Priest pays €213,000 in settlement of property rents scam
A tax-dodging priest sprinted from court yesterday after being fined for failing to declare thousands of euro in rental income.
The Cork priest was fined €6,000 after reaching a €213,000 settlement with the Revenue Commissioners over cash earned from 11 properties.
Despite earning just over €30,000 a year for his priestly duties, Fr Tadhg O'Donovan had an interest in a total of 13 properties in various parts of Cork dating back to 1989.
And it has emerged the priest's brother is also a tax dodger. Last month he was spared a one-month jail sentence after pleading guilty in another court to dodging tax.
Some of the rental income from 11 of the properties took the form of Rental Supplement payments from the Health Service Executive (HSE).
Judge Leo Malone at Cork District Court was told Fr O'Donovan failed to fully reveal the rental income for tax purposes for a period between 1998 and 2002.
Revenue assistant principal officer, Fergus Dempsey said Fr O'Donovan failed to disclose a bank account in which he was lodging his rental income payments, after being informed in 2004 he was under investigation. When further challenged, Fr O'Donovan changed his accountant and instructed the new official to make a full disclosure of his affairs to the Revenue. But in a subsequent tax statement, he again failed to reveal rental income from some properties, and he understated the rental income accruing from several of the properties he did declare for rental.
Mr Dempsey said that Revenue became aware of this when they investigated payments being made by both the Health Service Executive (HSE) and the Department of Social and Family Affairs.
The Rental Supplement Scheme is aimed at helping poorer families on lower incomes to secure rental properties they would otherwise be unable to afford.
Fr O'Donovan, a curate in the Cork parish of Whitechurch who was formerly based in Araglin in north Cork, yesterday pleaded guilty to a total of 10 charges relating to his tax affairs before Cork District Court.
The offences included five charges of failing to make proper tax returns, three charges of providing incorrect information to the Revenue Commissioners, one charge of making an incorrect tax statement and one charge of failing to keep proper accounts.
The charges also covered the sale by Fr O'Donovan of two properties from which he made a substantial capital gain, and the failure to notify this to the Revenue Commissioners for calculation of Capital Gains Tax.
The Court heard that the curate made an initial payment of €20,818 to the Revenue Commissioners in 2004, and last week issued a cheque of €192,404 to Revenue in final settlement of his tax obligations, bringing the total settlement to €213,222.
The €213,222 is composed of €81,265 in tax, €81,265 in penalties and €50,682 in interest. The settlement is more than six times the annual income enjoyed by most Diocesan priests.
Judge Malone convicted Fr O'Donovan on all 10 charges and imposed fines totalling €6,050. He imposed no other penalty and allowed Fr O'Donovan two months to pay the fines. The court heard that the curate, who was ordained in 1985, has no previous convictions.
Fr O'Donovan apologised to Judge Malone and the court for the entire affair.
"I am just happy to have reached a settlement with Mr Dempsey and I am sorry for the whole situation and that it took so long to sort out," he said.
The curate told the court that he now wishes to pay the fines "as soon as possible".
Last night, the Diocese of Cloyne said individual priests were responsible for their own tax affairs.
"Each priest is responsible for their own tax affairs and it is up to each individual priest to make the appropriate returns," a spokesman said.