As part of the July 2020 Jobs Stimulus Package, the Government announced a reduced interest rate of 3% per annum to apply to non Covid-19 related tax debts. This reduced rate is available to all taxpayers that have declared but unpaid tax liabilities for any period. The reduced 3% rate is also available to any undeclared liabilities that predate Covid-19 provided the liabilities are declared and a Phased Payment Arrangement agreed with Revenue by 31 October 2020.
This scheme is available across all tax types including VAT, income tax, corporation tax, CGT, RCT and PAYE (Employer) taxes and was introduced to provide vital liquidity support to struggling businesses and sole traders that have historic unpaid tax debts. By applying the lower interest rate of 3% per annum, the cost of paying unpaid tax debts is significantly reduced.
In addition, any individual or business with non Covid-19 unpaid tax liabilities will not qualify for a tax clearance certificate unless there is a Phased Payment Arrangement in place. Businesses cannot avail of the Employment Wage Subsidy Scheme, the Stay and Spend Scheme, accelerated loss relief and other measures without a tax clearance certificate.
Any existing Phased Payment Arrangements with Revenue will be reviewed automatically, and the reduced rate will be available for any tax debts that remain outstanding from 1 August 2020.
To avail of this reduced rate of interest, taxpayers must agree a phased payment Arrangement with Revenue before 31 October 2020. The first step is to apply online via ROS for a Phased Payment Arrangement (PPA).
Please contact us if you have any queries on how to avail of this reduced rate of interest.