Dáil Éireann Debate, Thursday - 13 October 2005
88 Mr. Durkan asked the Minister for Finance the reason home improvement rebate is being withheld in the case of a person (details supplied) in County Kildare who has come to an arrangement to pay arrears to the Revenue Commissioners; and if he will make a statement on the matter. [28501/05]
Amharc ar fhreagraI have been advised by the Revenue Commissioners that the outstanding arrears for 2004 were sizeable and collection of those arrears had not yet commenced. The additional amount becoming available by way of home improvement credit for 2004 was therefore offset against the outstanding arrears.
89 Mr. Gregory asked the Minister for Finance the areas in which the Revenue Commissioners grant tax exemptions to sporting groups; if the definition of sport is that as outlined in section 25 of the Finance Act 1932; and if this definition will be followed when deciding on qualifying activities for the purposes of a tax exemption under the Taxes Consolidation Act 1997. [28509/05]
Amharc ar fhreagraSection 235 of the Taxes Consolidation Act 1997 governs the operation of the tax exemptions provided in the case of sporting bodies. The provisions of that section are administered by the Revenue Commissioners. Section 235 provides tax relief upon the income of any body of persons established for and existing for the sole purpose of promoting athletic or amateur games or sports. Relief from capital gains tax and dividend withholding tax is also provided for under the Taxes Consolidation Act. Two categories of sports bodies are embraced by the provision: a body promoting an athletic game or athletic sport; and a body promoting an amateur game or amateur sport.
Section 25 of the Finance Act 1932 was an amendment to the Finance (New Duties) Act 1916 which provided for the charging of a since defunct excise duty on specific entertainments. That has no relevance to the tax exemption provisions in the case of sporting organisations and is therefore not followed when determining which bodies qualify for the relief.
In addition, a scheme was introduced in 2002 whereby tax relief is available on donations to approved sports bodies for approved capital projects similar to the tax relief in place in respect of donations to charities. This relief is aimed at providing support to sports bodies around the country that are engaged in projects of a capital nature such as the construction or refurbishment of sports facilities. There are currently some 1,500 tax exempted sports bodies, a full list of which is published on the Revenue website www.revenue.ie under publications/lists of bodies and organisations that qualify for relief — No. 17.
90 Dr. Cowley asked the Minister for Finance if he will consider extending the current taxation incentives for property development, including those available under the urban, town and rural renewal schemes which are set to end on 31 July 2006; his views on whether up to 50% of the designated sites have not yet been developed due to hold ups in the servicing and planning areas; his further views on whether an extension to this scheme will enable completion of current projects; and if he will make a statement on the matter. [28523/05]
Amharc ar fhreagraThe deadline for a number of tax incentive schemes, including the urban, rural and town renewal schemes was extended from 31 December 2004 to 31 July 2006 in budget 2004. In budget 2005, I directed my Department, together with the Revenue Commissioners, to undertake a thorough evaluation of the effect of various tax incentive reliefs including the urban, rural and town renewal schemes. In this context, I also confirmed to the House that the termination dates for the various schemes laid down previously in Finance Act 2004 remain unchanged. I am aware of the issues alluded to by the Deputy and these can be taken into consideration in the context of the ongoing reviews.
91 Mr. Kehoe asked the Minister for Finance further to the Finance Bill, the position regarding the value of entitlements as part of a transfer of property between persons (details supplied); if same will be defined as agricultural property or a non-agricultural property when calculating the inheritance tax liability; and if he will make a statement on the matter. [28562/05]
Amharc ar fhreagra92 Mr. Kehoe asked the Minister for Finance if, further to the Finance Bill and the sale of agricultural entitlements, the value of entitlement will be treated as a sale for income tax purposes or as a sale for capital gains tax; and if he will make a statement on the matter. [28563/05]
Amharc ar fhreagraI propose to take Questions No. 91 and 92 together.
With regard to inheritance tax, I take it that the Deputy is referring to entitlements under the 2005 single payment scheme and I am advised by the Revenue Commissioners that payment entitlement under this scheme does not qualify as agricultural property for agricultural relief within the definition in section 89 (1) of the Capital Acquisitions Tax Consolidation Act 2003. Agricultural property for capital acquisitions tax purposes is defined as agricultural land, pasture and woodland situated in the State and crops, trees and underwood growing on such land and also includes such farm buildings, farm houses, and mansion houses as are of a character appropriate to the property and farm machinery, livestock and bloodstock on such property. Therefore, payment entitlement itself, being an asset that is separate from the lands, crops and buildings, does not qualify for agricultural relief.
However, I am further advised by the Revenue Commissioners that such payment entitlements may qualify for business relief under Part 10, chapter 2, Capital Acquisition Tax Consolidation Act 2003. Where a gift or inheritance consists of business property, the value of the business may also be reduced by 90%, provided certain conditions are met. Business relief is available for transfers of relevant business property which the disponer has owned for two years in respect of an inheritance taken on the death of the disponer. Payment entitlement will qualify for business relief as an individual asset of the business on the assumption that the resulting payment will be used in the business or be required for future use in the business.
In terms of whether the proceeds of the disposal of such entitlements would be chargeable to income tax or capital gains tax, I am further advised by the Revenue Commissioners that such payment entitlements under the 2005 single payment scheme are chargeable assets for capital gains tax purposes and that gains arising from their sale will be chargeable to capital gains tax, rather than income tax, following normal capital gains tax rules.
