Unregistered landlords pocket €250m in rent welfare benefits
Published 17/06/2011 | 05:00
THE State paid more than €250m last year to thousands of unregistered landlords, the Irish Independent has learnt.
Half of the landlords who get rent supplement payments -- which can be as high as €1,100 a month -- from the Department of Social Protection do not have their properties registered with the Private Residential Tenancies Board (PRTB), despite being legally obliged to do so.
Rent supplement is paid out to tenants who can no longer meet the cost of their rent because of a change in circumstances. The tenants then pass the money on to the landlord.
The Revenue Commissioners last night said it had launched an in-depth probe of landlords to ensure that they were tax compliant, including door-to-door inquiries in areas where there were a lot of rented properties.
A spokesman said Revenue used a number of sources -- including taxpayer's claims for the rent tax credit, PRTB registrations, information from the HSE and Department of Social Protection on rent subsidies, data on the second-home tax and "local intelligence" -- to check that landlords were paying tax.
"Revenue is additionally undertaking door to door checks of estates where there is a known high proportion of rented properties" a spokesman said.
"Information obtained will be assessed in conjunction with other data at Revenue's disposal."
Details of the investigation came after the Irish Independent learnt that up to 47pc of landlords receiving rent supplements had not registered properties they own, despite being required to do so since 2004.
The State paid out €516m in rent supplement payments last year, and expects the bill for 2011 to reach €465.5m.
The high rate of non-compliance means these landlords may have received up to €260m in payments in 2010.
The revelation is a serious embarrassment to the Government, which has vowed to crack down on social welfare fraud, which it claims is costing the taxpayer up to €300m a year.
But it has failed to ensure that payments are only made to tax-compliant and registered landlords.
Despite flouting the law, landlords will not face prosecution. Instead they will be forced to register each tenancy at a cost of €90, and pay a late-payment registration fee of €90.
This is despite some receiving more than €12,000 a year in payments to house families in a single property.
The problem came to light after the PRTB installed a new computer system which allowed it to check payments -- made under the rent supplement scheme -- against registered properties.
Housing Minister Willie Penrose said that changes to how the system was operated would help stamp out the practice and that landlords in the system would be caught.
The Irish Property Owners' Association said the number of landlords accused of being non-compliant seemed very high, adding that the "vast majority" of landlords were compliant.