter of 2022,” he said.

"It is clear that we will need to continue to live with the challenges of Covid-19 for the foreseeable future. We will continue to work closely with our colleagues in the Department of Finance and play our part in administering the relevant Government schemes and measures to support individuals and businesses impacted by the pandemic," Mr Cody said.

Revenue also updated on the local property tax, saying the return compliance rate for 2022 currently stands at 81%, with the payment compliance rate standing at 91%. Payment of the tax for 2022 is due by next Wednesday.

Department of Finance figures, this week, showed the State’s tax revenues reached a record high of €68.4bn last year, driven by a huge haul from multinational companies.

Corporate tax revenues exceeded budget expectations by a wide margin. Overall tax revenues were up from €57bn in 2020 and even the previous record €58.3bn collected in 2019 before the pandemic.