Thursday, 17 April 2014

Questions (55)

Michael McGrath

Question:

55. Deputy Michael McGrath asked the Minister for Finance the tax expenditure associated with the capital gains tax exemption for property introduced in budget 2013 and extended in budget 2014; and if he will make a statement on the matter. [18259/14]

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Written answers (Question to Finance)

I am informed by the Revenue Commissioners, that the capital gains tax relief contained in Section 604A of the Taxes Consolidation Act 1997 (enacted in Finance Act 2012 and extended by Finance (No 2)Act 2013 will have  no cost, in terms of capital gains tax forgone,  for a period of seven years from the time any properties to which the relief applies were acquired.    Any such properties sold within seven years of being acquired will not qualify for the relief.  Disposals made after the seven year period of ownership will be subject to capital gains tax on any gain but effectively at a reduced rate by reference to the fraction that 7 years bears to the overall period of ownership.  It is not possible at this time to estimate when such properties will be disposed of in the future or the amount of chargeable capital gain, if any, that may arise on such disposals.  Accordingly, it is not possible to estimate what the cost will be in the future in terms of capital gains tax forgone.