Dáil Éireann Debate, Wednesday - 17 November 2004
188 Mr. R. Bruton asked the Minister for Finance the cost of tax relief on pension contributions; the aggregate value of contributions on which relief is provided; the value granted at the 20% rate; the value granted at the 42% rate; and the average value of pension relief given to tax-payers in different income ranges. [28680/04]
View answerThe cost of tax relief for private pension funding for the short tax year 2001 has been estimated by the Revenue Commissioners at €1.8 billion. This was a short transitional tax year running from 6 April to 31 December 2001. This cost covers tax relief on contributions by employers, employees and self employed and the exemption from income and gains in the pension fund. It should be noted that these costs are very tentative and that efforts are being made to improve information on the cost of tax relief for pensions.
Information on the aggregate value of contributions on which relief is provided and on the value granted at different rates of tax is not available in relation to occupational pension schemes. Information is available from the Revenue Commissioners in respect to income tax relief allowed for contributions to retirement annuity contracts for the short income tax year 2001, which are available to the self-employed and to employees not in occupational pension schemes. Income tax relief at an estimated cost of €170 million was allowed in the short income tax year 2001 on such pension contributions amounting to €450 million. The value of contributions allowed at the 20% and 42% tax rates is estimated at €78 million and €368 million respectively, amounting to €446 million. A further €4 million in contributions had the effect of reducing the total income of claimants below the exemption thresholds.
A distribution by income ranges of the claim amounts, amounts of tax relief and average deductions for tax relief for retirement annuity contracts is contained in the table below:
|
Retirement Annuity — by range of Gross Income. |
|||||
|---|---|---|---|---|---|
|
Range of Gross Income |
Totals |
||||
|
From |
To |
Number of cases |
Amount of deduction |
Reduction in tax |
Average deduction |
|
€ |
€ |
€ |
€ |
€ |
|
|
— |
6,000 |
1,258 |
1,301,889 |
76,588 |
1,035 |
|
6,000 |
8,000 |
1,217 |
1,131,858 |
159,747 |
930 |
|
8,000 |
10,000 |
1,976 |
2,066,245 |
318,130 |
1,046 |
|
10,000 |
12,000 |
2,779 |
3,131,978 |
538,747 |
1,127 |
|
12,000 |
15,000 |
5,489 |
6,725,589 |
1,228,558 |
1,225 |
|
15,000 |
17,000 |
4,446 |
5,613,493 |
1,067,199 |
1,263 |
|
17,000 |
20,000 |
7,513 |
10,476,115 |
2,039,761 |
1,394 |
|
20,000 |
25,000 |
12,222 |
19,723,266 |
4,505,791 |
1,614 |
|
25,000 |
27,000 |
4,567 |
8,276,351 |
2,214,991 |
1,812 |
|
27,000 |
30,000 |
6,350 |
12,331,704 |
3,457,396 |
1,942 |
|
30,000 |
35,000 |
9,441 |
20,838,925 |
6,506,746 |
2,207 |
|
35,000 |
40,000 |
7,942 |
20,490,572 |
7,354,258 |
2,580 |
|
40,000 |
50,000 |
11,247 |
37,038,299 |
14,847,501 |
3,241 |
|
50,000 |
60,000 |
6,807 |
29,985,541 |
12,417,840 |
4,405 |
|
60,000 |
75,000 |
5,741 |
35,653,618 |
14,883,125 |
6,210 |
|
75,000 |
100,000 |
4,543 |
41,479,867 |
17,310,850 |
9,131 |
|
100,000 |
150,000 |
3,951 |
56,115,725 |
23,514,956 |
14,203 |
|
150,000 |
200,000 |
1,753 |
38,561,305 |
16,149,432 |
21,997 |
|
Over |
200,000 |
2,635 |
98,693,919 |
41,399,977 |
37,455 |
|
Totals |
102,057 |
449,636,259 |
169,991,594 |
4,406 |
