I don't understand how health tax relief works

arleitiss

Hey, I don't understand how health/medical tax relief works.

So let's say I pay (Slightly rounded off values):

PAYE: 600 Euro
PRSI (EE): 140 Euro
USC: 110 Euro

Total taxes: 850 Euro Monthly.


My work policy says that for health insurance:

1) Setup my own health insurance policy to be paid monthly.
2) "The insurance company should give you tax relief at source" (not sure what this means)
3) Bring proof of policy to us and we will pay you for it + it says: "just to note the prices listed on these websites may already be after the tax relief at source".


I have literally 0 idea what this means, like from my understanding - I take out my own policy, pay for it then my work will compensate it in full. But what or how does tax exemption/relief come in play here?

Geuze

arleitiss wrote: »

Hey, I don't understand how health/medical tax relief works.

My work policy says that for health insurance:

1) Setup my own health insurance policy to be paid monthly.
2) "The insurance company should give you tax relief at source" (not sure what this means)
3) Bring proof of policy to us and we will pay you for it + it says: "just to note the prices listed on these websites may already be after the tax relief at source".


I have literally 0 idea what this means, like from my understanding - I take out my own policy, pay for it then my work will compensate it in full. But what or how does tax exemption/relief come in play here?

Tax relief on med ins is applied at source.

This means that if I buy a policy with a price of 1000, I actually pay 800.

I don't pay 1000, and claim 20% tax back.

I just pay 800 to the insurer.

The State and the insurer settle the tax relief between themselves.

That's how it works for people buying their own med ins.

relax carry on

Note that while you are paying for the insurance yourself and your company is ultimately reimbursing you for it; the money they reimburse you will be subject to BIK. (it will be taxed as if it's part of your wage).