carers allowance and tax credits

W

wolfie

Guest
I am in paye employment and my wife stays at home to care for our daughter who has downs syndrome.She receives carers allowance of approx 200 euros per week.
When my new tax credit statement arrived I noticed that 10000 euro was deducted from my standard cut off point figure and this was based on the yearly amount of carers allowance that she gets.
But I also noticed that they have deducted 2000 euro from my tax credits also.Is this right? and if so can I claim my wifes paye allowance against this?

Many Thanks.
 
You cannot claim your wife's PAYE credit if she is not working.

As you probably know carer's allowance is assessable for income tax.

Was your wife working last year but not this year? That could explain a reduction in your standard rate band this year.

Can you post a full list of the figures on your statement of tax credits so that people can comment?
 
Wolfie this occurs because your wife is in receipt of Carers allowance. When an employee is in receipt of other income which is not subject to PAYE eg a taxable payment from DSFA, the tax due on this payment is collected through the PAYE system. The SRCOP will be reduced by the amount of the annual value of the income and the tax credits will be reduced by the amount of the income multipled by the standard rate of tax. Therefore if payment is €10000 yearly then your SRCOP is reduced by this amount and your credits are reduced by €10000 X 20% = €2000.

Be sure to claim the Incapacitated Child Credit of €3000 if you're entitled to it and you probably should be if your child needs full time care
 
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If you haven't already done so, apply to the HSE for Domiciliary Care Allowance, which is paid in respect of children under 16 who have a disability requiring additional care. Entitlement is based on a medical assessment and a means test of the child's income (if any) - not that of the parents.

The application form and information is available at this site [broken link removed]
 
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Thanks for the replies.I have included some more info on figures:

On the tax credit side I claim Personal credit 3520
Paye credit 1760
Incapacitated child credit 3000

This is reduced by DSFA Carers Allowance 2000
which gives me net credits of 6280


On the srcop side I have Standard band of 53000

which is reduced by DFSA Carers Allowance 10000

Giving a total Srcop of 43000.

My wife has no other source of income which is why I found the deduction on the credit side strange. She has been a carer for 4 years.

I have not got the previous years credit forms to compare but I am sure that my credits were not reduced by her allowances before.

I am worried that this year is correct and that my credits should have been reduced the previous 4 years also and end up owing the tax office as a result!!
 
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