Written Answers Nos. 115-130
115. Deputy Pearse Doherty asked the Minister for Finance the number of instances in the past 12 months when the National Asset Management Agency has rejected an offer for assets under his control which, firstly, originated from a party the sale to whom the NAMA Act proscribes and secondly. was higher than the price eventually settled on by NAMA; if he will quantify the overall loss to NAMA arising from any such rejections. [40306/12]
Amharc ar fhreagraProspective purchasers of assets controlled by NAMA debtors and receivers are required to sign a declaration under Section 172 of the Act confirming that they are not a connected party within the meaning of that section and of the NAMA Board’s Guidance Note on the Disposal of Real Estate Assets by NAMA Debtors and Insolvency Office Holders which is published on NAMA's website. As this declaration precedes the evaluation and possible approval of any potential bids relating to the sale of assets under the control of NAMA debtors and receivers, the issue raised in the Deputy’s question does not arise.
116. Deputy Pearse Doherty asked the Minister for Finance further to a report in a Sunday newspaper that the National Asset Management Agency has agreed a substantial debt write-down on a loan that was made to a consortium of two companies developing Greystones Harbour, County Wicklow, if the loan in question was in default of any of its covenants including loan-to-value covenants, and if so, the basis on which NAMA agreed to any debt write-down arrangement with one party to the consortium; and the way in which such arrangement sits with section 172 of the NAMA Act [40307/12]
Amharc ar fhreagraI am advised that, under Sections 99 and 202 of the NAMA Act 2002 and the normal rules of banking confidentiality, NAMA is precluded from disclosing the details of transactions involving debtors. I am also advised that the media report which has prompted the Deputy’s question is inaccurate.
117. Deputy Thomas P. Broughan asked the Minister for Finance in view of the ongoing concerns regarding unfair competition for small and medium enterprises from the black economy; if he will consider further measures to ensure that small companies are not undercut by alleged unfair operations by persons in the black economy; and if he will make a statement on the matter. [40459/12]
Amharc ar fhreagraI am advised by the Revenue Commissioners that their tax compliance programmes are under constant review to ensure that they are focussed on the areas of greatest risk, including risks from the shadow economy. There is no doubt that shadow/hidden economy activity creates distortions in the economy and competitive disadvantages for compliant businesses. For these reasons, Revenue focuses on deterring shadow/hidden economy activity and non-compliance through its audit and investigation programmes based on risk analysis, use of Revenue powers and their intelligence and information systems. Revenue tackles the problem of the shadow economy through its range of compliance and audit interventions including through targeted special projects. Case interventions are undertaken based on Revenue’s assessment of compliance risks, the level of those risks and other relevant information available. Revenue is using a wide range of methodologies to identify those operating in the shadow economy and is deploying the full range of compliance interventions. Activities can include covert surveillance, cold calls to businesses and venues as well as pre arranged aspect queries on specific items. This work is continuing.
The Revenue Commissioner’s approach to the shadow economy is underpinned by close consultation and cooperation with the Department of Social Protection. The primary objective of these activities is to uncover either non-declaration or under declaration of income and/or fraudulent DSP claims.
The Deputy will be aware of the continuing strengthening of legislation to provide for a robust framework within which the Revenue Commissioners may tackle tax and duty evasion, including recent provisions relating to: -
- The making of returns of transactions by merchant acquirers, and other payment settlement entities, to the Revenue Commissioners.
- The more effective investigation of white-collar crime.
Further provisions included a comprehensive package of measures in relation to Excise (Oils) including, requirement for separate licences for auto-fuel traders and marked fuel traders, requirement to have a separate licence for every premises or place at which the fuel concerned is dealt in, and a requirement that a licence must be clearly displayed at the premises or place.
Revenue’s tobacco strategy, “Strategy On Combating the Illicit Tobacco Trade (2011- 2013)” was published on the Revenue website in June 2011. This three-year strategy is underpinned by annual action plans.
The strategic level plans include taking steps to ensure that the legitimate trade remains compliant, delivering more effective and visible interventions through enhanced capability and better deployment of Revenue resources. The strategy also include further development of cooperation and intelligence sharing at national and international level, together with a commitment to prosecute all serious cases of tobacco tax evasion and a focus, in partnership with other Government agencies, on reducing the demand for contraband tobacco.
During 2011 Revenue’s Customs Service seized a total of 109 million cigarettes in 10,581 seizures. Commercial quantities in maritime freight traffic accounted for 76.4 million cigarettes. Revenue also seized 11,158 kg of tobacco in 2011. In six particular operations, over 19 million cigarettes, 1,344 kg tobacco and 49 vehicles were seized.
Regulations were also introduced in 2011 requiring Government Departments and State Bodies to supply details of payments made to the Revenue Commissioners. I am advised by the Revenue Commissioners that this data is matched to the Revenue records of the various recipients, and is used to profile risk. Similar matching is also carried out using other third party data received by the Revenue Commissioners.
Revenue has a prioritised focus on those sectors that traditionally have been susceptible to shadow activity such as cash businesses. All possible sources of information, including following up on services advertised on TV, radio, local newspapers, Internet, special interest publications are used by Revenue.
The Revenue Commissioners have advised me that in order to inform the approaches they are taking, and help determine where resources may best be deployed, they continue to engage in meetings with trade and representative bodies. The Hidden Economy Monitoring Group provides a forum for the exchange of views on the effectiveness of measures introduced in combating the hidden economy. This group, which is chaired by Revenue, includes representatives from employer and business organisations, trade unions and other Government Departments and agencies. Regional hidden economy liaison groups have been established to facilitate greater local interaction and more immediate responses to insights and issues that may be highlighted.
Revenue investigations have detected the use of computer programmes or electronic devices to alter or conceal sales records. To counteract these risks, legislation was enacted in 2011 providing penalties for the possession, use or supply of automated sales suppression devices known as "zappers" for the purpose of evading tax.
Streetscape programmes, in which every cash business in an area is visited, without prior announcement, have been carried out. While the main focus of real time activity is on businesses that use cash registers, all sectors that have cash receipts are monitored. This includes professionals such as doctors, veterinary surgeons, etc. These operations have also resulted in the registration of previously unregistered persons. 803 such registrations were recorded in the period from January to the end of April 2012.
The results from all the various projects are reflected in the general audit and compliance results from audits, assurance checks, site visits etc. which are published in the Revenue Annual Report.
118. Deputy Michael Healy-Rae asked the Minister for Finance his views on correspondence (details supplied) regarding the Betting (Amendment) Bill 2012; and if he will make a statement on the matter. [40466/12]
Amharc ar fhreagraIt was announced in Budget 2011 that the necessary arrangements are being made to ensure that bets placed on the internet by domestic punters are subject to the same level of betting duty as applies to high street betting shops. This will serve to broaden the tax base and increase betting duty receipts. The Finance Act 2011 provides for the taxation of bets that remote bookmakers enter into with persons in the State. This means, for example, that a business which engages in online bookmaking and which accepts bets from people in this country will be liable for betting duty on those bets, irrespective of where that business is based. The existing betting duty (1%) will be applied to such bets. The Finance Act also provides for the taxation of Betting Exchanges under the new arrangements; however the calculation of the tax will take account of their particular business model, in other words a 15% tax on the commission charged. In addition, excise duties are being applied to the granting and renewal of remote bookmakers’ and remote betting intermediaries’ licences.
The Betting (Amendment) Bill, which was published in July, will establish the regulatory framework for these licences. The tax changes provided for in the Finance Act can only be implemented once the Betting (Amendment) Bill is enacted.
I am hopeful that by including the high-growth area of the betting sector the tax base from betting will be boosted significantly.
In addition, this measure conveys a positive signal to international betting operations that have expressed an interest in or have already invested in Ireland. A location with an appropriate licensing regime coupled with relatively low taxes provides real investment and employment opportunities in this sector, which ultimately can potentially be beneficial to all concerned. Clearly any betting operations which do choose to invest in Ireland would be subject to all other aspects of the taxation regime such as corporation tax, income tax, VAT etc.
119. Deputy Pearse Doherty asked the Minister for Finance the current marginal rate of tax on income earned of more than €100,000 per annum; and the way this rate compares internationally. [40474/12]
Amharc ar fhreagraAs the Deputy is aware, the marginal tax rate is described as the tax rate that applies to the last euro of the tax base. The current marginal tax rate on income earned over €100,000 for full PRSI employees is 52% and for self assessed income is 55%. The components of the marginal tax rate are provided in table below:
|
Marginal tax rate components |
PAYE employee full PRSI earning > €100,000 |
Self assessed income > €100,000 |
|
Income Tax |
41% |
41% |
|
PRSI |
4% |
4% |
|
Universal Social Charge |
7% |
10% |
|
52% |
55% |
The Deputy may wish to note that the OECD is the best source availability for the purposes of international comparisons. It publishes statistics on the “Taxation of Wage Income” which includes an international comparison of the top marginal tax rates which can be found on their website using the following link: http://www.oecd.org/tax/taxpolicyanalysis/2506453.xls
The OECD also has statistics available on their website on top marginal tax rates in respect of 2011 and previous years. These represent the marginal tax rates that are applicable on the average wage in OECD countries. Ireland is ranked joint 10th highest top marginal tax rate at this level of income. International comparison of top marginal tax rates at other income levels is not available on the OECD’s website.
120. Deputy Pearse Doherty asked the Minister for Finance the amount in carry-over from full-year measures in Budget 2012, which will be included in Budget 2013; if he will provide a breakdown in this amount between expenditure savings and revenue. [40475/12]
Amharc ar fhreagraA table giving details of the consolidation required to achieve the General Government deficit targets as set out in the EU/IMF Programme was included in the Medium-Term Fiscal Statement (MTFS) last November. In line with the figures presented in the MTFS, the Government is planning a €3.5 billion adjustment in Budget 2013, consisting of €2.25 billion in expenditure adjustments and €1.25 billion of revenue raising measures. The revenue raising measures will consist of €0.95 billion in new measures and €0.3 billion of a carry-forward from 2012.
As the Deputy is aware, my ministerial colleague Minister for Public Expenditure and Reform Brendan Howlin TD has primary responsibility for expenditure issues. In relation to expenditure, the MTFS shows €2.25 billion in spending adjustments will be part of the budgetary arithmetic for Budget 2013, €1.7 billion of which is related to current expenditure and €0.55 billion related to capital expenditure. I understand that the ongoing impact of policy measures introduced in the Comprehensive Expenditure Report 2012-2014 (CER) is being assessed as part of the ongoing planning to meet the agreed Departmental ceilings for 2013.
121. Deputy Pearse Doherty asked the Minister for Finance the saving that would be made to the Exchequer if the maximum tax-free lump sum available at retirement was reduced from €200,000 to €150,000 [40482/12]
Amharc ar fhreagraThe following arrangements currently apply to retirement lump sums paid under pension arrangements approved by the Revenue Commissioners. Lump sum amounts up to €200,000 are paid free of tax. They are also paid free of USC. The portion of a lump sum between €200,001 and €575,000 is taxed on a ring-fenced basis at 20%. This means that no tax credits or other tax reliefs can be set against this portion of the lump sum. No USC is chargeable. Any amount of a lump sum in excess of €575,000 is taxed at the individual’s marginal rate of tax (credits and other tax reliefs are available). In this instance, USC is chargeable on the excess. These amounts are lifetime amounts with prior lump sums aggregating with later lump sums. I assume from the Deputy’s question that he is proposing that retirement lump sums in excess of €150,000 be taxed as outlined above. As there is no general requirement for data on the number of persons who are receiving payments of retirement lump sums of less than €200,000 to be returned to my Department or to the Revenue Commissioners, I am not in a position to provide definitive figures on the Exchequer impact of reducing the tax-free retirement lump sum amount from €200,000 to €150,000.
As an exercise that might provide some indication of the scale of the savings involved, it is estimated that just under 2,500 individuals in the public service would be on salaries of over €100,000 and less than €133,500 which, under existing pension scheme arrangements generally applying across the public service, would deliver retirement lump sums of between €150,000 and €200,000. If it is assumed that these individuals would retire in line with retirement trends from the public service in a normal year (about 2.5%), then the additional tax yield from taxing lump sums in excess of €150,000 at 20% could be less than €0.5 m in a full year.
I have no data on which to provide a similar estimate in relation to the private sector. I should point out, however, that one significant difference between public sector and private sector pension schemes is that private sector schemes invariably allow scheme members the option of commuting part of their pension fund for a tax-free lump sum. This option is not available to members of public sector schemes. Depending on the impact of any tax charge on retirement lump sums, the option to commute part of a pension fund may no longer be exercised by private sector pension scheme members or may be exercised in a manner that reduces the value of the lump sum taken to minimise or avoid any immediate tax charge.
122. Deputy Paudie Coffey asked the Minister for Finance the plans he has to review the film industry's tax regime, an industry that historically has been extremely successful in attracting high profile films and TV productions; if his attention has been drawn to the fact that the Government in the United Kingdom is due to review their tax regime in respect of the film industry which could have a serious competitive impact on the film industry here; and if he will make a statement on the matter. [40483/12]
Amharc ar fhreagraThe Finance Act 2011 provided for an extension of the film relief scheme to the end of 2015. In that context I believe it is now appropriate to review the scheme in the context of making timely decisions regarding the future of the scheme after 2015. the 2009 Commission on Taxation recommended that film relief should be the subject of regular review. It was last reviewed in 2007. The terms of reference for this Review, which is currently underway, involved the evaluation of the tax expenditure scheme in broad socio-economic and fiscal terms, and are summarised as follows:
- Examination of the costs and benefits of the existing scheme, taking into account displacement/deadweight impacts, and the interplay between this and other tax reliefs;
- The identification of value for money of the scheme to the economy overall;
- Examination of the international competitiveness context within which the sector operates; and
- Recommendations, where and if necessary, for changes that could be made to enhance / maximise the value for money to the tax payer and sustainable job creation and taking digital production and technological advances into account.
Part of the work of the Review also involves an assessment of incentives in a number of competitor jurisdictions including the UK.
Twenty one responses were received following a public consultation process , which ended on 31 August last. These responses can be viewed on my Department’s tax policy website (http://taxpolicy.gov.ie/ ).
My Department is currently examining the responses. I would envisage that the results of the review will be published in due course.
123. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which tenants of State owned property have request of rent reviews that may be affected by upward only revision; the number of such cases if known; the extent to which it might be intended to address the issue in view of the on-going trading difficulties experienced by the commercial or retailing sectors; if a particular ameliorating solution has been found in such instances; and if he will make a statement on the matter. [40498/12]
Amharc ar fhreagraIn response to the Deputy’s question the Office of Public Works which comes under the aegis of Minister for Public Expenditure and Reform is involved in most purchases and leasing of buildings by the State including buildings leased by my Department.
124. Deputy Jack Wall asked the Minister for Finance the number of applications made to the Financial Ombudsman by bank customers relating to banking issues in each of the past three years; and if he will make a statement on the matter. [40527/12]
Amharc ar fhreagra125. Deputy Jack Wall asked the Minister for Finance the number of applications made to the Financial Ombudsman and the number of which the Financial Ombudsman recommended should enter into mediation with their banks; and if he will make a statement on the matter. [40532/12]
Amharc ar fhreagra126. Deputy Jack Wall asked the Minister for Finance the number of requests for mediation refused by the banks when customers had referred their banking issues to the Financial Ombudsman [40535/12]
Amharc ar fhreagraI propose to take Questions Nos. 124 to 126, inclusive, together.
Firstly, I must point out that the Financial Services Ombudsman is independent in the carrying out of his statutory functions. It would not be appropriate for me to comment on how he performs those functions.
The Financial Services Ombudsman's Bureau has informed me that his office has received the following number of complaints from consumers in relation to banking issues:
|
Year |
Total Number of Complaints |
Number of Complaints in relation to Banks |
|
2009 |
7,619 |
2,461 |
|
2010 |
7,230 |
2,381 |
|
2011 |
7,287 |
2,694 |
|
2012 (to 21 September 2012) |
5,767 |
2,296 |
The number of complaints received by the FSO in relation to the banks has increased each year including to date in 2012.
Mediation, while an integral part of the Financial Services Ombudsman’s process, is an informal method of trying to resolve a dispute. It is offered to each party after the internal complaints procedure of a financial services provider (e.g. Bank) has been exhausted by the complainant. There is no obligation on either party to accept the offer of mediation. The Financial Services Ombudsman Bureau has advised me that, in the majority of cases, it is not taken up by either party. The Bureau does not keep a record of refusals by banks to proceed to mediation.
Since the Financial Services Ombudsman commenced processing complaints in 2005, mediation was offered in each case. In 2011, 15 cases were referred to full mediation i.e. where the two parties met with a mediator. I have also been advised that a total of only 23 cases were ever resolved through mediation. If mediation is not taken up by either party or is unsuccessful, the file is sent for investigation and ultimately, adjudication by the Financial Services Ombudsman.
127. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 283 of 18 September 2012, if he will confirm the cost of the acquisition of Irish Nationwide by IBRC. [40581/12]
Amharc ar fhreagraI have been advised that on the 1st July 2011, under the INBS Transfer Order, all of the assets and liabilities of INBS, with certain exceptions, transferred to IBRC. On that date the Group’s net assets increased by €638m. No cash consideration changed hands. However the net assets of INBS included cash and cash equivalents of €128m.
128. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 283 of 18 September 2012, if he will provide a breakdown of IBRC's balance sheet for 2011. [40582/12]
Amharc ar fhreagraA breakdown of IBRC’s balance sheet is available on page 34 of the IBRC Annual Report and Accounts 2011 which can be accessed at http://www.ibrc.ie/About_us/Financial_information/Annual_Report/
129. Deputy Pearse Doherty asked the Minister for Finance further to Parliamentary Question No. 283 of 18 September 2012, if he will clarify the position regarding the interest on the promissory notes, providing a breakdown of the interest which will be submitted by IBRC or if the interest will be passed on to the Central Bank of Ireland; if he will provide a breakdown of the amount and the way that this will happen; and if any of the interest will eventually be returned to the State. [40583/12]
Amharc ar fhreagraThe Bank, including the former INBS, has been provided with promissory notes to the value of €30.6bn consisting of a number of tranches. Each tranche pays a market based fixed rate of interest which is set on the date of issue and is appropriate to the maturity date of the tranche. The promissory notes pay 10% of the initial principal amount of each tranche annually. Interest to be earned by IBRC on the promissory notes will, over their contractual life, total €16.8 billion.(table attached) As the Deputy is aware IBRC provides details of sale and repurchase agreements with Central Banks in their published accounts. This figure amounts to C €42.3bn as at 30 June 2012 (Interim Accounts). However, as I have already indicated that while there is an implicit link between the current repayment schedule on the Promissory Note and ELA there is no specific repayment schedule, as such, in relation to ELA.
Finally, while not issuing a revised projection the bank remains of the view that there will be a small return to the State at full resolution, given the assumptions currently being used.
Set out in the table is a detailed aggregated schedule of capital repayments and interest payments on the promissory notes:
|
€bn |
Total interest Paid: A |
Total Capital Reduction: B |
Repayments: A + B |
- |
|
31/03/2011 |
0.55 |
2.51 |
3.06 |
- |
|
31/03/2012 |
- |
3.06 |
3.06 |
** |
|
31/03/2013 |
0.49 |
2.57 |
3.06 |
- |
|
31/03/2014 |
1.84 |
1.22 |
3.06 |
- |
|
31/03/2015 |
1.75 |
1.31 |
3.06 |
- |
|
31/03/2016 |
1.65 |
1.41 |
3.06 |
- |
|
31/03/2017 |
1.55 |
1.51 |
3.06 |
- |
|
31/03/2018 |
1.44 |
1.62 |
3.06 |
- |
|
31/03/2019 |
1.32 |
1.74 |
3.06 |
- |
|
31/03/2020 |
1.19 |
1.87 |
3.06 |
- |
|
31/03/2021 |
1.06 |
2.00 |
3.06 |
- |
|
31/03/2022 |
0.91 |
2.15 |
3.06 |
- |
|
31/03/2023 |
0.75 |
2.31 |
3.06 |
- |
|
31/03/2024 |
0.57 |
1.52 |
2.09 |
- |
|
31/03/2025 |
0.45 |
0.47 |
0.91 |
- |
|
31/03/2026 |
0.39 |
0.52 |
0.91 |
- |
|
31/03/2027 |
0.33 |
0.58 |
0.91 |
- |
|
31/03/2028 |
0.26 |
0.65 |
0.91 |
- |
|
31/03/2029 |
0.19 |
0.73 |
0.91 |
- |
|
31/03/2030 |
0.10 |
0.81 |
0.91 |
- |
|
31/03/2031 |
0.01 |
0.05 |
0.05 |
- |
|
- |
16.8 |
30.6 |
47.4 |
- |
* These numbers may not tot exactly as a result of rounding
** The March 2012 repayment was settled with a long term Government bond.
130. Deputy Seán Kyne asked the Minister for Finance if consideration will be given, in view of the increased challenges a person with a disability faces to obtain employment, to the extension of the revenue job assist tax allowance into a more long term tax allowance which would support persons with a disability in employment; and if he will make a statement on the matter. [40631/12]
Amharc ar fhreagraSections 472A and 88A of the Taxes Consolidation Act 1997 provide for the Revenue Job Assist scheme, which allows qualifying employees, in addition to their normal tax credits, to claim certain income deductions, including additional deductions for qualifying children, for a three year period after taking up employment. The scheme also permits employers to take a double deduction for the salary of the employee when calculating profits for the purpose of taxation. This incentive applies in respect of individuals who have been unemployed for at least 12 months and are in receipt of a specified social protection payment or, who are in a category approved for the purposes of the scheme by the Minister for Social Protection with the consent of the Minister for Finance. Disability benefit and disability allowance are both qualifying payments for the purposes of this scheme.
The scheme is designed to help the long-term unemployed get back into paid employment by helping to ensure that the income earned from that employment is greater than could be obtained by staying on welfare payments. The additional income deductions are gradually reduced over the three year period.
To amend the scheme such that the disabled would retain access to the additional income deductions in perpetuity would go beyond the objectives of the scheme.
I would point out that if an individual is in receipt of certain disability payments, they may be allowed to do work or training and keep their payment or part-payment on the grounds that it is considered rehabilitative or therapeutic.
People with disabilities are, in general, liable to pay tax on their incomes in the same way as everyone else. The tax system does however provide additional tax credits and exempts certain incomes from tax for persons with disabilities of a permanent nature.
Anyone who is permanently incapacitated either physically or mentally, where he or she is unable to maintain himself or herself, may be able to claim one or more of the additional tax credits available. In addition, parents/guardians and persons who care for dependent relatives may also qualify for some of the relevant tax credits, which are set out below:
Incapacitated Child Tax Credit - can be claimed by a parent in respect of a child who is permanently incapacitated either physically or mentally from maintaining himself or herself and had become so before reaching 21 years of age or finishing full-time education or full-time training for a trade or profession. (Leaflet No. IT18 - Incapacitated Child Tax Credit )
Note: One Parent Family Tax Credit may also be claimed by a single parent (whether widowed, separated, deserted, single or divorced) with an incapacitated child. This credit can be claimed regardless of whether you have already claimed the incapacitated child tax credit. (Leaflet No. IT9 - One-Parent Family Tax Credit)
Blind Person’s Tax Credit -is due to a person who is regarded as blind. If two people, who are regarded as blind, are married, they can each qualify for this tax credit. (Leaflet No. IT35 - Blind Persons’ Tax Credits & Reliefs)
Employed person taking care of an Incapacitated individual - an incapacitated person who employs someone to care for himself, herself or a relative can claim for the cost of the employment. (Leaflet No. IT47 - Employed person taking care of an Incapacitated individual)
Covenants - relief is available in respect of a properly drawn up Deed of Covenant in favour of a permanently incapacitated individual. However, parents cannot covenant to a permanently incapacitated minor child i.e. under 18 years of age and unmarried. (Leaflet No. IT7 - Covenants to Individuals
Medical Expenses Relief - is available in respect of un-reimbursed nursing home, doctors’, hospital and other health expenses. (Leaflet No. IT6 - Health / Medical Expenses Relief)
The following sources of income and gains are exempt from Income Tax and Capital Gains Tax for people with incapacities, provided they are included in their annual return of income:
Deposit Interest Retention Tax (DIRT) - if you are permanently incapacitated or over 65 years of age you could be entitled to a refund of DIRT deducted, provided your gross income is exempt from tax or is marginally over the exemption limit. (Leaflet No. IT8 - Tax Exemption & Marginal Relief)
Leasing of Farmland - rent from farmland can be exempt if you are permanently incapacitated from carrying on the trade, provided certain conditions are met.
Payments to or in respect of Thalidomide Persons Payments made by the Department of Health and Children or the Hilfswerk Für Behinderte Kinder Foundation are exempt from income tax. Also exempt is any income arising from the investment of these payments, for example deposit interest, rental income, dividend income, etc. With effect from 1 January 2004, any gains arising from the disposal of assets acquired with such payments or with such an investment is exempt from Capital Gains Tax.
Personal Injury Compensation Payments Certain compensation payments received are exempt from Income Tax. Also exempt is income arising from the investment of such payments, and with effect from 1 January 2004, gains arising on the disposal of assets acquired with such payments or the investment of such payments, provided the aggregate of the gains and income exceeds 50% of the aggregate of the person’s total income and gains. The injury must have given rise to a permanent and total mental or physical incapacity which prevents the person from maintaining himself or herself. (Leaflet No. IT 13 - Personal Injury Compensation Payments)
Compensation payments made by the Hepatitis C and HIV Compensation Tribunal - are exempt from income tax. Also exempt is income arising from the investment of such payments and with effect from 1 January 2004, gains arising on the disposal of assets acquired with such payments, provided the aggregate of the gains and income exceeds 50% of the aggregate of the person’s total income and gains, if the individual is permanently and totally incapacitated from maintaining themselves as a result of the infection.
Lump Sums - can be exempt where paid by an employer because of injury or disability. Please see Information Leaflet IT21 - Lump Sum Payments on Redundancy/Retirement for further information.
