Revenue has published Tax Briefing Issue 11 on the application of tax relief to doctors with GMS income and private practice income where they contribute to both the GMS pension scheme and personal pension plans/PRSA. Revenue's Tax Briefing 74 also refers.

In Tax Briefing 74 Revenue confirmed that if pensionable remuneration from an office or employment in a year equals or exceeds the earnings limit (€150,000 from 2009 onwards), there is no scope to claim tax relief for contributions to a personal pension plan/PRSA for that year. Transitional arrangements, as outlined in Tax Briefing 79, apply in relation to the operation of the earnings limit for 2008.

Section 773 Taxes Consolidation Act (TCA)1997 treats doctor's GMS income as “remuneration from an office or employment” and the doctor to be an “employee” with respect to this income for the purposes of Chapter 1 of Part 30 TCA 1997.

Considering the treatment provided by section 773 TCA 1997, Revenue's view is that the operation of the aggregate earnings limit as outlined in Tax Briefing 74 applies to doctors with GMS and private practice income in the same way i.e. the GMS income and the GMS contributions must be considered first in determining the overall amount of tax relief on contributions made between occupational pensions and personal pensions.

In arriving at their interpretation, Revenue is taking the least flexible approach in determining how the €150,000 earnings limit is to be applied. This approach only applies where contributions are made on or after 7 September 2010 in respect of 2009 and contributions made during 2010 in respect of 2010 (whether made before or after 7 September).

Tax Briefing Issue 11 is available at http://www.revenue.ie