Terence Flanagan (Dublin North East, Fine Gael)
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Question 101: To ask the Minister for Finance if he will provide full details regarding the foreign earnings deduction introduced in the Finance Bill 2012; if the cost of air travel will be included in this deduction; and if he will make a statement on the matter. [34656/12]

Michael Noonan (Limerick City, Fine Gael)
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The Foreign Earnings Deduction is a deduction from income for income tax purposes for employees who travel abroad to certain countries as part of the duties of their employment. A deduction from salary of up to a maximum of €35,000 will be granted for employees travelling to the so-called BRICS countries, namely Brazil, Russia, India, China and South Africa as part of the duties of their employment. The individual claiming the deduction must be absent from the State for a minimum of 60 days in a period of 12 months beginning or ending in a relevant tax year. These days can be accumulated from a number of trips. However, in order to qualify each trip must have a minimum duration of four days.

The deduction has been introduced for three years and is scheduled to expire at the end of the 2014 tax year, at which point it will be reviewed.

It is likely that the cost of air travel for relevant journeys would be borne by an employer and therefore it would not be appropriate to include such costs when calculating the amount of income that can be deducted by an individual under the scheme. However, employers may claim a deduction for such costs in the accounts of the business when determining the profits of that business for tax purposes.

I am informed by the Revenue Commissioners that an information leaflet on the Foreign Earnings Deduction will be available on their website shortly.