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Ireland’s Cooperative Compliance Framework

AUTHOR(S): Joe Duffy
PRACTICE AREA GROUP: Tax
DATE: 15.06.2017

The Irish Revenue Commissioners ("Irish Revenue") has relaunched its cooperative compliance framework ("CCF") for large cases division ("LCD") taxpayers with effect from January 1 2017.

The CCF is designed to promote open communication between Irish Revenue and larger taxpayers, reflecting the mutual interest in being certain about tax liabilities and ensuring there are no surprises in later reviews. It is entirely voluntary.

Ireland originally introduced the CCF in 2005 with a view to managing the tax risks of LCD taxpayers in a more efficient and effective manner. However, following a review of the current operation of the CCF, it was decided to relaunch it. The review included an analysis of feedback received from taxpayers, case managers within Irish Revenue and also the evaluation of best international practice and other frameworks. The results of the review demonstrated that there was a lack of clarity among taxpayers, agents and Irish Revenue case managers regarding the CCF process and what was involved. It was also perceived that there was no clear distinction between taxpayers who opted into the CCF and those who didn't.

The CCF envisages a relationship based on trust and cooperation between Irish Revenue and large businesses where both parties work together to achieve the highest possible level of tax compliance. The main benefits of CCF participation for taxpayers include a dedicated case manager, a reduced level of compliance intervention, an annual face-to-face meeting and an annual risk review plan agreed between the taxpayer and Irish Revenue. On the other hand, taxpayers who do not participate in the CCF will not have a dedicated case manager and instead will be required to route queries or submissions to the Irish Revenue Commissioners through the general LCD customer service team.

The taxpayer has a number of responsibilities under the CCF that include:

  • Compliance with all tax obligations;
  • Performance of self-reviews and to inform Irish Revenue where risks or errors are identified;
  • Consultation with Irish Revenue in advance of undertaking any restructurings, reorganisations or major transactions; and
  • Informing Irish Revenue of economic and sectoral changes/insights.

Irish Revenue has recently undertaken a campaign encouraging eligible taxpayers to sign up to the CCF. Taxpayers wishing to participate in the CCF must make an application to the Irish Revenue LCD division. Acceptance by Irish Revenue of the CCF request is subject to the taxpayer meeting certain compliance criteria and providing certain requested information to the Irish Revenue.

Authored by Joe Duffy and Kathryn Stapleton.

A version of the above appeared in the International Tax Review of 30 May 2017.

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