What tax credits can be claimed in Ireland?

Are you confused about what are tax credits in Ireland or how to claim tax credits?

Put simply tax credits benefit each individual by reducing the amount of tax you pay each year.

Tax is calculated on gross pay and this tax is then reduced by any tax credits due to you in order to arrive at the net tax payable. Before the start of the new tax year (December time) it is worthwhile checking with the tax office or via myaccount on Revenue.ie that the tax credits assigned to you are correct and that the standard rate cut off point is correct.

It is in your interest to keep Revenue up to date of your personal information to ensure the correct credits are provided to you. Also when you receive your notification of tax credits from Revenue and your standard rate cut-off point you should double check it to ensure it lists all the tax reliefs you wish to claim.

If your employer does not receive credits from Revenue to allocate against your employment income you will be put on emergency tax. It is critical that you contact your local tax office to resolve this situation. Revenue are very helpful and will be happy to help you here.

Home Carer’s Tax Credit

Home carer’s tax credit may be claimed by a couple who are married or in a civil partnership, where one partner cares for one or more dependent people. If the carer has income in their own right of less than €7,200 the full home carer’s credit may still be claimed. Only one credit is due irrespective of the number of dependents. If the home carer’s income exceeds €9,200 in the tax year the home carers tax credit is not available. To claim the credit the couple must be jointly assessed. You can apply to be jointly assessed with your partner by submitting a form to Revenue.

You can also claim the home carer’s tax credit for a dependent relative who is cared for outside the home provided they live in a neighbouring residence or within 2kms of the carer. The tax office can help in identifying if claiming the home carer’s tax credit or the increased standard rate cut off point is more beneficial for you.

Single Person Child Carer’s Credit

This tax credit is granted to the primary carer who is either the parent, or to an individual who has a qualifying child in their custody and maintains that child for the whole or greater part of a year of assessment. The credit is granted for a child up to the age of 18 years or, if over 18 years where they are in full-time education.

The credit can also be claimed in the case of permanently incapacitated child where the incapacity occurred before age 21, or if older while the child was in full-time education.

The child must reside with the claimant for at least 6 months of the year of assessment. If the child was born in the year of assessment they must reside with the claimant for the greater part of the period from their date of birth. A child may be the subject of only one claim, and a claimant can only make a claim for one child for a year of assessment, irrespective of the number of children that reside with him or her.

Where the primary carer has no tax liability the credit can be used by the non-primary carer.

Widowed Parent Tax Credit

An additional tax credit is granted to a widowed parent for the five tax years following the year of bereavement.

Incapacitated Child Tax Credit

This can be claimed where an individual has a child who is permanently incapacitated either physically or mentally from maintaining themselves and is maintained by the claimant living with them at any time during the tax year. The child must have been incapacitated before reaching 21 years of age, or if over 21 years has become permanently incapacitated while still in full-time education or full-time training for a trade or profession for a minimum of two years

Age Tax Credit

This credit is available if you or your spouse/civil partner are over 65 years of age in the relevant tax year.

Dependent Relative Tax Credit

This credit is granted to claimants who prove that they maintain at their own expense any person who is:

A relative, who is incapacitated by old age or infirmity from maintaining themselves.
Their or their spouse/civil partner’s widowed mother or father whether incapacitated or not.
A son or daughter who resides with them and whose services they depend on by reason of old age or infirmity.

Employing A Carer

This allowance can be claimed if you employ a person to take care of yourself or a family member who is totally incapacitated, owing to old age or infirmity. The allowance can also be claimed if the services are provided by, or through an agency. The amount of the allowance is the actual cost of employing the carer up to a maximum of €75,000. This allowance is granted at your highest rate of tax.

Blind person tax credit

A credit is available during the tax year if you are blind. If both spouses/civil partners are blind the credit can be claimed by both spouses/civil partners. Also to note here a standard amount per annum is allowed as medical expenses where a blind person maintains a trained guide dog and is the registered owner with the Irish Guide Dog Association.

To view the full list of credits including credits that applied in previous years click here.

If you omitted to claim a tax credit you were entitled in the previous 4 years, it is not too late, you can still obtain a tax refund.

Caroline would be happy to review your tax affairs including your tax credits and tax bands with you to ensure they are correct. To arrange an appointment email caroline@charlespcrowley.com