Debt Warehousing Scheme – February 2024
Changes to Debt Warehousing Arrangements
There have been significant changes made to the Revenue Debt Warehousing arrangements during February 2024.
Firstly, the interest rate which will now apply during the so-called “Period 3” has been reduced to 0%. (A 3% rate was due to be applied).
Secondly, Revenue is expected to be more helpful, in terms of affording taxpayers “every possible flexibility in managing the payment of their warehoused debt, including the level of down-payment, if any, to commence the payment arrangement, an extended payment duration, and the availability of payment breaks and payment deferral if temporary cash flow difficulties arise during the arrangement term”.
These changes were introduced as a result of the real fear that many SME’s have, in relation to future cashflow difficulties.
Key Action to Take Now
Taxpayers must contact Revenue before 1 May 2024 to either pay their warehoused debt in full, if they can, or engage with Revenue on addressing the debt, including establishing a Phased Payment Arrangement (PPA).
This date is absolutely critical. According to Revenue, “any debt warehouse customer who has not applied for a Phased Payment Arrangement or otherwise engaged with Revenue by 1 May 2024 will have their Debt Warehouse status revoked. This means that all their outstanding debt will be subject to immediate collection and enforcement action and interest at the standard rate of 10% will apply”.
We strongly urge clients not to delay, and to contact Revenue at your very earliest opportunity.
Revenue’s guidance on the action required is:
- “Log onto ROS, the Revenue Online Service, and initiate an application for a Phased Payment Arrangement to address your warehoused debt. This should be done immediately and certainly before 1 May 2024.
- If you do not wish to commence repayments of warehoused debt immediately, you can apply for a payment break until after 1 May 2024.
- If you need support or assistance, you should contact Revenue through MyEnquiries or by telephone on 01 7383663. Remember that this engagement must take place before 1 May 2024.”
Flexibility by Revenue
It remains to be seen just how flexible Revenue will prove to be. This will be approached on a case-by-case basis.
It is essential that businesses continue to file their current tax returns and pay current liabilities as they fall due. It is also essential that there is proper engagement with Revenue in negotiating a Phased Payment Arrangement. Otherwise, Revenue will revoke any Debt Warehouse status.
If you have any queries, or require any assistance in approaching Revenue, please do not hesitate to call your usual PSC contact.