Róisín Shortall
Question:246. Deputy Róisín Shortall asked the Minister for Finance if he will detail all tax reliefs currently available to taxpayers at their marginal rate of tax. [7355/13]
View answerTuesday, 12 February 2013
Questions (246)
Written answers
The tax reliefs set out below are available for relief against calculated taxable income at the taxpayer's marginal rate. The Deputy should note that there are certain other exemptions, such as the artist's exemption, which provide that the relevant income does not come into charge at all. The Taxes Consolidation Act 1997 provides that the following may give rise to relief at the taxpayer’s marginal rate:
- Expenses wholly, exclusively and necessarily incurred in the performance of the duties of an office or employment – claims made under section 114;
- Interest relief in respect of loans taken prior to 7 December 2010 to purchase an interest in a company – claims made under section 248;
- Rented residential relief – also known as ‘section 23 type relief’ – eligible expenditure is treated as a deduction in computing rental profits – section 372AP;
- Losses incurred in a trade or profession (Case I and II) and losses in property letting (Case V) – claims made under sections 381 to 390 inclusive;
- Allowance for an employed person taking care of an incapacitated individual – claim made under section 467;
- Health expenses in respect of expenditure incurred in respect of nursing home expenses (all other expenses are allowed at the standard rate) – claim made under section 469;
- Permanent Health Benefit premiums paid in respect of an approved policy – relief granted under section 471;
- Revenue job assist for long-term unemployed taking up employment – relief allowed under section 472A;
- Seafarer’s allowance – allowance granted under section 472B;
- Relief for investment in films – relief allowed under section 481;
- Relief for expenditure on significant buildings and gardens – deduction allowed under section 482;
- Relief for certain gifts made to the Minister for Finance – relief allowed under section 483;
- Carry forward of excess reliefs of high earners – relief carried forward under section 485F;
- Relief for lessors of certain farmland – entitlement to deduction under section 664;
- Carbon tax on farm diesel – additional deduction for increase in rate of carbon tax on farm diesel from 1 May 2012 – section 664A;
- Stock relief for farmers – at rates ranging from 25% to 100% of the increase in stock value in an accounting period – sections 666, 667B and 667C – (subject to EU approval/ Ministerial Commencement Orders);
- Deeds of covenant in favour of permanently incapacitated individuals – relief allowed under section 792;
- Foreign Earnings Deduction (FED) for income earned in certain foreign states (Brazil, Russia, India, China or South Africa) – deduction allowed under section 823A;
- Relief allowed under the Special Assignment Relief Program (SARP) – relief allowed under section 825B;
- Donations to certain sports bodies by self assessed taxpayers – relief allowed under section 847A
- Donations to charities and other approved bodies by self assessed taxpayers– relief allowed under section 848A and Schedule 26A (it is proposed in the forthcoming Finance Bill to remove this deduction and to give relief to charities directly in respect of donations made after 1 January 2013);
- Relief for maintenance in case of separated spouses, or civil partners living apart – relief allowed under either section 1025 or section 1031J;
- Capital allowances in relation to industrial buildings and plant and machinery are available as deductions in taxing trading income and rental income.
- Relief for Investment in Corporate Trades, Employment and Investment Incentive Schemes, and Seed Capital Schemes – relief granted under Part 16; and
- Relief for contributions to retirement benefits schemes and personal pensions (subject to certain maxima) – granted under Part 30.
It should be noted that some of these reliefs are subject to restrictions. For example, Case V losses can only be set against Case V profits. Moreover, it should be noted that virtually all incentive reliefs are subject to the high earners’ restriction provided for in section 485C. The aim of this relief is to ensure that high earners who are subject to the restriction in full can only use so much of these reliefs in any one year as will leave them with an effective tax rate of 30%. Any relief not used in a year can be carried forward to future years.
Relief in respect of any claim by a taxpayer, where relief may be allowed at the marginal rate, is only allowed at that marginal rate where the taxpayer is otherwise paying tax at that rate.