Revenue Note for Guidance

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Revenue Note for Guidance

817RH Penalties

This section outlines the penalties that will apply in the event of failure to comply with the obligations imposed by this Chapter. It provides that Revenue will make an application to the relevant court for that court to determine whether a person has failed to comply with the obligations imposed on that person by this Chapter and the amount of the penalty that will apply in such cases

(1) Where a person fails to comply with any of the obligations imposed by this Chapter, the penalties set out under the following paragraphs (a), (b) and (c) shall apply –

  1. where the failure relates to an obligation imposed on a person by section 817RC (3) (i.e. the obligations of intermediaries in relation to marketable arrangements), section 817RC(10) (i.e. the obligations of intermediaries to inform another intermediary or the relevant taxpayer of their disclosure obligations where a reporting exemption applies due to legal professional privilege), section 817RD(4) (i.e. the obligation of relevant taxpayers to provide a reference number to other relevant taxpayers) or 817RF (i.e. the reporting obligations of both intermediaries and relevant taxpayers in relation to the “lookback” period), that person shall be liable to –
    1. a maximum penalty of €4,000, and
    2. if the failure continues after a penalty under subparagraph (i) is imposed, a further penalty of €100 per day for each day thereafter on which the failure continues.
  2. where the failure relates to an obligation imposed on a person under section 817RC(1) (i.e. the obligation of intermediaries within the meaning of paragraph (a)(i) of the definition of intermediary to make a return to Revenue of the specified information), section 817RC(2) (i.e. the obligation of intermediaries within the meaning of paragraph (a)(ii) of the definition of intermediary to make a return to Revenue of the specified information), section 817RC(5) (i.e. the obligation of intermediaries to provide other intermediaries and relevant taxpayers with a reference number) or section 817RD(1) (i.e. the obligation of relevant taxpayers to make a return to Revenue of the specified information), that person will be liable to –
    1. a maximum penalty of €500 for each day during the initial period (as explained in subsection (2)), and
    2. if the failure continues after the penalty under subparagraph (i) is imposed, a further penalty of €500 per day for each day thereafter on which the failure continues.
  3. where the failure relates to the obligation imposed on a relevant taxpayer to include a reference number in a return, the person will be liable to a maximum penalty of €5,000.

(2) For the purposes of subsection (1)(b), “the initial period” is defined as the period beginning on the relevant day and ending on the day on which an application referred to in subsection (3) is made. “Relevant day” is defined as the first day after the end of the period specified in subsection (1), (2) or (5) of section 817RC or section 817RD(1), during which an obligation imposed on a person by subsection (1), (2) or (5) of section 817RC or section 817RD(1) is discharged.

(3)(a) Notwithstanding section 1077B of the TCA 1997, Revenue shall make an application to the relevant court for a determination whether a person named in the application has failed to comply with the obligation imposed on him/her by virtue of subsection 1(a), (b) or (c).

(3)(b) The “relevant court” means the District Court, Circuit Court, or the High Court, as appropriate.

(4) A copy of the application referred to in subsection (3) shall be issued to the person named in the application.

(5) The relevant court shall determine whether the person named in the application is liable to the penalty and the amount of that penalty.

(6) In determining the amount of a penalty under subsection (5), the court shall take into consideration –

  1. in the case of an intermediary, the amount of fees received or likely to have been received, by the intermediary in connection with the reportable cross-border arrangement, and
  2. in any other case, the amount of any tax advantage gained, or sought to be gained, by the person from the reportable cross-border arrangement.

(7) Section 1077C of the TCA 1997, which deals with the recovery of penalties, will apply in relation to a penalty imposed under subsection (1).

Relevant Date: Finance Act 2019