Owing revenue money - are they open to negotiate?

M

Mers1

Registered User
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All,

Need urgent advice on this one please.......

A friend of mine appears to be in a difficult situation, without going into too many details, he is in arrears with the "taxman"!. Revenue have offered to put in place an installment arrangement over time which he is open to......however..

My question is.....if he were to make them an offer, would they accept? Are they open to reasonable offers? e.g. if you owed €12,000 would they accept €8,000. I think that he isn't in a position to get €12k upfront but would rather settle the debt in full immediately and possibly raise €8k.

I'm afraid that my ability to answer questions on this one is limited as I think it would look like I was prying too much.

Am I wrong to think that revenue would accept a reasonable offer? and what would they see as a reasonable offer?

Any advice greatly appreciated, it seems time is of the essence also on this!
 
I doubt that Revenue will negotiate but if "your friend" is going to try this then they should probably attempt it via a professional tax advisor or accountant rather than directly.
 
I'm surprised they haven't added on a load of interest and charges.
 
Your friend needs to contact the person in Revenue directly that is dealing with his case. Make him/her a serious offer 8k sounds serious and see how it goes from there. If money is outstanding due to self assessment might be more favourable. If due to PAYE harder for Revenue to negotiate.
 
If the matter came to court, it would be dealt with by the State Solicitor acting on behalf of the Revenue Commissioners who would accept a reduced settlement on a plea. Therefore this is nothing to suggest that they won't accept it in advance with a bit of a battle. The Revenue will likely settle on a sum based on the person's income, assets and ability to pay.
 
Thanks everyone for replies.

I know that he had been speaking directly with whomever is dealing with his case but they didn't sound like they were open to accepting any offers. I think all he can do is ask really.
 
In general terms, Revenue will seek to recover the actual amount of tax owed. Where they may be willing to negotiate is on the penalties and the timeframe for payment. Is the 12k the amount of tax owed or the total amount Revenue is seeking, including interest and penalties?

A bill of 12K is well within the means of most employed people to pay off within a reasonable amount of time, so I doubt that inability to pay this amount will fly with Revenue. You friends best approach would be to offer to pay a reasonable amount upfront as a lump sum and pay the remainder in installments over the next year or two.

If the matter came to court, it would be dealt with by the State Solicitor acting on behalf of the Revenue Commissioners who would accept a reduced settlement on a plea.
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The reduced settlement would generally be a reduction in the interest penalties rather than the original amount.

It is true that sometimes Revenue do accept less tax than they are owed, but this is generally in situations where a business is being wound up owing a significant amount which just cannot be recovered due to the failure of the business. As I've said earlier, 12k for a individulal is not regarded as a significant amount and is within the means of most taxpayers to pay off over time.
 
The short answer to OPQ is a qualified 'Yes'
The RC's are tough (and they need to be) but generally in the case of demonstrable facts will be fair too. Blanket pardons they do not do.

However, an honest open approach laying bare the logic of the proposer's position can pay dividends and deliver the desired result.

Ponder well these considerations, lay out your circumstances in advance and go for it. You are not in uncharted waters. And yes, it would be advisable to engage with a professional tax adviser on such an important matter.

Good Luck !
 
Again thanks,

Ubiqitous: I am not advising him merely trying to help, that is why I posed the question here. I am a PAYE employee and thankfully have very few dealings with tax office. He is self employed, and I just didn't understand why negotiations to reduce the amount don't seem possible.

csirl: I dont believe that it is "within his means" to pay 12k.

1john: Thank you, yes I am of the belief of appealing to peoples better nature and hoping for the best.

Again really appreciate the frank replies.
 
csirl: I dont believe that it is "within his means" to pay 12k.
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Maybe not in 1 lump sum, but surely by installments over a period of time? May mean foregoing some luxuries, but should be over 4-5 years for anyone with a full time job.
 
TBH, i won't be impressed if they did allow him to pay a lower amount....if thats the case, whats to stop anyone not paying taxes and then offering a lower amount? If that were the case the taxpayers would be subsidising the tax avoiders.

If he can't pay it all togeather, I would agree he should be allowed to pay it off over a few years.....plus interest!!
 
..or he should borrow from a bank or credit union instead - much cheaper than Revenue and probably easier to arrange.
 
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