Tax Relief For Islanders Proposed

Údarás na Gaeltachta, the regional authority responsible for the economic, social and cultural development of the Gaeltacht, has proposed a radical plan to the Commission on Taxation recommending a special taxation incentive scheme for offshore islands.

The proposals are based on the desire to promote economic activity on the off-shore islands of Ireland and thereby attract individuals to reside there.

The Údarás proposed scheme includes a pilot scheme that would give an exemption from income tax to individuals who reside on the islands, whose principal private residence is located on the Islands and who either earns income from employment on the islands; or the mainland; or who carries on a business mainly on the islands.

The suggested tax-exempt threshold would be in respect of a maximum annual income of €100,000 and the exemption would apply for a period of 10 tax years. The exemption would apply to both new and existing businesses on the islands.


Údarás has also proposed having a 100% capital allowances/free depreciation write-off for any equipment or buildings provided for use in a business allowable against non-exempt income and a BES type tax relief to apply to investors who invest capital in any business located on the islands.

Commenting on the proposal, Pádraig Ó hAoláin, CEO of Údarás na Gaeltachta, said, "Údarás made this submission for special taxation incentives for the offshore islands to help promote their development, help maintain their populations and to generate sustainable employment by making them a more attractive live-work option for islanders."

"While the infrastructure of our offshore islands has been substantially upgraded in recent years – and substantial state investment is currently being made in this sector – and while access via air and ferry services has been greatly improved, the overall population of the offshore islands continues to decline."

"As far as our function of enterprise promotion is concerned, the most challenging task for us is to create new employment and income – enhancement opportunities for island residents and especially for young islanders and islanders wishing to return to reside on the islands.

"We feel this is what holds the key to the future viability of the island communities," he added.

(PR)