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

  • Adoptive Benefit
  • Blind Pension
  • Carer’s Allowance
  • Carer’s Benefit
  • Deserted Wife’s Allowance
  • Deserted Wife’s Benefit
  • Death Benefit Pension
  • Disablement Pension (except for child increases)
  • Health and Safety Benefit
  • Illness Benefit (except for child increases)
  • Invalidity Pension
  • Incapacity Supplement (except for child increases)
  • Injury Benefit (except for child increases)
  • Jobseeker’s Benefit and Short-Term Enterprise Allowance (first €13 per week not taxable)
  • Maternity Benefit
  • One-Parent Family Payment
  • Partial Capacity Benefit
  • Short Term Enterprise Allowance
  • 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

Social Welfare and Other Payments: Not Taxable

  • Back to Work Allowance
  • Back to Work Enterprise Allowance
  • Back to Education Allowance
  • Back to Work Family Dividend
  • Back to School Clothing and Footwear Allowance
  • Carer’s Support Grant
  • Constant Attendance Allowance
  • Child Benefit
  • Disability Allowance
  • Disablement Gratuity (lump sum payment)
  • Domiciliary Care Allowance
  • Farm Assist
  • Fuel Allowance
  • Guardian’s Payment (Contributory)
  • Guardian’s Payment (Non-contributory)
  • Household Benefits Package
  • Jobseeker’s Allowance
  • Jobseeker’s Benefit (paid to systematic short-term workers)
  • Jobseeker’s Transitional Payment
  • Pre-Retirement Allowance
  • Supplementary Welfare Allowance
  • Telephone Support Allowance
  • Widowed or Surviving Civil Partner Grant
  • Working Family Payment

 

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 the state pension can be paid by reducing the individual’s tax credits and tax band to be applied to the occupational pension.

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.

As always, if you have any queries of a general nature, please leave a comment below.

 

Updated 11/04/19

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