Dan Boyle (Cork South Central, Green Party)
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Question 61: To ask the Minister for Finance the tax expenditure currently being foregone through the tax relief of private pension plans; the average tax relief given per individual; and the highest individual relief. [5952/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I assume the Deputy has in mind the estimated cost of tax relief on pension contributions by employers, employees and self-employed. I am informed by the Revenue Commissioners that the latest year for which this information is available is the income tax year 2003 and is provided in the table.

With regard to occupational pensions, that is approved superannuation schemes set up by the employer, it should be noted that the cost figures in respect of employee and employer contributions are very tentative estimates and that efforts are being made to improve information on the cost of tax relief for pensions, generally. Subject to these limitations, and using data on the numbers of employee contributors obtained from the Pensions Board, the approximate average value to each employee contributor of tax concessions in respect of the total combined estimates of contributions by employees and employers is estimated at €1,637. There is no basis on which to provide an estimate of the highest individual value of tax relief.

The average value of income tax concessions for contributions to Retirement Annuity Contracts (RACs) which are available to the self-employed and to employees not in occupational pension schemes and to Personal Retirement Savings Accounts (PRSAs) is estimated at €2,411 and €2,500, respectively.

The highest individual tax relievable contribution allowable in 2003 in respect of the contributions to RACs and PRSAs, assuming a contributor aged 50 years or over and taking into account a contributions earnings cap of €254,000, is 30 per cent of €254,000 or €76,200. This amounts to a tax relief of €32,004 at the top tax rate of 42 per cent. The relief can be doubled in the case of a married couple where each spouse qualifies for the maximum individual relief of €32,004. On the basis of the information available from tax records the highest individual values of tax relief allowed in 2003 were €56,262 for RACs and €39,900 for PRSAs.