1. IT Related Initiatives

1.1 Automatic age-related credits

With the development of the new PAYE IT system, Revenue is now in a position to automatically grant age related tax credits. These age related tax credits include the increased rent allowance for those reaching the age of 55, the increased exemption limit as well as the annual age tax credit for those reaching the age of 65. This development will be released before the end of 2007.

1.2 BIK Medical Insurance credit

Tax relief on medical insurance is granted at source on all premiums. Where an employer pays medical insurance as a BIK, the employer pays the lower premium and repays the tax credit to Revenue through the Corporation Tax return/payment. The employee, whose medical insurance has been paid by the employer, must then claim the tax credit individually. As a result, a large number of employees who are taxed on the BIK, have never claimed the appropriate tax credit.

To address this issue, the P35 for 2007 will include a new field to allow employers notify Revenue of the amount of medical insurance paid as a BIK. Revenuewill process this information and grant the tax credit to the individual in 2008.

2. DIRT Exempt accounts

This exemption at source scheme is now live and grants exemption from DIRT for those or their spouse, who are 65 years of age or over and whose total income is below the annual exemption limit. The scheme also applies to those or their spouse who are Permanently Incapacitated and who total income is below the relevant annual exemption limit.

• Broad guidelines on the operation of the scheme have been agreed with the Financial Institutions.
• Application forms and information leaflets for over 65's are now available for all Revenue offices, Financial Institutions and Post Office Savings Bank. The completed application forms should be returned to the Financial Institutions.
• This scheme also applies to those who qualify as Permanently Incapacitated. Application forms and information leaflets for Permanently Incapacitated have been distributed through the disability organisations as well as being available from any Revenue office.
• Application forms for Permanently Incapacitated should be returned to the Tax Office who will notify the appropriate Financial Institution to allow exemption on the nominated account.

3. Third-Party Information

Revenue will work with certain Third Parties to collect expenditure that qualifies for tax relief and process the data for tax refund purposes as if the relevant data had been submitted by the taxpayer. Qualifying expenditure includes,

3.1 Trade Union Subscriptions

Revenue is working with the Trade Union movement to collect the PPS numbers from employers who operate deduction at source for Trade Union subscriptions. The data will be processed by Revenue and the tax credit granted. This element is expected to commence this year.

3.2 Drugs Payment Scheme

The Health Service Executive hold expenditure data at individual level on prescribed drugs under the Drugs Payment Scheme. This data will be processed by Revenue and where appropriate, a tax refund will issue. This element is expected to be available towards the end of 2007.

3.3 Tuition Fees

Revenue are working with the Third Level colleges to collect data on those who pay Tuition Fees in respect of qualifying courses. This element is expected to be available in 2008.

3.4 Non Reimbursed Medical Costs from Medical Insurance Companies

Revenue will work with medical Insurance companies who can supply data on qualifying expenditure for inpatient and outpatient expenditure not covered by medical insurance Revenue will process the information and where,appropriate a refund will issue. This element is expected to be available in 2008.

3.5 Nursing Homes

Discussions have commenced with Nursing Homes with a view to them supplying details of net charges paid to Nursing Homes along with details of those making the payments. This is expected to commence in 2008.