The Foreign Earnings Deduction (FED) is provided for in section 823A of the Taxes Consolidation Act 1997 (TCA). It provides relief from tax on up to €35,000 of salary for employees who travel out of State to certain countries on behalf of their employer. In order to qualify for FED, an employee must spend a minimum of 30 days abroad in a year and each trip must consist of at least three (3) consecutive days in a qualifying country.
I am advised by Revenue that the most recent data available on the annual cost and the number of individuals who have availed of the scheme are as follows:
Year
|
No. of individuals
|
Exchequer Cost (€m)
|
2016
|
413
|
3.5
|
2015
|
472
|
3.2
|
2014
|
144
|
1.1
|
2013
|
135
|
1
|
2012
|
108
|
0.8
|
I am further advised by Revenue that FED is an allowance that is applied for by the employee through their own tax returns and is not returned at a company level. Therefore, it is not possible to provide the information on the number of companies associated with employees availing of the scheme broken down by multinational companies and SMEs, as requested by the Deputy.
Finally, I would like to advise the Deputy that FED will be reviewed this year, along with the Special Assignee Relief Programme, with the aim of ensuring that it operates as an efficient and effective tax relief. It is expected that the reports of these reviews will be completed and published as part of the Budget and Finance Bill process this year.