Find out if you need to pay tax on your Social Welfare Payments

The short answer is, if social welfare payments are your only source of income, probably not.

However, if you have other sources of income, such as an occupational pension, it could bring the social welfare payment into the tax net.

So what social welfare payments are taxable?

Social Welfare and Other Payments: Taxable

  • Blind Pension
  • Carer’s Allowance
  • Carer’s Benefit
  • Constant Attendance Allowance (payable with Disablement Pension)
  • Deserted Wife’s Allowance
  • Deserted Wife’s Benefit
  • Death Benefit Pension
  • Disablement Pension
  • Guardian’s Payment (Contributory) – Taxable on child’s income
  • Guardian’s Payment (Non-Contributory) – Taxable on child’s income
  • Illness Benefit
  • Invalidity Pension
  • Incapacity Supplement
  • Injury Benefit
  • Jobseeker’s Benefit and Short-Term Enterprise Allowance (first €13 per week not taxable)
  • One-Parent Family Payment
  • State Pension (Transition)
  • State Pension (Contributory)
  • State Pension (Non-Contributory)
  • Widow’s, Widower’s or Surviving Civil Partner’s (Contributory) Pension
  • Widow’s, Widower’s or Surviving Civil Partner’s (Non-Contributory) Pension
  • Payments made under the Rural Social Scheme, TÚS and the Community Services Programme

Social Welfare and Other Payments: Not Taxable

  • Adoptive Benefit (Update: Taxable from 1 July 2013)
  • Back to Work Allowance
  • Back to Work Enterprise Allowance
  • Back to Education Allowance
  • Bereavement Grant
  • Child Benefit
  • Disability Allowance
  • Disablement Gratuity (lump sum payment)
  • Farm Assist
  • Family Income Supplement
  • Health and Safety Benefit (Update: Taxable from 1 July 2013)
  • Jobseeker’s Allowance
  • Jobseeker’s Benefit (paid to systematic short-term workers)
  • Maternity Benefit (Update: Taxable from 1 July 2013)
  • Pre-Retirement Allowance
  • Supplementary Welfare Allowance
  • Payments made by VEC under VTOS

Additional Info

Jobseeker’s Benefit is generally taxable, but the first €13 each week is exempt from tax. Jobseeker’s Benefit payable to short-time workers is not taxable. The increase for a child dependant payable with Jobseeker’s Benefit is also not taxable. Other than this, if your social welfare payment is taxable, any increase in your payment for your dependants is also taxable.

No Other Source of Income

In general, if an individual is in receipt of only social welfare payments, no tax should be payable. Even if the social welfare payment is taxable, the individual may be either under the exemption limits for tax or have enough tax credits to cover the tax liability. Note that those in receipt of social welfare payments are entitled to the PAYE tax credit.

Other Sources of Income

Where an individual has another source of income as well as the social welfare payment, then tax may be due if the exemption limits are exceeded or the individual has used all his/her tax credits.

It is possible to pay this additional tax through the PAYE system in certain circumstances. For example, if an individual has a state pension and an occupational pension, the tax on both pensions can be deducted from the occupational pension. Revenue have automatically applied this system to pensioners for 2012 and have written to each pensioner outlining the system. Pensioners are advised to check the details in the letter to ensure they are correct and to contact their accountant or Revenue if they have any queries or concerns.

If any additional tax is due and hasn’t been collected under the PAYE system, then an income tax return must be filed by 31 October each year.

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