Time for Ministers to act on Carer Tax Bills
Time for Ministers to act on Carer Tax Bills - The Labour Party
- Legal certainty needed with amnesty on historic Carer tax bills.
- Rules applying to the Home Carer Tax Credit should be amended to exempt Carer Allowance income and include single people.
- Carer’s save State over €20 billion annually.
Labour Social Protection spokesperson Mark Wall TD has today called on the Ministers for Social Protection and Finance to immediately review the treatment of carers’ payments, as thousands of Carers now face Revenue tax bills going back years after around 34,000 people received letters confirming that Carer’s Allowance and Carer’s Benefit payments are taxable.
This situation risks causing serious financial and emotional stress to families who already carry an enormous caring burden.
Deputy Mark Wall said:
“This is an appalling situation that has blindsided carers across the country. Carer’s Allowance is means tested, and for many people that created a genuine and understandable belief that they did not owe tax.
“Now over 34,000 Carer’s are opening letters from Revenue telling them they may face tax bills going back years. We need to be clear about what this means in real life. These are people who have given up work or reduced hours to care for a loved one. They are already under incredible pressure financially, emotionally and physically.
“We also need to be honest about the scale of what carers provide. Family carers save the State over €20 billion every single year. To put that in context, the HSE’s approved budget stands at €26.9 billion. Carers are effectively delivering their own health service in homes and communities across the country, yet they are treated as an afterthought when it comes to basic fairness and recognition.
“This situation did not arise overnight. For years, carers’ organisations have warned that taxing carers’ payments makes no sense and causes confusion and distress. Comparable social welfare supports, including Jobseeker’s Allowance and Disability Allowance, are not taxed as these are means tested payments. There is no justification for singling out carers for worse treatment, particularly when the State depends so heavily on the care they provide to keep the health system functioning.
“Carers deserve certainty, respect and support, not shock letters and financial fear landing through the door.
“The Minister for Social Protection and the Minister for Finance must immediately review this matter, halt any retrospective tax demands linked to carers’ payments, and bring forward a permanent solution that removes carers’ payments from the tax net.
“While Revenue has said it will not seek to review or collect tax for previous years, Labour is proposing that legal certainty be provided with a clear amnesty for any historic liability, through amendments to the Finance Act. Separately, to address the tax exposure Carer’s now face to tax, the conditions that apply to the Home Carer Tax Credit should be changed by increasing the current credit above €1,950, extending eligibility to single people, and substantially increasing the income taper. At present only Carer’s who are married or cohabiting with income of less than €11,100 are eligible for the credit.
“Government must act now to stand up for carers and recognise that the care they provide is not just invaluable, it is essential to the functioning of our health and social care system. I will also be holding a meeting of the Cross Party Oireachtas Group on Family Carers to discuss this issue and agree urgent next steps to protect carers.”