Written answers

Friday, 7 September 2018

Department of Employment Affairs and Social Protection

Social Insurance Fund

Photo of Seán FlemingSeán Fleming (Laois, Fianna Fail)
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1222. To ask the Minister for Employment Affairs and Social Protection if the revision of PRSI being levied on phantom gains deemed to be arising to a trade when in fact there is an overall loss will be revised further to correspondence from persons (details supplied); and if she will make a statement on the matter. [35805/18]

Photo of Regina DohertyRegina Doherty (Meath East, Fine Gael)
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The Deputy is referring to a change in the Finance Act 2013 which provided that the release/forgiveness of a debt relating to land, which is held as trading stock is regarded as (notional) income for tax purposes. The debt forgiveness is regarded as “reckonable income” for PRSI purposes and is liable to PRSI at the Class S rate of 4%.

This provision only applies to individuals:

- who own land as part of their trade,

- the value of that land was previously written down, in many cases giving rise to large trading  losses, and,

- who benefitted from debt forgiveness on borrowings made to purchase that land.

Given the complexity of this issue, in particular to ensuring the correct application of the PRSI charge, my officials are currently re-examining this issue and the Department will be in contact with the relevant bodies including those who have contacted the Deputy on finalisation of its deliberations.


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