Garda trainees went untaxed on allowance for two decades


Garda trainees were able to avoid paying tax for more than two decades on a special allowance they received for accommodation and food.

Although the Revenue Commissioners discovered the discrepancy in 2011, it did not seek to recoup the arrears.

The disclosure, made in a report by the Comptroller & Auditor General Seamus McCarthy, is the latest in a series of controversies surrounding the operation of the Garda college in Templemore, Co Tipperary.

Although no estimate was given in the report of how much tax was missed out on, the sum is likely to be substantial.

According to Mr McCarthy’s report, the “living allowance” was payable throughout training after 1989.

The size of the allowance ranged from up to IR£50 (€63.48) a week in 1989 to €120.47 a week in 2009. While no tax was payable on it while trainees were based in Templemore, tax should have been levied during what is known as ‘phase 2’, a 26-week period when trainees were assigned to Garda stations.

The Department of Justice directed in 1989 that during phase 2 the payment should be classified as a subsistence allowance, which did not attract tax. There was no evidence that Revenue was consulted or agreed to this.

Revenue officials did a review in 2011 and directed that the practice should end.

They said procedures should be introduced to comply with rules on the tax treatment of employee expenses.

The phase 2 living allowance has not existed since 2014 when the Garda training period was reduced, but a taxable living allowance is still paid to trainees while at Templemore.

Separately, Mr McCarthy’s report revealed Revenue is examining tax issues linked to the operation of a bar at the college.

It comes after Garda management made an unprompted disclosure to Revenue last May, paying €32,800 in respect of incorrect accounting for VAT on bar sales since 2010 and the incorrect treatment of payroll taxes between 2014 and 2016.

Revenue has yet to make a determination on the tax breaches.