Shop owner to repay €25k after Revenue's incorrect Covid support advice

While Revenue said it empathised with the man’s position, it had to implement the law as passed by the Oireachtas. File photo

A convenience store owner, who was incorrectly advised by Revenue that he was eligible for a financial support scheme for businesses affected by Covid-19, has been ordered to repay almost €25,000 to the tax authorities.

The Tax Appeals Commission ruled that the business was not entitled to receive payments under the Covid Restrictions Support Scheme (CRSS). TAC commissioner, Andrew Feighery, dismissed an appeal by the businessman, who was not publicly named, against the demand by Revenue to refund any CRSS payments after it realised his business was not eligible for the scheme.

The owner of the convenience store had previously availed of the Restart Grant introduced at the start of the pandemic before it was replaced by the CRSS.

The TAC heard that the owner had been informed by Revenue that his business qualified for payments under the CRSS scheme and received payments totalling €24,918.40 between February and June 2021.

Revenue subsequently informed the store owner that it had reviewed his CRSS registration on June 23, 2021, and believed it was not eligible for the scheme.

Eligibility

Tax officials pointed out that CRSS payments were meant for businesses that had to prohibit or significantly restrict customers from accessing their premises.

The shop owner told the TAC that he and his wife had to implement very strict Covid safety procedures in the shop, including limiting the number of customers in the store at any one time to a maximum of two, due to various health conditions.

He said closing the shop was “never an option even by choice” as he was afraid customers would change their habits and shop elsewhere and they would be “lost forever.” The man also claimed the closure of schools had a big impact on his trade as a lot of his custom came from schoolchildren.

He criticised the tax authorities over the lack of engagement in the CRSS process and claimed he was worried about the survival of his business if he had to repay the CRSS funding. “I still in my heart believe I am entitled to CRSS,” he remarked.

However, Revenue claimed the shop was considered at all relevant times to be an “essential retail outlet” which was not required to prohibit or significantly restrict customers to its premises. While Revenue said it empathised with the man’s position, it had to implement the law as passed by the Oireachtas.

The TAC heard that the shop’s turnover during the pandemic was less than 25% of pre-Covid-19 sales levels in 2019. Mr Feighery said it was clear from the guidelines for the scheme that the claimant should have been deemed ineligible for CRSS payments.

Under the legislation, the commissioner said the money should be repaid to Revenue without “unreasonable delay”. In the event that the money was not refunded, Mr Feighery said Revenue was authorised to raise an assessment against the shop owner for a sum of €124,592, which represents five times the value of the payments received in error.

Mr Feighery noted that Revenue had signalled it was willing to collect the CRSS payments in instalments from the store owner and that the initial error was due to the tax authorities.

The commissioner said he noted the man’s complaints about the lack of engagement from Revenue and said there was a positive obligation on all public bodies to inform customers of their complaint procedures.

Mr Feighery said it was understandable that the appellant might be disappointed with his ruling but he had no discretion to deviate from the legislation. He expressed hope that the store owner’s business had recovered since the easing of Covid restrictions.