Denis Naughten
Question:79. Deputy Denis Naughten asked the Minister for Finance if he will review the relief available under the incapacitated child tax credit; and if he will make a statement on the matter. [54323/21]
View answerTuesday, 9 November 2021
Questions (79, 132)
Denis Naughten
Question:132. Deputy Denis Naughten asked the Minister for Finance if he will review the incapacitated child allowance; and if he will make a statement on the matter. [53577/21]
View answerOral answers (8 contributions)
The financial pressure that is placed on families providing full-time care for a child can be horrendous. A recent study from the National University of Ireland, Galway, found that the average annual cost for families of an autistic child amounted to €28,000, relating to private services, lost income and informal care. The current incapacitated child credit is just €3,300, which is insufficient to meet the costs facing parents.
I propose to take Questions Nos. 79 and 132 together.
The legislation governing entitlement to the incapacitated child tax credit is contained in section 465 of the Taxes Consolidation Act 1997, as amended. The legislation provides that an individual is entitled to a tax credit of €3,300 per qualifying child for a year of assessment if he or she proves that at any time during the year of assessment, he or she has a child who is under 18 years of age and is permanently incapacitated by reason of mental or physical infirmity, or if over the age of 18 years at the beginning of the year, is permanently incapacitated from maintaining herself or himself and had become so permanently incapacitated either before reaching 21 years of age or after that age while receiving full-time instruction at any university, college, school or other educational establishment.
A child under 18 is regarded as permanently incapacitated by reason of infirmity only if that infirmity is such that, if the child were over the age of 18, there would be a reasonable expectation that he or she would be incapacitated from maintaining himself or herself.
For the purposes of the credit, "maintaining" means the ability to support oneself by earning a living from working. In order to establish entitlement to the credit in respect of any such child, medical evidence provided by the child's medical practitioner is required to confirm both the extent of the incapacity and whether the incapacity permanently prevents the child from being able in the long term to maintain himself or herself independently when over the age of 18.
Detailed information on the operation of the tax credit is available on Revenue's website.
This is a matter that was assessed, albeit some time ago, in 2009, when the former Commission on Taxation recommended for reasons of equity that, ultimately, “the appropriate level of State support be provided to all incapacitated children through direct expenditure and that the tax credit be discontinued”. Such a course of action would obviously require very careful consideration and is not on the agenda at the present time. Equally, while tax measures are monitored by my Department as a matter of course, I currently do not have plans for a detailed review of the credit. I am sure Deputy Naughten wants to raise particular issues in regard to the operation of the credit and I will respond at that point.
I thank the Minister. The 2019 research by NUI Galway was carried out by Áine Roddy and Ciaran O'Neill. That research showed that the annual average cost per child for families amounted to €28,464.69 and was related to private autism services, lost income and informal care. By comparison, the annual State expenditure per child with autism in terms of related health, social and education resources was €14,192. That means families were out of pocket to the tune of €9,489.60.
The key findings have shown there is a significant economic burden associated with autism among children and adolescents in Ireland and that a considerable proportion of this is being borne directly by parents rather than by the State. This is also being reflected in the costs faced by other parents of children with disabilities. That is why I believe we need to look at this again in light of this research.
I thank the Deputy. I would be interested in seeing that research if it is possible for the Deputy to give me a copy.
That is no problem.
The Deputy will be aware there is tax relief available on medical expenses and on many different forms of healthcare. I entirely recognise that for a family looking after a child who has a very high level of medical need, the financial costs involved are exceptional. What the Government tries to do through the supports we make available to that family, through measures in the social welfare code and through our tax code, is to provide a meaningful contribution to the costs those families face. I know that, in many cases, costs are rising, they can be great and they can happen at very difficult times for a family. As I said, I am very happy to look at the report to which the Deputy referred to see if there is anything in it that should lead to a revision of our thinking in regard to the operation of this credit.
I thank the Minister for his constructive response, which I acknowledge. The out-of-pocket expenses for private therapeutic interventions and assessments were the highest category of medical costs associated. The average cost incurred by families was €948 but there was a considerable variation in that, ranging from zero right up to €14,400. Part of that variation is the variation in access to services. I will give one practical example. The waiting list at present for occupational therapy and assessments in the west is in excess of two years. Families are forced to go privately to get an assessment, which costs anywhere between €500 and €1,500, and the ongoing costs per session are between €75 and €100.
The State is failing in its obligation to provide early intervention to these children. They cannot get access to public services and families are forced to go down the road of trying to source private services. This whole area needs to be looked at and resourced properly to give every child, regardless of family resources, the opportunity to get early access to those vital services.
The issue of the funding of the very important services to which Deputy Naughten refers is separate to the operation of this credit. I know the Minister for Public Expenditure and Reform and the Minister for Health did an awful lot of work in the run-up to the recent budget to increase significantly the funding available for many of the services the Deputy has referred to. The Minister, Deputy McGrath, also worked with the Minister for Education, Deputy Foley, in regard to the help that can be given to young children who need additional support in our schools. To go back to the original point the Deputy has raised, if he gives me a copy of the report, I will be very happy to have a look at it.