High-paid executives moving here will gain significantly from an extended tax relief scheme which will leave thousands of extra euro in their pockets as part of a move to attract big employers.
Finance Minister Michael Noonan confirmed the measure yesterday as he published the Finance Bill which gives legal effect to the budget for next year.
An overhaul of the Special Assignee Relief Programme will see a cap lifted on the amount a senior executive earns where 30% of their income is exempt from income tax.
The SARP was introduced in the 2012 Budget in a bid to attract highly skilled workers into Ireland.
Under the old regime, an employee who moves here was able to make a claim to have 30% of their income between €75,000 and €500,000 made exempt for income tax purposes.
However, as part of this month’s budget, there will be no limit on their salary now. This means that a well-paid person, possibly earning millions of euro, could have almost a third of their income disregarded for income tax.
The relief scheme saw a low take-up last year of just 31, while just 12 availed of the scheme the previous year.
The relief programme will now also be extended until the end of 2017.
Under the new rules, the performance of work-related duties outside of the State will also be permitted and the requirement to have been employed abroad by the same employer will be reduced from 12 months to six months.
Mr Noonan also said that measures to grant extra allowances or discounts to households facing water charges would be introduced as the Finance Bill is debated in the Houses of the Oireachtas. The Government announced after the budget that there would be extra measures to ensure people who are not on social welfare or paying tax get relief on water charges.
The bill is expected to be signed off on by the end of November.
Another measure announced yesterday will see the same amount of Vat applied to herbal tea as to other teas. Cafes and restaurant businesses had expressed concern that indications from Revenue were that a high rate of Vat might have applied.
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