Social media influencers liable for tax on income face a three-tiered response from Revenue, the Public Account Committee (PAC) heard.
The agency is stepping up its efforts to ensure that it recoups what it is owed.
"It's a new industry but the tax rules apply to them just like they apply to anybody else," Revenue Chairman Niall Cody said.
"So it comes down to the basic income tax rules," he added.
"So, if they're getting an income in money or in kind, they're liable to the self-assessment system," Mr Cody told Fianna Fáil TD Paul McAuliffe.
Mr McAuliffe had pointed to "142 letters that were issued to social media influencers" by Revenue.
Mr Cody replied that Revenue gets "third party information in" from "the parent entity" responsible for paying influencers.
"We pay attention," he said, pointing to "three levels of intervention" that can then be deployed.
Firstly, the influencer will be sent a reminder to settle their tax liabilities.
If that does not resolve the issue, an "audit compliance intervention" follows, "where we have seen returns that mightn't necessarily reflect the information that we have".
However, Mr Cody said that Revenue is trying to "educate people to get them into the system", as "some of the people are actually very young, and have probably no real understanding of the thing".
Asked if "a free hotel room or a free meal to review a product" could qualify as income, Mr Cody said that there is a continuum that payments are placed on to determine whether tax is due.
"There's gift tax, sponsorship" and a variety of other potential liabilities, he said.
Mr McAuliffe suggested that some people who may consider themselves to be social media influencers may be earning "a very, very small small amount of income" and so not liable for any tax.
Warehoused debt recovered
The committee also heard that Revenue has secured repayments of almost €1 billion in warehoused debt in the past two years.
The Debt Warehousing Scheme was introduced in May 2020 to support to businesses struggling at the height of the Covid-19 pandemic.
The balance in the warehouse peaked in January 2022 at €3.2 billion, Mr Cody said.
At the end of 2023, the debt stood at €1.76 billion and was held by 58,000 taxpayers.
"The bulk of [the total] reduction was in payments," Mr Cody said, with a "significant" amount of it having been prompted by a 3% interest rate kicking in.
"Close to a billion was in actual payments," he added.
Almost 40,000 or 70% of those still availing of the scheme have debt of €1,000 or less.
"People are engaging", Mr Cody told the committee, adding that it is "the cheapest finance available" .
"The key message that I want to get out today is that businesses need to keep their current tax up to date and paid," he said.
As long as they do that, Revenue "will make appropriate tailored arrangements for the businesses to clear the warehouse" over time.
The deadline for making arrangements to address warehoused debt is 1 May.
All debt will then be subject to a 3% interest rate, "a significant reduction from the standard interest rates of 8% and 10% per annum that normally apply to late payments of tax".
Falling rate of property tax compliance
PAC also heard that the compliance rate for the Local Property Tax (LPT) fell last year.
"The payment compliance rates for LPT for 2022 and 2023 are 97% and 95% respectively," Mr Cody the committee.
He said that a "new structure for LPT came into effect from 2022", and said that "the majority of property owners make reasonable and honest efforts to value their properties".
Scrutinising the fall in compliance, Fianna Fáil's Cormac Devlin noted that the change meant that around 100,000 people previously exempt are now eligible for the tax.
Revenue suspended enforcement and compliance activity resulting from Covid-19 which affected the 2022 receipts, Mr Cody replied.
This meant that Revenue did not issue reminders in February 2022, which meant that those homeowners who wait for those reminders before filing did not pay.
"LPT is very stable," he said, with the average payment being around €400-500.
