Retired farmer must pay 'off the scale' €364,500 tax bill after losing battle with Revenue

Gordon Deegan

A retired farmer has been left with an “off the scale” €364,513 income tax and VAT bill after losing a battle with the Revenue Commissioners.

This follows the Tax Appeals Commission (TAC) upholding Revenue assessments against the retired farmer.

Across 2013, 2014 and 2015, the farmer declared a combined income of €493,443, but the TAC found that lodgements to his accounts during that time totalled €1.99 million.

Revenue raised the combined income tax and VAT assessments of €401,709, made up of €154,427 in VAT and €247,282 in income tax, in 2018 and 2019 for the 2013 to 2015 period.

Revenue issued the assessments after concluding that the farmer had understated his income for certain years, and had sold agricultural products including silage wrap on which he had not charged VAT.

At the hearing, the farmer told the TAC that he appealed the Revenue assessments as “they were off the scale altogether”.

He said: “No one knew what they were about.”

He said that he keeps suckler cows and families have to live off that.

“It’s unheard of even to audit a man in that situation,” he said.

The farmer had three different explanations for the difference between his declared income and lodgements to his accounts.

The first explanation was that his only income was from the sale of cattle, with a small amount of fertiliser contract work in 2015.

The second explanation was that he allowed his bank account to be used by two individuals as a “facilitation arrangement”, from which he obtained no benefit.

The third explanation was that he was a bulk buyer and distributor of agricultural supplies for other farmers.

However, Appeal Commissioner Simon Noone found that none of the three "explained the very significant difference between his declared income and the lodgements to his accounts".

Upholding the amended Revenue assessment of €364,513, Mr Noone said he was satisfied that the farmer failed to explain the substantial discrepancy between his declared income, and the transactions into and out of his accounts.

He said the farmer had not disclosed two bank accounts held by him, Ulster Bank and NI Bank of Ireland, to the Revenue and had not cooperated with the Revenue investigation.

Mr Noone said that Revenue had contacted nine farmers who stated that the appellant had supplied wrap and other agricultural supplies to them.

Five of them provided receipts or invoices given to them by the farmer, and the appellant had previously told Revenue that he did not provide receipts or invoices.

The farmer was not able to complete his evidence due to ill health, but Mr Noone stated that even taking his examination in chief at its height, he had not met the burden of proof upon him.

Mr Noone said he found the farmer’s evidence to be vague, extremely general in nature and contradictory.

He said there was no engagement by the farmer with the substance of the allegations against him.