Dáil Éireann debate -
Wednesday, 17 Apr 2002

Vol. 552 No. 1

Written Answers. - Tax Code.

Noel Ahern

Question:

256 Mr. N. Ahern asked the Minister for Finance the situation in relation to the liability for capital gains tax on the sale of a taxi plate by a person with spare income tax exemption; if the sale of a plate for approximately £5,000 is liable; the way in which it would be calculated, as the plate is in the same ownership since the 1970s; and if tax would be due or could be offset against a person's income tax exemption limit where they have plenty of spare capacity. [11811/02]

Minister for Finance (Mr. McCreevy)

I am informed by the Revenue Commissioners that the sale of a taxi plate is regarded as the disposal of a chargeable asset for capital gains tax purposes. The question of whether a gain arises will depend on the facts of the case. The general position is that the price obtained for the taxi plate is reduced by the price originally paid for the plate and any professional fees associated with the acquisition. The price originally paid and the fees associated with the acquisition of the plate, if any, may be adjusted to take account of the inflation content of those costs. If there are any costs arising from the disposal of the taxi plate, these are also deducted from the price obtained for the taxi plate. Any resultant gain is reduced by the annual exempt amount and the balance is charged to capital gains tax at the current rate of 20%.

The following example illustrates how the calculation is carried out. It assumes that the taxi plate was acquired in the tax year 1977-78 and disposed of in 2002. The calculation is in euros.

	€
Sale proceeds:	6,500
less
Cost of acquisition in 1977-1978	600
Adjusted by the consumer price index of 4.283	2,570

	€
Allowable costs	2,570
Chargeable gain	3,930
Annual exempt amount per individual	1,270
Net chargeable gain	2,660
Rate of tax 20%Tax payable	532

The capital gains tax payable may be reduced by losses not otherwise offset arising on other disposals of assets either in the same year or in previous years. It cannot be reduced by losses arising on a person's income tax account even where the income tax exemption limit is not reached. Capital gains tax retirement relief may be available for individuals over 55 years disposing of business assets if the individual complies with certain conditions.