Pearse Doherty (Donegal, Sinn Fein)
Link to this: Individually | In context

307. To ask the Minister for Finance further to Parliamentary Question No. 351 of 14 October 2025, if the standard fund threshold will increase from €2 million to €2.2 million in 2026; to outline a credible cost associated with the measure that includes change in behaviour that would directly result from this measure; and if he will make a statement on the matter. [57147/25]

Paschal Donohoe (Dublin Central, Fine Gael)
Link to this: Individually | In context

In line with section 13 of Finance Act 2024, I can confirm that the first initial increase to the Standard Fund Threshold (SFT) will take place for the year of assessment 2026, with the SFT increasing from its current level of €2 million to €2.2million.

I am informed by Revenue that they are unable provide a costing for changes to the SFT. Information on the numbers and values of individual pension funds or on individual accrued benefits in pension schemes are not generally required to be supplied to Revenue. Therefore, currently there is no readily available underlying data or methodology on which to base reliable estimates of any possible costs arising from changes to the SFT.

However as previously outlined to the Deputy, in the context of the 2024 examination of the SFT, my officials examined the issue of estimating the impact of changes to the SFT using the available information about previous payments of Chargeable Excess Tax (CET) in 2023. Following this examination, the Department prepared some indicative estimated costs of increases to the SFT, based on the information available and assumptions in relation to the basis for the CET paid in 2023. Using the model which generates these costs, the indicative estimated cost to the Exchequer arising from increasing the standard fund threshold to €2.2million would be approximately €10.5 million. There is not sufficient data available to prepare an estimated costing in relation to behavioural change. These costs are based on a reduction of the 2023 CET yield.

My officials and Revenue will continue to monitor the impact, as those changes to the SFT provided for in the Finance Act 2024 come into effect in the coming years.