The High Court has determined that Kevin O’Brien is liable for €108,423.77 in penalties after finding, on the balance of probabilities, that he deliberately failed to file VAT and income tax returns.
The order was made by Ms Justice Pilkington in proceedings brought by Fergus O’Brien under tax legislation. It covers failures to file VAT returns between 2008 and 2013 and income tax returns between 2009 and 2013. The judgment records VAT liabilities of €60,638, including a fixed penalty of €125, and income tax liabilities of €47,660.77.
The court said the assessments had become final because no valid appeal was lodged against the income tax assessments and the VAT assessments were not appealed. The issue before the court was how the defaults should be categorised for penalties and whether any statutory reductions or other relief applied.
Kevin O’Brien disputed being classed as a deliberate defaulter. He said difficulties with his accountant hindered the filing of returns, that he had been unaware VAT applied to his bed and breakfast business, and that he had sought to co-operate with Revenue. He also said he understood that a judgment entered against him in earlier proceedings had resolved his outstanding liabilities. Revenue disputed that understanding and said the earlier judgment did not prevent penalties being sought.
The judge found the defaults were deliberate, rather than careless. She said documents promised to Revenue were not provided and found that the respondent had not co-operated fully or made a prompted or unprompted qualifying disclosure. She also rejected the argument that the court should refuse the penalties because of delay, distinguishing an earlier case in which delay had been found inexcusable.
The judgment records that the respondent was an older farmer with health difficulties and cared for a daughter with serious health complaints. The judge said she had considered those personal circumstances but was required to apply the statutory provisions.
The court ordered the full penalty sought: €108,423.77 under the specified income tax and VAT provisions. It did not set out any further recovery order in the judgment and said it would hear the parties on any further orders sought.