STUDENTS:TAX RELIEFS for student fees are to be curtailed under new provisions in the Finance Bill.
The move will particularly affect part-time, full-time, postgraduate and other students who are not part of the free-fees scheme, including students in private colleges.
Union of Students in Ireland (USI) president Gary Redmond last night said the tax changes would make it “prohibitively expensive for many students to continue their studies”. Under the changes, there will be no tax relief on the first €2,000 of charges for full-time students and the first €1,000 for part-time students.
Under changes already announced in the budget, the existing €1,500 student services charge is being replaced with a €2,000 “student contribution” from next September.
Although the student services charge did not qualify for tax relief, the student contribution will. However, the first €2,000 of any claim for relief will be disregarded. As a result, only those who are paying charges for more than one student in a single tax year will benefit from the change.
For example, if a family is liable for the new contribution in respect of two full-time students, they can claim tax relief on the overall charge of €4,000. The first €2,000 would be disregarded and standard rate tax relief (20 per cent) would be allowed on the balance, leading to a potential for tax relief of €400.
In the case of a claim for relief where all the students concerned are studying part-time, the first €1,000 of the claim for relief will be disregarded.
Tax relief will continue to be available for other students that are not subject to the €2,000 student contribution. This will be at the standard rate per approved course, up to a maximum limit of €5,000 per year. However, the €2,000 or €1,000 disregard will also apply per claim, depending on whether the student is in full-time or part-time education.
Mr Redmond said many students seeking to upskill or reskill will not even be allowed to claim tax relief on fees. USI, he said, believed “all students should have a right to go as far as their talents will take them in higher education, and not only as far as their wallets will carry them”.
