Man suspected of receiving proceeds of crime loses appeal against €330,000 tax ruling

He argued that the amounts claimed by the CAB were exorbitant and did not reflect his actual income in the relevant years.

However, the CAB alleges the man’s expenses during this period exceeded his known income and his tax returns did not reflect his earnings and profits.

TAC learned that CAB officials estimated that he received miscellaneous income in the relevant years ranging from €5,000 in 2017 to €227,500 in 2019.

The complainant complained that the CAB had failed to disclose the basis on which it based its data.

He claimed that he had never seen the “accounting document” which, according to the CAB officers, was seized by the police during a search of his car and which showed that he had invested €518,500 in the business and not €124,200 as claimed by the accused.

Indictment

The tax assessment decision was issued in legal proceedings against the applicant brought before the Supreme Court under the Proceeds of Crime Act.

The man claimed he had no links with the unidentified parties other than real estate investment opportunities he had concluded with them, totalling €124,200, not €518,500 as alleged by the CAB.

The complainant, who was in regular employment, claimed that he had filed his own tax returns prior to the 2020-21 tax year and informed the TAC that he had worked in the telecommunications and insurance industries and in customer service between 2010 and 2015.

He worked in a different role between 2015 and 2021, his identity redacted from the TAC’s written ruling published on Tuesday, but he claimed he could not remember the name of his employer on the pay slips he received.

The complainant, who currently has another job, stated that he had established a successful business relationship with his partner but did not know whether tax returns were filed in connection with this activity.

He told TAC he lived at home but did not pay his parents any maintenance money before moving to a rented flat.

The man claimed that in recent years he had been living in a house that he had purchased for €330,000, with a mortgage of €220,000.

He testified that he had a modest income, went on holidays, had a social life and bought clothes.

Cross-examination

Under cross-examination by CAB counsel as to the source of the payments into his bank account, the man stated that these were repayments made after he had given the money to another person to make a purchase.

However, the man said that he would not call the other party to the transaction because it was difficult to contact them.

The TAC heard that he invested €90,000 in the pub at a time when his annual personal income tax income was €15,000.

The man explained that he financed it with €59,000 that he received from another person and €12,500 in compensation for personal injury, but he did not have any documents confirming these payments.

He claimed that an e-mail sent by another person to the lawyer, in which it was stated that the accused had invested €518,500 in the company, was untrue.

TAC also learned that the man had declared income from day trading in shares, but there was no evidence to support such an allegation.

The man’s tax advisor told the TAC that his client had some “complex arrangements” and that he had not filed any capital gains tax returns because they would have been “impossible to assess”. The TAC heard that the man declared annual self-employment income of between €9,245 and €30,616 between 2012 and 2021, with a further €14,212 from day trading.

In his legal filing, the accused’s defence lawyer stated that the CAB had not presented any evidence that his client led an expensive lifestyle.

However, as stated by the CAB’s representative, the applicant’s bank accounts show that he made net payments totalling €125,394 between 2012 and 2021, the sources of which were unknown.

TAC learned the man purchased two vehicles, one in 2018, for a total of €18,642, but there is no evidence he made payment for either purchase.

CAB’s legal counsel found that for several years there had been insufficient funds in its bank accounts to cover even basic living costs.

Burden of proof

The CAB legal representatives also argued that the burden of proof was on the complainant, but he was vague in his responses and did not provide any evidence or corroboration for his allegations, and did not know where the large sums of money deposited into his bank account came from.

They argued that his testimony was not credible and that his stories about selling certain goods and promoting brands changed throughout the course of his testimony.

TAC Commissioner Leonora Doyle found that the complainant had failed to provide any documentary evidence to support his claims of a range of miscellaneous income that had not previously been declared, such as income from brand promotion, day trading and personal injury compensation.

Ms Doyle said she was satisfied the man had failed to demonstrate that the CAB was not entitled to increase the taxes levied on him.

She noted that some of the complainant’s allegations could have been confirmed had he made reasonable inquiries among his legal representatives and family members, but he had failed to do so.

Rejecting his appeal, Ms Doyle said he had failed to provide credible explanations for how he managed to fund his investments.