# Taxation of Back to Education Allowance



## milly123 (29 May 2012)

Hi There,

My husband was on Jobseekers from Jan to Sept last year (2011) and Back to Edcucation Allowance from Sept to December.  I'm just completing the form 11 now (we are jointly assessed) and was wondering if someone here can answer these questions:

1. is he entitled to a PAYE credit for last year ?  ( I am not as I'm a proprietary director).

2. Is the BTEA taxable ? I saw on citizensinformation.ie that it is not, so should I not include it on the form ?

My P60 shows gross earnings of €43k for last year and he got €9600 approx between JA and BTEA.  

I would really appreciate any help.

Thanks in advance.


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## mandelbrot (29 May 2012)

Hi Milly,

Jobseekers *benefit* is taxable (minus the first €13 p.w. I think). Jobseekers *allowance* is not taxable, as it is a means tested payment. BTEA is not taxable either.

Taxable social welfare payments are treated as PAYE income. So if any of his income was a taxable social welfare payment then he would be entitled to a PAYE credit of 20% of the income, up to the max. credit of €1,650 (in effect, he would have to have taxable social welfare income of 8,250 in order to use up his entire PAYE tax credit).

If the social welfare is all Allowance, and therefore exempt, you should still include it on the Form 11; there should be a section for exempt income, and a box where you can put in a description ("Exempt Jobseekers Allowance / BTEA").

Hope that helps!


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## milly123 (29 May 2012)

Mandlebrot, thank you for clearing that up.  It was Jobseekers benefit he was on, so therefore I can claim the PAYE credit, which is great news as I thought I would have a tax bill to pay.

Thanks again.


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## mandelbrot (29 May 2012)

milly123 said:


> Mandlebrot, thank you for clearing that up. It was Jobseekers benefit he was on, so therefore I can claim the PAYE credit, which is great news as I thought I would have a tax bill to pay.
> 
> Thanks again.


 
You're welcome. In that case you'll need to split the income from social welfare so, as the BTEA element is exempt, and only enter the amount of taxable JSB (bearing in mind that the first €13 p.w. is exempt).


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## milly123 (29 May 2012)

Will do,  thanks again Mandlebrot.  I may even be due a small refund at this stage.  Happy Days.


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## smeharg (29 May 2012)

mandelbrot said:


> ...
> If the social welfare is all Allowance, and therefore exempt, you should still include it on the Form 11; there should be a section for exempt income, and a box where you can put in a description ("Exempt Jobseekers Allowance / BTEA").
> 
> Hope that helps!


 
Social welfare allowance that is exempt from income does NOT go on Form 11 (see Revenue's guide to completing Form 11 for 2010).  I don't think the 2011 guide has been published but it's unlikely to change.

If any element of the JSB was claimed in respect of children then this portion is also exempt and should be exlcuded from Form 11.


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## mandelbrot (29 May 2012)

Thanks Smeharg, and you're right, but it's a strange one... 

On the one hand it says "Back to Work Allowance, Unemployment Assistance and Maternity Benefit are all exempt from income tax and should not be entered in the Return" in the Section 220 - 223 area.

But on the other hand it says:
"Panel G - Exempt Income [410 - 415]
​​This part of the Return is only relevant where you have income which has a statutory exemption. Notwithstanding that this income is exempt, there is a legal requirement on you to enter the profits, gains, distributions or losses where requested. Do not enter income from other sources which is exempt solely because the level of income is too low to be taxed."​ 
A bit contradictory - reading Panel G without having read Section 220 - 223, one could have reason to believe the JSA / BTEA should be declared.​


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## milly123 (29 May 2012)

Thanks Smehard and Mandelbrot.  I don't think it will make any difference to the bottom line either way, might be no harm to leave it in.


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## Nige (29 May 2012)

Declarable "exempt" income is subject to USC, so putting it in there will create a USC charge.


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## milly123 (29 May 2012)

Thanks Nige. Will leave it out so. Thanks to all of you for posting your advice. Much appreciated.


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## Mrs Vimes (30 May 2012)

mandelbrot said:


> "Panel G - Exempt Income [410 - 415]
> ​This part of the Return is only relevant where you have income which has a statutory exemption. Notwithstanding that this income is exempt, there is a legal requirement on you to enter the profits, gains, distributions or losses where requested. Do not enter income from other sources which is exempt solely because the level of income is too low to be taxed."​
> A bit contradictory - reading Panel G without having read Section 220 - 223, one could have reason to believe the JSA / BTEA should be declared.​




Panel G refers to income which has a statutory exemption only - see here, and does not include income which is exempt such as certain social welfare payments.


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