Tuesday 17 October 2017

Tax authority must do more to avoid any further costly mistakes

Comment

IT is not often that Revenue makes mistakes. The tax authority is regarded as one of the most efficient public sector bodies in the State.
IT is not often that Revenue makes mistakes. The tax authority is regarded as one of the most efficient public sector bodies in the State.
Charlie Weston

Charlie Weston

IT is not often that Revenue makes mistakes. The tax authority is regarded as one of the most efficient public sector bodies in the State.

It collected €38bn in taxes last year, with a staff of 5,500. This is the same staffing level it had in 1975.

Despite its efficiency, Revenue has now blundered big time by sending out thousands of incorrect tax certs, mainly to pensioners.

The error in 5,000 tax certs means people have ended up paying too much tax.

A typical mistake in a tax cert has been to mistakenly double the amount of State pension people are getting, wiping out much, if not all, the tax credits they are due on an occupational pension.

And it is not the first time Revenue has messed up when it comes to pensioners.

In 2012, then chairwoman of Revenue Josephine Feehily was forced to apologise for the distress caused to 115,000 pensioners over letters it wrote over the Christmas period telling them they may face higher tax bills.

Ms Feehily told an Oireachtas Committee the jargon-riddled letters to the pensioners caused unnecessary confusion.

"We caused confusion, we caused distress to some people, and I am extremely sorry for that," she said.

The move came about after Revenue and the Department of Social Protection first started exchanging information.

Now the tax authority finds itself again apologising, and again the problem has arisen after the exchange of information between it and the Department of Social Protection on pensions.

More worrying is the fact that the mistake was not spotted by Revenue. It was out-of-pocket pensioners and the people who pay occupational pensions who noticed it.

Of course, we should all check our tax details to ensure they are correct.

But the tax cert goes to our employer or the people paying our private pension.

The other problem is that the income tax system is complicated. Most of us do not have enough understanding of it to challenge Revenue.

All this makes it essential that Revenue does more to double check the tax it collects from us is the correct amount. Nobody wants to pay more tax than they need to pay.

Irish Independent

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