Alan Farrell
Ceist:89 Deputy Alan Farrell asked the Minister for Finance the position regarding tax and other incentives given to the horse racing and breeding industry; and if he will make a statement on the matter. [26849/12]
Amharc ar fhreagraWednesday, 6 June 2012
Ceisteanna (99)
Freagraí scríofa
I am informed by the Revenue Commissioners that there are no specific statutory tax incentives for the horse racing and breeding industry.
Before 1 August 2008, profits or gains from stallion fees were exempt from income tax and corporation tax, although all other profits from horse-breeding, such as the sale of yearlings, were always taxable. The exemption no longer applies to profits or gains arising on or after that date.
Since 1 August 2008, stallions are treated as stock in trade which means that income from stud fees and profits or gains on the sale of the stallions are fully taxable in the hands of both corporate and individual owners.
A write-off over 4 years of the cost of a stallion is allowed as a deduction for tax purposes in computing income from stallion fees and profits or gains on the sale of stallions. This 4-year write-off period reflects the fact that some stallions have a short nomination life and also takes into account that the majority of stallions are unsuccessful at stud. The impact of the deduction on taxable profits during the write-off period is directly related to the success, or otherwise, of the stallion. Without this provision the cost of a stallion would, under normal rules, be allowed as a deduction upon its disposal or death.