Tax Credits, Reliefs and Exemptions

MS can come with many costs. We have pulled together some information on tax credits, reliefs and exemptions that may be relevant to you or your loved ones, to help you to navigate this space. Supporting evidence – such as medical certificates are required. The information provided in this piece has come from www.revenue.ie as well as Inclusion Ireland and Citizens Information, and is correct at the time of writing (January 2017).  

Time limits: 
It is important to note: Claims for repayment of tax must be made within 4 years after the end of the year for which the claim is being made. For example claims relating to 2016 must be claimed by December 31st 2020.

Tax credits, reliefs and exemptions that may apply to people with Multiple Sclerosis:

Blind Person’s Tax Credit

This credit of €1,650 may be claimed by anyone who is regarded as blind. Revenue state the following conditions must be met in order to claim this credit;

‘To qualify for the tax credit you or your spouse or civil partner must have impaired vision to the extent that:

  • the central visual acuity does not exceed 6/60 in the better eye with spectacles or contact lenses 

or

  • the field of vision is limited to such an extent that the widest diameter of the visual field subtends an angle no greater than 20 degrees.

Supporting evidence is required to claim this credit – a medical certificate provided by an eye specialist must state the degree of vision loss, as well as stating whether the vision loss is permanent or temporary.  In cases where the vision loss is temporary – a new medical certificate must be submitted for each year the tax credit is claimed.

For further information on how to apply, and for the relevant claim form, please visit: http://www.revenue.ie/en/tax/it/credits/blind-credit.html

Deed of Covenant

This legal agreement is made between two individuals, where one agrees to pay the other an amount of money without any benefit in return.  As long as a Deed of Covenant is properly drawn up in favour of a person who is permanently incapacitated, tax relief is available.  Please note that parents cannot covenant to a permanently incapacitated child under the age of 18. 

For further information, please visit: http://www.revenue.ie/en/tax/it/leaflets/it7.html

Dependent Relative Tax Credit 

This tax credit of €70 can be claimed by a taxpayer who maintains: 

  • A relative who has a disability or is aged 65 or over.
  • A widowed parent.
  • A son or daughter who lives with the taxpayer and on whom the taxpayer relies because of old age or infirmity.

For more information, please visit: http://www.revenue.ie/en/tax/it/credits/dependent-relative.html

Employed person taking care of an Incapacitated Individual

This relief can be claimed in respect of the cost of employing a person (including a person whose services are provided by or through an agency) to take care of either: 

  • an incapacitated family member, including the claimant, their spouse or civil partner.
  • a relative of the claimant, or a relative of the claimant’s spouse or civil partner, who is totally incapacitated. A ‘relative’ in this context includes an individual for whom the claimant is or was the legal guardian. 

This allowance of up to €75,000 may be claimed by one family member or divided among a number of family members if they are contributing towards the cost. 

For further information, visit:  http://www.revenue.ie/en/tax/it/leaflets/it47.html

Home Carer’s Tax Credit   

A Home Carer’s tax credit is available for married couples where one spouse works in the home caring for;

  • a child for whom Child Benefit is being paid, 
  • a person over 65 
  • a person who requires the care because of a disability. 

The tax credit has a value of €1,100 for carers with an income up to €7,200 (or €5,800 for years up to and including 2015).

For more information, please visit: http://www.revenue.ie/en/tax/it/credits/home-carers.html

Health/Medical Expenses Tax relief 

This tax relief can be claimed on the claimant’s own behalf or on behalf of another person whom the claimant has paid medical expenses. 

Relief may be claimed on expenses including the following;

  • Doctors’ bills
  • Hospital bills 
  • Medicines prescribed by a practitioner 
  • Physiotherapy prescribed by a practitioner 

Costs incurred in provision of a wheelchair or wheelchair lift – excluding alterations to buildings (it may be useful to view information on the Housing Adaption Grant for People with Disabilities – from your local Council).

For a full list of expenses which are eligible for tax relief, and for further information on how to apply, please visit: http://www.revenue.ie/en/tax/it/leaflets/it6.html

Incapacitated Child Tax Credit 

A parent or guardian of a child who became permanently incapacitated before the age of 21, or while she or he was in full-time education, may apply for this tax credit of €3,300.

For further information, please visit: http://www.revenue.ie/en/tax/it/credits/incapacitated-child-credit.html

Deposit Interest Retention Tax (DIRT) 

If you have savings in a financial institution such as a bank, building society, credit union or post office, tax at is deducted on the interest. This is called Deposit Interest Retention Tax (DIRT). An individual, their spouse or civil partner, who is permanently incapacitated, may be entitled to exemption from DIRT or to a DIRT refund. 

For more information,  please visit: http://www.revenue.ie/en/tax/dirt/leaflets/de2.html

Lump Sums

Lump Sum payments can be exempt where paid by an employer because of injury or disability. To qualify for relief, the payment must be made on account of injury or disability of the holder of the office or employment and the disability must be the cause of termination of employment. 

For more information, please visit: http://www.revenue.ie/en/tax/it/leaflets/it21.html#section3

Special Trusts for Permanently Incapacitated Individuals 

Special tax treatment applies on income arising following the creation of a trust whose funds have arisen as a result of public subscription raised on behalf of an individual or individuals who are permanently and totally incapacitated. Contact your Revenue office for further information. 

For further information, please visit: http://www.revenue.ie/en/personal/circumstances/disability-information.html

Universal Social Charge (USC) 

People who hold a full medical card and who’s total yearly income is below €60,000 may have a reduced rate of USC. Payments and income from the Department of Social Protection already subjected to DIRT are exempt from USC. 

For more information, please visit: http://www.revenue.ie/en/tax/usc/

Medical Expenses of Incapacitated Persons 

An exemption on inheritance tax is in place for gifts or inheritances taken by an individual who is permanently incapacitated - to meet their medical expenses (such as nursing home care).

For more information, please visit: http://www.revenue.ie/en/tax/it/leaflets/it6.html

VAT Refunds 

VAT repayment can be claimed on the purchase of some special aids and appliances such as walk-in baths and hoists. Individuals who purchase an aid or appliance for a disabled person can claim a VAT refund.

For more information please visit: http://www.revenue.ie/en/tax/it/leaflets/it12.html 

Drivers and Passengers with Disabilities 

A number of tax reliefs may be claimed by persons with disabilities on the purchase of motor vehicles including VAT and VRT refunds or for the adaption of a vehicle.

Revenue states:

“Relief is available for the following applicant types, depending on the level of vehicle adaptation and is subject to a maximum amount of relief…

Drivers with a Disability 

  • €10,000 for a driver with a disability where the vehicle has adaptations. 
  • €16,000 for a driver with a disability where the vehicle has more specific adaptations
  • €22,000 for a driver with a disability where the vehicle has extensive adaptations 

Passengers with a disability/family member of a passenger with a disability

  • €16,000 for a passenger with a disability/family member of a passenger with a disability whose vehicle has adaptations. 
  • €22,000 for a passenger with a disability/family member of a passenger with a disability whose vehicle has more extensive adaptations.

More information on the range of tax reliefs which can be applied can be found in ‘DRIVERS AND PASSENGERS WITH DISABILITIES ORGANISATIONS TAX RELIEF SCHEME’, which may be found on the website http://www.revenue.ie/en/personal/circumstances/disability-information.html#section3

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Further information on these tax reliefs, credits and exemptions and how to apply, can be found on www.revenue.ie or by calling Revenue’s LoCall numbers:

Border Midlands West Region:  Call 1890 777 425 
Cavan, Donegal, Galway, Leitrim, Longford, Louth, Mayo, Monaghan, Offaly, Roscommon, Sligo, Westmeath

Dublin Region: Call 1890 333 425 
Dublin (City and County)

East & South East Region: Call 1890 444 425 
Carlow, Kildare, Kilkenny, Laois, Meath, Tipperary, Waterford, Wexford, Wicklow 

South West Region: Call 1890 222 425 
Clare, Cork, Kerry, Limerick

Reference:

http://www.revenue.ie/en/tax/it/leaflets/it12.html

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