Social welfare legislation provides that an increase in pension shall be paid to a widow or widower in receipt of a contributory widow's or widower's pension in respect of a qualified child or qualified children. A qualified child for this purpose is defined as a person who is ordinarily resident in the State; who is not detained in a reformatory or industrial school; and is under the age of 18 years or over age 18 and under age 21 and in full-time education.
The existing provisions governing the taxation of widow's contributory pension are set down in section 126 of the Taxes (Consolidation) Act 1997. The full amount of the pension payable to the widow, including the child dependant component, is assessable for tax purposes. The amount of tax payable, if any, would depend on the overall income and circumstances of the individual concerned.
I assume the Deputy refers to the recent Supreme Court judgment in the case of Seán Ó Síocháin, Inspector of Taxes, and Bridget Neenan. The Supreme Court ruled that the relevant provisions of the Social Welfare Acts provided for an increase in the widow's contributory pension in respect of the child payable to the widow and not a pension for the child payable to the widow. The effect of the judgment is that the existing taxation provisions remain unchanged so that such income continues to be assessable for income tax under the Income Tax Acts.
Any change to the tax treatment of a contributory pension would involve a change in tax legislation and would be a matter for the Minister for Finance. I remind the Deputy that the Minister for Finance is aware of the problems facing widowed people, especially in the period following the bereavement. Accordingly, he made substantial improvements in the budget to the widowed parent bereavement allowance.