Terence Flanagan
Ceist:126. Deputy Terence Flanagan asked the Minister for Finance if tax relief on maintenance payments will be introduced (details supplied); and if he will make a statement on the matter. [27160/15]
Amharc ar fhreagraTuesday, 7 July 2015
Ceisteanna (126)
Freagraí scríofa
I assume that the Deputy's question is in relation to tax relief for maintenance payments in respect of children. There is no provision in the tax code for tax relief in this regard. This is the case regardless of whether the payments are made voluntarily or under a legally binding maintenance arrangement.
Maintenance payments in respect of children are not taxable in the hands of the children or the receiving spouse. The effect of this is that the payments are treated in the same way as if the taxpayer was providing for the child out of his or her after-tax income. This is in line with the tax treatment of all other parents, where the cost of maintaining their children is not tax deductible.
As regards maintenance payments in respect of a spouse, the position is generally that the spouse who makes payments under a legally enforceable maintenance agreement is entitled to claim a tax deduction in respect of the payments. The maintenance payments are then taxable in the hands of the receiving spouse and the couple are treated for tax purposes as if unmarried.