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Ireland Expands Disabled Drivers' Tax Relief

The Irish Finance Department has announced a series of improvements to the Disabled Drivers and Disabled Passengers (Tax Concessions) Scheme.

Finance Minister Michael Noonan confirmed that the changes to the Scheme were made in secondary legislation, which he signed into law at the end of December 2015. The Scheme provides repayment or remission of value-added tax (VAT) and vehicle registration tax (VRT) on the purchase of an adapted car or vehicle for the transport of a person with specific, severem and permanent physical disabilities. It also provides an exemption from motor tax on that vehicle and a fuel grant, up to a certain limit.

Noonan explained that to provide for the needs of drivers with disabilities and to recognize the significant costs of adapting vehicles to requirements, he has introduced two new categories of vehicles to the Scheme. A category of "specifically adapted vehicle" will be made available to drivers with disabilities who have made significant adaptations to their vehicles. This category will provide VRT and VAT relief of up to EUR16,000 (USD17,400) for the purchase of such vehicles, which must be held for three years before resale.

Noonan added that a second new category, of "extensively adapted vehicle," will be provided where drivers and/or passengers require extensive modifications to their vehicles. It will afford VAT and VRT relief up to EUR22,000. The vehicle concerned must be held for six years before it is resold.

Four further changes will also form part of the expanded Scheme. The maximum amount of VRT and VAT relief available for drivers with disabilities will increase from EUR9,525 to EUR10,000, and the maximum relief for passengers with disabilities will rise from EUR15,875 to EUR16,000. The requirement that a qualifying organization may not receive the majority of their funding from the government is being removed. The current limits on engine size are being expanded, and individuals will be able to claim a repayment of VRT when they purchase an adapted vehicle, or purchase and adapt a vehicle, through a private sale.

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