County Council settles with revenue after defaulting on taxes

It's emerged that Donegal County Council has reached an €800,000 settlement with the revenue commissioners after a PAYE and PRSI audit in 2008 found a number of irregularities in allowances paid to staff.

Briefing members on the settlement, the county manager said the irregularities arose because of a national change in the way allowances were calculated, and measures are being put in place to ensure it doesn't happen again.

The irregularities arose in the area of site supervision and fixed travel allowances for certain outdoor staff, along with related subsistence allowances. County Manager Michael Mc Loone says the problem arose when what had previously been a standard allowance was changed to a requirement that specific transactions be identified and claimed for.

The new rates were agreed nationally, but had to be changed later based on revenue interpretation.

A total of just under €800,000 was paid by the council, including €250,000 in interest and penalties.

Mr Mc Loone told the council that procedures have been put in place to reduce the liklihood of this happening again, including upgrading of the council's financial management system and a full review of how allowances are calculated and paid.