Tax Relief on Third Level Fees

The relief available for fees paid for third level education has been restricted by section 11 of the Bill which provides that the first €2,250, (was €2,000), in fees per claim will be ineligible for tax relief where the fees are in respect of full-time education. Where students are in part-time education, the first €1,125 in fees will be ineligible; this has increased from €1,000.

Retirement Relief for Certain Income

Section 5 provides that professional cricket players will now also be able to avail of relief from income tax in respect of certain earnings and consequently be eligible for a higher rate of relief on pension contributions.

Share Based Remuneration

Section 4 provides for a number of administrative changes intended to clarify the tax treatment of share based remuneration.

• Provision for the refund of income levy and universal social charge where shares are forfeited.
• Employers may withhold or sell sufficient shares to fund the income tax and USC charge on that award of shares, before transferring the balance to the employee. This applies only in case where the employee does not provide sufficient funds to meet the tax charge.
• Under section 128A TCA 1997 individuals could defer the payment of income tax on share options until there was a disposal of the shares. Section 4 provides that where such individuals dispose of shares, half of the net gains must be used to pay the outstanding income tax liability.

Section 2 also contains a number of technical amendments in relation to the application of the USC to share based remuneration.