Revenue extends debt warehousing scheme as businesses struggle with costs

07/10/2022 Pictured is the sign for the Revenue Irish Tax and Customs office in Dublin Castle. Photograph: Leah Farrell / RollingNews.ie

Revenue decided to extend its debt warehousing scheme as businesses battle soaring costs.

The scheme will now run until May 2024, an extension of one year, “in light of the current challenging economic situation for businesses”.

“Revenue appreciates the very significant challenges that businesses are currently experiencing in meeting their tax obligations, arising from the impacts of the energy costs crisis and the financial pressures these have placed on businesses as they continue their recovery from the pandemic,” said Revenue collector general Joe Howley.

The Debt Warehousing Scheme was introduced to provide a vital liquidity support to businesses suffering a downturn due to the Covid-19 pandemic.

Businesses using the scheme will aim to clear their debt in the warehouse or enter into a phased payment arrangement to clear the debt before they reach the the new deadline. They will still be able to avail of the reduced 3% interest rate from January 1, 2023, as opposed to the general interest rate of 10%, when they come to pay the debt.

“Where a business has the capacity to repay any or all of the debt warehoused in the meantime, then they can of course do so,” said Mr Howley.

Statistics published by Revenue show that €2.2bn, the bulk of the €2.58bn warehoused debt, is warehoused by 7,500 taxpayers. Around 50,000 taxpayers have debts of less than €5,000 warehoused.

There are currently just over 27,000 taxpayers with warehoused debts in excess of €5,000 and these include more than 19,000 employers who employ over 315,000 employees.

“The scheme continues to be important in sustaining employment and viable businesses. The extension announced today will give businesses some certainty as they head into the end of 2022 and plan for 2023,” said Mr Howley.

Revenue will write to all businesses with debt in the warehouse in early December, setting out their statement of debt and advising them of the extension announced today.

Such businesses will also be reminded of the importance of filing current returns and paying their current liabilities on time and as they arise.