He should ask Revenue for a P21 balancing statement for 2006 anyway just in case. In general I feel that people should request one as a matter of course because even if things seem to be in order there can be surprises (I know this from experience).
He should be able to claim back some or all of the tax paid for 2007 to date if he is out of work long enough for his credits to accumulate unused and cover tax paid to date. The P50 will sort this out.
Whether or not he is entitled to welfare payments depends on his PRSI records (Jobseekers Benefit) and means test (Jobseekers Allowance). Best to just sign on ASAP and ask at the local SW office about entitlements.