The Consultative Committee of Accountancy Bodies-Ireland

The Institute of Chartered Accountants in Ireland

The Association of Chartered Certified Accountants

The Chartered Institute of Management Accountants

The Institute of Certified Public Accountants in Ireland

83 Pembroke Road

Dublin 4

Tel 637 7200

Fax: 6680842

Mr Norman Gillanders

Assistant Secretary

Revenue Operations, Policy and Evaluation Division

Ardilaun House

St Stephen's Green

Dublin 2

3 December 2007

Dear Norman

Consultation process on mandatory electronic filing of tax returns and payments

Thank you for your letter of 7 November.

We did indeed express publicly our reservations regarding the timing of this Revenue initiative, and the position of CCAB-I remains that the introduction of mandatory electronic filing at this time is inappropriate. I know we need not remind Revenue of the support of ROS offered by us over the years, which has contributed to levels of electronic filing of the direct taxes on a voluntary basis which are without parallel worldwide. The promotion and use of electronic filing methods is not in dispute, and we subscribe to its benefits and efficiencies. Our members frequently tell us that having adopted electronic filing, they would not willingly revert to paper based methods.

That said, we see two issues in particular with the introduction of mandatory electronic filing at this time:

• The development of ROS has been characterised by commercial awareness on the part of Revenue of the requirements of taxpayers, to the great benefit of the system. If the use of ROS is mandated by law, there could be a temptation to suborn taxpayers’ requirements to expediency in systems development. ROS may need further development in a voluntary use environment.
• The voluntary nature of ROS permits flexibility, both on the part of taxpayers and the part of Revenue, where circumstances arise which the ROS system may not fully address. A mandatory e-filing system is only sustainable where it can deal with all the circumstances of that sector of the taxpayer community for whom its use is obligatory. Existing ROS services, while very good in many respects, are not yet comprehensive for all taxpayer circumstances.

A distinction must be drawn between electronic filing and its consequences, which it is entirely legitimate for us to comment upon, and electronic payment methods. The latter, we suggest, is primarily a commercial arrangement between the individual taxpayer and Revenue and thus perhaps partly outside of the remit of representative associations.

While recognising the benefits to taxpayers of electronic filing, we must also point out that the benefits to Revenue in terms of time savings in return and payment processing are particularly significant. We would hope that these savings would be reflected in further customer service initiatives on the part of Revenue in an era of mandatory electronic filing. This aspect may deserve amplification by Revenue.

Despite these significant reservations on this particular project, we are willing, should Revenue consider it helpful, to consider very carefully any specific proposals you have and offer comment. In so doing, we would recognise that most of the consultation on ROS to date has been in the context of accountants as tax agents for self assessed individuals and companies. I infer from your letter that Revenue's focus on this occasion may be more towards the use of electronic filing for fiduciary tax obligations.

In conclusion, CCAB-I will be happy to meet with you, under the auspices of TALC or otherwise, as you suggest in your letter, and I will be in touch to agree a mutually convenient date.

Kind regards.

Yours sincerely

Brian Keegan

ICAI Director of Taxation on behalf of CCAB-I