Doubt about tax relief on medical expenses

K

Knorp

Registered User
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Hi,

My partner incurred in some medical expenses last year. Given that she didn't earn a lot of money, it resulted that (after applying the tax credits) she didn't actually pay any tax. Is she entitled to claim tax relief on medical expenses anyway?:confused:

Thank you in advance.
 
You might be entitled to claim back taxes you paid if she's your spouse.

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Knorp said:
she didn't actually pay any tax. Is she entitled to claim tax relief on medical expenses anyway?:confused:
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No - MED1/2 tax relief is not a tax credit granted even to those who pay not tax like some others (e.g. SSIA topup tax credit, SSIA to pension incentive tax credit, owner occupier mortgage interest tax relief, private health insurance premium tax relief etc.).
 
ClubMan said:
No - MED1/2 tax relief is not a tax credit granted even to those who pay not tax like some others (e.g. SSIA topup tax credit, SSIA to pension incentive tax credit, owner occupier mortgage interest tax relief, private health insurance premium tax relief etc.).
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Thank you for the answer. That's what I thought, but just wanted to confirm. Anyway, I think it's not very fair because Is suppose that in theory the idea is to help people (via the relief) and the way it's done it favours people with high income: if you pay tax @41% you get higher relief than if you pay tax @20% and if you don't pay tax then you get nothing. So, in the end the more you earn the more you are helped with your medical expenses...

I'd like to ask another question. Right now I can't claim medical expenses for my partner because we aren't married. We are going to marry before the end of the year. In relation to the health expenses for 2007, could I in 2008 claim expenses incurred by her, for example, in April 2007 if we get married in December 2007? I mean, in terms of claiming medical expenses, is the year considered as a whole?

And finally, yet another question (sorry). We aren't Irish and visit our home country from time to time. I've read that it's possible to claim tax relief on health expenses incurred abroad (while being an Irish resident for tax purposes, obviously). I've read that the practitioner has to be a registered one in his/her country. What are the limitations for this tax relief? I mean, does it only apply to emergency treatment abroad or to any medical expense?

Thank you in advance for the answers.
 
For 2007 onwards the system has changed and you can now claim tax relief on the medical expenses you have incurred for anyone. So, if during this year, you pay her medical expenses, you can claim the tax relief.
 
Knorp said:
the way it's done it favours people with high income: if you pay tax @41% you get higher relief than if you pay tax @20% and if you don't pay tax then you get nothing. So, in the end the more you earn the more you are helped with your medical expenses...
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But the more you earn the more tax you pay! It doesn't make sense to give people back more or less tax than they actually paid does it? I don't really understand your point or see any grounds for complaint here.
 
ClubMan said:
But the more you earn the more tax you pay! It doesn't make sense to give people back more or less tax than they actually paid does it? I don't really understand your point or see any grounds for complaint here.
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Well, you pay more tax because you earn more. If you pay tax at the top rate you will be be able to afford things like visits to consultants more easily than someone that doesn't pay tax because his/her income is low. One of the purposes of taxation is that governments can (or should) use it to compensate or at least moderate the inequalities in society (the economic liberals would kill me for saying this! :D). All I'm saying is that the way this tax relief works is that in reality you are helping more the one who has more money. It's a fact, isn't it?. You say: you pay more tax, therefore is normal that you receive more relief. I say that, in my view, at the end of the day this relief is increasing inequality by helping more the one who already has more. It's not a complaint but a reflection that has come to my mind. Just to clarify the issue, I pay tax myself at the top rate and I'm not a left-wing extremist or anything like that.:)
 
Knorp said:
Well, you pay more tax because you ean more. Therefore, any medical expense will affect you less than someone that earns less
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Not necessarily. The higher earner could have less disposable income due to higher financial committments (e.g. house, family expenses etc.).
and anyway you receive more help than someone who earns less.
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If the point of the relief is to ensure that people pay no tax on qualifying medical expenses then it makes sense for those on 41% to get 41% back, those on 20% to get 20% back and those who don't pay tax to get nothing back (since there is not tax paid to get back in the first place).
 
ClubMan said:
Not necessarily. The higher earner could have less disposable income due to higher financial committments (e.g. house, family expenses etc.).

If the point of the relief is to ensure that people pay no tax on qualifying medical expenses then it makes sense for those on 41% to get 41% back, those on 20% to get 20% back and those who don't pay tax to get nothing back (since there is not tax paid to get back in the first place).
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Hi, I have shortened my previous comment because it was too long.

What you say makes sense, of course. If it's a tax relief, it's a tax relief. By definition, if you don't pay tax there is no tax to get back. My point (and I insist it's only a reflection) is that perhaps tax relief is not the best way to help people with their medical expenses (especially those on low incomes). That's all.:)
 
I think Revenue are drawing up plans so that tax relief is given at source on all types of medical expenses, irrespective of whether you pay tax or which tax bracket your in. At the moment, tax relief on health insurance is given at source at the standard rate of 20%. This applies to every individual, irrespective of their taxation status. Revenue also have plans to extend tax relief at source to other things such as tuition fees and trade union subscriptions.
 
Tenacious said:
I think Revenue are drawing up plans so that tax relief is given at source on all types of medical expenses, irrespective of whether you pay tax or which tax bracket your in.
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Interesting. Never heard anything about this myself. Do you have any more info (e.g. links etc.)? I guess that the many people who (judging by posts here) seem to claim relief on medical expenses paid abroad will still have to claim this back manually since relief at source is probably not going to happen in a foreign jurisdiction?
 
ClubMan said:
Interesting. Never heard anything about this myself. Do you have any more info (e.g. links etc.)? I guess that the many people who (judging by posts here) seem to claim relief on medical expenses paid abroad will still have to claim this back manually since relief at source is probably not going to happen in a foreign jurisdiction?
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I am interested in medical expenses paid abroad (I had some). Are you entitled to claim tax relief the same way you do with expenses in Ireland?

Thanks.
 
ClubMan said:
Interesting. Never heard anything about this myself. Do you have any more info (e.g. links etc.)? I guess that the many people who (judging by posts here) seem to claim relief on medical expenses paid abroad will still have to claim this back manually since relief at source is probably not going to happen in a foreign jurisdiction?
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Clarkey said:
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Thanks - so it seems that this tax relief at source for medical expenses might only apply to those with private health insurance where the insurer can inform Revenue directly about any unreimbursed qualifying expenses but those without medical insurance will still have to claim relief as normal?
 
ClubMan said:
Thanks - so it seems that this tax relief at source for medical expenses might only apply to those with private health insurance where the insurer can inform Revenue directly about any unreimbursed qualifying expenses but those without medical insurance will still have to claim relief as normal?
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Can you suggest an alternative, I can never see Doctors etc. making returns to Revenue for every patient they see and collect a fee from. They would need to hire additional staff just to deal with this alone.
 
Recam said:
Can you suggest an alternative,
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Wasn't critising you, don't jump to conclusions, just checking if you could suggest an alternative, you never know what governement minister or official is reading these posts.
 
Don't GPs/pharmacists etc. already file patient specific Social Welfare related documentation so maybe they could easily enough also file patient specific Revenue documentation to facilitate tax relief at source?
 
For what its worth, I think tax relief on medical expenses should be abolished, except perhaps if someone has substantial medical costs in a given year, ie at least €1,000 or €2,000.

The system as it stands is not working. Most people entitled to claim do not do so. The relief is worth only a small sum to the vast majority of those who are entitled to claim. Its difficult to keep track of receipts and its difficult for people to grasp the implications of the €125 threshold. It must also be an administrative nightmare for Revenue. The notion that GPs might end up having to supply Revenue with details of every consultation fee beggars belief.
 
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