Making Cents: Claim tax refunds now, have money before Christmas

Consumer advice with Gráinne McGuinness.

This day seven weeks is New Year’s Day and anyone who has not applied before then for any tax rebates they are due from 2014 has missed the boat.

Revenue allows people to go back up to four years to claim tax back on, for example, health expenses, nursing home fees, tuition fees, and for claiming entitlements to tax credits or reliefs due, such as the home carer’s tax credit.

This sounds like a generous window but so many leave these unclaimed that earlier this month Revenue wrote to over 125,000 taxpayers to remind them about their entitlements before the December 31 deadline.

Pat Murphy, manager in Revenue’s Personal Division, reminded taxpayers about the time limits:

There is a four-year limit for claiming tax refunds and the deadline for 2014 claims is 31 December. You can claim a refund of tax paid for any of the last four years, if there are entitlements you are due but have yet to claim.

Revenue wrote to PAYE workers who have paid tax but have not claimed any additional tax credits or reliefs in the previous four years. But you don’t have to have received a letter to be eligible for money back, Revenue doesn’t know who is entitled until the taxpayer makes a claim. So now is a good time for all PAYE workers to check that they have claimed all their entitlements.

So how do you do it?

“For taxpayers who want to make a claim, the quickest, easiest, and most convenient way to claim tax back is using PAYE Services in myAccount,” said Mr Murphy. “You can register for, or sign in to, myAccount on www.revenue.ie or through RevApp and the services in myAccount are accessible on all mobile devices.

“Even if you did not get a letter from Revenue, you can review, and update, your tax record online at any time, using PAYE Services in myAccount.

"When you submit a claim, it is processed and verified by Revenue.”

The really good news is refunds are now processed quickly enough that you could have a refund in time for the seasonal shopping ahead.

“Generally, most online refund claims are paid within five working days so there is still plenty of time to submit your claim and have your refund paid into your bank account before Christmas,” said Mr Murphy.

There are a wide range of expenses and reliefs that can be claimed by the average taxpayer, some of which I listed above, but a large number of Irish people are either unaware of them or are put off by the paperwork involved.

Tax experts at Taxback.com recently estimated that 20,000 people are failing to claim nursing home relief, to use just one example.

An assessment of the most recent Revenue figures for nursing home relief reveals that while there are 30,000 people in nursing homes nationwide, just 6,800 claimed the relief in 2016.

“Like almost all tax reliefs available in Ireland, the nursing home relief is underutilised, and the statistics support this contention,” said Eileen Devereux, commercial director at Taxback.com.

“Anyone paying nursing home fees, either for themselves or for someone else, is eligible to claim relief at their marginal rate of tax,” said Eileen Devereux, commercial director at Taxback.com.

“Many nursing home occupants in the country have part of their fees paid under the Fair Deal Scheme, but these people can still claim relief on their contributions.”

Taxback.com said that many nursing home fees are paid by the children of the occupants, or are spread across siblings, some of whom could be paying tax at the higher rate and would be eligible for an even greater relief of up to €20,000 on fees of €50,000.

The fact that just 6,800 people out of 30,000 claimed the relief says to us that many are simply not aware of the tax reliefs available, or perhaps some believe that applying for the refund would be ‘too much hassle’. We want to stress to these people that the application process really is very straightforward.

You can get a full list of the reliefs available at revenue.ie, where you can also register for myAccount and get information on how to complete the form.

There are a number of services that will calculate your claim for a fee but every year thousands of Irish people manage it perfectly well on their own. Why not make 2018 the year you join them?

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