Are the details in a mortgage application fully confidential with the lender? Will the bank disclose any details to Revenue? If so, is it only those details where it is suspicious of money laundering that it will disclose?
They're confidential within reason. It's not only for anti-money laundering, for example, credit institutions must disclose details, if requested, to certain bodies such as the Financial Regulator.
If the borrower applies for tax relief at source (TRS) on mortgage interest payments, this will be administered on the Revenue's behalf by the lender, so the Revenue will have borrower's account details and the lender will have the borrower's PPSN, thus closing the loop.
If you're asking will the bank/broker disclose untaxed income declared on a mortgage application form to the Revenue, the answer is that they have no obligation to do that. But I doubt if untaxed income is eligible anyway as income for the purpose of assessing repayment capacity. And it doesn't make it right, obviously.