Research Report on Tax and Regulatory Policy to encourage Greater
Philanthropy is now available
In August 2008 ICTR joined forces with Philanthropy Ireland to commission Farrell Grant Sparks
Consulting (FGS) to carry out research on tax and regulatory policy to encourage greater charitable and
philanthropic giving in Ireland. The research team was led by Greg Sparks and the final report is now
available. The key recommendations include:
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Reducing the current threshold above which tax relief may be applied from €250 to a new rate
of €175
That the tax relief applying to donations to charitable organisations should be decoupled from
the provision in the Finance Act 2006 to limit the use of tax reliefs by higher earners (i.e. those
with an adjusted income over €250,000) as the donor does not receive any benefit from the
donation. In keeping with the recommendation of the Commission on Taxation they
recommend that this relief be capped at an upper threshold of €500,000
Extending the provision of tax relief on donations of cash and securities to charity to include
donations of property
The introduction of tax benefits in relation to the donation of property through the use of
split/charitable remainder income trusts (i.e. where donors put property in trust for a charity
with the rights to the capital and income elements being split between the donor and the
recipient)
The introduction of a VAT subsidy for charities to compensate for VAT incurred on inputs, similar
to the scheme that is currently operating in Denmark where the subsidy is based on the
proportion of funds received by the charity from private donations
The removal of the two-year waiting period for charities to become eligible to claim tax relief on
donations
A relaxation of the rule where an individual’s tax relief is restricted to 10% of their income tax
where they have an association with the charity
The report will be used in our joint efforts with government to achieve a taxation and regulatory
environment that specifically encourages greater philanthropy in Ireland.