Pearse Doherty (Donegal, Sinn Fein)
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288. To ask the Minister for Finance the estimated cost of flat rate expenses; and if he will make a statement on the matter. [23129/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy is aware Section 114 of the Taxes Consolidation Act (“TCA”) 1997 provides for a tax deduction in respect of expenses incurred wholly, exclusively and necessarily by an individual in the performance of the duties of his or her employment.

I am informed by Revenue that the flat rate expense (“FRE”) regime is operated by Revenue on an administrative basis where both a specific commonality of expenditure exists across an employment category and the statutory requirement for the tax deduction as set out in section 114 TCA 1997 is satisfied. Namely, that the expenses are wholly, exclusively and necessarily incurred in the performance of the duties of the office or employment by the employee concerned and that such expenses are not reimbursed by his or her employer.

I am advised by Revenue that of the estimated €158.8m cost for Allowable Expenses in 2022, the most recent year for which data is readily available, an estimated €75.5m refers to a Flat Rate Expense (“FRE”). Allowable Expenses is included in the ‘Cost of Tax Expenditures’ publication which is available on the Revenue website at:

.

Further guidance on FRE’s is available at the following links:

• Tax and Duty Manual - www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-05/05-02-20.pdf
• Website -