PayLessTax tax credits Archives

Chart of Personal Tax Credits, Allowances and Reliefs

March 24, 2020

In addition to your personal tax credits there are various tax credits, allowances and reliefs available to be claimed and we list each of these below:

Tax Year

2020

2021

Single Person

1,650

Married Person

3,330

3,300

Widowed / surviving civil partner with no dependant child

2,190

Widowed / surviving civil partner bereaved in the year

3,300

Widowed / surviving civil partner with dependant child – first year after bereavement (a reducing credit is available in following years)

5,250

Single parent with dependent child

3,300

Home Carer’s Tax Credit (max)

1,600

Earned Income Credit

1,650

PAYE Tax Credit

1,650

Additional Tax Credit for Age 65 Plus

Single/Widowed

245

Married

490

Blind Person’s Tax Credit

One spouse blind

1,650

Both spouses blind

3,330

3,300

Additional Allowance for Guide Dog

825

825*

Incapacitated child credit

3,300

Allowance for Employing a Carer

75,000

The tax rate on your income starts at 20% and then increases to 40% when your income exceeds a certain level ( tax rate band) as listed in the table below.

Tax Year		2020	2021


Up to Threshold Amount	Standard Rate	20%	20%
Income Over Threshold	Upper Rate	40%	40%
Single/Widowed Persons	Threshold	35,300	35,300
Single Parents Single/Widowed with Dependent Children	Threshold	39,300	39,300
Married Couple with One Income	Threshold	44,300	44,300
Married Couple with Two Incomes	Threshold	*70,600	*70,600

*Note: The extra amount taxable at the 20% applies provided each spouse has taxable income of at least €35,300.

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Blind Persons Tax Credit

March 23, 2020

This can be claimed where an individual or their spouse is blind during the year of assessment. The additional tax credit for a single person is €1,650. If married and both spouses are blind the additional tax credit is €3,300.

Where a blind person has a guide dog they are entitled to an additional allowance of €825 – from 2011 onwards the cost of maintaining a guide dog (max €825) may be claimed under the heading of Health Expenses.

Tax Credits – Tuition Fees and Training Courses

March 23, 2020

Tax relief at 20% is available for third level tuition fees that you have paid for.

The maximum amount on which tax relief can be claimed is €7,000 subject to an amount being disregarded as follows –

– For the years 2018 and 2019 no relief will be allowed for the first €3,000 of fees paid for full time courses or the first €1,500 for part time courses.

These amounts are deducted from the total of the claims for the year in question e.g. the same deduction applies if the claim is for one person or two or more persons.

TAX SAVING TIP

This claim is often overlooked by parents who are paying fees for children attending private colleges. It is not too late to make a claim for the last four tax years if not already done so.

Tax Credits – Tuition Fees and Training Courses

March 23, 2020

Tax relief at 20% is available for third level tuition fees that you have paid for.

The maximum amount on which tax relief can be claimed is €7,000 subject to an amount being disregarded as follows –

– For the years 2018 and 2019 no relief will be allowed for the first €3,000 of fees paid for full time courses or the first €1,500 for part time courses.

These amounts are deducted from the total of the claims for the year in question e.g. the same deduction applies if the claim is for one person or two or more persons.

TAX SAVING TIP

This claim is often overlooked by parents who are paying fees for children attending private colleges. It is not too late to make a claim for the last four tax years if not already done so.

Tax Credits – Home Carers

March 22, 2020

This tax credit was introduced to provide a measure of compensation to married couples where one spouse remains at home to look after family members in view of the increased 20% tax rate band for dual income couples.

The tax credit is €1600 for 2020 & 2021. This tax credit must be claimed from the Revenue. In practice people often overlook this claim so it is worth checking to ensure that you are being allowed the benefit.

Where the home carer has other income a calculation needs to be done to see which is more beneficial i.e. the €1,600 tax credit or the increased 20% tax rate band.

If the home carer earns income of up to €7,200 during the tax year, the full tax credit may be claimed.

When the income exceeds €7,200, the tax credit is reduced by one half of the income of the home carer that exceeds this limit.

The spouse (the ‘home carer’) who works in the home must be looking after one or more dependent persons, i.e., a child for whom they are entitled to Social Welfare child benefit, a person aged 65 or over, or a person who is permanently incapacitated by reason of mental or physical infirmity and the qualifying person normally resides with the couple for the year.

The tax credit is not available to married couples that are taxed as single persons.

Tax Credits- Home Service Charges

July 27, 2013

The tax relief for home service charges/ refuse collection charges has been abolished for tax year 2012 onwards.

You can tax relief for tax years up to 2011 based on the amount paid in the previous year. In other words there is no tax relief for charges paid in 2011 which would have been allowed in 2012.

Income tax relief was available for individuals who paid local authority and other service charges. Relief was given for service charges paid in full and on time in the previous calendar year. The amount of the tax relief was 20% of the amount paid.

The maximum amount which qualified for tax relief was €400 which equated to a tax credit of €80.

Tax Credits- Trade Union Subscriptions

July 27, 2013

This tax credit has been abolished from 2011 onwards.

The maximum amount of the tax credit available was €70 for 2008, 2009 and 2010.

Personal Tax Credits- Reliefs and Exemptions

July 27, 2013

There are numerous tax credits and tax claims which often get overlooked. We have divided these into three different categories as follows:

Personal Tax Credits

Allowed at the 20% tax rate as a credit against your income tax liability.

Home Carer’s Tax Credit
Mortgage / Loan Interest
Private Rented Accommodation
Medical Insurance Policies
Tuition Fees & Training Courses
Incapacitated Child
Age Credit
Blind Tax Credits
Incapacitated Child
Dependent Relative Credit
Seafarer’s Credit
Medical Expenses

Personal Tax Reliefs

Allowed as a deduction in calculating your taxable income, which means they are more valuable in terms of tax saved for top rate tax payers.

Nursing Home Costs
Employing a Home Carer
Contributions to Pension Scheme
Revenue Approved Permanent Health Benefit Schemes (PHI)
Employment & Investment Incentive Scheme
Film Investment Relief for 2015 – scheme has been reformed and moved to a film corporation tax credit model with effect from 1 Jan 2015.
Deeds of Covenant

Personal Tax Exemptions

There are not many of these around but we explain the most common ones.

Income Exemptions & Marginal Relief
Child Minding Services in your home
Rent-a-Room Relief Tax Free Income
Leasing Farm Land
Foreign Service Allowances for Employees of Government Agencies

Single Parent Tax Credit

July 27, 2013

This additional tax credit is available to single parents who have dependant children. The extra tax credit is equal to the single persons tax credit so that the combined tax credits for a single parent equal the normal married persons tax credit. In addition a qualifying single parent is entitled to a slightly increased 20% tax rate band.

With effect from 1 January 2014, the additional credit is only available to the principal carer of the child.

A dependant child, for the purposes of this additional tax credit is a child who at the beginning of the year of assessment is under 18 years of age or if over 18 is receiving full time education. A child who is permanently incapacitated by reason of mental or physical infirmity from maintaining himself will also qualify as a dependant child regardless of age provided they were so incapacitated before reaching 21 years of age. A child also includes a stepchild, a child whose parents have not married, a child who has been informally adopted and an adopted child.

This additional single parent tax credit is not available to an unmarried couple who are living together.

Married Persons/ Civil Partnerships Tax Credit

July 27, 2013

This credit is available for all married couples/ civil partnerships (referred to in future collectively as qualifying couples) living together that are not continuing to pay their tax as single persons. Qualifying couples have different options as to how they should pay their tax. There are 3 different options for known as Joint Assessment, Separate Assessment and Single Assessment.

Joint Assessment
The majority of couples pay their tax on this basis. One spouse/partner is responsible for completion and submission of tax forms to the Revenue and for paying any tax owed to the Revenue. All tax credits are normally given to this spouse/partner and if the other spouse/partner is working they receive basic tax credits only against their earnings e.g. PAYE allowance for PAYE earners.

Separate Assessment
This is not to be confused with separated couples. A qualifying couple can elect to be taxed as single people during the tax year subject to re-examination after the end of the tax year to see if they would pay less tax under the Joint Assessment basis. If so they will get a refund.

This option can lead to cash flow disadvantages between spouses if there is a substantial difference in their incomes. However, provided you claim the re-examination of your joint tax position after the end of the tax year any tax overpaid during the tax year will be refunded to you.

If you wish to use this separate assessment method you have to apply for it to your tax office before the 1st of April during the relevant tax year.

Single Assessment
As the name implies this option means each spouse/partner is taxed as though they remained single. Your tax affairs are never joined together. This can result in more tax being paid than under the Joint Basis and Separate Assessment Basis.

This option is not chosen very often by qualifying couples because unlike the Separate Assessment Basis there is no option for re-examining your tax affairs on a Joint Basis after the end of the tax year.

If you wish to use this single assessment method you have to apply for it to your tax office before the end of the relevant tax year.

Tag: tax credits