Disability benefits from social welfare

alfabeta said:
Disability Benefit is taxable but I believe that Disability Allowance is not.
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I thought that most allowances were also assessable for income tax but since you need to satisfy a means test to qualify for them in the first place chances are you are probably exempt from tax anyway? Anyway the original query was about (PRSI linked) benefits not (means tested) allowances unless the original poster is not aware of the difference?
 
alfabeta said:
My understanding of reading the op was refering to the benefit itself, was it subject to tax and prsi. Disability Benefit is taxable (1st 6 wks non taxable) and Disability Allowance is not. In relation to PRSI/Health Levy, I believe that no illness benefits are subject to this charge.

http://www.citizensinformation.ie/c...e-payment/taxation_of_social_welfare_payments
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My wife has being receiving Dissability Benifit for some years now and it is taxed by reducing the credits on my personal tax credits each year by 20% of the amount she receives in 46 weeks of each tax year
 
My wife has being receiving Dissability Benifit for some years now and it is taxed by reducing the credits on my personal tax credits each year by 20% of the amount she receives in 46 weeks of each tax year[/quote]

That is generally the way they work it for jointly assessed paye, sometimes on SelpEmloyed it is taken into account on the IT return particularly if there are two PPS numbers involved.
 
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Don't forget that your wife is entitled to a PAYE allowance (as she has income which is subject to PAYE) which should almost negate her tax liability on her 46 weeks of Disability Benefit.

While your tax credits are being reduced to take account of her Benefit I would be checking if the correct reduction is being made.

You can obtain a Certificate of Taxable Disability Benefit received for each of the relevant years and send it to the Revenue with your P60. and request a review (especially if you think she has not been receiving a PAYE allowance)

P.S. If she has been on Disability Benefit for several years should she not have considered applying for Invalidity Pension?
 
Sorry I missed a bit!

The Cert of Benefit received can be requested from you local Social Welfare Office or the Taxation of Disability Benefit Section at the Dept. of Social Welfare. It will take a few weeks.
 
Nellie123 said:
Don't forget that your wife is entitled to a PAYE allowance (as she has income which is subject to PAYE) which should almost negate her tax liability on her 46 weeks of Disability Benefit.

While your tax credits are being reduced to take account of her Benefit I would be checking if the correct reduction is being made.

You can obtain a Certificate of Taxable Disability Benefit received for each of the relevant years and send it to the Revenue with your P60. and request a review (especially if you think she has not been receiving a PAYE allowance)

P.S. If she has been on Disability Benefit for several years should she not have considered applying for Invalidity Pension?
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My PAYE allowance has always been for two since she's been on D.B. (15yrs) I looked up the website on the Invalidity pension which seems to be worth extra €5.50 aweek.
She might investigate that a bit further, thanks
 
There are a couple of extra Benefits to Invalidity Pension ie. Free Travel for her (and you if travelling with her) and possibly Household Benefit Package (Electricity, Telephone & T.V.).

The extra Benefits + the extra cash might it worth a look.
 
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