The taxman comet to 60,000
Many of those with bogus non-resident accounts are small business people and those with modest lump sums to hide away secretly as nest eggs for the rainy day. As a result, they could end up losing all their savings. Furthermore, people who inherit such money can also be made liable for tax due.
Pressure is being stepped up on account holders who failed to avail of a tax amnesty before the November 15 deadline.
Take for example, someone who put 10,000 euro into such an account in 1987 and did not avail of the November deadline. The tax owing, plus full interest and penalties could be up to 40,000 euro.
Had the same person come forward prior to November, they would have to pay a maximum of 20,000 euro.
The Revenue Commissioners estimated that 700m euro would be paid up by bogus account holders prior to November, but the actual figure came to only 179m euro which came from 3,675 people.
A Revenue spokesperson yesterday said they were currently working through the courts on 1,800 accounts that had been identified and they are also getting further information on foot of High Court orders.
"We always said we would see this task through,'' the spokesperson added. Pressure is also being put on the banks who have been contacting account holders by letter.
The letters state that banks are legally obliged to provide information to the Revenue in relation to "certain classes'' of accounts as at March 31, 1990, and March 31, 1995.
The letters have created a certain amount of panic so much so that a new group has been set up to offer people advice.
A spokesman for the Reaction Group for Non-Resident Account Holders said where tax was due, people would have to pay it. However, he added, there could also be an underlying issue of compliance on the part of banks and other financial institutions, which facilitated people to open the accounts.
"If it could be proved that a bank was compliant in opening a bogus account, then the bank could be liable for some of the settlement to be made with the Revenue. It's not correct or fair for one of the banks to claim before the Public Accounts Committee that it was duped and defrauded by bogus account holders.'' The claim was made by AIB group chairman Lochlann Quinn when he attended at the Dáil's Public Accounts Committee in December 2000. He said many people with bogus accounts lied to the banks.
The banks and financial institutions have already paid 208m euro to the Revenue in DIRT settlements.
In 1998, there were 302,000 non-resident accounts in Ireland, holding 3.3bn euro and the Comptroller and Auditor General later estimated that 18% showed signs of being bogus, representing about 600m euro.
Dublin had the largest share with 879m euro, followed by the border region on 703m. Dundalk alone had 189m euro, followed by Galway on 115m euro and Cork on 105m euro. Cork and Kerry were top of the league in making declarations before the November 15 deadline last year. There were 55 declarations of over 100,000 euro from both Cork and Kerry, amounting to about 5.5m euro from each county, followed by Dublin where 52 declarations of over 100,000 were made. Meanwhile, the Reaction Group for Non-Resident Account Holders is hoping to form a strong lobby.
The group can be contacted at 021-4547011.
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