Annual Report 2005

Tax Clearance Provisions

Evidence of Compliance with the Tax Acts

The 2001 Act introduced a set of provisions requiring the production of evidence of compliance with the Tax Acts (See Note 1 below). These apply to members of Dáil and Seanad Éireann and to appointees to senior office (See Note 2 below) and the judiciary.

The evidence of compliance consists of certain documents - a Tax Clearance Certificate (see Note 3 below) or Application Statement (See Note 4 below) and a Statutory Declaration (see Note 5 below). In the case of TDs, Senators and appointees to senior office, the evidence of compliance must be provided to the Standards Commission within 9 months of being elected or nominated or appointed, as the case may be. Persons who are being recommended for appointment to judicial office must provide the evidence of compliance to the Judicial Appointments Board.

TDs, Senators and appointees to senior office must provide:

• a Tax Clearance Certificate, or Application Statement, which must be dated not more than 9 months before, and not more than 9 months after, the date of election or nomination or appointment, as the case may be;
• a Statutory Declaration which must be dated not more than one month before, and not more than one month after, the date of election or nomination or appointment, as the case may be.

Appointees to judicial office must provide:

• a Tax Clearance Certificate which was issued not more than 18 months before the date of the recommendation for appointment;
• a Statutory Declaration that taxation obligations have been discharged which was made not more than one month before the date of the recommendation for appointment.

The Standards Commission has no role in relation to appointees to judicial office. Statutory documentation must be provided to the Judicial Appointments Board.

Note1:

The Tax Acts referred to are:
(a) the Tax Acts,
(b) the Capital Acquisitions Tax Act, 1976, and the enactments amending or extending that Act
(c) the Capital Gains Tax Acts,
(d) the Value-Added Tax Act 1972, and the enactments amending or extending that Act.

Note2 -

"senior office" means a designated position or directorship in a public body within the meaning of the 1995 Act in relation to which the remuneration is not less than the lowest remuneration for a Deputy Secretary General in the civil service [€149,454 at 1/1/06].

Note3

A Tax Clearance Certificate is issued by the Collector General on application where the applicant has complied with the requirements of the Tax Acts.

Note4

An Application Statement is issued by the Collector General in circumstances where a decision has not been reached on whether to issue or refuse a Tax Clearance Certificate or where a Tax Clearance Certificate has been refused and the refusal is the subject of an appeal under the Taxes Consolidation Act 1997.

Note5 -

A Statutory Declaration is a document prescribed by the Statutory Declarations Act 1938, as amended by the 2001 Act. In this case the declaration is that the person is in compliance with the Tax Acts and that there is no impediment to the issue of a Tax Clearance Certificate by the Collector-General. A Statutory Declaration must be witnessed by one of the following:

• a Notary Public
• a Commissioner for Oaths
• a Peace Commissioner
• a Practising Solicitor

Tax Clearance Provisions - compliance by appointees to senior office

With the increase in the number of public bodies within the remit of the Ethics Acts, more persons are being appointed to senior office within the meaning of the 2001 Act. It is essential that such persons are advised of their statutory obligations to provide the required evidence of compliance with the relevant taxation legislation in good time. Otherwise, such persons may find themselves to be in contravention of the 2001 Act, through not being informed of their responsibilities.

Accordingly, the Standards Commission recommends that public bodies put in place procedures to identify directorships or positions which would fall within the definition of senior office and to notify appointees to such positions of their obligations, preferably at the time an offer of appointment is being made.

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