The information requested for 2002 is as set out in the following table provided by the Revenue Commissioners. Sufficient data are not yet available to enable an update of the estimated corresponding cost to be provided for 2005 in respect of all of these items.
INCOME TAX AND CORPORATION TAX
Cost of Tax Credits, Allowances and Reliefs 2002
|
Tax Relief Provision
|
(1) Estimated cost for 2002
|
|
€
|
Numbers
|
INCOME TAX
|
|
|
Exemption limits:
|
|
|
General Exemption (2)
|
0.0
|
0
|
Child Addition (2)
|
1.0
|
2,900
|
Age Exemption (2)
|
21.9
|
31,700
|
Married Person's Credit (3)
|
1,805.1
|
629,400
|
Single Person's Credit (3)
|
1,552.8
|
1,169,600
|
Widowed Person's Credit (3)
|
122.3
|
72,950
|
Additional Credit to Widowed Person in Year of Bereavement
|
6.1
|
4,000
|
Additional Bereavement Credit to Widowed Parent
|
5.6
|
3,500
|
Additional Personal Credit for Lone Parent
|
137.8
|
102,700
|
Homecarer Credit
|
73.7
|
100,800
|
Additional Credit for Incapacitated Child
|
4.4
|
8,800
|
Employee (PAYE) Credit
|
917.2
|
1,257,800
|
Dependent Relative Credit
|
1.1
|
16,600
|
Person Taking Care of Incapacitated Taxpayer
|
0.6
|
600
|
Age Credit
|
19.3
|
68,100
|
Blind Person's Credit
|
0.7
|
850
|
Medical Insurance Premiums
|
161.7
|
859,000†
|
Health Expenses
|
63.2
|
143,850
|
Contributions Under Permanent Health Benefit Schemes, after Deduction of Tax on Benefits Received (4)
|
1.7
|
20,000
|
Employees' Contributions To Approved Superannuation Schemes *
|
563.3
|
709,300
|
Employers' Contributions To Approved Superannuation Schemes *
|
623.1
|
N/A
|
Exemption of Net Income of Approved Superannuation Funds (Contributions Plus Investment Income Less Outgoings) (5) *
|
1,271.60
|
N/A
|
Retirement Annuity Premiums
|
250.9
|
110,600
|
Interest paid:
|
|
|
Loans relating to Principal Private Residence
|
192.8
|
430,000
|
Other (6)
|
15.6
|
5,260
|
Rent Paid in Private Tenancies
|
26.4
|
97,400
|
Expenses Allowable to Employees Under Schedule E
|
153.8
|
866,420
|
Third Level Education Fees
|
6.9
|
17,500
|
Exemption of Certain Earnings of Writers, Composers and Artists
|
23.9
|
1,600
|
Dispositions (Including Maintenance Payments made to Separated Spouses)
|
12.8
|
5,900
|
Exemption of Interest on Savings Certificates, National Installment Savings & Index Linked Savings Bonds
|
108.8
|
N/A
|
Rent a Room
|
1.8
|
1,440
|
Exemption of Income of Charities, Colleges, Hospitals, Schools, Friendly Societies, etc. (7)
|
23.4
|
N/A
|
Donations to Approved Bodies
|
16.3
|
25,600
|
Donations to Sports Bodies.(8)
|
0.1
|
140
|
Exemption of Irish Government Securities Where Owner Not Ordinarily Resident in Ireland (5) *
|
130.1
|
N/A
|
Exemption of Statutory Redundancy Payments
|
25.1
|
25,100
|
Service Charges
|
5.2
|
124,900
|
Top Slicing Relief — Reduced Tax Rate for Payments in Excess of Exemption Amounts Made as Compensation for Loss of Office
|
5.7
|
1,300
|
Revenue Job Assist allowance
|
0.9
|
1,700
|
Allowance for seafarers
|
0.2
|
120
|
Trade Union Subscriptions
|
11.0
|
229,600
|
Exemption From Tax of Certain Social Welfare Payments:
|
|
|
Child benefit *
|
266.4
|
336,300
|
Maternity allowance *
|
8.4
|
9,600
|
Exemption of Pensions, Benefits or Gratuities Payable to Veterans of the War of Independence, their Widows or Dependents
|
0.09
|
1,400
|
Relief Under Profit Sharing Schemes *
|
37.6
|
50,600
|
Investment in Corporate Trades (BES)
|
20.3
|
2,300
|
Investment in Seed Capital
|
1.4
|
72
|
Stock Relief *
|
1.9
|
N/A
|
Relief for expenditure on significant buildings and gardens
|
3.7
|
54
|
Donation of Heritage items
|
4.2
|
5
|
Special Savings Incentive Scheme
|
433.0
|
1,143,400
|
INCOME TAX AND/OR CORPORATION TAX
(9)
|
|
|
Capital Allowances:
|
|
|
Urban Renewal (10)
|
N/A
|
N/A
|
Other (11)
|
N/A
|
N/A
|
Total Capital Allowances
|
1,595.00
|
N/A
|
Rented Residential Accommodation (12) *
|
N/A
|
N/A
|
Effective Rate of 10% for Manufacturing and Certain Other Activities (13)
|
1,174.1
|
4,700
|
Double Taxation Relief
|
427.3
|
9,100
|
Investment in Films*
|
21.6
|
2,230
|
Group Relief
|
166.8
|
1,290
|
†Arising from the change over to Tax Relief at Source the figures for 2002 relate to the number of policies issued. These include policies where subscriptions were paid by businesses on behalf of their employees. or this reason and also because some claimants may have more than one policy, the numbers for 2002 are necessarily higher than before
Notes on Table
(1)Figures accompanied by an asterisk * are particularly tentative and subject to a considerable margin of error.
(2)The cost figures for the exemption limits are based on the excess of the exemption limits over the basic personal tax credits. They include the cost of marginal relief for taxpayers whose incomes are not greatly in excess of the exemption limits.
(3)The figures shown for the basic personal tax credits (married, single and widowed) are the costs of these tax credits as if all other tax credits and the exemption limits did not apply. They do not include individuals who are not on Revenue records because their incomes are below the income tax thresholds.
(4)Part of the cost of contributions to Permanent Health Benefit Schemes is not identifiable as a result of the move to a "net pay" basis for contributions by PAYE taxpayers from 6 April 2001
(5)In the absence of other information, tax has been assumed at the standard rate even though a different rate might be appropriate in many cases.
(6)"Other" relates to borrowings for purposes such as acquiring an interest in a company or partnership or to pay death duties.
(7)The cost of exempting the income of charities, colleges, hospitals, schools, friendly societies, etc. from income tax includes the sums repaid in respect of tax credits and income tax deducted at source (certain dividends, other investment income and payments received under covenant) It also includes the cost of exempting certain bodies from the deduction on income arising from government securities. Information is not available about other income received gross.
(8)Relief for donations to Approved Sports Bodies was introduced in 2002 and the cost is based on self assessment returns for that year.
(9)Except where otherwise indicated, the costs included for corporation tax are by reference to accounting periods which ended in the years 2001 and 2002.
(10)In the absence of Revenue-sourced data the figures shown are tentative estimates based on basic data supplied by the Department of Environment and Local Government which cannot be linked directly with tax claims. Use of this data has been discontinued because alternative arrangements have been made by the Revenue Commissioners for more suitable tax-based data to be captured. Until recently claims for urban renewal relief were aggregated in tax returns with other claims and were not separately identifiable. However, as part of ongoing commitments to improve the quality of information available on the costs of tax expenditures generally, the Revenue Commissioners have introduced changes to the income tax returns forms which are intended to yield additional information on the take-up of the relief claimed by individuals from the 2004 tax year onwards. Corresponding changes have been made to the Corporation Tax return form which will produce similar information for accounting periods ending in 2005 and subsequent years.
(11)Capital Allowances data was not requested on the 2002 CT1 form, therefore the 2002 figures are estimated.
The cost shown for capital allowances does not include any cost associated with "unused capital allowances", that is, capital allowances which are not absorbed by a company in the accounting period in which they arise because they exceed the amount of the company's profits of that accounting period which are available for offset. Unused capital allowances can be offset as losses against taxable profits arising in the previous accounting period and against certain profits arising in future accounting periods and can be offset against the profits of another company in the same group of companies. It is estimated that €3,000 million of unused capital allowances were claimed in respect of 2002 accounting periods but as the proportion of this item which is included in previous years losses and in group relief is not separately identifiable a reliable estimate of the cost of the capital allowance element cannot be provided.
The 2001 figure for capital allowances has been revised.
(12)In the absence of Revenue-sourced data the figures shown are tentative estimates based on basic data supplied by the Department of Environment and Local Government which cannot be linked directly with tax claims. The figures for "section 23/section 27" relief are confined to urban renewal schemes in place up to 1999 and usable data is not compiled for later schemes. Use of this data has, therefore, been discontinued because it is incomplete.
Until recently claims for "section 23/section 27" type relief were aggregated in tax returns with other claims and were not separately identifiable. However, as part of ongoing commitments to improve the quality of information available on the costs of tax expenditures generally, the Revenue Commissioners have introduced changes to the income tax return forms which are intended to yield additional information on the take-up of the relief claimed by individuals from 2003 onwards. Corresponding changes have been made to the Corporation Tax return form which will produce similar information for accounting periods ending in 2005 and subsequent years.
(13)The cost does not include any notional cost associated with IFSC companies. The International Financial Services activity in Ireland represents new business which has developed as a result of, among other things, the concessionary tax rate. This means that as the cost of the concessionary rate is not just the difference between the concessionary tax rate and the full tax rate, it is therefore not quantifiable. In regard to the cost shown for the effective rate of 10 per cent for manufacturing and certain other activities, no account is taken of the fact that without these incentives, many enterprises may not have set up here. To the extent that profits earned by such enterprises would not have been available for Irish tax purposes, part of the cost figure shown might be regarded as notional.