Revenue has deferred a decision on the implementation of any planned changes to the flat rate expenses (FRE) system for a year, pending the outcome of a review by the Tax Strategy Group (TSG) in the Department of Finance.

A review by Revenue of the regime has been underway for 18 months into the tax reliefs which can be claimed by those working in certain professions who traditionally had incurred expense in the course of their jobs.

There was concern among certain employee groups about the possibility that they could lose their allowances, which in some cases are substantial.

Miners can claim reliefs of up to €1,312 a year under the system, while musicians in the RTE National Symphony and Concert Orchestras can claim reliefs of up to €2,476.

Revenue said its descision was taken in light of the Minister for Finance backing plans to examine the policy and legislative options in relation to several aspects around the entitlement to tax relief for expenses incurred in employment.

Earlier this week Paschal Donohoe told Revenue Chairman Niall Cody in a letter that he noted that "the review has raised a number of aspects in the current FRE regime where further policy consideration may be warranted". 

He also confirmed that he backed a suggestion from Revenue that the Tax Strategy Group could look at the issue, as this would be "an appropriate forum in which the issues in question can be fully considered".

Today Revenue wrote back to say it had decided to defer implementation of any planned changes until 1 January 2021, pending the outcome of the TSG review and consideration of any further changes to legislation that might result.

Revenue said its review has so far identified a number of inconsistencies within the existing regime.

These include the fact that self-employed and employees are treated differently to each other.

Other inconsistencies revolve around the claiming of ineligible registration fees and the nature of the expenses that are being claimed.

Taxback.com said it welcomed the decision to postpone any action.

"While it’s true that the system is dated and is probably in need of an overhaul – we would advocate for this to be done cautiously and logically, so as not to disadvantage those who have a reasonable claim to such reliefs," said CEO, Joanna Murphy.

"In fact, we would hope that greater discussion around the flat rate expense relief might make more people aware of its existence and ultimately to lead more people to claim what they are owed – we believe that thousands of people don’t claim annually and are missing out on hundreds if not thousands of Euro as a result."