Dáil Éireann debate -
Tuesday, 29 May 1990

Vol. 399 No. 3

Written Answers. - Tax Liability.

Liam Fitzgerald

Question:

52 Mr. L. Fitzgerald asked the Minister for Finance the reason the reassessment of the tax liability of a person (details supplied) in Dublin 17 resulted in an increase in tax-free allowance from £111 to £126 but also in the taxpayer changing from the 32 per cent tax band to 48 per cent tax band; and if he will make a statement on the matter.

Minister for Finance (Mr. A. Reynolds)

I have been advised by the Revenue Commissioners that a certificate of tax-free allowances issued to the taxpayer on 9 March 1990, granting her a tax-free allowance of £5,812 for the current year i.e. £111.77 per week taxable at table R (30 per cent). As the taxpayer's income will not greatly exceed the general exemption limit for the current year she is entitled to a measure of marginal relief in calculating her tax-free allowances for the year.

An amended certificate of tax-free allowances issued to the taxpayer on 11 April 1990 incorporating marginal relief. This certificate granted her a total tax-free allowance of £7,686 for the year i.e. £147.80 per week taxable at table T (53 per cent). The effect of granting marginal relief is to reduce the overall tax liability. This is achieved because although the rate of tax is higher the amount of income to which is applies is considerably less because of the increased allowances.

The inspector of taxes has no record of a certificate issuing for £126 per week taxable at 48 per cent.