Ireland Revenue Commissioners Audit Response

The situation

Brendan, 52, runs a small construction and fit-out company in Cork with 12 employees (annual turnover ~€2.4M). In January 2026 he received a Revenue letter: "We have selected your business for a Level 2 Revenue Audit covering Corporation Tax and Employer PAYE for the periods 2022–2024."

He has 30 days before the audit begins. He suspects there may be some PAYE classification issues with subcontractors he treated as self-employed.

What Brendan doesn't know: (a) The voluntary disclosure window is now open. If he discloses the subcontractor classification issue to Revenue before the audit commences, his penalty is 50% of the tax shortfall (prompted voluntary disclosure) rather than 75%–100% if Revenue finds it themselves. The Code of Practice gives him until the audit commences to make this disclosure. (b) He has the right to have a tax advisor present during the audit. (c) If Revenue issues an amended assessment after the audit and he disagrees, he can appeal electronically to the Tax Appeals Commission (independent body, separate from Revenue) within 30 days, and the TAC process often leads to settlement by agreement before a formal hearing. The Grant Thornton contact he called quoted €12,000 for audit representation.

Who receives this

Irish SMBs (sole traders, partnerships, limited companies) receiving Revenue Level 2 audit notifications or post-audit amended assessments. Primary: construction, hospitality, and professional services SMBs, the most common Revenue audit targets. Secondary: sole traders receiving Revenue risk review letters for VAT or income tax.

Why the agency will not advise you

Revenue cannot advise audit respondents on how to structure their voluntary disclosure, challenge findings, or prepare a TAC appeal against its own assessments. The TAC portal accepts electronic appeals but provides no drafting guidance. Irish Big 4 / top-tier firms (Grant Thornton, EY, Deloitte, PwC, Forvis Mazars, Maples Group) handle Revenue audit defence at €5,000–€20,000, unaffordable for most Irish SMBs with turnover under €3M. The national enterprise infrastructure (National Enterprise Hub) does not provide audit response support.

Key facts, with sources

• Revenue collected €734 million following more than 291,600 audit and compliance interventions in 2025. Revenue's compliance framework has three intervention levels: Level 1 (voluntary compliance/self-correction), Level 2 (risk review or full audit, the most common formal audit level), and Level 3 (investigation for suspected tax fraud or evasion). Level 2 audit notifications are sent in writing; the business has a right to have a tax advisor present. Revenue's Code of Practice for Revenue Audit and Other Compliance Interventions (2022) governs the process and sets out the rights of taxpayers during audit. Source: Revenue collects €734m in more than 291,600 audit and compliance interventions — The Irish Times · Revenue audit — Revenue.ie · Irish Revenue's updated Code of Practice for Revenue Audits/Queries — Forvis Mazars Ireland
• The Tax Appeals Commission (TAC) is an independent statutory body established under the Finance (Tax Appeals) Act 2015 whose main task is hearing and determining appeals against assessments and decisions of the Revenue Commissioners. The TAC is completely independent of Revenue. Appeals can be submitted electronically through the TAC website. All parties are given the option of Case Management Conferences and may settle appeals by agreement with Revenue before the hearing. In 2023 (most recent TAC annual report), PwC noted that the TAC works quickly to resolve tax appeals. There is no formal ADR mechanism for domestic tax disputes with Revenue, but Revenue is generally open to settlement discussions in appropriate cases. Source: Welcome to the Tax Appeals Commission — taxappeals.ie · TAC works quickly to resolve tax appeals — PwC Ireland · Tax Controversy 2025 — Ireland — Chambers and Partners Global Practice Guides
• Revenue's voluntary disclosure mechanism under the Code of Practice significantly reduces penalties for taxpayers who come forward before or during audit: an unprompted qualifying disclosure (made before Revenue notification) attracts only 25% of the tax shortfall as a penalty; a prompted qualifying disclosure (made after audit notification but before the audit commences) attracts 50%; cooperating but not disclosing during audit attracts 75%; non-cooperation attracts 100%. The voluntary disclosure calculation is therefore a critical tool for any Irish SMB that suspects undisclosed liabilities before or during a Revenue audit. Source: How to Handle a Revenue Audit in Ireland: A Business Owner's Guide — Intax · Revenue audit — Revenue.ie

When to bring in a professional

Self-serve responses fit routine cases: clear facts, amounts a business can absorb, and a deadline still ahead of you. Bring in a licensed professional when the amount at stake is large relative to their fee, the facts are genuinely disputed, criminal exposure is possible, or the deadline has already passed. A short paid consultation to sanity-check your plan is often worth it even when you handle the filing yourself.

All sources for this guide

1. Revenue collects €734m in more than 291,600 audit and compliance interventions — The Irish Times
2. Revenue audit — Revenue.ie
3. Irish Revenue's updated Code of Practice for Revenue Audits/Queries — Forvis Mazars Ireland
4. Welcome to the Tax Appeals Commission — taxappeals.ie
5. TAC works quickly to resolve tax appeals — PwC Ireland
6. Tax Controversy 2025 — Ireland — Chambers and Partners Global Practice Guides
7. How to Handle a Revenue Audit in Ireland: A Business Owner's Guide — Intax