Dáil Éireann díospóireacht -
Tuesday, 13 Jun 2000

Vol. 521 No. 1

Written Answers. - Tax Relief.

Derek McDowell

Ceist:

150 Mr. McDowell asked the Minister for Finance the number of occasions on which relief from income tax or corporation tax has been claimed under section 483 of the Taxes Consolidation Act, 1997; the number of occasions on which applications made under the section have been refused; the classes of purposes for the use for which the Minister has accepted gifts of money under the section in the past and for which he would be at present disposed to accept such gifts; if gifts have been accepted for general Exchequer purposes without being dedicated to any particular purpose; if a gift consisting of a return of a pension payable out of public moneys has ever been or is in the process of being accepted; if such a gift would be credited to the taxpayer at its gross or net value, for the purpose of being deducted from or set off against other income chargeable to tax; the criteria, guidelines or precedents which apply to the acceptance of gifts under the section generally and to returns of pensions in particular; and if he will make a statement on the matter. [16658/00]

Minister for Finance (Mr. McCreevy)

Section 483 of the 1997 Taxes Consolidation Act provides a relief from income tax or corporation tax in respect of gifts of money accepted by the Minister for Finance for use by the Minister for any purpose for or towards the cost of which public moneys are provided. Public moneys is defined in the legislation as moneys charged on or issued out of the Central Fund or provided by the Oireachtas. The section was first enacted as section 64 of the 1965 Finance Act.

I understand that, to date, nine applications for the purposes of section 483 have been accepted by Ministers for Finance and that 15 have been rejected. It would seem that three other applications were made but did not go ahead.

Gifts donated under this section have been accepted for general Exchequer purposes. Gifts have also been accepted for specific purposes including the restoration of national monuments.

Gifts of pensions by persons while in receipt of other income from the State have been accepted.

The House will be aware, from my statement on 23 May, that Mr. Hugh O'Flaherty, who has been nominated by Ireland for appointment as a Vice-President of the European Investment Bank, has informed me that it is his intention, on his appointment, to forego his judicial pension for the duration of his period in the bank.

Tax relief is given on a gift by deducting the amount of the gift from the individual's total income before calculating the tax due. If the gift consisted of the return of a state pension, the individual's chargeable income for the tax year, including the pension, would be reduced by the amount of the gift. In effect, from an income tax point of view, the person would be in the same position as if they had not received the income.

In the case of a company, the gift is treated as a loss in a separate trade which means that the amount can be set against the company's income from all sources in the particular accounting year or in the previous accounting year.

Applications for tax relief under this section are decided on their individual merits. However, in considering a particular application I would need to be conscious of the cost of granting tax relief and the possible implications for public expenditure of accepting a donation.

The section has applied for a significant number of years. Every effort has been made to ensure the accuracy of the information provided in this reply in relation to the number of applications. If further information on the number of past applications comes to light, it will be made available to the Deputy.