Michael McGrath (Cork South Central, Fianna Fail)
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128. To ask the Minister for Finance the number of applications for tax relief certificates under the employment and investment incentive scheme, EIIS, in each year since its creation and in each month of 2018; the number of applications awaiting processing and approval by the Revenue Commissioners; the average time taken between original application and the final approval for tax relief certificates under the EIIS in tabular form; and if he will make a statement on the matter. [17299/18]

Michael McGrath (Cork South Central, Fianna Fail)
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129. To ask the Minister for Finance the number of outstanding applications for tax relief certificates under the EIIS awaiting processing and approval by the Revenue Commissioners at the end of each month in each of the years 2016 to 2017 and to date in 2018, in tabular form; and if he will make a statement on the matter. [17300/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 128 and 129 together.

Employment and Investment Incentive (EII) relief is granted in two tranches: the first portion of the relief (currently 30/40 and previously 30/41) is given at the time of investment (on foot of a completed Form EII 1), while the second portion (currently 10/40 and previously 11/41) is given if, after 3 years, the company has increased employment or spent all of the money on qualifying research and development (Form EII 1A). 

Revenue advise that the increased complexity of the scheme, arising from changes in Finance Act 2015 and 2017, means that each application takes longer to process than in previous years.  The increased complexity also results in a large number of incomplete applications being made, which in turn increases the volume of correspondence dealt with by the processing team.

The figures in relation to the number of initial applications for the incentive are set out in tables 1 and 2.

Table 1: No. of initial applications for EII Certification 2012 – 2017

* Please note that the 2017 figures are provisional and subject to change. The analysis of those 2017 applications still waiting to be processed is not yet complete.

Table 2: No. of Applications for EII Certification 2018

* The number of 2018 investors is not currently available as the analysis of these applications is not yet complete.

The number of initial applications for certificates under the EII currently awaiting processing is 133 (i.e. initial applications where no processing has yet taken place). As such, this figure excludes cases where taxpayers have been asked to provide additional information but have not yet done so.

I am advised that it is not possible to give an average time taken to issue a decision regarding approval or rejection. Where a full application, with all supporting documentation, is received a decision will issue more quickly than a case where additional information and clarifications must be sought.  Equally, it takes less time to carry out the level of examination required in respect of a claim by a company with a simple corporate structure than a claim in respect of a complex corporate grouping.  At present, in respect of the more complex cases, it can take up to six months for a reply to issue.

The figures requested by the Deputy in relation to the number of outstanding applications by month since January 2016, are set out in tables 3, 4 and 5.  These figures include both EII 1 and EII 1A certifications.

I am further advised by Revenue that figures prior to August 2017 represent unworked items only (i.e. where no processing has yet taken place), while those after August 2017 include items in respect of which a final answer has not yet issued.  Therefore, a file was not identified as outstanding in July 2017 where correspondence was sent to a taxpayer requesting more information and that information was still awaited at the end of the month.  That file, from August 2017, is identified as an outstanding work item.  These changes in the recording of the statistics, which allowed for a more accurate representation of the level of the work outstanding, account for the large spike in the numbers in the latter part of 2017.  While it is not possible to split the August 2017 to December 2017 figures into cases worked and cases closed, this information has been collated for the first three months of 2018.

Table 3: 2016 Total Applications O/S By Month

Table 4: 2017 Total Applications O/S By Month

Table 5: 2018 Total Applications O/S By Month

It should be noted that the figure above of 180 cases outstanding as of March 2018 relates to both initial applications as well as follow-on case work.

Finally, and as the Deputy will be aware, I announced that a review of EII will be carried out this year. I expect that the review will be completed ahead of Budget 2019.  The review will, among other matters, consider operational aspects of the scheme.