Noel Ahern (Dublin North West, Fianna Fail)
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Question 98: To ask the Minister for Finance if he will clarify the position in relation to the charging of the income levy on persons in receipt of pensions from Irish companies registered and based here, but where the persons are living abroad and making their tax arrangements where they live; if this practice is correct; and the way an exemption from same should be processed. [25365/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The position, in general, is that persons who are in receipt of pensions from Irish companies, registered and based here, are subject to the income levy in respect of that pension where the payment is in excess of the relevant thresholds set out in the legislation.

Where the recipient is resident abroad in a country with which Ireland has negotiated a Double Taxation Agreement, that individual will not be subject to the income levy if the Revenue Commissioners, in affording relief from double taxation under section 826(1)(a)(i) of the Taxes Consolidation Act 1997, have issued an Exclusion Order in respect of that income. However, persons who are in receipt of a pension as a consequence of having been office holders (e.g. civil servants) will be liable to income levy on that pension, even if resident in a country with which Ireland has negotiated a Double Taxation Agreement as that pension income continues to be taxable in Ireland under such agreements.

If the person is resident in a country with which Ireland has not negotiated a Double Taxation Agreement, the person will be liable to income levy and indeed income tax on the pension.