Dáil Éireann Debate, Wednesday - 28 April 2021
265. Deputy Peter Burke asked the Minister for Finance if his Department will review the possibility of retrospective further tax relief on third level fees that can be accessed later than the calendar year in which the fees were paid, for example, as part of the remaining balance of a student loan; and if he will make a statement on the matter. [21298/21]
Amharc ar fhreagraSection 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 (including a postgraduate course), subject to the 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. Claimants who pay tuition fees in instalments can claim tax relief either in the tax year when the academic year commenced or the tax year when the instalment is paid.
“Qualifying fees” mean tuition fees in respect of an approved course at an approved college and includes what is referred to as the “student contribution”. No other fees e.g. administration fees, examination fees, capitation fees, qualify for tax relief. Tuition fees that are, or will be, met directly or indirectly by grant, scholarship, employer contribution or other means are deducted in arriving at the net qualifying fees. A claim for relief may be made in respect of a number of students. It should be noted that any claim for relief must be submitted within the 4-year time limit which applies to claiming tax reliefs.
The maximum amount of fees that can qualify for the relief is €7,000 per course per academic year. In accordance with the governing legislation, an amount must be disregarded, whether the claim is in respect of one or more students. The disregarded amount per claim is currently €3,000 in the case of a full-time course(s) and €1,500 for a part time course(s). One disregard amount applies to each claim.
Full details of the relief, including the conditions that apply, are set out on the Revenue website at www.revenue.ie/en/personal-tax-credits-reliefs-and-exemptions/education/tuition-fees-paid-for-third-level-education/index.aspx. Revenue advises that the simplest way for taxpayers to claim third level tuition fees and any other tax credit entitlements is by logging on to myAccount on the Revenue website at https://www.ros.ie/myaccount-eb/sign_in.html?execution=e1s1.
In terms of the question of retrospective tax relief, it should be noted that section 473A requires that fees are paid as a trigger for the relief and, as is generally the case with tax reliefs, the claimant must have suffered tax in the year of claim in order to avail of the relief.
More generally, as the Deputy will appreciate, I must be mindful of the public finances and the many demands on the Exchequer; tax reliefs, no matter how worthwhile in themselves, lead to a narrowing of the tax base. Under my Department's Tax Expenditure Guidelines, changes to measures should only be considered in circumstances where there is a demonstrable market failure and where a tax based incentive is more efficient than a direct expenditure intervention.
Finally, I would be reluctant to introduce further complexities to this particular tax support. However, if the Deputy has further information regarding the particular circumstances of an individual case, Revenue advises me that it will be happy to consider what relief may be due in that particular instance.
