I am informed by the Revenue Commissioners that on the basis of the claims for capital allowances entered on tax returns filed by non-PAYE taxpayers and companies for the tax years 2002 to 2008 in respect of property used for the provision of rented accommodation, both private and commercial, the amounts of capital allowances so claimed and the estimated costs to the Exchequer are as set out in the following table. Capital allowances for rental property
Tax Year
|
Amount Claimed
|
Maximum Tax Cost
|
|
€m
|
€m
|
2002
|
473
|
199
|
2003
|
494
|
183
|
2004
|
648
|
248
|
2005
|
650
|
252
|
2006
|
683
|
260
|
2007
|
542
|
200
|
2008
|
470
|
169
|
The figures shown for 2002 relate to individuals only as rental income of companies was returned as excluding capital allowances on the corporation tax return for that year.
The estimates are based on assuming that tax relief was allowed at the top income tax rate of 42% (up to 2006) and 41% (for 2007 and 2008) in respect of individuals and at the standard rate of 25% in respect of companies. The figures provided could therefore be regarded as the maximum Exchequer cost in respect of those taxpayers.
The figures for 2008 are subject to adjustment in the event of late returns being filed or where returns already filed are subsequently amended.
It should be noted that any corresponding data returned by PAYE taxpayers in the income tax return form 12 is not captured in the Revenue computer system. However, any PAYE taxpayer with non-PAYE income greater than €3,174 is required to complete an income tax return form 11. This return is the source of the figures provided in this reply.
The Deputy will no doubt be aware that the level at which interest repayments can be claimed against tax for residential rental properties was reduced from 100% to 75% in section 5 of the Finance Act 2009 at an estimated full year yield of €95 million.