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Income Tax - obligations


All Irish tax residents must pay Irish Income tax on all income, regardless of where that income comes from.

Each taxpayer is also obliged to make an annual tax return, unless they are exempted from this obligation. The primary exemption applies to taxpayers whose main source of income is from a wage, salary or pension and who pay their tax through the PAYE system.

All others, - self employed, those whose incomes come from rents, dividends etc must make an annual return and pay tax on the income they receive, after deduction of bona fide expenses relating to that income.

Claims for credits & allowances can be made for up to 4 years retrospectively.


Income Tax   -  Rates (2008)


The following are the income levels at which the rates apply

Single/Widowed Person - 20% on first €35,400, 41% on income above this.

Married Couple - One Income - 20% on first €43,000, 41% on income above this

Married Couple - Two Incomes - 20% on first €70,800, 41% on income above this. 

Note - transferable between spouses up to €44,400 max for any one spouse

One Parent Family - 20% on first €38,000, 41% on incomes above this. 

Exemption Limits (Over 65) - Single/Widowed €20,000, Married €40,000


Income Tax Credits


Tax Credits are effectively a discount off your tax bill.

                                                     2008            2007                2006                2005                2004

Single Person                               1830            1760                1630                1580                1520

Married Couple                            3660            3520                3260                3160                3040

Widowed Person

-year of bereavement                                     3520                3260                3160                3040

-with dependant children                               1760                1630                1580                1630

-without dependant children                         2310                2130                1980                1820

Widowed Parent

-1st year after bereavement       4000         3750                3100                2800                2600

-2nd year after bereavement       3500         3250                2600                2300                2100

-3rd year after bereavement       3000         2750                2100                1800                1600

-4th year after bereavement       2500         2250                1600                1300                1100

-5th year after bereavement        2000        1750                1100                800                  600

One parent family

-  Widowed                             1830         1760                1630                1580                1520

-  Other                                                   1760                1630                1580                1520

Incapacitated Child (Max)             3660        3000                1500                1000                500

Dependant Relative (Max)                                 80                    80                    60                    60

Blind Person                                    1830        1760                1500                1000                800

Blind Married Couple                       3660        3520                3000                2000                1600

Age Credit

            Single/Widowed                 325           275                  250                  205                  205

            Married                               650           550                  500                  410                  410

PAYE                                               1830         1760                1490                1270                1040

Home Carer (Max)                           900           770                  770                  770                  770

Trade Union Subs (Max)                                     60                    60                    40                    40

Employment of carer of

Incapacitated Person (Max)                        50000              50000              30000              30000

(At marginal rate)

Rent Relief  (Max)              

Single Under 55                                                 1800            1650

Single Over 55                                                   3600            3300

- Widowed/Married U 55                                  3600            3300

- Widowed/Married O 55                                 7200             6600

Mortgage (Max)

First Mortgage

      -Single                                   10000             8000             4000

      -Married/Widowed               20000          16000             8000

Other Mortgages

      -Single                                     3000             3000             2540

      -Married/Widowed                 6000            6000             5080



Income Tax Allowances


Tax Allowances reduce your taxable income, before tax rates are applied.

The principal tax allowances are:

1. Pension Contributions – subject to % of income, dependant upon age, and overall cap.

2. Medical Expenses – no cap. From 2007 on you can claim expenditure on any approved medical expense for any person.

3. Guide Dogs for blind persons – max €825

4. Employment of carer for incapacitated person – max €50000.

5. BESinvestment - subject to limits. 

Disclaimer
The information on this website is for general guidance only.It is essential to take professional advice on specific issues about their impact on any individual or entity.No liability can be accepted for any errors or omissions or for any person acting or refraining from acting on the information provided on this site.