Irish Revenue have said that all offshore assets outside of Ireland must be declared by next month to Irish Revenue or people risk facing higher tax penalties or prosecution, reports The Irish Post.
For the Irish in Britain or those further afield who have returned to live in Ireland, the announcement means all pensions, holiday homes, rented homes, or any other means of income from outside the Irish State, must be declared by a ‘qualifying disclosure’.
This is a freely disclosed tax default to Revenue, rather than it being discovered through an audit or investigation.
From May 1 2017, it will no longer be possible to benefit from any account, income or financial gain from a source based in any other territory outside of Ireland without declaring all offshore assets to Irish Revenue.
Property outside of the state belonging to an Irish resident must also be disclosed by May 1 after Finance Minister Michael Noonan announced at the end of last year that his department would be cracking down on offshore tax defaulters.
A spokeswoman for Safe Home Ireland, a Mayo-based support service for Irish returning after living abroad, described the disclosure notice as “scary”, but also pointed out that not everyone with assets abroad will be effected.
“It is scary when you read the document, it can put people older people on their nerves, especially older people who are in receipt of pensions from abroad.
“However, the other side of it is that there’s a lot of pensioners that it won’t affect anyway because they’re below the tax threshold,” she said.
While it is not illegal to have an offshore account or to have assets or investments offshore, residents within the State of Ireland must pay tax on any interest, income or gains earned.
Any money placed in an offshore account or used to acquire assets or investments offshore must be declared for tax purposes, unless exempt from tax or Irish tax has already been paid on it.
Irish Revenue, part of the Department of Finance, said: “Persons with liabilities involving “offshore matters” could be liable to higher penalty rates, the settlement could be liable for publication in the quarterly Defaulters’ List, and the person concerned could be the subject of a criminal prosecution.”
However, after the disclosure period, the Automatic Exchange of Information will allow the Irish Government to check with other tax authorities around the world for undeclared assets belonged to Irish citizens.
Until May 1, however, Irish residents may disclose their offshore assets to Revenue and reduced penalties and non-publication on the Defaulters’ List.