Tax officials are targeting millions of euro in undeclared income from landlords as part of a crackdown on the “shadow economy”.
Investigations into sections of the economy most likely to deal in cash show rental income accounted for the biggest individual yield last year.
Officials found most liabilities in this area related to undeclared income, tax incentive reliefs claimed as losses, false claims or non-allowable expenses, and stamp duty claw backs. The rental sector has grown dramatically over recent times, with more people renting homes now than at any point in the last 50 years.
There are fears that many buy-to-let landlords do not register with the Private Residential Tenancies Board (PRTB), accept cash in rent and do not make tax returns.
An initial examination of these cases shows there are “likely to be cases in the database which are operating in the “shadow economy”, or whose assets would indicate undeclared income”.
Revenue plans to share its results with the Department of Social Protection as part of a joint investigation.
Cross-checks are being made by looking at claims for rent relief from tenants, PRTB registrations, information on rent subsidies from the Health Service Authority and the Department of Social Protection.
Officials are also using data from local authorities on who has paid the second-homes tax.
The Revenue is determined to improve tax compliance as returns for the Exchequer have plunged. Income tax, the largest source of revenue, is now way off boom-year highs.
If you have any concerns in relation to rental properties you can contact Jason or Catherine at McDowell & Co Accountants, Stephen St Sligo, Tel: 071 9147580 email: firstname.lastname@example.org where we can offered you advice on what you should do in relation to your rental income.