Dáil Éireann Debate, Wednesday - 18 April 2012
174 Deputy Simon Harris asked the Minister for Finance the rationale for the lone parent tax credit; the reason this credit is no longer paid when the parents enter into a cohabiting relationship; and if he will make a statement on the matter. [18687/12]
View answerThe one-parent family allowance was introduced in the late 1970's and replaced the housekeeper allowance which was available to certain one-parent families. The original underlying objective of the relief was to support labour market participation of single and widowed parents and to provide a means of support to those families. The one-parent family allowance was converted into a tax credit in 2001. A single person, whether widowed, a surviving civil partner, single, separated or divorced or formerly in a civil partnership which has been dissolved and with a dependent child or children may, subject to compliance with the conditions governing the credit, be entitled to claim the One-Parent Family Tax Credit and an extended standard rate tax band that is €4,000 per annum greater than the single standard rate tax band of €32,800. The value of the credit is €1,650 per annum. The One-Parent Family Tax Credit, where due, is given in addition to the basic personal tax credits. The One-Parent Family Tax Credit, therefore, provides individuals who are in one-parent family situation with the same basic personal tax credits as both a married couple, or a couple in a civil partnership, who are living together.
To qualify for the tax credit and the extended standard rate tax band, a qualifying child must be resident with the individual claiming the credit and that individual must not be living with his or her spouse or civil partner or cohabiting with another person.
The tax credit is not available to cohabiting persons. The reason the credit is withdrawn where parents enter into a cohabiting relationship is because they do not meet the policy objective of the measure, namely, to provide additional support for single parent families in order to promote labour market participation.
175 Deputy Simon Harris asked the Minister for Finance the range of tax credits available for married couples with children; if these tax credits differ from those available to cohabiting couples with children; and if he will make a statement on the matter. [18688/12]
View answerThe tax credits and allowances available to married couples with children (including civil partners with children) are as follows (it is to be noted that these credits and allowances, apart from the home carer's credit, are available regardless of whether or not the person is married, if the person meets the qualifying criteria):—
Incapacitated child tax credit— This is available in respect of a child who is permanently incapacitated by reason of physical or mental infirmity, or if over 18 was so incapacitated before reaching age 21 or was in full-time education at the time of the incapacity.
Home carer’s tax credit— This is available to married persons and civil partners who are jointly assessed and where one spouse or civil partner works at home to care for children, the aged or incapacitated persons.
Employed person taking care of incapacitated individual— This is available where a person is employed to take care of a family member who is totally incapacitated by physical or mental infirmity.
Medical expenses relief— Qualifying health expenses incurred by an individual in respect of a child qualify for tax relief.
Medical insurance relief— Relief is allowed in respect of qualifying premiums for health insurance paid in respect of a dependant child.
Relief for the long-term unemployed (known as “Revenue job assist”)— Additional relief is allowed on a tapering basis in respect of each qualifying child over a 3-year period of claim.
The tax credits and reliefs available to married persons with children, as set out above (with the exception of home carer's tax credit), do not differ to those available to cohabitating couples with children.
