pension issue (taxation) - after death

C

casiopea

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Hi,

My father died in October 2011. My mum received a letter this morning from the revenue commisioners saying that tax was incorrectly deducted from his social protection pension (formerly social welfare pension) and that it would be adjusted and the amount owing deducted in 2012. The thing is, he is dead.

According to mum, dad received an occupational pension (and therefore salary cheque) monthly but never a social welfare pension. We notified the occupational pension in October that he died and mum now receives 50% of this.

So Ive a couple of questions
1) Could they have made an error given that he did not receive a social welfare pension but an occupational one? Or is one a subset of another?
2) Is mum liable for this, or all of this, debt given that the person this letter is addressed to is not her. I am kind of assuming she is as she inherited "his estate" ie the family home.
3) Given that mum only receives 50% of this occupational salary, is she liable for only 50% of the debt
4) Given this is the money she lives off every month can she negotiate how they deduct the money off - as its no longer the 100% pension.

Thanks for this. My mum has a ridiculous distrust of the revenue commissioners (or the tax people as she calls them) and its difficult for me to contact them from switzerland - though I am trying this too.

Thanks in advance for any help
cas
 
Hi,

I would suggest contacting the revenue department about this. From the news today they are not looking to chase underpayment but this may change in the future. Currently you mother should be getting the percentage of your fathers private pension and also the widows pension.

The revenue should be aware of this and she will have the correct tax credits assigned to her so hopefully she shouldnt see any difference in what she is able receive.

I would contact the revenue in the first instance then the comapny who the private pension is held with talk with there pensions department and make sure she is not going to see any changes.

Best of luck
Rob
 
Sorry for your loss.

The recent news reports about Revenue chasing tax from pensioners has been misunderstood in some quarters. It's not a new tax. Anyone earning more than the tax exemption limit (currently €36,000 per year for a couple where one or both are over 65) has an obligation to pay tax. This would include State pension, private or occupational pensions, taxable rental income etc. Some people were receiving private pensions as well as the State pension. Revenue were only calculating tax based on the private pensions and ignoring the State pension, claiming that they (Revenue) weren't aware of the person's State pension, despite the State pension being paid by...er...the State and Revenue being another arm of the State.

So now they've joined the dots, looked at who is receiving the State pension, cross-referenced this with who is also receiving a private pension and figured out that about 115,000 people may have been taxed incorrectly. At this time, it's not clear whether or not they intend to look back to try to collect back-taxes or will just correct matters going forward and ignore the past.

If, as your post suggests, your Dad never received a State pension, then this shouldn't affect your Mum as presumably the correct amount of tax was deducted from his private (occupational) pension.

But I'm curious as to why he wouldn't have received a State pension? Was he a public servant?
 
casiopea said:
Hi,

My father died in October 2011. My mum received a letter this morning from the revenue commisioners saying that tax was incorrectly deducted from his social protection pension (formerly social welfare pension) and that it would be adjusted and the amount owing deducted in 2012. The thing is, he is dead.
Click to expand...

My condolences on your loss. This letter has been mass mailed to about 115,000 older people or pensioners. Many have no liability whatsoever, inluding my mother-in-law, but the wording is still the same. does the letter state a particular amount owing? I suspect not. If not, tell your mum to relax as it does not apply to her. Your dad's estate would be liable in any event.
 
Also got one for my 90+ year old Mum and its v hard to figure what it means. She has an Irish Life pension and a state one. I remember asking Irish Life after Dad's death what was the story with tax and the state pension and they said not to worry as this was already taken into account with the tax they deducted.
 
putsch said:
Also got one for my 90+ year old Mum and its v hard to figure what it means. She has an Irish Life pension and a state one. I remember asking Irish Life after Dad's death what was the story with tax and the state pension and they said not to worry as this was already taken into account with the tax they deducted.
Click to expand...

You'd need to add her State and Irish Life pensions together and then calculate if Irish Life are deducting the correct amount of tax, based on the combined figure. An online calculator like www.taxcalc.eu would probably help with this.
 
guys,

Thank you so much for your responses. Its been so helpful and thanks so much for that online calculator I will definitely sit down with her and use it to make sure she is sorted and paying the right tax. Yes he was a public servant (dept of marine) and was on an occupational pension from them.

The good news is she got on the phone and rang "those tax people " (as she calls them) and got a very helpful lady. Who essentially told her that what is owed by dad is 2 cents for some months in 2011. There was no amount written in the original letter. She told mum to tear up the letter and ignore it !!! I told mum not to do that, but I am glad that she seems to have gotten over her fear of the revenue commissioners through this unfortunate experience (the unfortunate experience being that they wrote to my dead father which upset her greatly).

I will use this calculator to ensure that she is paying the right tax on the remaining occupational pension and widows pension.

Thanks again guys
Cas
 
Glad to hear you got sorted. As your father had only one pension, the letter should never have gone out. I do think that this was handled badly by Revenue.
 
In relation to your question about your mother being liable for your father's tax debts, she would not have to pay anything. But she should ensure that she is paying the correct tax on her own income (all income).

Also she will probably get more unwelcome letters from revenue addressed to your father unless you notifiy revenue that he has died.

My condolences to you and your mother.
 
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