Richard Bruton (Dublin North Central, Fine Gael)
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Question 514: To ask the Minister for Finance his views on making arrangements that where a couple are jointly assessed, tax relief can be provided for pension contributions of a spouse who drops out of the work force temporarily to care for children in order that the principle which is already established in the social welfare code that such persons should not suffer any diminution of their pension rights as a result of periods of absence for child caring would also apply in the tax code. [43919/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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An individual may, subject to certain limitations and restrictions, receive tax relief at his or her marginal income tax rate for pension contributions made from:

(i) remuneration from his/her relevant office or employment to an occupational pension scheme; and

(ii) "relevant earnings" to an non-occupational pension scheme.

"Relevant earnings" means income from a non-pensionable office or employment or from carrying on a trade or profession but does not include unearned income such as rental income or deposit interest.

Where only one spouse is working but both spouses are contributing to pension schemes, the working spouse cannot claim tax relief in respect of the non-working spouse's pension contributions for a number of reasons—

(a) for those in occupational pensions schemes, the tax relief on an individual's pension contributions is due only against the remuneration for that individual's office or employment; and

(b) for those not in occupational pensions schemes, the tax relief for pension contributions is granted only by reference to an individual's relevant earnings and the legislation provides that an individual's relevant earnings cannot be treated as including the relevant earnings of his/her spouse for this purpose even where the couple are jointly assessed for tax purposes.

Where an individual contributes to a pension and that individual would, but for the insufficiency of his/her relevant earnings or employment remuneration in a particular tax year, be entitled to tax relief in respect of such contributions in that year, the individual concerned may seek tax relief on those pension contributions in a later tax year for which he/she has relevant earnings or employment remuneration (subject, of course, to the normal age-related and overall earnings limits for tax relief in respect of pension contributions).

Many pension schemes provide for a pension, not alone for the holder, but also for the surviving spouse should the holder predecease the spouse. Pension contributions to a pension scheme that provides for widows/widowers and orphans also qualify for tax relief in the normal manner.

The purpose of funding pension arrangements is to enable an individual to provide an adequate income in retirement for him or herself and family dependants relative to his or her pre-retirement income. The current arrangements for providing tax relief on pension contributions are supportive of this aim and are both generous and flexible. I have no plans to amend them in the manner suggested by the Deputy.

Gay Mitchell (Dublin South Central, Fine Gael)
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Question 515: To ask the Minister for Finance if the Revenue Commissioners will review the application of a person (details supplied) in Dublin 6W for top slicing relief; if they will allow the claim in all the circumstances; and if he will make a statement on the matter. [43920/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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The Revenue Commissioners have informed me that the taxpayer's claim for top slicing relief was made outside the time limit of four years as laid down in the Finance Act 2003.

As the Deputy will be aware the Finance Act 2003 introduced a new time limit for claiming tax repayments. Where a claim is made after 1 January 2005 the overall time limit is reduced from 10 to 4 years. The change was announced in the Budget speech in December 2002 and the measure received a considerable amount of print and broadcast media publicity at that time.

Reminders of this change were advertised by Revenue in the national press in October and November 2004. In addition to the Revenue advertisements there was considerable comment about this change including a number of newspaper articles, towards the end 2004.

Unfortunately the taxpayer's claim for top slicing relief for the year 2001 was made well outside the four year limit from the end of the year of assessment. To be within the time limit, the claim should have been made before 31 December 2005, whereas in fact the claim was first made in October 2006. It is not therefore possible to allow a claim for relief at this stage.

Finian McGrath (Dublin North Central, Independent)
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Question 516: To ask the Minister for Finance the position regarding stamp duty and inheritance tax especially in relation to a parent leaving their house to their two children. [43944/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am advised by the Revenue Commissioners that a charge to stamp duty does not arise where the house passes to the children by inheritance on the death of the parent.

Whether inheritance tax arises when a parent leaves a house to his/her children depends on the circumstances. The Finance Act 2000 introduced a package of measures specifically designed to reduce the impact of inheritance tax for certain dwelling houses. The purpose of this exemption was to benefit individuals who had been living in a house for a period prior to taking the benefit, either by way of inheritance. The main conditions attaching to the exemption are that the beneficiary of the dwelling house must have resided in the house for a minimum of 3 years prior to the inheritance and must not have an interest in any other dwelling house. Also, the recipient or recipients must continue to occupy that dwelling house as his/her only or main residence for a period of 6 years commencing on the date of the inheritance. This exemption ensures that what may be the family home for many people will not be the subject of inheritance tax when it is inherited.

If this relief does not apply in the case in question, the children can avail of the "Group thresholds". The relationship between the person who provided the inheritance (i.e. the disponer) and the person who received the inheritance (i.e. the beneficiary), determines the maximum tax-free threshold — known as the "Group threshold". There are three Group thresholds based on the relationship of the beneficiary to the disponer and these thresholds are indexed annually by reference to the Consumer Price Index. The indexed Group threshold applying to an inheritance received by a child from their parents is the Group A threshold. In 2006 this threshold was €478,155 and for 2007 the threshold is €496,824. Each child is separately entitled to its own Group A threshold.

Any other inheritances that might have been received by the child from the parents since 5 December 1991 will also be taken into account on each occasion when applying the threshold for the purposes of calculating the inheritance tax. If the total value of all inheritances received by the child since this date from the parents is above the threshold figure then a 20% rate of inheritance tax will apply on the excess over the threshold figure.

Joan Burton (Dublin West, Labour)
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Question 517: To ask the Minister for Finance the position on VAT and income tax registration of sellers of equipment through casual arrangements such as fairs and on a door-to-door basis; the level of such activity that took place in 2006; the amounts of VAT and income tax paid by such sellers; if there has been an audit of this sector during the past five years; and if he will make a statement on the matter. [43961/06]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am advised by the Revenue Commissioners that, in relation to sellers of equipment through casual arrangements such as fairs and on a door to door basis, no separate registration provisions exist and the normal arrangements with regard to VAT and Income Tax registration apply. I am also advised that the Revenue Commissioners have engaged on a continuous basis with the regular participants at fairs and exhibitions to advise them of their compliance obligations. Accordingly, many such traders are registered for VAT and remit through the normal return process.

Because 'casual traders' are not recorded separately in Revenue's tax register, there is no specific information available on the level of such activity that took place in 2006, nor are there statistics available on the amounts of VAT and Income Tax paid by such sellers.

Revenue manages the risk presented by 'casual traders' through periodic compliance testing of the registration status and remittance position of those operating at markets etc. Revenue staff regularly visit Exhibitions, Fairs, Open-air markets, Seasonal Street Traders, Music Concerts and major sporting events to ensure that participants and traders are tax compliant. From time to time, joint compliance operations are carried out by Revenue, An Garda Síochána and the Irish National Federation Against Copyright Theft (INFACT). Revenue also routinely obtain details of casual trading licences issued by local authorities for any follow up action required.

While there has been no general audit of this sector as a whole during the past five years, audits would have taken place on individual traders where Revenue's Risk Profiling indicated a need for a specific intervention. Where Revenue receive complaints in relation to the operations in this sector, these are followed up as required.