Dáil Éireann Debate, Thursday - 15 May 2014
65. Deputy Brendan Griffin asked the Minister for Finance the savings anticipated in 2014 by changes to the rate of rebate available to charitable organisations in respect of donations from PAYE workers; his plans to review this matter; and if he will make a statement on the matter. [21979/14]
Amharc ar fhreagraAs the Deputy is aware, changes were made to the scheme of tax relief for donations to approved bodies in Finance Act 2013 as follows:
- Donations from all individual donors under the scheme are treated in the same manner, with the tax relief in all cases being repaid to the charity.
- A blended rate of relief of 31% applies to all taxpayers regardless of their marginal tax rate. All donations are grossed up as was previously done for donations from individuals within the PAYE collection system.
- The charitable donations scheme has been removed from the scope of the high earners' restriction in recognition of the fact that donors will no longer benefit from the tax relief associated with their donations.
- An annual donation limit of €1 million per individual, for which a refund of income tax can be claimed by approved bodies, has been applied.
These changes were made following a process of engagement between officials at the Department of Finance and the Revenue Commissioners with representatives of the charities sector from the Irish Charities Tax Reform Group (ICTR). The objectives of that process were threefold: (i) to simplify the operation of the regime, (ii) to reduce the administrative overheads on charities and on the Revenue Commissioners incurred in the operation of the scheme, and (iii) to ensure that any change would be Revenue neutral from the Exchequer perspective. It is worth noting that PAYE-only taxpayers were never able to claim tax relief for donations made. As the changes were designed to be Revenue neutral, there are no anticipated savings as a result of these changes in 2014.
