I propose to take Questions Nos. 91 to 93, inclusive, together.
Section 473A of the Taxes Consolidation Act 1997 provides for income tax relief in respect of qualifying tuition fees paid by an individual for a third level education course, subject to the terms and conditions set out in that section. The relief is granted at the standard rate of income tax (currently 20%), where an individual pays qualifying fees for an approved course, whether on his or her own behalf, or on behalf of another individual. Fees which are met from any other source, from a grant or scholarship fro example, are not allowable. In addition, examination fees, administration fees and registration fees do not qualify for relief.
The maximum amount of fees that can qualify for the relief is €7,000 per course. However, an amount must be disregarded from each claim, whether the claim is in respect of one or more students. “Qualifying fees” for the purposes of the relief mean tuition fees in respect of an approved course, at an approved college, reduced by the amount of the "student contribution". The disregarded "student contribution" amount is currently €3,000 in the case of a full-time course and €1,500 in the case of a part-time course, and it applies to all third level courses. This means the first €3,000 or €1,500, as appropriate, of all fees claimed by an individual taxpayer does not attract tax relief. As a claim may relate to one or more students, generally claimants will get full tax relief on the tuition fees for each of the second and subsequent students in their claim.
I am informed by Revenue that it is not possible to identify the number of courses per claimant, or the breakdown between full and part time courses, from the available data in relation to the disregard for third-level tuition fees. It is therefore not possible to provide an estimate of the tax cost associated with changes to the disregard amount, as outlined by the Deputy.
In relation to the estimated cost of increasing the maximum benefit from €7,000 to €10,000, €15,000 and €20,000; it is not possible to estimate such costs as it would depend on variables such as the amounts claimed and the numbers in respect of which claims are made.
Finally, regarding allowing the third-level tuition fees relief to be claimed at the higher rate of tax and on the assumption that the Deputy is referring to allowing the relief on third level tuition fees to be claimed at the individual’s marginal rate of tax; Revenue advise that this change has an estimated cost of €8 million. This does not account for any changes in taxpayer behaviour associated with the increased rate of relief. It is also the case that equity issues would arise in the event of such a change taking place.