Joanna Tuffy (Dublin Mid West, Labour)
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Question 106: To ask the Minister for Finance the position regarding the tax covenanting scheme that is available; the circumstances in which it can be availed of; the persons who can avail of it; the financial limits that apply and the money expended by the State in relation to these tax covenants. [33075/08]

Joanna Tuffy (Dublin Mid West, Labour)
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Question 107: To ask the Minister for Finance the position regarding the abolition of certain tax covenanting arrangements that applied before the abolition of third level tuition fees; the amount estimated as saved by his Department each year by the abolition of those tax covenanting arrangements; and the amount spent on this covenanting scheme in the year that preceded the year it was abolished. [33076/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I propose to take Questions Nos. 106 and 107 together.

A deed of covenant is a legally binding written agreement made by an individual to pay an agreed amount to another individual, without receiving any benefit in return. To be legally effective, it must be properly drawn up, signed, witnessed, sealed and delivered to the individual receiving the payments. Any amount can be paid under a deed but only covenants in favour of certain individuals qualify for tax relief. A deed must be capable of exceeding a period of six years to qualify for tax relief.

Up to and including the 1993/94 tax year, tax relief was available to the covenanter in respect of covenants in favour of all individuals and for research, teaching of natural sciences and to certain bodies for the promotion of human rights. There was evidence that this tax relief was being abused. To curb this abuse, to stem the rising cost to the Exchequer of covenants and to help fund the phasing out of fees for third level education, this regime was phased out, for both existing and new covenants, in tax years 1994/95 and 1995/96. Since the tax year 1996/97, unrestricted tax relief can only be claimed by covenanters in respect of covenants in favour of permanently incapacitated minors (other than covenants from parents to their own minor incapacitated children) and in respect of covenants in favour of permanently incapacitated adults.

Tax relief can also be claimed by a covenanter in respect of covenants in favour of adults aged 65 or over but the amount of tax relief available on one or more covenants cannot exceed 5% of the total income of the covenanter. When paying over the monies under the covenant, the covenanter deducts tax at source at the standard rate of tax (currently 20%). A covenantee may be entitled to a refund of all, or part, of this tax where his or her tax credits reduce his/her tax liability to less than the amount of income tax deducted by the covenanter, or if the covenantee's total income is below the applicable income tax exemption limit.

The attached table provided by the Revenue Commissioners shows the estimated cost of the tax relief in each tax year from 1993/94 to 2005. The cost of the relief dropped considerably in tax year 1996/97, the year in which certain restrictions already outlined were introduced. The Revenue Commissioners have also provided figures (rounded to the nearest hundred) for the number of taxpayers since 2000/01 claiming tax relief on covenants.

Michael Ring (Mayo, Fine Gael)
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Question 108: To ask the Minister for Finance the amount of income tax paid by a married couple, under the PAYE system, assessed jointly with one income of €2,400 and the second income of €65,600 in 2007 assuming the standard tax credits. [33109/08]

Michael Ring (Mayo, Fine Gael)
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Question 109: To ask the Minister for Finance the amount of income tax paid by a married couple, under the PAYE system, assessed jointly with one income of €5,000 and the second income of €63,000 in 2007 assuming the standard tax credits. [33110/08]

Michael Ring (Mayo, Fine Gael)
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Question 110: To ask the Minister for Finance the amount of income tax paid by a married couple, under the PAYE system, assessed jointly with one income of €12,000 and the second income of €56,000 in 2007 assuming the standard tax credits. [33111/08]

Michael Ring (Mayo, Fine Gael)
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Question 111: To ask the Minister for Finance the amount of income tax paid by a married couple, under the PAYE system, assessed jointly, with one earner of €68,000 in 2007, assuming the standard tax credits. [33112/08]

Michael Ring (Mayo, Fine Gael)
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Question 112: To ask the Minister for Finance the amount of income tax paid by a married couple, under the PAYE system, assessed jointly with two incomes each of €34,000 in 2007 assuming the standard tax credits. [33113/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I propose to take Questions Nos. 108 to 112, inclusive, together.

The position in 2007 regarding tax bands and credits for a married couple is as follows.

The following five examples show the income tax payable by married couples as requested by the Deputy on gross income of €68,000 for 2007.

Example 1

Married two income couple under the PAYE system, assessed jointly with one of €2,400 and the second income of €65,600.

Example 2

Married two income couple under the PAYE system, assessed jointly with one of €5,000 and the second income of €63,000

Example 3

Married two income couple under the PAYE system, assessed jointly with one of €12,000 and the second income of €56,000

Example 4

Married couple under the PAYE system, assessed jointly with one earner of €68,000.

Example 5

Married two income couple under the PAYE system, assessed jointly with two incomes each of €34,000

Róisín Shortall (Dublin North West, Labour)
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Question 113: To ask the Minister for Finance the estimated saving to the Exchequer if a cap of €200,000, €150,000, €130,000 and €100,000 respectively was applied to the reckonable salary for pension contribution purposes; and if he will make a statement on the matter. [33142/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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It is presumed the Deputy is referring to the current annual earnings cap of €275,239 which operates to limit the level of tax-relieved personal pension contributions in any one year. The annual earnings cap acts, in conjunction with age-related percentage limits of annual earnings, to put a ceiling on the annual amount of tax relief an individual taxpayer can obtain on pension contributions.

The full year yields to the Exchequer arising from reducing the earnings cap to the amounts mentioned in the question are estimated as follows:

A breakdown of the figures by reference to income levels is available only in respect of the tax relief for contributions to Retirement Annuity Contracts (RACs) and Personal Retirement Savings Accounts (PRSAs) to the extent that these contributions are included in the personal tax returns of tax payers.

With regard to occupational pensions, (that is, schemes set up by the employer), the figures in respect of employee contributions are available only in aggregate form. Information on such contributions is not captured in such a way as to make it possible to associate contributions with individual income levels. For that reason the estimated yields to the Exchequer provided in respect of these contributions are extremely tentative.

The estimates of yield are based on assuming that tax relief which would be affected by the changes mentioned in the question is currently allowed at the top income tax rate of 41% and at the maximum age-related percentage limit of earnings. The estimated figures provided could therefore be regarded as the maximum Exchequer yield in respect of those taxpayers.

Róisín Shortall (Dublin North West, Labour)
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Question 114: To ask the Minister for Finance the cost to the Exchequer of tax relief on small self-administered pensions in the past five years for which figures are available with a breakdown by relief type. [33143/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Employer contributions to small self-administered pension schemes are treated as a trading expense. Employee contributions are netted off as deductions from an individual's income before arriving at the definition of income for tax purposes. I am informed by the Revenue Commissioners that figures of pension contributions by employers and employees are not captured in such a way as to provide a dedicated basis for compiling estimates of cost to the Exchequer in respect of contributions to such schemes. Accordingly, I am not in a position to provide the specific information requested by the Deputy.

Róisín Shortall (Dublin North West, Labour)
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Question 115: To ask the Minister for Finance the cost to the Exchequer of tax relief on mortgage interest relief for landlords in the past five years for which figures are available; and if he will make a statement on the matter. [33144/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I am informed by the Revenue Commissioners that based on personal income tax returns filed by non-PAYE taxpayers for the years 2003 to 2006 inclusive, the latest year for which this information is available, the estimated amount of tax foregone by allowing a deduction for interest on borrowings to be offset against rents assessable under Case V, Schedule D is as set out as follows.

The estimates are based on assuming that tax relief was allowed at the top income tax rate of 42% and the figures provided could therefore be regarded as the maximum Exchequer cost in respect of those taxpayers.

Corresponding suitable data is not available for the year 2002. Data for the tax year 2007 is not yet available as the income tax returns for that year are not due for filing until October 2008. Company returns of rental income are net of interest on borrowings and the figures for interest are not separately distinguished in those returns. It should be noted that any corresponding data returned by PAYE taxpayers in the income tax return form 12 is not captured in the Revenue computer system. However, any PAYE taxpayer with non-PAYE income greater than €3,174 is required to complete an income tax return form 11. This return is the source of the figures provided in this reply.

Róisín Shortall (Dublin North West, Labour)
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Question 116: To ask the Minister for Finance the cost to the Exchequer of tax relief on mortgage interest relief for interest only mortgages in the past five years for which figures are available; and if he will make a statement on the matter. [33145/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I am informed by the Revenue Commissioners that the cost to the Exchequer of all mortgage interest relief relating to borrowers' sole or main residences which was provided by way of tax relief at source (TRS) in each of the years 2004 to 2008 inclusive is as follows:

It is not possible to distinguish between the cost of mortgage interest relief for interest only and other types of mortgages.