Dáil Éireann Debate, Tuesday - 20 November 2018
175. Deputy Noel Rock asked the Minister for Finance if his attention has been drawn to the comments by a person (details supplied) regarding tax breaks for those who invest in the development of football here; if he will consider same; and if he will make a statement on the matter. [48064/18]
View answerI am very much aware of the important contribution that football can make in developing young adults; a role that will also help in strengthening the social fabric of our country.
As the Deputy will be aware, the Government recently approved a National Sports Policy 2018-2027 brought forward by the Minister for Transport, Tourism and Sport. Any developments along the lines of those referred to in the Deputies question would need to be consistent with the National Sports Policy and with my Department’s Tax Expenditure Guidelines.
The Deputy may wish to note, however, that a range of tax incentives are already in place in relation to sporting activities.
Section 847A Taxes Consolidation Act 1997 (TCA) for donations to certain sports bodies for the funding of capital projects. For donations to be eligible for this tax relief, the project must be approved by the Minister for Transport, Tourism and Sport and the sports body must hold a certificate from the Revenue Commissioners stating that the body is, in their opinion, an exempt body under section 235 TCA – that is, a body whose income is exempt from tax by virtue of the fact that it is a body established for and existing for the sole purpose of promoting athletic or amateur games or sports and whose income is applied solely for those purposes. Relief under the scheme is allowed for relevant donations up to €40,000,000 in respect of an approved project.
The method of granting tax relief for donations depends on whether the donor is a self-assessed individual, a PAYE-only taxpayer or a company. Self-assessed individuals claim a deduction in their annual tax return. In the case of PAYE-only taxpayers, the approved sports body is entitled to claim a refund of the income tax deducted after the donation has been re-grossed at the donor’s marginal income tax rate. Where a company makes a relevant donation to an approved sports body, the amount of the donation is treated as either a deductible trading expense or an expense of management deductible in computing total profits of the company for the relevant accounting period.
The type of approved capital projects of relevant sports bodies for which donations may attract tax relief under this scheme are the categories for which the Minister for Transport, Tourism and Sport has issued a certificate to the approved sports body certifying that it is an approved project, which are as follows:
- purchasing, constructing or refurbishing a building for use for sporting or recreation activities provided by the approved sports body,
- purchasing land for use by the approved sports body in providing sporting or recreation facilities,
- purchasing permanently based equipment for use by the approved sports body in providing such facilities,
- improving the playing pitches, surfaces or facilities of the approved sports body, and
- repaying money borrowed by the approved sports body for any of the above-mentioned purposes.
The tax status of recognized amateur sports bodies should also be noted. Section 235 TCA exempts from income tax and corporation tax the income of certain bodies established for the sole purpose of promotion of athletic or amateur games or sports where such income is applied solely for that purpose.
Section 610A TCA provides that a capital gain by an approved sports body will be exempt from capital gains tax where the proceeds of a disposal have been or will be applied for the sole purpose of promoting athletic or amateur games or sports.
The question of the appropriateness of existing tax incentives for sport, including the desirability of any additional measures in this area is something that will be kept under review in conjunction with the Minister for Transport, Tourism and Sport.
