I am informed by the Revenue Commissioners that the latest relevant information available is in respect of income tax relief allowed for contributions to Retirement Annuity Contracts (RACs) and Personal Retirement Savings Accounts (PRSAs) for the income tax year 2007. RACs and PRSAs are available to the self-employed and to employees not in occupational pension schemes. The information is set out in tables following this reply which provide the number of cases, amount of deduction and reduction in tax for tax relief for RACs and PRSAs for the various contribution ranges. The information is based on income returns contained in Revenue records at the time the data were compiled for analytical purposes, representing close on 90% of all returns expected. A married couple who has elected or has deemed to have elected for joint assessment is counted as one tax unit.
The figures for the total number of cases and the total reduction in tax shown in the tables are lower than those indicated in the table supplied with the reply I gave on 3 November last to Parliamentary Question ref 38545/09 tabled by the Deputy. This is due to the fact that the figures now being provided represent under 90 per cent of all income tax returns expected for 2007, while the figures supplied on 3 November were, in accordance with normal practice, grossed-up at aggregate level to adjust for this incompleteness. It is not possible to provide corresponding figures in regard to the take-up of the tax relief for pension contributions by employers and employees to occupational pension schemes as the relevant data are not captured in such a way as to make this possible.
Provisions were included in the Finance Act 2004 with a view to improving data quality and transparency without overburdening taxpayers or employers. The Act includes provisions that require employers to provide data on superannuation contributions in the P35 form to be filed by employers from 2006 on. These changes have yielded additional information regarding the overall cost of tax relief for pension contributions but, as the returns are aggregated at employer level, they cannot provide a precise basis for measuring the potential impact on the Exchequer of any proposals to limit tax relief for pension investment for individuals across different income ranges.
INCOME TAX 2007
Retirement Annuity — by range of Gross Income.
|
Range of gross income
|
Totals
|
|
|
|
|
From
|
To
|
Number of cases
|
Amount of deduction
|
Reduction in tax
|
Tax due for payment
|
Gross Tax*
|
Reduction in tax as % of Gross Tax
|
€
|
€
|
|
€
|
€
|
€
|
€
|
%
|
—
|
10,000
|
816
|
1,090,619
|
15,433
|
1,273
|
16,706
|
92.4
|
10,000
|
20,000
|
4,023
|
7,610,530
|
1,056,140
|
1,125,139
|
2,181,279
|
48.4
|
20,000
|
30,000
|
9,121
|
19,640,312
|
3,639,370
|
8,985,960
|
12,625,330
|
28.8
|
30,000
|
32,730
|
3,168
|
7,509,033
|
1,460,629
|
5,112,254
|
6,572,883
|
22.2
|
32,730
|
40,000
|
9,127
|
23,785,995
|
5,543,666
|
20,635,934
|
26,179,600
|
21.2
|
40,000
|
50,000
|
12,354
|
39,221,676
|
11,425,057
|
44,823,408
|
56,248,465
|
20.3
|
50,000
|
60,000
|
10,986
|
42,422,932
|
13,034,048
|
58,431,806
|
71,465,854
|
18.2
|
60,000
|
70,000
|
9,541
|
42,982,398
|
13,008,673
|
68,507,813
|
81,516,486
|
16.0
|
70,000
|
80,000
|
7,947
|
42,617,895
|
12,764,454
|
74,628,321
|
87,392,775
|
14.6
|
80,000
|
90,000
|
6,330
|
41,510,052
|
12,996,014
|
74,152,710
|
87,148,724
|
14.9
|
90,000
|
100,000
|
4,897
|
38,251,287
|
12,508,260
|
70,817,423
|
83,325,683
|
15.0
|
Over
|
100,000
|
24,586
|
630,019,771
|
243,535,147
|
1,362,193,618
|
1,605,728,766
|
15.2
|
Totals
|
|
102,896
|
936,662,500
|
330,986,892
|
1,789,415,659
|
2,120,402,551
|
15.6
|
*"Gross tax" means the tax that would be due before relief is allowed for retirement annuity deductions.
Average Industrial Wage is €32,730.
The figures do not include contributions made by employees through employers' payroll systems and in respectof which tax relief is provided on the net pay basis. Information on such contributions is not captured in such a way as to make it possible to provide disaggregated figures.
Personal Retirement Savings Accounts — by range of Gross Income.
Range of gross income
|
Totals
|
|
|
|
|
From
|
To
|
Number of cases
|
Amount of deduction
|
Reduction in tax
|
Tax due for payment
|
Gross Tax*
|
Reduction in tax as % of Gross Tax
|
€
|
€
|
|
€
|
€
|
€
|
€
|
%
|
—
|
10,000
|
150
|
230,848
|
1,818
|
165
|
1,983
|
91.7
|
10,000
|
20,000
|
790
|
1,519,146
|
224,686
|
152,616
|
377,302
|
59.6
|
20,000
|
30,000
|
2,240
|
4,615,210
|
879,802
|
2,171,028
|
3,050,830
|
28.8
|
30,000
|
32,730
|
724
|
1,688,295
|
329,412
|
1,262,871
|
1,592,283
|
20.7
|
32,730
|
40,000
|
1,934
|
5,089,074
|
1,326,500
|
4,880,218
|
6,206,718
|
21.4
|
40,000
|
50,000
|
2,193
|
7,066,857
|
2,258,955
|
9,097,529
|
11,356,484
|
19.9
|
50,000
|
60,000
|
1,798
|
6,614,692
|
2,198,980
|
10,841,069
|
13,040,049
|
16.9
|
60,000
|
70,000
|
1,503
|
6,798,996
|
2,111,219
|
11,647,236
|
13,758,455
|
15.3
|
70,000
|
80,000
|
1,170
|
6,200,782
|
2,219,156
|
11,752,273
|
13,971,429
|
15.9
|
80,000
|
90,000
|
912
|
5,625,655
|
2,193,256
|
11,821,124
|
14,014,380
|
15.7
|
90,000
|
100,000
|
615
|
4,705,744
|
1,900,412
|
9,609,226
|
11,509,639
|
16.5
|
Over
|
100,000
|
2,621
|
42,381,897
|
17,300,020
|
121,388,445
|
138,688,466
|
12.5
|
Totals
|
|
16,650
|
92,537,196
|
32,944,217
|
194,623,801
|
227,568,018
|
14.5
|
*"Gross tax" means the tax that would be due before relief is allowed for PRSA deductions.
Average Industrial Wage is €32,730.
The figures do not include contributions made by employees through employers' payroll systems and inrespect of which tax relief is provided on the net pay basis. Information on such contributions is not captured in such a way as to make it possible to provide disaggregated figures.