Vol. 509 No. 6
620 Mr. Finucane asked the Minister for Education and Science his views on whether it is fair to disallow leasing of agricultural equipment when computing the assessment of means of parents, such as in the case of a person (details supplied) in County Limerick; and if the application will be reviewed accordingly. [21497/99]
The assessment of means under the third level student support schemes maintenance grants scheme is based on gross income with certain deductions for specified social welfare and health board payments. When assessing income from self-employment-farming the amount assessed is the adjusted profit-loss for income tax purposes from all self-employment activities (both Irish and foreign) whether or not they are exempted or relieved from Irish income tax. Capital allowances and other capital related costs, such as interest on borrowings used to purchase fixed assets, are not deductible from the adjusted profit in computing reckonable income for grant purposes. These means test arrangements have been in operation since 1983 and are applied nationally.
Finance lease arrangements are an alternative method of funding the acquisition of fixed assets. The lease payments are comprised of two elements repayment of the "purchase outright" cost of the asset and finance charges levied by the lease company. As these two elements are directly related to capital additions, the expenditure is not deductible for higher education grants purposes. Expenditure relating to operating leases is deductible in calculating reckonable income for the purposes of the grant.
Details of the lease documentation, in relation to the case to which the Deputy refers, were submitted to my Department following an appeal to the local authority, and were deemed to be in the nature of finance leases and thus not deductible in computing reckonable income.
I have no plans to change the method of computing reckonable income for the purposes of the student support schemes.
