I propose to take Questions Nos. 100 and 101 together.
These questions both relate to the carry forward of tax relief on pension contributions under the provisions of section 774(7)(d) Taxes Consolidation Act 1997; I propose taking them together.
I am informed by the Revenue Commissioners that section 774 of the Taxes Consolidation Act, 1997 provides tax relief for contributions by an employee to an occupational pension scheme against tax due in respect of the remuneration of the employment in relation to which the scheme is effected. In this regard, section 774(7)(a) provides that relief for ordinary annual contributions is given by way of a deduction in determining the employee's income tax liability under Schedule E for the year in which the contributions are paid.
Relief for an employee's ordinary annual contributions is normally provided by an employer under what is known as the net pay arrangement whereby the contributions are deducted from gross remuneration before tax under Schedule E is calculated. In the case of special contributions, relief is normally granted by way of a claim made by the taxpayer to Revenue after the end of the relevant tax year.
In any tax year, the amount of contributions on which relief can be granted to an employee is limited to an age-related percentage of the employee's remuneration from the office or employment in respect of which the contributions are paid (subject to an overall annual earnings cap, which currently stands at €115,000).
The age-related percentages are as follows:
|
Age
|
% of Remuneration
|
|
Under 30
|
15
|
|
30 to 39
|
20
|
|
40 to 49
|
25
|
|
50 to 54
|
30
|
|
55 to 59
|
35
|
|
60 or over
|
40
|
Where a person's contributions in a year exceed the amount on which relief can be granted (based on his or her age-related percentage limit or the overall earnings cap as appropriate), section 774(7)(d) provides that the unrelieved amount is carried forward and treated as a contribution made in a later year or years.
The carry forward of unrelieved contributions under section 774(7)(d) is provided for only in cases where an individual's pension contributions in a year exceed the amount for which relief can be granted in that year. It is not provided for in any other circumstances.
In relation to the specific questions the Deputy has posed regarding the number of instances where this relief was granted by way of carry forward or refunded to executives of State agencies during the period of their assignment abroad, data are not collected in respect of section 774(7)(d) in a manner which enables Revenue to isolate these claims or the amounts associated with this particular aspect of the relief.
Finally, if the Deputy's query concerns a particular individual then that individual may wish to contact his or her local Revenue office who should be able to assist in any queries they may have with regard to the operation of section 774(7)(d).
