Retired sports stars getting up to €100,000 in tax refunds
Published 03/01/2014 | 02:30
TOP sports stars are getting up to €100,000 in tax refunds on earnings under a special scheme introduced by former Fianna Fail finance minister Charlie McCreevy.
The scheme covers rugby players, domestic soccer players, jockeys, motor racing drivers, swimmers and other professional sportspeople who have retired from their sport.
A Freedom of Information request has revealed that the highest payment to date in the scheme is €99,999. The identities of the sports people involved are not revealed by the Revenue due to taxpayer confidentiality.
It has only benefited 271 elite athletes since it was introduced, with 45 getting tax refunds in 2010 -- the most recent year for which figures are available.
However, the scheme will not benefit Irish soccer internationals such as Robbie Keane and Damien Duff who have pursued their professional careers abroad. Only income earned here can be claimed back when a sportsperson retires.
The scheme costs around €300,000 per year. Since it was introduced in 2002, over €1.8m had been paid out in tax refunds to retired sports people.
They are allowed to claim back a 40pc tax deduction on their gross earnings from sports activity over a 10-year period. That includes wages and match bonuses, but does not include sponsorship money, payments for writing media columns or fees for appearing in advertisements.
Revenue refused to release a breakdown of the type of sports played by those with the highest deductions, saying that the numbers claiming were so small that there would be a "very real risk of exposing the identities of the individuals ". But it said that the highest payments to a sportsperson ranged from €68,825 in 2004 to €99,999 in 2011.
Finance Minister Michael Noonan recently changed the rules of the scheme to allow players who finished their career in another country to still benefit from tax relief.
However, they can only claim a tax refund on income earned here. That could benefit players such as Johnny Sexton, who had several highly successful seasons with Leinster before transferring to Racing Metro in France.
Mr Noonan turned down another recommendation from his officials to cap the maximum tax relief claimed under the scheme at €100,000. They claimed it would have restricted the scheme's cost.
When the scheme was introduced by Mr McCreevy, he said it was a recognition of the fact that most professional sportspeople in Ireland were not very wealthy and that they had a short earnings career that could often be cut short by injury.