Michael Creed
Ceist:242 Mr. Creed asked the Minister for Finance the tax incentives available to persons establishing their own business. [11306/02]
Written Answers. - Tax Incentives.
The seed capital scheme was introduced in 1993 as an incentive to encourage individuals to start up new businesses. The scheme provides a refund of tax paid in the previous six years to employees who leave employment and start their own business. To qualify for the refund, the individual must comply with certain conditions and the company must be carrying on a qualifying trade, that is, manufacturing, certain tourism activities etc. The company must also be certified by an appropriate agency such as a county enterprise board. The size of the refund depends on the amount of the individual's investment and effective tax rate. There is an upper limit in any one year of the tax paid on income of €31,750.
The business expansion scheme may also be availed of by companies to which the seed capital scheme applies. Details of both schemes are available on the Revenue website at www.revenue.ie.
From 1 January 2001, a 12.5% rate applies to small and medium-sized companies where the trading income, other than such income as is taxable at the 10% or 25% rates, does not exceed €254,000. Marginal relief applies where the income is between €254,000 and €317,500.