In recent years, there has been a radical change in the approach taken by tax authorities when it comes to sharing information. With the recent Panama and Paradise papers, the definition of what constitutes a “tax haven” has seemingly widened and some countries with relatively robust tax policies have found themselves tarnished by the tax evasion brush. In Ireland, the Revenue Commissioners recently announced an inquiry to catch taxpayers engaged in offshore tax evasion and avoidance. This follows the receipt of 2,734 offshore disclosures totalling €84 million gathered under the offshore disclosure regime, which closed last May. Those with undisclosed offshore tax liabilities will now face much harsher penalties.

With programmes such as FATCA, DAC and the OECD’s Common Reporting Standard, Revenue now has access to data of Irish taxpayers in over 100 jurisdictions. Revenue says its systems can interrogate the data, match the incoming information to existing records such as names, dates of birth and tax reference numbers, and identify suspicious patterns. So if you have valuable offshore assets but no obvious means disclosed on your tax records to fund these, you might alert the system. In addition to the international exchange of taxpayer information, iXBRL filings and the onset of real-time PAYE reporting will result in a vast increase in the amount of taxpayer data gathered by Revenue. It now seems that they are beginning to find ways to use it.

Cróna Brady is a Tax Manager at Chartered Accountants Ireland.