Members have raised issues regarding warehoused debt and directors’ emoluments which are affected by section 997A TCA 1997. Following representations, Revenue has informed us that there are no provisions to warehouse the balance of the relevant Schedule E liability due in respect of 2021 to be paid in 2022.
As previously advised, Finance Act 2021 introduced a provision to allow directors who are employees with a “material interest” in a company to warehouse their Schedule E liabilities which were due to be paid by 31 October 2021 (17 November 2021 where the ROS extension applied), where the section 997A TCA provision prevented them from being entitled to a credit for the PAYE tax deducted by their employer company as a result of the employer availing of warehousing.
Last month, Revenue announced an extension to the Debt Warehousing Scheme to 1 May 2024. This will apply for any taxpayer who has warehoused their Schedule E liability which was due to be paid in October/November 2021 also.
Schedule E liability due to be paid by 31 October 2022 (16 November 2022 where the ROS deadline applies)
Revenue has confirmed that, as there is no legislative provision to allow the Schedule E liabilities due to be paid by 31 October 2022 (16 November 2022 where the ROS extension applies) to be warehoused, the balance of tax due in respect of 2021 will be due to be paid by 31 October 2022 (16 November 2022 where the ROS extension applies). Therefore, in relation to the 2021 Form 11 Income Tax Return, there is no warehousing tick box on the Form 11, as there is no Income Tax Debt Warehousing provision in respect of income tax payments due to be paid in 2022.
Revenue has stated that, where a taxpayer has not availed of warehousing for their Schedule E preliminary tax liability for 2021 (i.e., they did not request warehousing when completing the Statement of Net Liabilities declaration, when filing their 2020 Form 11 in 2021), they would not be considered to have warehoused their Schedule E preliminary tax liability and the liability will be due to be paid.
Where a taxpayer has difficulties making the Schedule E liability payment, they may contact Revenue to discuss flexible payment options available.