Written Answers. - Tax Reliefs.
John Dennehy
Question:
191
Mr. Dennehy
asked the
Minister for Finance
if he will liaise with his colleague the Minister for Tourism, Sport and Recreation on his proposal to provide a tax break to professional sports people at the end of their careers; if this will be extended to assist amateur sports people who play representative sport at recognised national level; if he will exempt earnings of amateur sports people from endorsements and appearances; and if he will make a statement on the matter.
[5529/02]
Bernard J. Durkan
Question:
202
Mr. Durkan
asked the
Minister for Finance
if he will extend his proposed sports personality tax incentive to participants in all sports; and if he will make a statement on the matter.
[5878/02]
I propose to take Questions Nos. 191 and 202 together.
Section 12 of the Finance Bill, 2002, provides for the introduction of a new scheme of relief from income tax on the direct sports earnings for Irish resident sportspersons involved in certain sports. Qualifying sportspersons, whether in a professional or semi-professional capacity, will be entitled to an annual deduction from earnings from direct participation in their particular sport of the order of 40% for up to ten years of assessment back to and including the tax year 1990-91 provided the sports person was resident in the State in these years. Eligible income under the scheme will arise from direct participation in the sport and will not include income accruing from sponsorship, advertising or endorsements. The relief can be claimed in the year in which the sportsperson ceases to be permanently engaged in that sport, provided the individual is resident for tax in that year, and will be provided by way of repayment of tax.
The categories of sportspersons that can avail of this relief are listed in Schedule 23A of the Taxes Consolidation Act, 1997, which provided higher contribution limits for retirement annuity purposes. These categories are an athlete, badminton player, boxer, cyclist, footballer, golfer, jockey, motor racing driver, rugby player, squash player, swimmer and tennis player. There is scope for the Minister for Finance to add to this list by regulation after consultation with the Minister for Tourism, Sport and Recreation if a justifiable case is made on behalf of categories of sportspersons with direct earnings that are excluded.
This scheme is based on an approach that income earned from direct sporting activities should have a treatment that recognises the particular challenges and achievements that arise in earning that income and the short earning career involved. Of its nature it can only apply where sports earnings are involved. This means that it is only those sportspersons that derive income from participation in their sport that can benefit. As amateur sportspersons are not paid for participating, the measure obviously does not apply to them.
