Tax debt warehousing

Where tax debt warehousing is now

• 0% interest rate on warehoused debt;
• Businesses availing of the Debt Warehousing Scheme have until 1 May 2024 to either:
•  
  • Pay their warehoused debt in full.
  • Engage with Revenue on addressing the debt, including arrangements for a Phased Payment Arrangement (PPA).
• “Every possible flexibility” for managing payment of warehoused debt including:
  • The level of down payment to commence a phased payment arrangement.
  • An extended payment duration, where necessary.
  • The availability of payment breaks and payment deferrals if temporary cash flow difficulties arise during the arrangement term. 

What’s essential to maximise the benefits of Tax Debt Warehousing?

Taxpayers must keep up to date with filing current tax returns and paying current tax liabilities as they fall due to keep the benefits of tax debt warehousing.

It is also essential for the taxpayer to engage with Revenue with their plans to deal with the warehoused debt.

The consequence of not meeting the conditions is that the warehouse facility is revoked, meaning that:

• All outstanding tax debt will become payable immediately.
• may be subjected to debt collection enforcement action.
• will be subject to the standard interest charges of 8% or 10% per annum.

Actions now

1. Pay now in full, or in part, through online payment channels;
2. Apply for a Phased Payment Arrangement (PPA) via ROS. A payment break can be applied for until after 1 May 2024;
3. Customers may also request to offset repayable claims such as Value-Added Tax (VAT) against warehoused debt on an ongoing basis.
4. Review interest already paid and request a refund.

Benefits of engaging early

There are several benefits to engaging with Revenue early in relation to the repayment of warehoused debt, such as:

• Providing certainty for businesses on their financial position and allowing future cashflow to be planned.
• Allowing time to agree the best repayment solutions appropriate to the business.
• Payment arrangements that can be activated now with a minimal down payment and monthly repayments commencing later, that is, from 1 May 2024.
• Payment schedules can be adjusted should circumstances change in the interim.

If you have any questions in relation to the above, or if you would like to discuss this topic further, please contact a member of the Mazars corporate tax team below: