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By Fionnan Sheahan
Tuesday September 23 2008
THE taxman had to make an embarrassing settlement of €1.7m to himself for unpaid taxes. And another €1m was taken from public bodies in unpaid tax this year.
The Revenue Commissioners failed to tax travel benefits awarded to its own staff and ended up paying the price.
The rules for so-called benefits-in-kind for travelling to and from work changed four years ago -- but Revenue failed to notice the new system itself.
The tax authorities did an extensive communications campaign to inform employers of the onus being placed on the employer to tax employees at source in respect of BIK.
But two years after the changes, concerns were raised by officials about the tax treatment of these same benefits received by Revenue staff for travel to and from work.
It transpired that over two and-a-half years, around €2m in BIK arose from staff travelling to and from work.
When the overall liability, interest and penalties were applied, Revenue owed €1.7m.
The C&AG was concerned at the delay in identifying Revenue's obligations to tax benefits paid to its own staff and that similar issues could arise in other State bodies and the private sector.
- Fionnan Sheahan
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