Dáil Éireann Debate, Wednesday - 27 September 2006
469 Mr. O’Shea asked the Minister for Finance his proposals to allow cohabiting couples to claim one another’s tax credits on the same basis as married couples; and if he will make a statement on the matter. [28275/06]
View answer478 Ms Burton asked the Minister for Finance the position in relation to affording the same rights to cohabiting partners as those enjoyed by married couples in regard to sharing tax credits and in regard to equality of treatment in relation to taxes levied on married couples, cohabiting partners and individuals such as income tax, capital acquisitions tax and capital gains tax; and if he will make a statement on the matter. [28420/06]
View answerI propose to take Questions Nos. 469 and 478 together.
Generally speaking, the tax system treats members of cohabiting couples as separate and unconnected individuals. Each partner is a separate entity for tax purposes and credits and bands and reliefs cannot be transferred from one partner to the other. There are no special favourable tax arrangements for cohabiting couples with dependent children.
The Working Group Examining the Treatment of Married, Cohabiting and One-Parent Families under the Tax and Social Welfare Codes, which reported in August 1999, was sympathetic, in principle, to changes in the tax legislation to address the issues raised relating to cohabiting couples and reported that the options that it set out should be considered further. However, it acknowledged in relation to the tax treatment of cohabiting couples that a key issue is whether tax law should proceed ahead of changes in the general law.
Various developments in this general area include:
the consultation paper on the rights and duties of cohabitees which was published by the Law Reform Commission in April 2004;
the Tenth Progress Report of the Oireachtas All-Party Committee on the Constitution entitled ‘The Family' which was recently published earlier this year;
the establishment by the Minister for Justice, Equality and Law Reform of a working group to examine the area of civil partnerships and to prepare options on the various legislative choices available to the Government for action in this area. The Group has been requested to report by 20 October 2006.
I previously put on the record of the House that I would view as problematic and unwise a situation where changes in the tax code relating to the treatment of couples would set a headline in advance of developments in other relevant areas of public policy, for example, in the area of legal recognition of relationships other than married relationships. I remain of that view.
470 Mr. Bruton asked the Minister for Finance the reason for the delay in tax relief at source for mortgages; if his attention has been drawn to the fact that delays of up to six months occur; his plans to tackle this problem; and if he will make a statement on the matter. [28276/06]
View answerTax relief on mortgage interest is applied ‘at source' by the mortgage provider since 1st January 2002. The mortgage provider in turn claims back the tax relief directly from Revenue. Since 2002, the number of new mortgage accounts for which interest relief was sought increased from 95,857 in 2002 to 113,673 in 2005.
New applications for relief at source can be notified directly to Revenue through the Revenue web site or by completing the mortgage details on a TRS1 application form. New applications are notified to the relevant mortgage provider on a monthly basis by electronic file. The mortgage provider in turn applies the tax relief by reducing the monthly payment by the equivalent of the tax relief.
There are currently no delays in processing new applications except where incomplete or inaccurate information is supplied in the first instance.
Many applications for interest relief are in respect of mortgages that commenced in previous years. The timescale for processing the refunds due in respect of the earlier years usually takes one month additional to the month for granting current relief. This is due to the fact that the mortgage account has to be confirmed as a valid home mortgage through the electronic file exchange with the mortgage provider. As with new applications, there are no backlogs except where incomplete or inaccurate information is supplied in the first instance.
