Tax dodgers get six weeks to come clean in crackdown

THOUSANDS of tax dodgers who invested undeclared income in life assurance policies over the past 25 years have been given six weeks to come clean to the Revenue Commissioners or face being named and shamed.

The latest crackdown will target all those who have taken out single-premium policies by investing lump sums in insurance funds.

According to figures from the insurance industry, €33 billion has been invested in single premium products since 1980. The latest probe is expected to net Revenue as much as e1bn.

A spokesperson for Revenue said the investigation will initially focus on those whose aggregate investments were €20,000 or greater.

All life insurance companies will write to customers who invested at least €20,000 in single-premium life products, advising them to make a voluntary settlement.

The Revenue said anyone who comes forward before May 23 and makes a full settlement within two months of that date will face reduced penalty charges and interest rates and will not be named.

However, it warned those who do not disclose their liability to brace themselves for severe sanctions. The Revenue can impose huge penalties on tax dodgers, often many times the sum owed, and can seek criminal prosecutions.

The Revenue said after July 22 it will use a High Court order to compel the insurance companies to disclose the details of investments by customers who have outstanding tax liabilities. A senior Revenue official said yesterday: “Step forward now, because we will come after you anyway.”

The investigation does not apply to those who invested in an assurance product from sources which were not taxable or were properly disclosed for tax purposes.

The chairman of the Dáil’s Public Accounts Committee, Michael Noonan, welcomed the Revenue inquiry and said the committee had first brought the matter to public attention last November.

“The way the new investigation is established means that those who invested €20,000 or more - for the purposes of evading tax - in these single premium insurance products will face a full investigation unless they make a full disclosure,” he said.

Mr Noonan said his estimate of €1bn in outstanding taxes still stood.

Over the past four years, investigations by the Revenue Commissioners have yielded €1.65bn for the Exchequer from just over 25,000 tax dodgers. Holders of bogus non-resident bank accounts have paid €801m in interest and penalties, while the offshore assets inquiry has netted €723m so far.

A further €135m has been recovered from Ansbacher account holders, the various tribunals of inquiry and the National Irish Bank/Clerical Medical Insurance investigation.