Check tax records for possible refunds

TAXPAYERS were yesterday warned to examine their tax records immediately to avoid missing out on refunds for expenses such as medical bills, third level college fees, non-routine dental treatment and private rented accommodation costs.

What expenses qualify for relief?

Medical bills are the biggest category. These could range from repeat trips to a doctor to specialist fees not covered by VHI or other private health insurers. Relief extends to money paid out for prescribed drugs. A taxpayer can claim relief for expenses incurred on himself/herself, their spouse, children or relatives.

But the first €125 in a given year must be borne by the taxpayer with no relief, so there is no point in claiming for a single trip to the doctor.

Other qualifying expenses include third level college fees, whether paid out for oneself or for children, and certain dental treatment. Braces, for example, would qualify, but fillings or extractions would not. Many people living in private rented accommodation are unaware they can claim a tax break to cover part of the cost.

Mortgage interest relief is also available but this has been applied at source over the past two years.

How much are these refunds worth?

Medical bills can be written off at the marginal 42% rate, so for every €100 that qualifies, a top-rate taxpayer should get a cheque for €42.

Most other reliefs, such as third-level fees, rent and mortgage interest, are only available at the standard 20% rate.

So someone who paid €2,000 in college fees gets a tax break worth €400.

What should taxpayers do before December 31?

Go through any records of significant amounts spent on doctors, dentists or education. Get information on how to claim the refund from the Revenue website, www.revenue.ie, or call 1890-306706.

Revenue must receive a completed claim form before Friday, December 31. Some claims will need to be accompanied by receipts.

Who should be worried by the change?

Anyone who was unaware of the tax breaks due to them, but especially those who incurred the expenditure more than four years ago.

Why is it being brought in?

It will make life easier for Revenue by removing the need for them to go back through a taxpayer’s records over 10 years. But the changes also mean Revenue will only be able to inspect an individual’s tax affairs over the past four years and will tidy things up for taxpayers too.

What happens to people who have incurred these expenses over the past four years?

They have nothing to worry about until the end of next year.

But why wait to claim money due from the taxman?

Far better to find out what refunds are due and ask Revenue for a cheque immediately.