Paul Kehoe (Wexford, Fine Gael)
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Question 123: To ask the Minister for Finance the way, in view of his Department proposing to pay the farm waste management grant over three years, the Revenue Commissioners will deal with the capital allowances for tax year 2008 on these works as farmers are unsure as to the grants that they will receive as inspections have not been done yet by his Department; and if he will make a statement on the matter. [8549/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I am advised by the Revenue Commissioners that, for the purposes of claiming capital allowances in relation to expenditure incurred on the construction of buildings or structures which secure a reduction or elimination of any pollution arising from the trade of farming, grants must be deducted from the amount of the expenditure incurred.

The Taxes Consolidation Act 1997 provides that the allowable expenditure amount for capital allowances purposes must be reduced in so far as it has been or is to be met directly or indirectly by a grant from the State (regardless of the period over which it is to be paid). Accordingly, claims for capital allowances for 2008 in relation to expenditure incurred under the Farm Waste Management Scheme must be based on the net figure of expenditure incurred i.e. gross amount of expenditure less any VAT refunded less 100% of grant to be received from the Department of Agriculture, Fisheries and Food in the years 2009, 2010 and 2011.