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Thursday, 9 Sep 2021

Written Answers Nos. 176-195

Tax Reliefs

Questions (176)

Jim O'Callaghan

Question:

176. Deputy Jim O'Callaghan asked the Minister for Finance if he has had discussions with the Minister for Health in relation to tax relief being extended to counselling and psychotherapy as a qualifying health expense and the application of VAT exemption now rated at 13.5% on earnings over €37,500 for counsellors and psychotherapists. [43172/21]

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Written answers

Section 469 of the Taxes Consolidation Act 1997 provides for tax relief in respect of qualifying health expenses. Section 469 defines "health expenses" as "expenses in respect of the provision of health care including the services of a practitioner". 

A practitioner is defined in the section as "any person who is:

1. registered in the register established under section 43 of the Medical Practitioners Act 2007, 

2. registered in the register established under section 26 of the Dentists Act, 1985, or, 

3. in relation to health care provided outside the State, entitled under the laws of the country in which the care is provided to practice medicine or dentistry there".

In the case of counselling or psychotherapy, the relief is available where the counsellor, psychologist or psychotherapist carrying out the treatment is a qualified practitioner, or where a patient is referred by a qualified practitioner for a diagnostic procedure.

This is similar to the position that applies to other medical expenses, and I am satisfied that the legislation provides sufficient flexibility for expenses that should qualify for tax relief. Accordingly, there are no plans to change these arrangements at this time.

Comprehensive guidance material on medical expenses can be found on Revenue’s website in Tax and Duty Manual Part 15-01-12 https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-12.pdf

With regards to the application of VAT exemption now rated at 13.5% on earnings over €37,500 for counsellors and psychotherapists, the VAT rating of goods and services is subject to the requirements of EU VAT law, with which Irish VAT law must comply. Under domestic legislation, professional medical care services recognised as such by the Department of Health are exempt from VAT. Professional medical care services recognised by the Department of Health are generally those medical care services supplied by health professionals who are enrolled, registered, regulated, or designated on the appropriate statutory register provided for under the relevant legislation in force in the State or equivalent legislation applicable in other countries. This includes health professionals registered under the Medical Practitioners Act 2007, the Nurses Act 1985 and those engaged in a regulated profession designated under Section 4 of the Health and Social Care Professionals Act 2005. 

Statutory Instrument No. 170 of 2018 (Health and Social Care Professionals Act 2005 (Regulations 2018) of 2 July 2018 designates psychotherapists and counsellors as a regulated profession and established the Counsellors and Psychotherapists Registration Board. Professional counselling and psychotherapy services provided by persons registered by this Board are exempt from VAT from the date of their registration.

The thirteen members of the Counsellors and Psychotherapists Registration Board were appointed with effect from 25 February 2019.

The Board has begun the substantial body of work which must be undertaken before it is in a position to open its registers. Questions on the establishment of the Counsellors and Psychotherapists Registration Board and their progress in opening their register are a matter for the Minister for Health. 

Covid-19 Pandemic Unemployment Payment

Questions (177)

Réada Cronin

Question:

177. Deputy Réada Cronin asked the Minister for Finance if he will examine the situation in which a company (details supplied) reported to have informed prospective buyers in a development that their contracting Covid-19, receiving the PUP and being unable to draw down their mortgage would see them forfeit their deposit which, in the case of a person who felt they had to withdraw from the purchase would have been in excess of €36,000; and if he will make a statement on the matter. [41547/21]

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Written answers

I have a functional responsibility for the regulatory framework governing the provision of residential mortgage credit to consumers by Central Bank regulated entities.  However, I do not have a functional role in the regulation of contracts for the purchase and sale of residential property.  The terms of such contracts which are entered into by the purchasers and sellers of residential property, including the issue of a purchase deposit and the circumstances relating to such a deposit if the purchase/sale of a property is not completed, are contractual matters for the parties entering into the purchase/sale of the property.  However, house purchasers usually engage the services of a legal practitioner in relation to  the conveyancing requirements associated with the purchase of a residential property and it will be the responsibility of the legal practitioner to advise and represent his/her client in such conveyancing and contractual matters including, as necessary, in relation to any particular requirements or conditions in a mortgage offer that the purchaser will need to be take into consideration where the purchaser is availing of mortgage finance to purchase the residential property.

 In relation to the mortgage aspects of the question, the Central Bank has advised that it expects all regulated firms to take a consumer-focused approach and to act in their customers’ best interests at all times, including during the COVID-19 pandemic.  It also indicated that regulated lenders continue to process mortgage applications and have supports in place to assist customers impacted by COVID-19. If mortgage applicants have any queries or concerns about the impact of COVID-19 on their mortgage application, they should contact their lender directly.  However, within the parameters of the regulatory framework, the decision to grant or refuse an individual application for mortgage credit, and/or the conditions which may attach to a mortgage offer, is ultimately a business and commercial decision to be made by the regulated entity and I cannot become involved in such matters.

Currency Exchange

Questions (178)

Catherine Murphy

Question:

178. Deputy Catherine Murphy asked the Minister for Finance if he and or the Revenue Commissioners have evaluated the potential for tax liability concealment and or avoidance as a consequence of the use of the various different types of crypto-asset and or cryptocurrency transactions. [41552/21]

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Written answers

I am advised by the Office of the Revenue Commissioners that Revenue operate a risk-based compliance framework, using advanced analytics in a Risk Evaluation Analysis and Profiling (REAP) system to detect non-compliant behaviour. Risks in relation to crypto assets are included in Revenue’s compliance framework. This analytical approach to taxpayer behaviour and risk is continuously evolving and being enhanced in line with current developments.

Ireland operates a self-assessment tax system. The receipt of crypto assets as a form of payment for services or goods rendered will give rise to Income Tax for individuals or Corporation Tax for corporate taxpayers. Value Added Tax (VAT) on the Euro equivalent value of the crypto asset when received should also be considered, if applicable, to the receipt of these assets as a form of payment. The disposal of crypto assets is treated in the same manner as the disposal of all assets for Capital Gains Tax purposes. There are no special rules in Ireland for the tax treatment of crypto assets.   

Under the Taxes Consolidation Act, Revenue have the power to obtain information on crypto asset or cryptocurrency transactions, as is the case for other transactions, where there is reason to believe the transaction is relevant to tax. These powers include obtaining information from the taxpayer, from a financial institution or from any other third party who holds relevant information.

The European Commission is expected to publish a proposal on exchange of information in respect to crypto-assets before the end of 2021. This will be the eighth iteration of the Directive on Administrative Cooperation (DAC) and will be referred to as “DAC8”. We understand that the purpose of DAC8 will be to ensure that EU tax transparency rules keep pace with the evolving economy including in respect to crypto assets and e-money.

The OECD is also anticipated to release a recommended policy framework for crypto-assets reporting standards in the upcoming months. This framework will further strengthen the cohesive approach under the Common Reporting Standards (“CRS”) which calls on jurisdictions to obtain, on an annual basis, information from financial institutions and exchange that information with other jurisdictions.

Ireland actively contributes to the ongoing work at both EU and OECD levels to develop tax reporting frameworks that will provide information to tax authorities on transactions involving crypto-assets and e-money and has also been engaged in work to better understand how such transactions are treated for tax purposes in different jurisdictions.

Departmental Staff

Questions (179)

Fergus O'Dowd

Question:

179. Deputy Fergus O'Dowd asked the Minister for Finance the current policy regarding the employment of persons with disabilities in his Department and in each State and semi-State body under the aegis of his Department; the disability quota of his Department at present; if there is an active campaign to increase the disability workforce from the current target of 3% to a minimum of 6% by 2024; if this quota has now been exceeded; if so, the details of same; if there has been an advertised competition in relation to the quota; and if he will make a statement on the matter. [41593/21]

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Written answers

During the years 2015 to 2020 inclusive, my Department satisfied the 3% target of employing staff with disabilities. My Department is aware of the increase in the target to 6% and is committed to achieving this revised target by 2024. The following table sets out the percentage of employees with a disability for the years 2015 to 2020. The 2020 figure was taken from a census survey conducted in March 2021 and is deemed the current percentage figure for my Department.

Year

2015

2016

2017

2018

2019

2020

Percentage

4.9%

3.0%

4.1%

4.1%

5.14%

4.38%

All recruitment into my Department from outside the Civil Service is conducted through the Public Appointments Service (PAS). As such, my Department does not directly determine the level of access to employment for persons with disabilities. Where my Department recruits internally or through the Civil Service Mobility Scheme, this is conducted in accordance with the Code of Practice published by the Commission for Public Service Appointments (CPSA). The Code of Practice reflects the following core principles:

- Probity

- Appointments are made on merit

- An appointments process in line with best practice

- A fair appointments process applied with consistency

- Appointments are made in an open, accountable and transparent manner

Furthermore, my Department has recently rolled out Diversity 3.0 Workshops to all staff and has aimed to ensure all staff have undertaken this programme. During 2016 and 2017, a major refurbishment project was undertaken by the Office of Public Works in my Department in Government Buildings on Merrion Street. As part of that project, electronic doors were installed to assist the movement of staff across the campus. In 2019, an external lift was installed in the main block to allow staff with mobility difficulties to access the building more easily.

My Department adheres to its requirements as set out by the Disability Act of 2005. It has a Disability Liaison Officer (DLO) who works closely with the National Disability Authority (NDA) to ensure that the Department is fully compliant with its obligations under the Act. Bi-monthly DLO Network meetings are held to share knowledge and assist other DLOs across the Civil Service, as well as engaging with staff in accessing training and learning events. My Department has also held awareness presentations in the areas of Autism and Dyslexia in the Workplace and has marked International Day of People with Disabilities and it is proposed to continue to do so.

My Department’s website, intranet and Build to Share programmes all have software to aid the visually impaired. A ‘loop system’ is in place in my Department’s main conference room for staff and visitors with hearing loss.

The position in relation to bodies under the aegis of my Department with direct employees is set out below.

The Central Bank of Ireland is committed to attracting and retaining people with disabilities and has various actions in place to support this. It gathers data on disability in the workplace via an annual employee survey; 2.7% of respondents to end-2020 disclosed that they had a disability. This equates to 1.45% of the total workforce at that time. The Central Bank is considering ways in which it can increase disclosure rates to build a more accurate profile. In addition, the Bank is currently considering, via a cross-functional Disability Taskforce, what further actions are needed to increase the number of employees with disabilities taking into account the legislative target of 3% and the 6% target outlined in the Comprehensive Employment Strategy for People with Disabilities. The Bank has participated in recent years in work experience programmes designed specifically for people with disabilities including the Willing Able Mentoring (WAM) work placement programme run by the Association for Higher Education Access and Disability (AHEAD) and placements via the National Council for the Blind of Ireland. Working with WAM, the Central Bank ring-fences roles, typically two, in its annual Graduate Programme for graduates with disabilities. The Bank also attends AHEAD’s Annual Careers Fair. Across all of its recruitment campaigns, the Central Bank highlights that it welcomes diverse candidates and is an equal opportunities employer. It provides reasonable accommodations throughout every stage of the recruitment process. The Bank aims to provide an accessible physical environment which supports the attraction and retention of people with disabilities. Its headquarters in North Wall Quay has won national and international awards for its universal design and accessibility. Over one hundred specific recommendations were integrated into the design, from large “smart” lifts with good signage, clear controls, light floor finishes, and contrasting handrails to half-height mirrors. A variety of supports are provided to colleagues with disabilities as required, including ergonomic and accessibility assessments, personal emergency evacuation planning, ‘buddy’ training, assistive technologies such as voice activated software and other equipment or awareness training. The Central Bank has an Access Officer to provide a central point of contact for staff and the public, as well as to promote awareness across all activities and services. It has an active employee led network (Bankability Network), the aim of which is to ensure a strong and supportive network for colleagues impacted by disability and to raise awareness among all staff. Amongst other activities, the network hosts regular events which are open to all staff to attend with inspiring speakers on various topics relating to disability in the workplace. Disability awareness training is also provided to frontline staff and to those providing services to the public. The Central Bank provides staffing to the Investor Compensation Company DAC which is also a body under my Department’s remit.

The Financial Services and Pensions Ombudsman (FSPO) fully recognises its obligations and responsibilities with regard to the Employment Equality Acts 1998-2015 and Disability Act 2005, and is committed to enabling access to employment for persons with disabilities. The FSPO operates its recruitment campaigns in compliance with the Codes of Practice for Appointment to Positions in the Civil Service and Public Service and is committed to a policy of equal opportunity for prospective candidates. It encourages applications under all nine grounds of the Employment Equality Acts and offers reasonable accommodation to current and prospective employees with disabilities, in accordance with the Acts. A staff census undertaken in 2020 indicated that, at 8.23%, the FSPO exceeded the minimum requirement set out in the Disability Act 2005 in relation to the level of employment of people with disabilities, which demonstrates that its recruitment policies have been effective in reaching the targets set out in the Comprehensive Employment Strategy for Persons with Disabilities. The FSPO continues to enhance practices in this area and has emphasised the requirement to achieve an inclusive and diverse workplace over the course of the next strategic period.

The National Treasury Management Agency (NTMA), is aware of and engaged in achieving the targets to increase employment of persons with a disability. The NTMA is exceeding the target of 3% with a current disability workforce of 4.28%. The NTMA is working towards the target of 6% by 2024 by engaging with specialist recruiters and attending specialist recruitment fairs. The Disability Awareness Team works with business units to recruit roles for persons with a disability. The NTMA partners with organisations in order to expand and advance its objectives and continues engagement with Down Syndrome Ireland, the National Council for the Blind of Ireland, AHEAD, Trinity College, and Specialisterne Ireland. Under the terms of a Service Level Agreement, the NTMA provides staffing services to Home Building Finance Ireland, the National Asset Management Agency and the Strategic Banking Corporation of Ireland, all of which are also bodies under the aegis of my Department.

The Office of the Comptroller and Auditor General takes all reasonable measures to promote and support the employment of persons with disabilities. The Disability Act 2005 requires public service employers to report each year on the number and percentage of employees with disabilities according to the legal definition of a disability. Each employee fills out this form as part of their induction process in the Office. All employees are given access to this form on the Office intranet and may also submit this at any time during employment should a disability develop or come to light. There is a DLO in place to support staff with disabilities employed by the Office. Currently just under 8% of staff of the Office have self-declared a disability. The Office has a range of items available to assist staff with a disability, including sit-stand desks and scanner pens which read text aloud once scanned over an electronic document. Hearing aids are also available and can be linked to staff telephone extension numbers. Other items such as larger monitors for the visually impaired or specialised chairs for back conditions are purchased by the Office on a case by case basis. The Office is also fully wheelchair accessible. The Office also ensures that all vacancies are advertised on its website; the website is enabled with software, Recite me, which reads the site, translates and/or increases the size of text to provide information to visually or audibly impaired persons who may wish to apply for vacancies.

I am advised by the Office of the Revenue Commissioners that there is a strong culture of acceptance and equality among Revenue staff and towards taxpayers, ensuring that human rights and diversity are embraced and accepted. As an Equal Opportunities employer, Revenue operates in compliance with the relevant legislative framework to promote the inclusion of people with disabilities at work, including the Employment Equality Act 1998, the Equal Status Acts 2000, the Employment Equality Act 2004 and the Disability Act 2005. Revenue has two DLOs, who provide information to support new entrants and serving employees with disabilities, as well as those requiring workplace accommodations which may include the provision of assistive technology and certain office equipment. Most Revenue offices countrywide are adapted for use by staff with physical disabilities. In compliance with its reporting obligations under Part 5 of the Disability Act 2005, Revenue provides information on its employment of people with disabilities to the NDA annually. In 2020, the proportion of Revenue employees with a declared disability was 4.1%. Revenue staff are trained in Equality and Diversity as part of their induction training. In 2019, Revenue established a Partnership Intensive Group to review and update its Equality and Diversity Strategy and Public Sector Duty Action Plan. In 2020, the group drafted an Equality, Diversity and Inclusion (EDI) policy document and associated Action Plan. This work is being further developed in 2021, in the context of Revenue’s Statement of Strategy and Workforce Plan for the period 2021-2026. The policy provides a future EDI framework, ensuring that Revenue is following best practice, promoting a culture of dignity and respect for all employees, and eliminating all forms of discrimination. Revenue’s recruitment competitions are subject to the Code of Practice of the Commission for Public Service Appointments, which has a statutory role to ensure that appointments in the organisations subject to its remit are made on merit and as the result of fair and transparent appointment processes. Revenue actively participates in Disability Programmes such as the WAM Initiative, which serves to widen access to employment for those with disabilities and create attitudinal change and opportunities for further employment and is committed to continue taking all reasonable measures to promote and support the recruitment and employment of people with disabilities and enrich the culture of inclusivity and diversity in its workforce.

The Tax Appeals Commission conducts all its recruitment campaigns through the PAS and any request for staff does not differentiate between persons from minority or disadvantaged communities or anyone who may have a disability. As of August 2021, the percentage of staff employed by the Commission with a disability is just under 6%.

The Irish Fiscal Advisory Council is committed to supporting and promoting the employment of people with disabilities and is an equal opportunities employer. Currently, none of the Fiscal Council’s staff members have declared a disability.

Flexible Work Practices

Questions (180)

Brian Stanley

Question:

180. Deputy Brian Stanley asked the Minister for Finance if the criteria for the working from home allowance will be reviewed given that those who availed of the help to buy scheme to purchase their home in 2020 are currently precluded from it. [41644/21]

View answer

Written answers

The Help to Buy (HTB) incentive scheme was introduced to assist first-time purchasers with a deposit needed to buy or build a new house or apartment. Subject to a maximum repayment amount, HTB takes the form of a repayment of income tax, including DIRT, paid for the four tax years prior to making an application.  A first-time buyer is given the option of selecting all or any of the previous four tax years prior to making an application for HTB.   

Section 477C Taxes Consolidation Act 1997 outlines the definitions and conditions that apply to the scheme.  Revenue’s Tax and Duty manual Part 15-01-46 Help to Buy Scheme outlines further guidance and is available on its website at www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-46.pdf.

In August 2020, the Government introduced an enhancement to the HTB scheme as part of the July Stimulus plan, which was later extended in Finance Act 2020. In summary, where a first time purchaser enters into a contract for the purchase of a new home, or makes the first draw down of the mortgage in the case of a self-build, during the period 23 July 2020 and 31 December 2021, increased relief for the HTB scheme will be available to the lesser of:

(i)                €30,000 (increased from €20,000),

(ii)                10 per cent (increased from 5 per cent) of the purchase price of a new home or the  

                    completion value of the property in the case of self builds, or,

(iii)               the amount of Income Tax and DIRT paid in the four complete tax years prior to making the

                    application.

This is subject to the conditions of the scheme as outlined in the legislation being met.

As regards the working from home allowance, I am advised by Revenue that while working remotely does not entitle PAYE workers to a tax credit or an allowance, there is a Revenue administrative practice in place relating to e-Workers who incur certain expenditure in the performance of the duties of their employment from home.

E-Workers will incur certain expenditure in the performance of their duties from home, such as additional heating, electricity, and broadband costs. Revenue allows an employer to make compensatory payments of up to €3.20 per day to remote workers, subject to certain conditions, without deducting PAYE, PRSI, or USC.

Where an employer does not pay €3.20 per day to an e-Worker, or indeed where an employee incurs costs in excess of the €3.20 per day paid by the employer, the employees concerned retain their statutory right to claim a deduction under section 114 of the Taxes Consolidation Act 1997 in respect of actual vouched expenses they have incurred wholly, exclusively and necessarily in the performance of the duties of their employment. PAYE employees are entitled to claim any such additional costs in respect of the number of days spent working from home, apportioned on the basis of business and private use.

As regards the Deputy’s question, the position is that the HTB scheme is mutually exclusive from other claims for refunds of tax paid by an individual.  By way of example, where an individual paid tax of €25,000 in 2019 and claimed €20,000 in that year for HTB, some or all of the balance of tax of €5,000 remaining could be refunded to the person, if he/she had additional tax credits or reliefs to claim that year in respect of expenditure on items such as working from home expenses or health expenses.  Of course, if a person has had all their tax deducted for a year refunded to them under the HTB scheme, he/she would not be entitled to any further tax refunds for that year.

In the scenario mentioned by the Deputy, for an individual who availed of the HTB scheme to purchase his or her home in 2020, he or she is not precluded from claiming a deduction in respect of actual vouched expenses incurred in working from home in 2020 or 2021 (or for that matter, from an employer paying that individual €3.20 per day).  The HTB legislation prescribes that an individual must select a relevant tax year, which means a year of assessment within the four tax years immediately preceding the year in which the application was made.  Thus, for a house purchased in 2020, the relevant tax years are 2016, 2017, 2018 or 2019.

A PAYE worker who incurs relevant expenditure can claim e-Working expenses by completing an Income Tax return at year end. Revenue advises that the simplest way for taxpayers to claim their e-Working expenses and any other tax credit entitlements is by logging into the myAccount facility on the Revenue website. 

Revenue has published detailed guidance on this subject and on the question of how claims for e-Working expenses should be calculated and submitted in the Tax and Duty manual ‘e-Working and Tax’, which is available on the Revenue website at www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-02-13.pdf.

Finally, the national remote working strategy ‘Making Remote Work’, commits the Tax Strategy Group to reviewing the current tax arrangements for remote working in respect of both employees and employers.  The Tax Strategy Group will take account of the economic, financial and organisational implications arising from the experience of remote working during the pandemic and assess the merits of further enhancement for consideration in the context of Budget 2022. 

Financial Services

Questions (181)

Rose Conway-Walsh

Question:

181. Deputy Rose Conway-Walsh asked the Minister for Finance if the commercial terms under which public investment was made by ISIF in a company (details supplied) assure the State preferential access to genome data collected by the company; if so, the details of preferential access; and if he will make a statement on the matter. [41649/21]

View answer

Written answers

The NTMA have informed me that in line with its double bottom line mandate, ISIF made an investment in Genuity Science. ISIF’s investment was, amongst other things, aimed at supporting the creation of a precision medicine hub in Ireland which it was hoped would have associated benefits to Ireland. ISIF’s role in its investments is that of an investor/shareholder with the day to day operations of such companies including Genuity typically being managed by the relevant executive management team. Genuity Science is a standalone commercial entity and decisions relating to its commercial activities, including in relation to genetic information it holds, are a matter for Genuity Science.

Tax Collection

Questions (182)

Catherine Murphy

Question:

182. Deputy Catherine Murphy asked the Minister for Finance the amount collected by the Revenue Commissioners in excise duty on mineral oils in the form of mineral oil tax and carbon tax since 2016 to date in 2021. [41667/21]

View answer

Written answers

I am advised by Revenue that receipts for Mineral Oil Tax (MOT) and carbon tax on mineral oils for the years up to year 2019 are published on the Revenue website at:

www.revenue.ie/en/corporate/documents/statistics/excise/net-receipts-by-commodity.pdf

The receipts from MOT and carbon tax for 2020 and to the end of July 2021 are shown in the table below. Please note that the 2021 receipts are currently provisional and maybe subject to change.  

-

Mineral Oil Tax

 

Carbon Tax

 

-

2020 €m

2021* €m

2020 €m

2021* €m

Petrol

424.64

228.69

46.09

31.18

Aviation Gasoline

0.53

0.25

0.06

0.05

Auto -diesel

1,342.25

782.46

212.57

153.68

Marked Gas Oil

46.76

25.56

65.27

45.75

Kerosene

-

-

68.23

50.47

Fuel Oil

0.70

0.30

1.32

0.99

LPG (Other)

-

-

11.24

8.81

Auto LPG

0.13

0.70

0.04

0.03

*to end July 2021

Financial Services

Questions (183)

Brian Leddin

Question:

183. Deputy Brian Leddin asked the Minister for Finance the purpose of the deemed disposal of exchange traded funds for taxation purposes after eight years; if he plans to change this arrangement for small investors; and if he will make a statement on the matter. [41825/21]

View answer

Written answers

The normal tax treatment afforded to Irish collective investment funds is that the funds invested are allowed to grow on a tax-free basis within the fund.  The income is taxed at the level of the investor rather than the fund, as is standard international practice.

In order to ensure that the appropriate tax is collected from Irish investors, funds are obliged to operate an exit tax regime and remit the tax deducted in this manner to Revenue.  This charge to tax does not apply in the case of unit holders who are non-resident. In the case of non-resident investors, their liability to tax on gains from the fund will be determined in their home jurisdiction. 

The broad rationale for exempting such funds from direct taxation is to facilitate individuals to invest collectively, without suffering double taxation (that is, taxation both within the fund and in the hands of the investor on distribution).  Most OECD countries now have a tax system that provides for neutrality between direct investments and investments through a Collective Investment Vehicle/Fund.

There is a charge to tax on Irish residents on the happening of a “chargeable event”. In order to prevent the indefinite deferral of a chargeable event (and therefore an exit charge), a deemed disposal occurs 8 years following inception of a policy of life assurance or acquisition of a fund and then every 8 years thereafter.  The deemed disposal rules also apply to equivalent offshore funds.  Any gain on the investment which arises from the date of inception or the date of acquisition to the date of the deemed disposal is subject to tax. This ensures that income isn’t rolled up indefinitely in life assurance policies or funds without being taxed. On the ultimate disposal of the investment, any tax paid which arose as a result of a deemed disposal is allowed as a credit against any final tax liability on disposal.

There are no plans to review the 8 year deemed disposal rule at this time.

Covid-19 Pandemic Supports

Questions (184)

Éamon Ó Cuív

Question:

184. Deputy Éamon Ó Cuív asked the Minister for Finance if a business which is only open to the public for a fixed period of time each year can claim the Covid restrictions support scheme during any other part of the year in cases in which there is ongoing storage, maintenance and preparations involved that can be proven; if not, the reason for the refusal to cover these ongoing overheads while operational but not open to the public; and if he will make a statement on the matter. [41839/21]

View answer

Written answers

The Covid Restrictions Support Scheme (CRSS) is a targeted support for businesses significantly impacted by restrictions introduced by the Government under public health regulations to combat the effects of the Covid-19 pandemic. The support is available to companies, self-employed individuals and partnerships who carry on a trade or trading activities, the profits from which are chargeable to tax under Case I of Schedule D, from a business premises located in a region subject to restrictions introduced in line with the Living with Covid-19 Plan.

Details of CRSS were published in Finance Act 2020 and detailed operational guidelines, which are based on the terms and conditions of the scheme as set out in the legislation, have been published on the Revenue website.

A relevant business activity which is seasonal in nature is not restricted from qualifying under CRSS where they are subject to Covid restrictions and as a result, are prohibited or significantly restricted from allowing customers access their business premises, and they meet all other qualifying criteria.

Where a business is no longer subject to COVID restrictions which require them to prohibit or restrict customers from accessing their business premises, that business will not be eligible for CRSS for the periods where they choose not to open because of the seasonal nature of the business.

It is not sufficient that the trade of a business has been impacted because of a reduction in customer demand as a consequence of Covid-19.  The scheme only applies where, as a direct result of the specific terms of the Government restrictions, the business is required to either prohibit or significantly restrict access to its business premises. 

As non-essential retail businesses were permitted to open from 17 May 2021, they are no longer subject to Covid restrictions which would require them to prohibit or significantly restrict customers from accessing their business premises.  Therefore, from that date, they ceased to qualify for support under the CRSS. However, subject to meeting the relevant criteria, a business reopening after a period of restrictions, may claim a “restart week payment” under the CRSS scheme to assist it with the costs of reopening.

For businesses reopening between 29 April 2021 and 1 June 2021, an “enhanced restart week payment” may be claimed, which is computed at double the normal weekly CRSS rate, for two weeks, subject to a maximum weekly amount payable of €5,000.

Businesses who qualified for CRSS and who, from 2 June 2021, become eligible to claim a “restart week” payment, can submit a single claim for a “restart week” payment, that will cover a period of three weeks at double the normal rate, to assist them with the additional costs of reopening. he amount that may be claimed in respect of each “restart week” is subject to a maximum weekly amount payable under the scheme which has been increased to €10,000 per week specifically in relation to the triple restart week payments.

On 1 June, I announced that an additional business support scheme, the Business Resumption Support Scheme (BRSS), would be available for businesses whose turnover in the period from 1 September 2020 to 31 August 2021 is reduced by 75% compared with their 2019 turnover.  To qualify under the scheme, a business must carry on a trade or trading activities, the profits from which are chargeable to tax under Case I of Schedule D.  The BRSS is now open for applications via the Revenue Commissioners website.  Under the scheme, a qualifying business will be able to claim a cash payment calculated as three times the sum of 10% of their average weekly turnover up to €20,000 and 5% on any excess of average weekly turnover above €20,000, subject to a maximum payment under the scheme of €15,000.

Companies and self-employed individuals may be entitled to support under other measures put in place by Government, including the COVID Pandemic Unemployment Payment (PUP) and the Employment Wage Subsidy Scheme (EWSS). Businesses may also be eligible to warehouse VAT and PAYE (Employer) debts and also excess payments received by employers under the Temporary Wage Subsidy Scheme, and the balance of Income Tax for 2019 and Preliminary Tax for 2020 for self-assessed taxpayers if applicable.

The Deputy will be aware that the Employment Wage Subsidy Scheme has been extended to the end of 2021 and it is expected that CRSS will be continued to the end of 2021 for those businesses that are still directly affected by public health restrictions that may remain in place.

The Government will continue to assess the effects of the Covid-19 pandemic on the economy and I will continue to work with my Ministerial colleagues to ensure that appropriate supports are in place to mitigate these effects.

Tax Forms

Questions (185)

Éamon Ó Cuív

Question:

185. Deputy Éamon Ó Cuív asked the Minister for Finance if he plans to defer the latest date for filing self-employed and corporate tax returns for 2020 this year due to the difficulties businesses and accountants have had due to Covid-19 restrictions in which many of their staff have been working remotely and also where response times from departments and State agencies are often delayed also affecting the ability of businesses and their accountants to access necessary information for tax returns; and if he will make a statement on the matter. [41858/21]

View answer

Written answers

I can assure the Deputy that Revenue understands and appreciates the unprecedented situation facing taxpayers and businesses as a result of the ongoing COVID-19 pandemic, and has played a key role in responding to the many challenges arising during this crisis. Revenue works very closely with businesses and tax practitioners and continues to be flexible and responsive in putting solutions and processes in place that assist and support businesses. Revenue’s approach must also have regard to the very considerable supports being provided by Government, the need to make sure that businesses are correctly availing of those supports and the need to ensure ongoing tax compliance by those availing of these supports.

For taxpayers who file their 2020 Form 11 return and make the appropriate payment through ROS for Preliminary Tax for 2021 and Income Tax balance due for 2020, the due date has already been extended by Revenue from 31 October to Wednesday 17 November 2021. Where access to necessary information for tax returns is being impacted by COVID-related difficulties, the relevant return should be submitted on a ‘best estimate’ basis. Revenue has advised me that it would expect that the instance of such difficulties is expected to be very low and Revenue has assured me that any subsequent amendments can be completed on a self-correction basis without incurring additional penalties.

Revenue will continue to monitor the situation over the coming months, but no further extension on filing deadlines is envisaged at this time. The timely filing of tax returns is essential so that Revenue can quantify liabilities, particularly for the purposes of Debt Warehousing and for continued eligibility of businesses to the various COVID-19 support schemes.

House Prices

Questions (186)

Réada Cronin

Question:

186. Deputy Réada Cronin asked the Minister for Finance if he will request banks to extend the lifetime of mortgage approval for borrowers given the dearth of affordable properties to buy and the increase in house prices far above those advertised for even modest properties; and if he will make a statement on the matter. [41906/21]

View answer

Written answers

There is no specific regulatory provision which specifically relates to the duration period of a mortgage approval (either an Approval in Principle or a mortgage offer). However, lenders should make the duration of any Approval in Principle clear to a consumer, in line with the requirement of the Consumer Protection Code 2012 to provide clear information to a consumer and to bring key information to the attention of the consumer.  When a lender offers a mortgage to a consumer, the Code requires that the lender must include the length of time for which the mortgage offer is valid in the offer document. However, it remains a business matter for individual lenders to set the duration period of a mortgage approval (and if necessary to decide whether or not to extend the period of mortgage approval) and it would not be appropriate for me to become involved in the commercial and business making decisions of lenders.  Ultimately of course there is also an obligation on lenders to provide mortgage credit to consumers only where the results of a creditworthiness assessment indicates that the consumer’s obligations resulting from the credit agreement are likely to be met in the manner required under that agreement and lenders will need to satisfy themselves that they can comply with this obligation.      

Nevertheless, it should be noted that the Central Bank has indicated that it expects all regulated firms to take a consumer-focused approach and to act in their customers’ best interests at all times, including during the COVID-19 pandemic.  If a mortgage applicant is not satisfied with how a regulated firm is dealing with them in relation to an application for credit or the drawn down of credit, or they believe that the regulated firm is not following the requirements of the Central Bank’s codes and regulations or other financial services law, the mortgage applicant should make a complaint directly to the regulated firm. If the mortgage applicant is still not satisfied with the response from the regulated firm, he or she can refer the complaint to the independent Financial Services and Pensions Ombudsman.

Childcare Services

Questions (187)

James Lawless

Question:

187. Deputy James Lawless asked the Minister for Finance his plans to increase tax relief on childcare; and if he will make a statement on the matter. [41942/21]

View answer

Written answers

The Government acknowledges the continuing cost pressures on parents, particularly those with young children.

In recognition of these cost pressures, a number of support measures are already in place to ease the burden on working parents. These include various tax-exempted child-care related supports provided by the Minister for Children and Youth Affairs and measures such as the Working Family Payment provided by the Minister for Employment Affairs and Social Protection.

With regard to taxation measures, and separate to the above:

- The Accelerated Capital Allowances scheme for Childcare Services was introduced to encourage employers to develop childcare facilities onsite for their employees.

- Individuals who provide child-minding services in their own home may claim childcare services relief each year, provided that they do not receive more than €15,000 income per annum from the child-minding income.

- Furthermore, a Single Person Child Carer tax credit of €1,650 is available as well as an additional standard rate band of €4,000. This credit and band is payable to any single person with a child under 18 years of age or over 18 years of age if in full time education or permanently incapacitated. The primary claimant may relinquish this credit and increase in the rate band to a secondary claimant with whom the child resides for not less than 100 days in the year.

- I have no plans to introduce a specific income tax relief for parents to assist with childcare costs. As the Deputy will appreciate, I receive many requests for the introduction of new tax reliefs and the extension of existing ones. In considering these, I must be mindful of the public finances and the many demands on the Exchequer and I must have regard to budgetary constraints and the equitable treatment of all tax-payers. Tax reliefs, no matter how worthwhile in themselves, reduce the tax base and make general reform of the tax system that much more difficult.

Flexible Work Practices

Questions (188, 209, 211)

Carol Nolan

Question:

188. Deputy Carol Nolan asked the Minister for Finance the measures he is taking to promote or facilitate remote working for staff in his Department or bodies under the aegis of his Department; the costs this has generated in terms of the provision of laptops, desktop computers or contributions to wi-fi costs or phone-related expenses; the number of staff who have applied for permission to work from home on a permanent or hybrid-model basis (details supplied); and if he will make a statement on the matter. [41952/21]

View answer

Dara Calleary

Question:

209. Deputy Dara Calleary asked the Minister for Finance the steps being taken to facilitate remote working within his Department in particular to encourage remote working for those who live in the regions; and if he will make a statement on the matter. [42706/21]

View answer

Holly Cairns

Question:

211. Deputy Holly Cairns asked the Minister for Finance the way in which his Department and public bodies and agencies under his remit are accommodating requests for persons to work from home. [42756/21]

View answer

Written answers

I propose to take Questions Nos. 188, 209 and 211 together.

Departments and Offices are currently working in line with Government COVID-19 guidance, which provides for home working to continue where possible.

My Department  is an active participant on the interdepartmental working group that is developing a central policy framework for Blended Working in the Civil Service and which will be finalised in conjunction with employee representatives over the coming months. This framework will inform the development of organisation level blended working policies tailored to the specific requirements of each Department/Office, whilst ensuring a consistency of approach across key policy areas.

The Department’s Covid-19 Response Management Group meets weekly and continues to consolidate work already advanced in response to the pandemic in line with on-going Government guidance and recommendations.

The cost for providing equipment for the facilitation of Departmental staff to work from home from 01 February 2020 to 31 August 2021 is set-out below in tabular form. These figures are VAT inclusive:

Laptops and hybrids

 -

2020/2021

Laptops

€154,489.05

Hybrids

€92,126.27

 Total

€246,615.32

Computer Peripherals

 -

2021

2020

Total

USB   Multi-ports

€962.52

€146.4

€1,108.92

Cables

€2,232.55

 N/A

€2,232.55

Headsets

€1,090.67

€3,500.25

€4,590.92

Monitors

€15,458.75

€7,660.5

€23,119.25

Keyboard+Mice

€1,399.99

€968.21

€2,368.20

Docks

€7,995.00

€9,394.74

€17,389.74

Total

€29,139.48

€21,670.1

€50,809.58

Phones, mobile Wifi access dongles, usage:

Handsets/dongles

€5,049.15

Usage

€1,316.1

Total 

€6,365.25

Licences:

 -

2020

2021

 

Citrix licence

€34,917

€2,672.11

 

Citrix licence tokens

€2,110.47

€712.05

 

Total 

 

 

€40,411.63

The position of those bodies under the aegis of my Department which have direct employees is detailed below, all figures provided are inclusive of VAT.

The Central Bank of Ireland, which also provides staffing and facilities for another body under the aegis of my Department, the Investor Compensation Company DAC, made a strategic decision in 2017 to replace desk top computers with Wi-Fi enabled laptop computers to facilitate and encourage collaboration and mobility within the North Wall Quay premises. As a consequence of this decision all staff were already equipped to work remotely from 16 March 2020 when Public Health restrictions were introduced. Approximately eight weeks after the introduction of these restrictions the Central Bank began a process of providing additional equipment such as a monitor, office chair, laptop stand, keyboard and mouse, to improve the ergonomic experience of remote working staff at a cost of €353,259. The Bank does not pay any contribution towards home telephony or Wi-Fi costs. The Bank is currently undertaking an impact assessment of potential future ways of working which will result in the introduction of an optional hybrid working model for the majority of staff. Temporary transitional working arrangements in line with current public health guidelines are in operation pending completion of this assessment.

The Credit Review Office (CRO) currently has 3 staff: 1 Credit Reviewer employed by my Department and 2 seconded from Enterprise Ireland. The CRO has incurred no additional costs in relation to remote working, and has received no applications for remote working to date.

The Financial Services and Pensions Ombudsman (FSPO) has taken measures to facilitate remote working since March 2020, in order to comply with public health measures in the context of the Covid-19 pandemic while ensuring it continues to fulfil its statutory role and meets the needs of its customers. The costs associated with the facilitation of remote working are as follows: €105,892 on IT equipment and €1,887 on telephony. The FSPO has not contributed to individual staff Wi-Fi or phone-related expenses. The costs detailed above relate to the provision of FSPO equipment to facilitate staff to work remotely. The FSPO has undertaken staff engagement surveys on remote working to assist in determining the future working arrangements of the FSPO in accordance with public health guidelines. The FSPO is examining the potential to pilot a blended working arrangement for team members, where appropriate, recognising that the primary focus of any future working arrangements will be delivery against the FSPO’s statutory role and ensuring the delivery of an efficient, accessible service for all its customers, while taking account the needs of staff and ensuring that Government policy in this area is implemented.

All staff of the Irish Fiscal Advisory Council have been working remotely since March 2020 and continue to do so. The Council has invested approximately €7,500 in respect of the provision of laptops and equipment to facilitate remote working. The Council has a remote working policy in place with a hybrid-model applying on a physical return to the office.

The National Treasury Management Agency (NTMA) introduced remote working for employees in July 2019 by way of the NTMA Remote Working Guide. Since the onset of the pandemic in 2020, and in accordance with Government advice, NTMA employees have predominantly worked from home. It is the NTMA’s expectation that employees will not have to seek permission for hybrid working rather that a hybrid working model will be available to all employees. The costs incurred to date in terms of the provision of Laptops and ICT related peripherals to promote or facilitate remote work for staff are as follows: €207,260 on ICT equipment and €3,191 on reimbursement of employee costs incurred on personal mobile accounts for the purposes of carrying out work. While the NTMA Remote Working Guide is dated July 2019, costs were primarily incurred further to the impact of Covid-19 from March 2020 onwards. Under the terms of a Service Level Agreement, the NTMA provides staffing services to Home Building Finance Ireland, the National Asset Management Agency and the Strategic Banking Corporation of Ireland which are also bodies under the aegis of my Department.

Staff of the Office of the Comptroller and Auditor General are working remotely in line with current Government and HSE guidelines and will continue to do so until updated advice has been received. Due to the nature of the work of the Office, a degree of remote working was already facilitated prior to the current pandemic, a teleworking policy was in place and staff had the necessary equipment to work outside of the Office, at home or in client premises. The Office has been able to fund any additional costs associated with remote working during the pandemic from savings in other areas within the Office’s voted allocation. A model for the future of work in the Office developed with extensive staff consultation, has recently been approved by the Audit Board. The model will facilitate a hybrid working arrangement enabling staff to divide their time between remote and in-office work while ensuring that the business objectives are achieved. The model will form the basis of a blended working policy for the Office to be developed once the central policy framework has been agreed.

Most staff at the Office of the Revenue Commissioners have been working remotely since March 2020. Generally in excess of 75% of Revenue’s staff are remote working each week. Revenue staff are currently continuing to work in line with Government Covid-19 guidance, which provides for home working to continue where possible. Revenue is an active participant on the interdepartmental working group that is developing General Principles to inform a longer term remote working framework for the Civil Service. It is expected that the central policy framework for Blended Working in the Civil Service will be finalised in conjunction with employee representatives over the coming months. This framework will inform the development of Revenue’s future blended working policy. The primary objective of the longer-term framework will be towards ensuring that Revenue’s business requirements are fully supported and will also be in accordance with the objectives of the “Programme for Government – Our Shared Future” in relation to the availability of remote working for staff in the Public Sector. Revenue is also actively participating with other Government Departments in the design of the application process that will be used to administer staff requests to work from home once the current Covid-19 restrictions are lifted. In a survey of Revenue staff carried out in May 2021, 67% of respondents indicated that they favoured blended working for the future. Revenue’s key expenditure figures for equipment to enable homeworking since March 2020 are €565,000 on laptops, €92,000 on headsets, €39,000 on network equipment, and €447,200 on mobile phones.

The Tax Appeals Commission has drafted a remote working policy for its staff members but is awaiting final guidelines and direction from the Department of Public Expenditure and Reform before implementation can take place. The new remote working policy is expected to be offered to all staff members. The Commission spent €27,847 procuring laptops for the majority of staff to enable employees to work from home. This expenditure was also necessary for the Commission to move to a “Build To Share Desktop Service” in August 2020 provided by the Office of the Government Chief Information Officer. This support now underpins the ICT infrastructure that maintains the Commission’s business services including servers, storage, government networks, perimeter defenses, conferencing services, web content filters and anti-virus faculties. To date, no staff member has requested remote working on a permanent or hybrid-basis, however, the Commission conducted an internal anonymous survey in May 2021 which indicated a level of interest in some form of hybrid working. 

Insurance Industry

Questions (189)

Neale Richmond

Question:

189. Deputy Neale Richmond asked the Minister for Finance if his attention has been drawn to insurance companies declining employer’s insurance to disabled employers who manage their own support services in order to live independently in the community; if he has engaged with insurance companies on this issue; and if he will make a statement on the matter. [41968/21]

View answer

Written answers

I understand that the issue referred to relates to insurance for companies which are set up with the support of Áiseanna Tacaíochta. This in turn facilitates direct payments to its disabled members to enable them manage their own support services.  I am aware of the difficulties being experienced by this organisation and its members regarding the increased cost of insurance cover and share concerns regarding such issues as cost and supply of insurance. However, as the Deputy will appreciate, neither I nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products, nor do we have the power to direct insurance companies to provide cover to specific individuals. This position is reinforced by the EU Solvency II Directive insurance framework.

Having said that, since becoming aware of this issue, my officials have engaged with the industry representative body Insurance Ireland.  It has acknowledged that some insurers have withdrawn from parts of the liability insurance sector in recent years, and also noted the increase in average claims costs during this time, pointing to data from the recent report of the National Claims Information Database.  According to Insurance Ireland, increases in claims costs were due to volatility in the personal injuries claims environment.

In this regard, I believe that the new Personal Injuries Guidelines should provide much greater certainty regarding award levels, in addition to reducing awards for many common injuries, and also leading to lower legal fees by encouraging greater use of the Personal Injuries Assessment Board to settle claims. This should have a stabilising impact in relation to the issues currently being experienced by these organisations.  Indeed, in meetings with the main insurance companies in the Irish market, Minister of State Fleming has stated the Government’s expectation that insurers should now increase their risk appetite to extend cover to new market segments or areas they may have withdrawn from in recent years, in light of these savings.  I understand that he will be meeting with insurers again in the coming months to review their response to the Guidelines and other insurance reforms.

Furthermore, I also hope that the improved claims environment resulting from the implementation of the Guidelines will help to attract new entrants into the Irish market, or encourage providers who previously exited this market to return. Separately, I understand that the new Office to Promote Competition in the Insurance Market is working with IDA Ireland to develop a customised proposition for potential new market entrants, and to identify a shortlist of specific target companies.

These and further important actions, such as reviewing the duty of care, are being prioritised under the Action Plan for Insurance Reform. The implementation of the Government's broad package of reforms should assist in the development of a more sustainable and competitive market by deepening and widening the supply of insurance here, thereby improving both the cost and availability of cover for all groups, particularly those that deliver such valuable services as the organisation in question. 

Tax Credits

Questions (190)

Michael Healy-Rae

Question:

190. Deputy Michael Healy-Rae asked the Minister for Finance if the 5% tax credit (details supplied) will be retained; and if he will make a statement on the matter. [42001/21]

View answer

Written answers

Section 481 TCA 1997 provides a 32% payable credit for eligible expenditure on film production in Ireland. It is available to Irish and international film production companies that are resident in the State or in an EEA State and carry on business in the State through a branch or subsidiary. The scheme is intended to act as a stimulus to the creation of an indigenous film industry in the State, creating quality employment opportunities and supporting the expression of the Irish culture.

Finance Act 2018 introduced a short-term, tapered regional uplift. The purpose of the regional uplift is to support the development of new, local pools of talent in areas outside the current main production hubs, to support the geographic spread of the audio-visual sector. The regional availability of the uplift is limited to areas in Ireland sanctioned to receive regional aid under the EU regional aid guidelines.

When introduced in Finance Act 2018 the regional uplift was to be phased out on a tiered basis with 5% available in years 1 and 2 (2019 & 2020), 3% available in year 3 (2021), 2% available in year 4 (2022), and 0% available from year 5 on. However, the COVID-19 crisis had a detrimental impact on the audiovisual sector, with the majority of production companies having to suspend activity for a significant portion of 2020 and, as a result, much of the intended incentive effect of the regional uplift in 2020 was lost. Therefore Finance Bill 2020 amended the regional uplift to provide for an additional 5% year in 2021, in effect to replace the incentive year lost as a result of the Covid-related public health measures.  The tapered withdrawal of the uplift then restarts, reducing to 3% in 2022, 2% in 2023, and Nil thereafter.

My officials examine a range of possible measures in advance of the Finance Act each year, including potential amendments to Section 481 Film Relief, and the Deputy's proposal will be considered as part of this process. In this regard it should be noted that film relief is an approved State aid and any amendments to the scheme would require consideration of State aid constraints and approval from the European Commission.

Tax Reliefs

Questions (191)

Neale Richmond

Question:

191. Deputy Neale Richmond asked the Minister for Finance if he has considered extending the tax relief applied to general practitioner referred physiotherapy costs to general practitioner referred therapy sessions for mental health; and if he will make a statement on the matter. [42014/21]

View answer

Written answers

I am informed by Revenue that Section 469 of the Taxes Consolidation Act 1997 provides for tax relief in respect of qualifying health expenses.

Section 469 defines "health expenses" as "expenses in respect of the provision of health care including the services of a practitioner".

A practitioner is defined in the section as "any person who is:

a) registered in the register established under section 43 of the Medical Practitioners Act 2007,

b) registered in the register established under section 26 of the Dentists Act, 1985, or,

c) in relation to health care provided outside the State, entitled under the laws of the country in which the care is provided to practice medicine or dentistry there".

Regarding therapy sessions for mental health, tax relief will apply where the therapist is a qualified practitioner as defined above. The relief is also available from a psychologist or psychotherapist if they are a qualified practitioner, or where a patient is referred by a qualified practitioner for a diagnostic procedure.

This is similar to the position that applies to other medical expenses, such as physiotherapy and I am satisfied that the legislation provides sufficient flexibility for expenses that should qualify for tax relief. Accordingly, there are no plans to change these arrangements at this time.

Comprehensive guidance material on medical expenses can be found on Revenue’s website in Tax and Duty Manual Part 15-01-12 www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-12.pdf. 

Banking Sector

Questions (192)

Pearse Doherty

Question:

192. Deputy Pearse Doherty asked the Minister for Finance the total invested by the State and the cash received to date in disposals, redemptions and coupons, dividends and fees; the net cash position and valuation of remaining investment; and the net position at the end of July 2021 in banks (details supplied) in tabular form. [42018/21]

View answer

Written answers

As requested by the Deputy, the table below sets out the cumulative position in relation to the State’s investment in AIB and PTSB as at end-July.

On the 23rd June, I announced my intention to sell part of the State’s 13.9% shareholding in Bank of Ireland by way of a trading plan. At the same time, I confirmed that I was limited in the amount of detail I could disclose in relation to the plan as it would be detrimental to maximising value for the taxpayer. The number of shares sold, the average price achieved and the cash generated will be disclosed once the plan has been completed. Accordingly, the position in the table for BOI is at 22nd June, the day before the announcement was made.

Table: Summary of State investments

 -

AIB*

PTSB*

 

BOI**

 

€m

€m

 

€m

 

 

 

 

 

Gross invested

20,751

3,954

 

4,667

 

 

 

 

 

Sale/redemption proceeds - including accrued int

7,112

1,891

 

3,597

 

 

 

 

 

Investment income

1,728

120

 

784

 

 

 

 

 

CIFS/ELG - net

1,783

669

 

1,547

 

 

 

 

 

Net cash position - In/(out)

(10,128)

(1,274)

 

1,261

 

 

 

 

 

Market value of equity stakes

3,999

497

 

676

 

 

 

 

 

Net position - including valuations

(6,130)

(777)

 

1,937

*Position for AIB and PTSB as at end-July 2021.

** Position for BOI as at 22 June 2021.

Pension Provisions

Questions (193)

Louise O'Reilly

Question:

193. Deputy Louise O'Reilly asked the Minister for Finance if his attention has been drawn to the practice in the public service whereby retirees receive a monthly pension payment and an interim payment of approximately half the after-tax amount in the middle of the month; if this arrangement is revenue compliant and all relevant deductions can and are being made; and if he will make a statement on the matter. [42037/21]

View answer

Written answers

The matter of the Public Service payroll is primarily a matter for my colleague the Minister of Public Expenditure and Reform. Furthermore, enquiries made by my Department with relevant bodies failed to identify the practice within the public service pensions payment system to which the Deputy refers.  However, if the Deputy wishes to provide further details, my officials will make further enquiries.

That being said, in terms of Revenue compliance in relation to payroll practices, Revenue have advised as follows:

The Pay As You Earn (PAYE) system is a method of tax deduction under which an employer (including occupational pension providers) calculates and deducts any income tax due each time a payment of wages, salary, pensions etc. is made to an employee (any reference to employee also includes ‘occupational pension recipients’). In addition, employers are obliged to calculate and deduct any liability to Pay Related Social Insurance (PRSI), Universal Social Charge (USC) and Local Property Tax (LPT).

The PAYE system operates on a receipts basis which means that income tax and other statutory deductions are to be operated when a payment is being made to an employee. Under the PAYE system, tax should be operated on any interim payments or advance payments of emoluments made by an employer to an employee. With the introduction of PAYE real time payroll reporting with effect from 1 January 2019, employers are obliged to report their employees’ pay and statutory deductions to Revenue, on or before the date they pay their staff.

I have been advised by Revenue that the frequency of payments to retirees is a matter for the Public Service employer in question and notwithstanding this an employer is obliged to operate PAYE correctly on all payments.

Tax Credits

Questions (194, 224, 225, 226)

Pearse Doherty

Question:

194. Deputy Pearse Doherty asked the Minister for Finance the reason the 30 per cent research and development tax credit regime for small and micro companies provided in the Finance Act 2019 is not yet operable; and when it will come into effect. [42108/21]

View answer

Pearse Doherty

Question:

224. Deputy Pearse Doherty asked the Minister for Finance if he will provide an overview of the changes announced to the research and development tax credit for small and micro-companies in section 25 of Finance Act 2019. [43176/21]

View answer

Pearse Doherty

Question:

225. Deputy Pearse Doherty asked the Minister for Finance the date on which a submission was made to the European Commission for State Aid approval with respect to changes made to the research and development tax credit for small and micro-companies under section 25 of the Finance Act 2019; the status of this submission; the expected date of its approval; and if he will make a statement on the matter. [43177/21]

View answer

Pearse Doherty

Question:

226. Deputy Pearse Doherty asked the Minister for Finance the estimated cost in 2022 of amending the research and development tax credit regime by allowing small and micro companies to receive the credit in one instalment rather than three instalments over a 33-month period payable not earlier than the relevant tax pay and file date for the company’s accounting period in which the qualifying expenditure was made; and if he will make a statement on the matter. [43178/21]

View answer

Written answers

I propose to take Questions Nos. 194, 224, 225 and 226 together.

In Budget 2020, I provided for the introduction of a number of enhancements to the R&D tax credit for micro and small companies, including an increase in the rate of credit and an enhanced method of calculating the payable credit.

Section 25 of Finance Act 2019 introduced new measures in respect of the Research and Development (R&D) tax credit for micro and small companies, however as these are targeted measures they require State aid approval from the European Commission, and were therefore introduced subject to a Commencement Order.

The planned measures for micro and small companies include:

- An increase in the R&D tax credit rate from 25% to 30%.

- The addition of an enhanced method to calculate the payable element of the R&D tax credit, based on twice the current year payroll liabilities.

- The introduction of a new provision to allow pre-trading R&D expenditure to qualify for an R&D tax credit, which is limited to offsets or repayments calculated by reference to payroll tax (PAYE and USC) and VAT liabilities for the same period.

- Officials in my Department began engagement with the Commission on this matter in March 2020. However the Deputy will be aware that this coincided with the onset of the Covid-19 pandemic, which required the immediate attention of officials both in Ireland and in the Commission to develop and implement measures to support businesses and employees affected by the public health restrictions.

- Since the onset of the pandemic, this Government has introduced extensive Covid-19 supports, many of which will have provided immediate support to small businesses to maintain a level of trade and retain their staff in employment.

- The measures specific to small and micro companies therefore have not yet been commenced, but the easing of public health restrictions and the reducing need for related support measures will allow greater scope for my officials to progress matters relating to the R&D credit.

- In respect of PQ 43178/21, I am advised by Revenue that future levels of expenditure on research and development is not known and therefore a cost for the year 2022 of the Deputy's proposed amendment cannot be estimated. However, based on information included in tax returns for 2019 (the most recent year available), the cash flow impact in that year would have been €25 million if the Deputy’s proposal had been implemented in that year for small and micro companies.

- The Deputy may also be interested in Revenue’s published information in respect of the research and development tax credit, which is available at: https://www.revenue.ie/en/corporate/documents/statistics/tax-expenditures/r-and-d-tax-credit-statistics.pdf .

Vehicle Registration Tax

Questions (195)

James O'Connor

Question:

195. Deputy James O'Connor asked the Minister for Finance if he will address issues (details supplied) regarding VRT; and if he will make a statement on the matter. [42112/21]

View answer

Written answers

The Disabled Drivers & Disabled Passengers Scheme provides relief from VRT and VAT on the purchase and use of an adapted car, as well as an exemption from motor tax and an annual fuel grant. Details of these reliefs and the grant in respect of fuel usage are available on the Revenue website.

The relief from Value Added Tax and Vehicle Registration Tax are generous in nature amounting to up to €10,000, €16,000 or €22,000, depending on the level of adaption required for the vehicle.

It should be noted that the new VRT charging table does not necessarily result in increased VRT rates. VRT is an emissions-based tax and therefore the amount of VRT incurred will vary across different vehicle makes and models. Typically, the new rates structure will result in increases for high emission vehicles, and decreases for lower emission vehicles. Accordingly, I have no plans to amend the reliefs at this time.

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