Tax exiles to do own sums over €200,000 charge
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WEALTHY tax exiles will assess their own finances to see if they are liable for the new charge of €200,000.
The new levy will work on a self-assessment basis, but the Revenue Commissioners will have the powers to conduct an audit.
The Department of Finance says it is not clear how many of the 6,000 tax exiles will be hit by the new levy.
The domicile levy will have to be paid by exiles who fall under the following criteria:
- Irish citizens.
- Irish-located capital of €5m.
- Worldwide income of €1m.
- Income tax bill of less than €200,000.
- Those liable for the levy will have to pay it regardless of where they live or where they are resident.
The definition of Irish-located capital includes property, cash, deposits, shares, art work, jewellery and other valuables.
Revenue will have rules in place to prevent assets being spread out across members of the tax exile's family.
But the €5m capital will not include productive assets, such as companies, to ensure there is not a disincentive for further investment. While the self-assessment is a light-touch regulation, Revenue will be aware of the types of high earners being targeted by the levy.
Labour Party finance spokeswoman Joan Burton said the minister had introduced the levy following a long campaign by her party. But she said it remained to be seen how many of the near 6,000 tax exiles this would actually affect.
Sidestepped
Ms Burton said that in his December Budget speech, the minister said "high earners must pay their fair share".
"However, the minister has sidestepped many of the reforms proposed by the Commission on Taxation in terms of restricting tax avoidance measures used by the super-rich to minimise their tax bills. For instance, he did nothing to curtail tax relief on investments in private hospitals or mega pension pots," she said.
- Fionnan Sheahan Political Editor
Irish Independent
