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Life insurance taxation

  • 02-09-2022 11:59pm
    #1
    ClmAlfie
    Registered Users, Registered Users 2 Posts: 88 ✭✭


    Hi guys

    Recently my father died and he had a life insurance/assurance. Not sure which one. So my mother wants take out the whole lot.

    Obviously she will have to pay tax and usc

    Can anyone explain how does the tax and usc work

    For instance let say it's 86000e

    Does she pay the 20% 1st and then 40% or is it the 30% (I think) for the whole lot

    She's 84 and has a medical card. Does she pay the standard usc rate

    I'm clueless at these things



Comments

  • #2
    ari101
    Registered Users, Registered Users 2 Posts: 2,835 ✭✭✭ari101


    Sorry for your loss.

    Forgive me if I'm completely off the mark here, but if it is a policy solely insuring the deceased, I would have thought a payout would form part of his estate? And if they were married, she would get full Capital Acquisition Tax exemption on it as part of her inheritance.

    Maybe the details of this policy are different but I'd start enquiring if that is the case.

    If so, what it might affect is her means tested capital for the medical card (or any other means tested social welfare payments).



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