Taxed for being on carer's allowance

Lorna93

Hey everyone,

My partner was previously a carer for his brother, his sister took over in September and my partner secured a job in November. His new tax cert has just came in saying his €3300 tax credits are being reduced by almost €2200 for his carers allowance income (same as this year). We've contacted the revenue but it could be up to 25 days before we get a response. We've also tried to remove the income from his PAYE account online with no success.

Is it normal to have your tax credits reduced this much even though he isn't claiming carer's allowance anymore?

Thanks

CIARAN_BOYLE

I'll assume that the tax cert is for 2018 and not 2019.

He was on carers allowance for 8 months (January to august). Carers allowance is a taxable source of income. Tax credits are generally taken up on a weekly or monthly basis. So if your partner used his tax credits against his income from the state for 8 months I would expect 8 months tax credits to be used up.

2200 of 3300 is 2/3. January to August is also 2/3.

Lorna93

The tax cert is for 2019. So if he claimed for 8 months, he'll be taxed for 8 months is that it? Sorry I don't have a clue about this.

wiggle16

Lorna93 wrote: »

The tax cert is for 2019. So if he claimed for 8 months, he'll be taxed for 8 months is that it? Sorry I don't have a clue about this.

No, the tax due on the carer's allowance will be collected over the course of the year.

If he's paid weekly for example, then the amount of tax owed will be divided by 52 and his credits will be reduced by that amount each week, so he will pay more tax than he would have. The idea being that by the end of the year, the tax due on the carer's income will have been collected through his wages.

Kristopherus

CIARAN_BOYLE wrote: »

I'll assume that the tax cert is for 2018 and not 2019.

He was on carers allowance for 8 months (January to august). Carers allowance is a taxable source of income. Tax credits are generally taken up on a weekly or monthly basis. So if your partner used his tax credits against his income from the state for 8 months I would expect 8 months tax credits to be used up.

2200 of 3300 is 2/3. January to August is also 2/3.

Are you sure Carers Allowance is taxable? Cares Benefit is, but I thought the Allowance was not.

wiggle16

Kristopherus wrote: »

Are you sure Carers Allowance is taxable? Cares Benefit is, but I thought the Allowance was not.

Carer's allowance is taxable - http://www.citizensinformation.ie/en/social_welfare/irish_social_welfare_system/claiming_a_social_welfare_payment/taxation_of_social_welfare_payments.html#l450a3

You might be thinking of jobseeker's benefit, which is taxable, and jobseeker's allowance, which is not.

The Diddakoi

If he is no longer claiming carer’s allowance he will need to get a letter from the Department of Employment Affairs and Social Protection(DEASP) stating the date payment ceased. When he gets this he can send it in to Revenue through myEnquiries if he is registered for myAccount, or post it in to his local Revenue office. His credits for 2019 will then be returned to the usual amount.

For 2018 he should get a statement from DEASP showing the total amount of Carers received for the year, and when he gets his P60 from his employment he can request a P21 balancing statement to see if he is due a refund.

splinter65

Kristopherus wrote: »

Are you sure Carers Allowance is taxable? Cares Benefit is, but I thought the Allowance was not.

It didn’t used to be but it is now.