September Payroll Tip – Claim tax relief on college fees.

Many people mistakenly believe that they can only claim tax relief for themselves or for their children. In fact, there is no limit on the number of individuals for whom you can claim provided you are paying the fees for the course. Employees can claim tax relief for approved undergraduate and postgraduate courses. The maximum amount of qualifying fees allowable under the tax relief scheme is €5,000. Tax relief is given at the standard rate. You can only claim for one course for any individual in any tax year.

Approved Undergraduate Courses must:
• be carried out in an approved college;
• be of at least 2 academic years duration; and
• In the case of courses carried out in colleges and institutions that require approval by the Department of Education and Science for the purposes of this tax relief, the course must be approved by that Department.

Approved Postgraduate Courses must:
• be carried out in an approved college;
• be of at least 1 academic year but no more than 4 academic years in duration; and
• Lead to a postgraduate award based on either a thesis or an examination.
• The person taking the course must already have a primary degree or equivalent qualification.

How may the relief be claimed?
• You can apply for this relief by completing the application form.
• You should retain a receipt from the course provided in relation to tuition fees for which relief has been claimed as it may be requested for verification at a later date.
• Relief shall only be given for one approved course per person in respect of the year of assessment.

Relief is not available in respect of:
• any part of the tuition fees that are or will be met directly or indirectly by grants, scholarships, by an employer or otherwise;
• Administration, registration or examination fees.

This relief is allowable per course per academic year. If you have paid college fees in respect of more than one individual attending college in an academic year, relief is due to you in respect of the fees paid for each person up to the maximum limit per course.

Where fees are paid in installments and any such amounts are paid in a tax year following the year in which the academic year of the approved course commenced, then the relief for fees relating to that academic year may be granted either –
• in the tax year during which the academic year of the approved course commenced;
Or
• The tax year in which the installment was paid.

However, relief will only be granted in respect of amounts actually paid and subject to the maximum relief available in that academic year.

Lists of Approved Colleges and Courses
Annual lists of approved Third Level colleges in the State and approved undergraduate and postgraduate courses in the State are available on http://www.revenue.ie