Free money from Revenue for parents

OU812

Don't think a lot of people know about this one, but if one of a pair of parents are stay at home to look after the kids - maybe by choice or maybe through unemployment/redundancy, the working parent is entitled to a tax credit of €1,100 per year.

Thats a little shy of €22 a week extra in your pay packet.

It can be backdated up to four years but if the stay at home parent had any income in any of those years, you won't get it.

If you're claiming now for this year, it'll be backdated until January (6 weeks if paid weekly).

Further info here: Citizens Information Website

You can claim by calling your local revenue office or online at the mypaye site.

Wheety

Isn't this just a transfer of the tax credits of the non working parent?

loyatemu

OU812 wrote: »

It can be backdated up to four years but if the stay at home parent had any income in any of those years, you won't get it.

Not quite - you can earn a certain amount and still claim it - for 2017 this amount is €7200, it was less in previous years.

You also can't claim the credit if you're availing of the increased standard rate band for dual-income couples - if the stay-at-home parent's income is <€5500, you're better off claiming the credit.

OU812

Wheety wrote: »

Isn't this just a transfer of the tax credits of the non working parent?

It's an additional tax credit which you are giving to your partner. You should also transfer all other credits if you are not working to avail of more benefit.

loyatemu

Wheety wrote: »

Isn't this just a transfer of the tax credits of the non working parent?

no - it's an extra credit and you have to claim it. If you're a married couple with no kids, you can't claim this.

It was introduced as a sop to single income couples when tax individualisation was brought in many years ago.

OU812

loyatemu wrote: »

Not quite - you can earn a certain amount and still claim it - for 2017 this amount is €7200, it was less in previous years.

You sure? Revenue told me it was not available if you had ANY income in a particular year.

loyatemu

OU812 wrote: »

You sure? Revenue told me it was not available if you had ANY income in a particular year.

http://www.revenue.ie/en/tax/it/leaflets/it66.html

To qualify for the full tax credit the home carer’s income must not exceed €7,200 in the tax year. Where the home carer’s income is between €7,200 and €9,400 in 2017 (€7,200 - €9,200 in 2016 and €5,080 - €6,700 in years 2013 - 2015) the tax credit is reduced.

Ceist_Beag

Hmm, I think you are missing one important point OP. This is an either or scenario - either you can avail of the tax credits of your partner (i.e. avail of the increased standard rate band), or you can add this tax credit to your own, but that you cannot avail of both. It is up to each couple to decide which is more beneficial to them.
See the section "If I am married or in a civil partnership and taxed under Joint Assessment, can I claim both the Home Carer Tax Credit and the increased Standard Rate Band for dual income couples?" under http://www.revenue.ie/en/tax/it/leaflets/it66.html for more.

gaz wac

I think that's for dual income Ceist B, the OP is talking about if one parent is at home full time. If this is the case, the person working should have tax credits of €6,050 ( 1650 x 3 + 1,100) and a cut off point of €42,800. And remember to claim the €200 tax credit if your employer pays your health benefit and you pay BIK on it.

randombar

Could a grand parent apply for this?

ted1

Ceist_Beag wrote: »

Hmm, I think you are missing one important point OP. This is an either or scenario - either you can avail of the tax credits of your partner (i.e. avail of the increased standard rate band), or you can add this tax credit to your own, but that you cannot avail of both. It is up to each couple to decide which is more beneficial to them.
See the section "If I am married or in a civil partnership and taxed under Joint Assessment, can I claim both the Home Carer Tax Credit and the increased Standard Rate Band for dual income couples?" under http://www.revenue.ie/en/tax/it/leaflets/it66.html for more.

You are not reading it correctly


Where only 1 person works you can do both, I've been doing it for years . If only 1 person works then you are not a dual income couple

ted1

GaryCocs wrote: »

Could a grand parent apply for this?

If they live:
next door in a neighbouring residence, or
on the same property, or
within 2 kilometres of the claimant.
They may be entitled

Ceist_Beag

ted1 wrote: »

You are not reading it correctly

Where only 1 person works you can do both, I've been doing it for years . If only 1 person works then you are not a dual income couple

Fair point but I thought it was worth pointing out. You don't need to both be working to be considered a dual income couple (if for example you have a second home which you are renting out or have any other source of income). So it is not correct to say that if one 1 person works then you are not a dual income couple.

ted1

Ceist_Beag wrote: »

Fair point but I thought it was worth pointing out. You don't need to both be working to be considered a dual income couple (if for example you have a second home which you are renting out or have any other source of income). So it is not correct to say that if one 1 person works then you are not a dual income couple.

No if you have a home you rent out , you put that income with the person working. It is correct to say that if 1 person works you are a single income

Ceist_Beag

ted1 wrote: »

No if you have a home you rent out , you put that income with the person working. It is correct to say that if 1 person works you are a single income

Hmmm, I had this very conversation with my accountant and he said you cannot put rental income against one person if both names are on the property deeds Ted. His words were that you cannot decide who to put the income against - it is distributed to both owners. Is there anywhere to back up what you say before I investigate this further?

gerrybbadd

Mods - would this not be better moved to the taxation forum?

nhunter100

It's not free money from Revenue, it just means you are allowed to keep slightly more of your hard earned money.

ted1

Ceist_Beag wrote: »

Hmmm, I had this very conversation with my accountant and he said you cannot put rental income against one person if both names are on the property deeds Ted. His words were that you cannot decide who to put the income against - it is distributed to both owners. Is there anywhere to back up what you say before I investigate this further?

Your accountant should look at page 10 of form 11 which is used for self Assessments.
Clearly two columns for declaring rental incomes. One marked self and the other marked spouse or civil partner

Blade

Note to Taxation mods, this has been moved here from Bargain Alerts, please remove if not appropriate

phormium

I wouldn't take two columns to mean you can decide yourself which one you want to put it in if it's from a joint property, I imagine the need for two columns is because both spouses could have separate rental income from properties in their sole names.

ted1

phormium wrote: »

I wouldn't take two columns to mean you can decide yourself which one you want to put it in if it's from a joint property, I imagine the need for two columns is because both spouses could have separate rental income from properties in their sole names.

Well there's no middle column so
Think away but I've been claiming it legitimately for the past 8 years and have had revenue audits. It's credit fur when one parent stays at home to mind the kids.

OU812

Ceist_Beag wrote: »

Hmm, I think you are missing one important point OP. This is an either or scenario - either you can avail of the tax credits of your partner (i.e. avail of the increased standard rate band), or you can add this tax credit to your own, but that you cannot avail of both. It is up to each couple to decide which is more beneficial to them.
See the section "If I am married or in a civil partnership and taxed under Joint Assessment, can I claim both the Home Carer Tax Credit and the increased Standard Rate Band for dual income couples?" under http://www.revenue.ie/en/tax/it/leaflets/it66.html for more.

ted1 wrote: »

You are not reading it correctly


Where only 1 person works you can do both, I've been doing it for years . If only 1 person works then you are not a dual income couple

Wife got her payslip today. Can confirm, this is an ADDITIONAL allowance. She's getting €140 extra this week & from next week will have an additional €22 a week.

barneystinson

OU812 wrote: »

Wife got her payslip today. Can confirm, this is an ADDITIONAL allowance. She's getting €140 extra this week & from next week will have an additional €22 a week.

Has the standard rate cut off point been reduced accordingly?

OU812

barneystinson wrote: »

Has the standard rate cut-off point been reduced accordingly?

Haven't seen the payslip but she called earlier with that info.

Capslock

Thanks for this information. What is the credit called do you know? When I ring them I'd like to quote it. I am currently getting the tax credit of my partner who doesn't work at all. But this can be added too right and back dated?

nhunter100

Capslock wrote:

Thanks for this information. What is the credit called do you know? When I ring them I'd like to quote it. I am currently getting the tax credit of my partner who doesn't work at all. But this can be added too right and back dated?

Home carer credit I think it's called. You may already be in receipt of it though if you are using some of partners allowance.

Capslock

nhunter100 wrote: »

Home carer credit I think it's called. You may already be in receipt of it though if you are using some of partners allowance.

I thought the two credits where different things though...didn't another poster say they received both for a number of years now?

nhunter100

Capslock wrote:

I thought the two credits where different things though...didn't another poster say they received both for a number of years now?

I don't think they are. Best to ring ROS. I don't want to give you wrong advice. I just know before my wife went back to work I received part of her tax allowance ( what you can earn at 20%) and an extra credit of just over a 1000 for the year (divided by 52).

Capslock

loyatemu wrote: »

no - it's an extra credit and you have to claim it. If you're a married couple with no kids, you can't claim this.

It was introduced as a sop to single income couples when tax individualisation was brought in many years ago.

This was posted earlier in the thread...guess I'll ring em and find out though...

loyatemu

There are 3 things being confused here:

1. If you are married and on a single income, the non-earner can transfer their personal tax credit to the earner (this is worth €1650 - the PAYE credit is also worth €1650 but this is non-transferable - if you're not in employment, you don't get it). So a married, single income earner will get €1650 x 3 (=€5950) in tax credits.

2. If the non-earning spouse is at home caring for (their own) children (or an elderly/disabled relative) then the couple can also claim the Home Carers Credit of €1100. You can still claim this even if the home spouse earns some money (< €7200, then it tapers off).

3. There's also the standard rate cut off, which for single people is €32800, and for married couples is €41800. If both members of a married couple are working, the cut off can be increased up to €65600 but the extra allocation is non-transferable (so e.g. if the main earner is using the €41800, the second earner has to take the extra €23800 even if they can't use it all).

You can't claim the Home Carer's Credit if you are also claiming the increased standard rate cutoff. If the secondary earner is earning less than €5500 then you are better off taking the credit, above that you are better off taking the increased standard rate cutoff. (this is only relevant if the "home spouse" has some small income - if they have no income of their own, just claim the Home Carers credit).

psnKOB79LFC

ted1 wrote: »

Well there's no middle column so
Think away but I've been claiming it legitimately for the past 8 years and have had revenue audits. It's credit fur when one parent stays at home to mind the kids.

So misinformed it hurts my brain