Dáil Éireann Debate, Tuesday - 22 February 2022
71. Deputy Marc Ó Cathasaigh asked the Minister for Finance the latest figures available with respect to entrepreneur relief; the total tax expenditure forgone in that year; the average costs per claimant; the number of claims in excess of €1 million of relief; and if he will make a statement on the matter. [9449/22]
View answerAs the Deputy will be aware Section 597AA of the Taxes Consolidation Act 1997 provides that disposals of qualifying business assets (in most businesses but excluding those involving dealing in land or holding investments) by qualifying individuals are charged CGT at a rate of 10% up to a lifetime limit of €1 million in chargeable gains. To qualify, among other conditions, an individual must own at least 5% of the business and have spent a certain proportion of their time working in the business as a director or employee for three out of the previous five years, prior to disposal.
I am informed by Revenue that in respect of 2019, the most recent available year, the tax expenditure foregone for entrepreneurial relief was €94 million. The average cost per claimant was €96,600. The number of claims greater than €1 million was 189. It should be noted that claims can exceed €1 million in a year arising from spouses claiming the relief on a single return.
An external review by Indecon Consultants of the Revised CGT Entrepreneur Relief was published as part of the Budget 2020 documentation. While the Indecon review identified a number of possible amendments and improvements it also recommended retaining the relief. Retaining this relief ensures stability and consistency for businesses and individuals and allows them to plan and organise their affairs with a degree of certainty. However an evaluation before the end of 2024 (when the relief is due to expire) would allow consideration of the appropriate next steps for this relief.
