I am informed by the Revenue Commissioners that the taxpayer is in receipt of full tax-free allowances which amount to £6,600 for the current year 1997-98.
The widow's pension of £6,322 which the taxpayer receives from the Department of Social, Community and Family Affairs together with her income from employment is taxable. This pension, however, is paid gross by the Department of Social, Community and Family Affairs, i.e. without tax being deducted. The method of taxing the social welfare widow's pension is that an amount equivalent to the annual social welfare payment is deducted from the taxpayer's full tax-free allowances. Consequently, the taxpayer's net tax-free allowance, for use against other sources of income, is £278. I do not accept that the method of collecting income tax in this case represents a disincentive to returning to employment.