Hi,
Just a quick question regarding carers allowance and tax. If one person is receiving the carers allowance and their spouse is working should the spouse be paying tax on the carers allowance? Should it be regarded as income?
Thanks!!!
Looking at the Citizen's Information Website here Carer's Allowance is classed as a taxable payment. It should therefore be included in a joint tax return. However, the spouse in receipt of the Carer's Allowance should then be entitled to the PAYE employee Credit of €1,830 which is granted to taxable Soccal Welfare recipients and that then largely covers the payment.
There are quite a few means tested payments which are taxable. Being means-tested does not, of itself mean tax exemption for the payment. Equally, just because it is taxable, does not ultimately mean that tax will be due.