Would the date of the compensation award or the cheque (?) payment not determine which tax year this money falls into as income?Thanks Clubman, was thinking the same. The leaflet online seems clear that tax has to be paid so I think the revenue staff were mistaken. It is not an everyday enquiry to be fair. Still can't find out if possible to offset compensation against 2007 tax - assuming that tax will have to be paid. As he had no income in 2007 it would solve the tax issue for him if this was allowed.
Thanks, but I am confused now as I rang the tax office today to ask about the possibility of claiming against 2007 income for the compensation received in 2008 and explained the situation and that the injuries were minor so we knew tax would be payable etc. The 2 supervisors in the office both stated that the income was tax free and when I referred to the documentation given in the link from Clubman (thanks), that states that minor injuries are not tax exempt, they insisted I was wrong!!! When I pressed on about the fact they told me they know their job and not to worry but I still think tax has to be paid??!!! Can anyone help??? Last thing he wants/we want is a tax bill down the line when the money is gone on fees etc. Any advice???? Thanks
With the best will in the world Revenue staff can and do give out incomplete or incorrect information from time to time. You need professional advice so this is a good idea:I've spoken to 2 different people in revenue about it and both said there's no tax due!
may also talk to a tax accountant about it.
With the best will in the world Revenue staff can and do give out incomplete or incorrect information...
How does that conflict with what I said about Revenue officials sometimes giving out incorrect or incomplete info?!Not sure I agree with that Clubman! Two people both talk to revenue independently and probabaly to different officials as well and both are given seemingly contradictory information to what's on their website
I doubt that the PIAB are qualified to give authoritative tax advice! In my opinion you need professional advice from somebody qualified and authorised to give tax advice.Decided to ring the Personal Injuries Assessment Board (PIAB) to see what their take is on the tax on compensation and they insist it is not taxable.
Decided to ring the Personal Injuries Assessment Board (PIAB) to see what their take is on the tax on compensation and they insist it is not taxable. However, if the money received is invested and earns a return, this is taxable except in certain cases which you can see when you re-read the information on revenue.ie:
"What compensation payments do not qualify for exemption?
The following compensation payments do not qualify for exemption:They are talking about taxing the income arising from investment of the compensation, not the compensation itself it would seem. If you are permanently and totally incapacitated and can no longer maintain yourself you will not pay tax on the income arising from investing the compensation. Otherwise, you will pay tax this income! This was not clear when reading the revenue info without having spoken to PIAB first.
- Compensation payment received as a result of minor injuries
- Compensation payment to an individual whose injury causes permanent incapacity but the incapacity is not total or does not prevent the individual from maintaining himself or herself."
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