Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
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198. To ask the Minister for Finance the estimated full-year cost of uncollected tax revenue as a result of individuals offsetting their private health insurance costs against tax liabilities. [28825/24]

Jack Chambers (Dublin West, Fianna Fail)
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Firstly, it is important to clarify the position, which is that section 470 of the Taxes Consolidation Act 1997 (“TCA 1997”) provides for income tax relief in respect of payments made to authorised insurers under relevant contracts in respect of medical insurance and dental insurance.

Qualifying medical insurance policies can be for health insurance, dental insurance or health and dental insurance combined.

Tax relief is granted at the standard rate of tax (currently 20%) on the payment of the premium. The relief available is limited to the lesser of:

• the premium paid or €1,000 per adult, or
• the premium paid or €500 per child.

In general, tax relief is given as a reduction on the cost of the insurance policy. This is known as tax relief at source (“TRS”) and under this treatment policy holders pay a reduced premium to the authorised insurer (i.e. pay an amount net of tax relief). The authorised insurer then makes a claim to Revenue for the tax relief granted at source to the policy holder. For example, the TRS in respect of a gross premium adult policy of €2,500 is €200 (i.e., €1,000 x 20%). Thus, in this case as TRS is applied, the individual will pay the authorised insurer €2,300 and the authorised insurer may claim the TRS of €200 from Revenue.

Detailed guidance on tax relief for qualifying medical insurance premiums can be found in Tax and Duty Manual Part 15-01-14, which can be accessed using the link –

www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-15/15-01-14.pdf.

Finally, I would point out that the latest Revenue data (2021) estimates that the cost of tax relief for medical insurance was approximately €390 million and it was availed of by 1,350,987 claimants.

www.revenue.ie/en/corporate/documents/statistics/tax-expenditures/costs-tax-expenditures.pdf.

Brian Stanley (Laois-Offaly, Sinn Fein)
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199. To ask the Minister for Finance if an employer has to facilitate the tax rebate scheme for those who purchase yearly tickets for commuting to work; and in cases in which the employer refuses to facilitate this, the options that are open to the employee. [28932/24]

Jack Chambers (Dublin West, Fianna Fail)
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I understand that this Parliamentary Question relates to a situation where an individual is unable to avail of the Taxsaver scheme as their employer does not participate in the scheme and that the Deputy wishes to know whether the individual can avail of the scheme by another method.

Section 118(5A) of the Taxes Consolidation Act 1997 (TCA) provides an exemption from benefit-in-kind (BIK) where an employer purchases a travel pass for an employee. This is commonly known as the Taxsaver scheme.

Under section 118B TCA, an employer and employee may also enter into a Revenue-approved salary sacrifice arrangement under which the employee agrees to sacrifice part of his or her salary, in exchange for the relevant benefit.

It is important to note that employers are not required to take part in the TaxSaver scheme. Where an individual's employer does not participate in the schemes, any benefits that could arise under the relevant scheme will not be available to any employees of that employer.

This means that an individual cannot avail of the scheme if their employer has chosen not to participate. However, it may be worth highlighting to their employer that if they do decide to participate in the scheme, employer’s PRSI is not payable on the cost of the relevant benefit(s) when they make the associated deduction from their employees' salary payments.

Further details on the tax treatment applicable to the provision of a travel pass to an employee and in regard to salary sacrifice arrangements can be found on Revenue’s website and in Tax and Duty Manuals Part 05-01-01f and Part 05-01-01k, respectively, which may be accessed at the following links:

• Revenue website - www.revenue.ie/en/employing-people/benefit-in-kind-for-employers/travel-passes-and-air-miles/index.aspx
• Tax and Duty Manual Part 05-01-01f - www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-01-01f.pdf
• Tax and Duty Manual Part 05-01-01k – www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-01-01k.pdf.