Revenue to dock wages in tax debt recovery
THE Revenue Commissioners will be able to claim debts owed to them directly from a person's pay cheque under newly published regulations.
The regulations, which were included in the Finance Bill earlier this year but have now been detailed by the Revenue, allow the authority to place a 'Notice of Attachment' on a person's income if he or she has defaulted on their tax bill.
An attachment, which is used by several countries around the world, requires anyone who owes the debtor money to pay a certain amount of it directly to the Revenue.
In practice, the Government will be able to take what is owed straight from anyone paying money to the debtor, including wages or salary, rather than wait for the person to make the payment themselves. The Revenue has been able to use the powers of attachment since 1988 but could not use them against wages until this year's Finance Bill.
In the 'Guidelines for Attachment' issued to Revenue staff and published yesterday, the attachment can only be used if a number of conditions have been satisfied. Extra criteria are needed to claim wages.
The conditions for using the attachment include:
• The debt must be in default for at least one month. To claim wages, the minimum default period is six months.
• When claiming wages, the debt must be at least €10,000, and the person must be earning more than €50,000 a year gross.
• A 'final demand' and a specific 'demand notice' must have been issued, outlining the intention to attach wages/salary and inviting a financial statement to decide how much money will be taken per month.
• Only one attachment can be used per debt.
• The notice must be sent by registered post or hand-delivered.
The guidelines describe attachments as "a very effective enforcement method of collecting unpaid tax debts" and cite "no court delays", quick results, and the cost effectiveness due to a lack of legal fees as advantages of the scheme.
The attachment will remain active until the debt is paid or the notice is revoked, which can happen for a number of reasons.