Michael Noonan (Limerick City, Fine Gael)
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The general position is that these special provisions for sportspersons are related to the short period during which a sportsperson is active. The reliefs available would not apply to taxpayers in general who have a full working career of 35 or 40 years. According to the note provided to me, the sportsperson's relief is based on ten previous years of earnings, during which the sportsperson will have been paying into a pension. Sportsperson's relief essentially ring-fences any tax relief claimed on contributions paid to retirement annuity contracts, RACs, by professional sportspeople from a later reduction in income arising from a claim under this relief. However, this is not the case for personal retirement savings accounts, PRSAs. As a result, a sportsperson who takes out a PRSA could be disadvantaged over a sportsperson who takes out a retirement annuity contract.

The amendment provides that PRSAs are afforded equal treatment with retirement annuity contracts such that any relief awarded for contributions to a PRSA will not affect the amount of sportsperson's relief available to the sportsperson. As a result of this legislation, the relief received for pension payments is excluded when calculating the relief an individual receives under the sportsperson's scheme. If this relief was not excluded, the person would receive much less relief. As such, the measure provides for equalisation of RACs with PRSAs and applies to sportspersons who, by definition, have a short earning career from their sport. Its purpose is to remove an inconsistency in the scheme.

The initial contact on this issue came from the Irish Rugby Football Union, IRFU, or persons associated with that organisation. It was not made to me personally but was made officially to the Department.