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Revenue issues demands to 11,700 firms over warehoused debt

By May 10, 2024No Comments

Almost 90% of the €1.65 billion debt which was still warehoused at the start of last month has been repaid or is in the process of being repaid, Revenue has said.

The debt warehousing scheme was introduced near the start of the Covid-19 pandemic to help firms struggling with cash flow as a result of the lockdown.

Of the €1.65bn which remained warehoused at the start of April, €1.45bn is now either paid in full, in the process of being repaid in installments, or is part of a proposed phased payment arrangement which is being finalised.

That will leave €200 million still warehoused, which Revenue noted “has therefore reduced significantly from a peak of €3.2bn in January 2022”.

At that stage, 250,000 businesses availed of the scheme.

In a statement, Revenue acknowledged “the high level of engagement from businesses and their agents,” especially as last week’s deadline approached.

Firms had to have either paid back their debt or agreed a plan to pay it by 1 May.

Revenue has now issued demands to the roughly 11,700 businesses with debts of over €500 and who failed to meet that deadline.

Around 10% (775) of them have debt worth up to €130m.

Almost a third (3,670) have debt of between €5,000 and €50,000.

The majority (7,279) have debt of less than €5,000.

If those businesses fail to respond within seven days, Revenue will issue a final demand and the warehoused debt will “immediately and automatically” become subject “to standard enforcement proceedings”.

This means that the 0% interest rate and flexible payment options which apply in respect of warehoused debt would no longer be available.

Revenue also said that it is aware that a number of businesses contacted it in the last month but didn’t ultimately submit a formal phased payment proposal.

“If they do so before next Wednesday (15 May) the terms of the debt warehouse scheme, including the 0% interest, will be applied to that payment plan,” it said.

“We are currently putting in train our system updates to implement the standard interest rates on any outstanding warehoused debt and this will automatically be applied on 15 May where a payment plan has not been finalised.”

“Therefore, the demand period affords businesses a final opportunity to engage with Revenue on same, and Revenue will continue to engage on late payment proposals submitted during the relevant demand period.”

Article Source: Revenue issues demands to 11,700 firms over warehoused debt

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