Tax credits and DSP Income

Lazy Bhoy

I am trying to help a neighbour to sort out her tax credits and I see something that I am not too sure about.

She has sent off for a pin number and logged onto the Revenue website.

Her tax credits are

Personal Tax Credit 1,650
PAYE Tax Credit 1,650
One Parent Family Tax Cr 1,650

In the following section the form states that her tax credits were reduced by

DSP Income 2,400

What DSP payments could be reducing her tax credits?

She claims FIS for one of her children who is still in school.
Her other son moved abroad last summer when he finished school and so the FIS payment was reduced.

Her only other payment apart from her salary is her monthly child benefit payment for the remaining child who is still attending school.

She says that this DSP income reduction has been there since she started work in 2005. Would it be the FIS and Child benefit payments which are causing this reduction?

Any advice would be greatly appreciated.

Thank You

Citizenpain

Neither Child Benefit or FIS are taxable

Is she getting the One-Parent Family Payment by any chance?

Lazy Bhoy

Thank you for the reply Citizen

As far as I am aware, she just gets the One Parent Family Tax Credit
She does not get a one parent payment

Citizenpain

A quick call to Revenue should get it sorted

see contact locator bottom right of the below

http://www.revenue.ie/en/index.html

List of DSP payments and whether taxable or not here

http://www.citizensinformation.ie/en/social_welfare/irish_social_welfare_system/claiming_a_social_welfare_payment/taxation_of_social_welfare_payments.html

Lazy Bhoy

Cheers Citizen

I will drop round to her this evening when she is finished work and have her contact the Revenue.

I had a feeling that FIS and Child benefit should not be deducted and that's why I posted the question here.

The girl told me that she does not receive any other DSP payments so I can not see why such a reduction would be made.

Do you know if these reductions could be backdated to when they began if it is found to be an error?

Citizenpain

You can go back 4 years

Mongarra

Seems to me some payment was being made in the year(s) before she started work and, obviously, the tax credit deduction has carried on automatically as will happen if Revenue are not advised about any change.

As a previous poster has indicated, a 'phone call to the Revenue office (best to contact the one that issued the tax credit notification) should clear it up. Refunds may be due for the over-deduction of tax due to the tax credit reduction (presumably €2,400 @ 20% for each year) but, unfortunately, you cannot go back further than 4 years plus the current year, so 2009 and later can be claimed.

relax carry on

Lazy Bhoy wrote: »

Cheers Citizen

I will drop round to her this evening when she is finished work and have her contact the Revenue.

I had a feeling that FIS and Child benefit should not be deducted and that's why I posted the question here.

The girl told me that she does not receive any other DSP payments so I can not see why such a reduction would be made.

Do you know if these reductions could be backdated to when they began if it is found to be an error?

If the taxable DSP payments were recorded in error, she will be able to have her records reviewed for the last 4 year's.

The payments could be on there for years, that is why you should always check your credits and rate band at the start of every year. The amount itself could refer to the one parent family payment from the DSP if she ever received it.

Lazy Bhoy

Thanks everyone

I have just sent her a text advising her to contact the Revenue.

Hopefully she will get it sorted out.