Ministers use home tax ‘perk’ to claim €800k

THE country’s most senior politicians have claimed more than €800,000 over the past seven years through a controversial tax write-off to maintain a second home in Dublin.

The Government ministers have been allowed to write off over €100,000-a-year from what is known as the ‘dual abode allowance’. And this is all after Enda Kenny had promised to end the scheme while in opposition, but the allowance was retained and remains in place.

The tax perk applies to ministers, ministers of state, or the Attorney General if they live outside Dublin and rent or own a second home in the capital.

According to the latest full year figures, it is now being claimed by sixteen different politicians.

In 2016, the total value of claims came to just over €120,000 which had a cost to the Exchequer of more than €48,000, according to Revenue figures. Only partial figures are available for 2017 and around €48,000 was claimed with a tax loss of more than €19,000.

Overall, the tax lost on the €809,000 that has been claimed for by the politicians was €328,000 based on the higher band of 41, and more recently 40, per cent.

It is understood that the allowance is mainly used currently by politicians to claim a tax writeoff against the cost of renting a second property in Dublin.

However, it is also open to them to claim against the cost of buying a property or costs involved in staying in a hotel while in the city for work. When claims for that type of accommodation are made, the money can be used to offset costs including laundry.

If the politician chooses to buy a property, the relief can be claimed against the mortgage and interest repayments, with legal and auctioneering fees.

The Government examined abolishing the allowance in 2012. One proposed system that would have directly reimbursed ministers for overnights would have ended up costing the taxpayer more and the idea was dropped.

The Revenue Commissioners said they would not detail how many claims had been made in 2017 to protect ‘confidential taxpayer information’ and would only confirm there had been fewer than ten. They said: ‘There is a possibility of further claims for 2017 being received; therefore, this should be considered a provisional figure.’

Asked whether it was fair that a perk like this was available only to a select group, Revenue said: ‘Matters of tax policy are not within [our] remit. Revenue’s responsibility is for the fair and efficient administration of the tax legislation that is in place.’

In a statement, the Department of Public Expenditure said: ‘[The] individual may, by way of written claim to Revenue, claim a tax deduction in respect of the expenses incurred in maintaining a second residence where he/she is obliged to so because of her/his duties. The abolition of the dual abode allowance was not part of the Programme for a Partnership Government nor was it part of the Programme for Government … [from] 2011 to 2016. No policy changes are envisaged for the existing arrangements.’

Money can be used to offset cost of laundry