IT1 - Tax Credits, Reliefs and Rates for the Tax Years 2009 and 2010

Personal Tax Credits

The following chart gives details of the main personal tax credits for the tax years 2009 and 2010

Details of personal tax credits for 2009/2010
Personal Circumstances Tax Year 2009 Tax Year 2010
Single Person €1,830 €1,830
Married Person €3,660 €3,660
Widowed Person qualifying for One Parent Family Tax Credit €1,830 €1,830
Widowed Person without dependent children €2,430 €2,430
Widowed Person in year of bereavement €3,660 €3,660
One-Parent Family, Widowed, Deserted, Separated or Unmarried (with qualifying dependent children, see note 1) €1,830 €1,830
Widowed Parent Bereaved in 2009 --- €4,000
Widowed Parent Bereaved in 2008 €4,000 €3,500
Widowed Parent Bereaved in 2007 €3,500 €3,000
Widowed Parent Bereaved in 2006 €3,000 €2,500
Widowed Parent Bereaved in 2005 €2,500 €2,000
Widowed Parent Bereaved in 2004 €2,000 ---
Home Carer (max.) €900 €900
PAYE Tax Credit €1,830 €1,830
Age Tax Credit if Single/Widowed €325 €325
Age Tax Credit if Married €650 €650
Incapacitated Child (See note 1) €3,660 €3,660
Dependent Relative (See note 1) €80 €80
Blind Tax Credit - Single €1,830 €1,830
Blind Tax Credit - One Spouse Blind €1,830 €1,830
Blind Tax Credit - Both Spouses Blind €3,660 €3,660
Blind Tax Credit - Additional Relief for Guide Dog €165 €165
Incapacitated Person - Allowance for Employing a Carer €50,000*max €50,000*max

* Relief for Employing a Carer (2009 and 2010) is allowable at the individual's highest rate of tax, i.e. 20% or 41%.

Note 1

Child or relatives income limits regarding tax credits
The Child's/Relative's income limits Tax Year 2009 Tax Year 2010
One Parent Family Tax Credit 0 0
Incapacitated Child Tax Credit 0 0
Dependent Relative Tax Credit €13,837* €13,837*

* In the case of Dependent Relative Tax Credit, if the relative's income exceeds the relevant limit no tax credit is due.

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Exemption Limits

Exemption limits for single/widowed, married and additional for dependent children in 2009 and 2010
Personal Circumstances Tax Year 2009 Tax Year 2010
Single/ Widowed 65 years of age or over €20,000 €20,000
Married 65 years of age or over €40,000 €40,000
Single/Widowed/Married 65 years of age or over
Additional for 1st and 2nd dependent child		 €575 €575
Single/Widowed/Married 65 years of age or over
Additional for each subsequent dependent child 		€830 €830
Marginal Relief Tax Rate 40%* 40%*

*The Marginal Relief Tax Rate only applies to persons 65 years of age or over.

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Tax Rates and Tax Bands

Tax rates and bands applicable to your personal circumstance in tax year 2009 and tax year 2010
Personal Circumstances Tax Year 2009 Tax Year 2010
Single / Widowed without dependent children €36,400 @ 20%, Balance @ 41% €36,400 @ 20%, Balance @ 41%
Single / Widowed qualifying for One Parent Family Tax Credit €40,400 @ 20%, Balance @ 41% €40,400 @ 20%, Balance @ 41%
Married Couple - one spouse with income €45,400 @ 20%, Balance @ 41% €45,400 @ 20%, Balance @ 41%
Married Couple - both spouses with income €45,400 @ 20% (with an increase of €27,400 max), Balance @ 41% €45,400 @ 20% (with an increase of €27,400 max), Balance @ 41%

Note: The increase in the standard rate tax band is restricted to the lower of €27,400 in 2009 and 2010 or the amount of the income of the spouse with the lower income. The increase is not transferable between spouses.

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Income Levy - 2009 & 2010

2009

The Income Levy is payable on gross income from all sources before any tax reliefs, capital allowances, losses or pension contributions.

The 2009 annual rates and thresholds of the Income Levy are as follows:

  • 1.67%: Income up to €75,036 per annum
  • 3%: Income between €75,037 and €100,100 per annum
  • 3.33%: Income between €100,101 and €174,980 per annum
  • 4.67%: Income between €174,981 and €250,120 per annum
  • 5%: Income in excess of €250,120 per annum

For PAYE payroll purposes the folowing Income Levy rates apply:

Applicable to payments made from 1 January 2009 to 30 April 2009
Income Levy Thresholds Rate
Income up to €100,100 per annum 1%
Income between €100,101 to €250,120 per annum 2%
Income in excess of €250,120 per annum 3%
Applicable to payments made on or after 1 May 2009
Income Levy Thresholds Rate
Income up to €75,036 per annum 2%
Income from between €75,037 to €174,980 per annum 4%
Income above in excess of €174,980 per annum 6%

The rates and thresholds of the Income Levy remain unchanged for 2010

2010

Applicable to payments made in 2010
Income Levy Thresholds Rate
Income up to €75,036 per annum 2%
Income from between €75,037 to €174,980 per annum 4%
Income above in excess of €174,980 per annum 6%

The following are exempt from the Income Levy:

  • Individuals who hold full medical cards (A 'GP only' medical card is not a 'full' medical card)
  • Individuals whose annual income does not exceed €15,028
  • Individuals aged 65 or over whose annual income does not exceed €20,000
  • Married couples, one or both of whom are aged 65 or over, whose combined income for the year does not exceed €40,000

All Social Welfare payments are also exempt from the Income Levy.

For the latest information on the Income Levy including Frequently Asked Questions and the Income Levy Certificate 2009 & 2010

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Rent-a-Room Relief

Where a room (or rooms) in a person’s sole or main residence is (are) let to an unconnected person as residential accommodation, gross annual rental income of up to €10,000 in 2009 and 2010 is exempt from tax. Relief in respect of mortgage interest relief is not affected. The relevant Capital Gains Tax/Stamp Duty provisions are also not affected. For more information see Leaflet IT 70 - A Revenue Guide to Rental Income.

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Childcare Services

Childcare Services relief is a scheme of tax relief for income arising from the provision of certain childcare services. When the gross annual income from the provision of childcare services does not exceed €15,000 in 2009 or 2010 the income is exempt from tax. The childcare service must be provided in the carer's home, not the children's home and no more than 3 children may be cared for at any time.

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Rent Relief for Private Rented Accommodation

Relief is due at the standard rate of tax (20%) in the tax years 2009 and 2010 subject to the following upper limits:
Personal Circumstances Tax Year 2009 Tax Year 2010
Single Under 55 max. €2,000 €2,000
Single Over 55 max. €4,000 €4,000
Widowed/ Married under 55 max. €4,000 €4,000
Widowed/ Married over 55 max. €8,000 €8,000

Relief can be claimed by completing pdfForm Rent 1 - Claim for Rent Relief on Private Rented Accommodation (PDF, 108KB)

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Tax Relief for Loan Interest (Secured and Unsecured)

Tax Relief at Source (TRS) on Secured loans

Tax relief for home mortgage interest (secured loans) is not given through the tax system but is instead granted at source (TRS). Mortgage repayments are reduced by the amount of the tax credit due. For example, if the interest element of your mortgage repayment per month is say €500, your mortgage lender will reduce your monthly mortgage payment by €100 per month. This reduction is the same as giving tax relief at the standard rate of tax (20%).

Any future adjustments in your tax relief will be made automatically by your mortgage lender. It is not necessary to claim relief on your annual tax return or to contact your local Revenue office.

If, however, you are making mortgage repayments and not receiving Tax Relief at Source, you should contact TRS Section, Collector-General’s Division at LoCall 1890 46 36 26 who will arrange for the relief to come into effect. For further information see: Leaflet CG13 - Mortgage Interest Relief (Tax Relief at Source).

Unsecured Home Loans

Relief for interest payments made on unsecured Home Loans used for qualifying purposes, i.e. repair or improvement of your sole or main residence can be claimed by review at the end of the tax year.

If, however, you are paying interest on a qualifying private residence mortgage in excess of the ceiling for relief, listed below, and you are receiving Tax Relief at Source on this interest then there will be no additional relief due in respect of a qualifying unsecured home loan.

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Amount of Relief Available

2009: From 1 January 2009, First-time buyers - the rate of mortgage interest relief is increased from 20% to 25% in years 1 and 2 and to 22.5% in years 3, 4 and 5. The relief remains unchanged at 20% for years 6 and 7 of the mortgage. First time buyers relief ends after year 7.
Non-first time buyers - the rate of mortgage relief is reduced from 20% to 15%.

2010: Qualifying loans taken out before 1 July 2011 will continue to get relief for 7 years. Transitional measures will be provided for qualifying loans taken out between 1 July 2011 and the end of 2012.

Those whose entitlement to relief would, in the absence of this change, expire in 2010 or after, will continue to qualify for relief at the applicable rate up until the end of 2017.

The relief will be abolished completely by the end of 2017.

For more information see leaflet: Tax Relief at Source (TRS) for Mortgage Interest Relief.

Relief available for loan interest on secured and unsecured loans for the tax years 2009 and 2010
Personal Circumstances First Time Buyers All Others
Single €10,000 €3,000
Married/Widowed €20,000 €6,000

Note: Amounts shown in the above table are the ceiling amounts for the years 2009 and 2010

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Medical Insurance Premiums

Tax Relief at Source (TRS)

Tax relief for medical insurance premiums paid to authorised insurers is granted at source (TRS). Subscribers will pay a reduced premium (80% of the gross amount) to the authorised medical insurer. This reduction is the same as giving tax relief at the standard rate of tax (20%).

Employees whose medical insurance premiums are paid on their behalf, by their employer, as a Benefit-in-Kind, will not have been allowed tax relief at source. To claim the relief due it will be necessary to notify your local Revenue Office by phone, email or in person with the relevant details or by completing your annual tax return.

Revenue Job Assist

Additional tax relief at the individual’s highest rate of tax, i.e. 20% or 41% in 2009 and 2010, is available for people who have been unemployed for one year or more and who take up a qualifying job. Relief in the first year of employment is €3,810 plus €1,270 for each child, reducing to two-thirds of that amount in Year 2 and one-third in Year 3. This relief is also available for persons who have been in receipt of either Disability Allowance, Blind Person’s Pension or Invalidity Pension for 12 months or more, Illness Benefit for 3 years or more or released after 12 months or more in prison. For more information see pdfLeaflet IT 58 - Job Assist Information for Employees (PDF, 138KB).

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Revenue Approved Permanent Health Benefit Schemes

Where an employer deducts the contributions from gross pay the tax relief is given at source. Therefore no further action is necessary to claim relief.

Where an employer does not deduct the contributions from gross pay relief can be claimed, by notifying your local Revenue office of the relevant details by phone, email or in person ( See Further Information) or by completing your annual tax return.

Tax Relief on Service Charges

Income tax relief is available for individuals who pay local authority and other service charges. Relief is given for service charges paid in full and on time in the previous calendar year. For more information see pdfLeaflet IT 27 - Tax Relief for Service Charges (PDF, 52KB).

Home Carer’s Tax Credit

A tax credit at the standard rate of tax (20%) in the tax years 2009 and 2010 is available for married couples where:

  • One spouse (the 'home carer') works in the home caring for one or more dependent persons, i.e. a child for whom they are entitled to Social Welfare child benefit, a person aged 65 or over, or a person who is permanently incapacitated by reason of mental or physical infirmity and the qualifying person normally resides with the couple for the year.
  • The home carer’s income is not in excess of €5,080. A reduced tax credit applies where the income is between €5,080 and €6,880 in 2009 or 2010.

The tax credit is not available to married couples that are taxed as single persons. Neither is the tax credit available to married couples with combined incomes over €45,400 in the tax years 2009 or 2010 and who claim the increased standard rate tax band for dual income couples. For more information and also to claim the relief due complete the application form in pdfLeaflet IT 66 - Home Carer's Tax Credit (PDF, 185KB) and send it to your local Revenue office. Alternatively, you can telephone your Regional LoCall number (see Further Information) with details of your claim.

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Trade Union Subscriptions

An annual flat rate allowance of €350 at the standard rate of tax 20% (tax credit €70) is available for Trade Union subscriptions paid in 2009 and 2010. The full allowance is available annually regardless of the actual amount of the subscription paid. If you are/were a member of a Trade Union at any time during 2009 or 2010 and you have not been granted relief for subscriptions made, you can phone your Regional LoCall number.

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Health/Medical Expenses Relief

You may claim tax relief on a Form MED 1, at the standard rate of tax (20%), from 1 January 2009 (with the exception of nursing home expenses for which tax relief is still available at your highest rate of tax) for certain medical expenses incurred by you, on your own behalf or on behalf of another person. Most medical expenses, with some exceptions e.g. routine dental and ophthalmic care, qualify for relief.

You cannot claim relief for any expenditure which has been or will be reimbursed, e.g. by Hibernian Aviva Health, Quinn-healthcare, VHI, a Health Authority, or where a compensation payment is made or will be made.

For more information see Leaflet IT 6 - Health / Medical Expenses Relief, Form pdfMED 1 (PDF, 343KB) or phone your Regional LoCall number.

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Tuition Fees

Tax relief at the standard rate of tax (20%) in the tax years 2009 and 2010 is available for certain tuition fees. The maximum limit on such qualifying fees for the academic years 2009/2010 and 2010/2011 is €5,000. For more information see Leaflet IT 31 - Tax Relief for Tuition Fees.

Tax Relief Available to Systematic Short-time Workers

The exemption from income tax for Jobseeker's Benefit paid to systematic short-time workers has been extended indefinitely.

PRSI & Health Contributions - Employers/Employees

Class A (Normal rate at which contributions are made)

Tax Year 2009 (applicable from 1 January 2009 to 30 April 2009)
Employee’s Income chargeable as below: Total Employer’s rate
Earnings up to €52,000 to PRSI @ 4% plus a Health
Contribution of 2%
 6% 10.75%
Earnings from €52,000 to €100,100 to a Health Contribution of 2%
 2% 10.75%
Earnings over €100,100 (€1,925 per week, €3,850 per fortnight & €8,342 per month) to a Health Contribution of 2.5% 2.5% 10.75%
Tax Year 2009 (applicable from 1 May 2009 to 31 December 2009)
Employee’s Income chargeable as below: Total Employer’s rate
Earnings up to €75,036 to PRSI @ 4% plus a Health
Contribution of 4%
 8% 10.75%
Earnings over €75,036 (€1,443 per week, €2,886 per fortnight & €6,253 per month) to a Health Contribution of 5%
 5% 10.75%
Tax Year 2010
Employee’s Income chargeable as below: Total Employer’s rate
Earnings up to €75,036 to PRSI @ 4% plus a Health
Contribution of 4%
 8% 10.75%
Earnings over €75,036 (€1,443 per week, €2,886 per fortnight & €6,253 per month) to a Health Contribution of 5%
 5% 10.75%

Employees are exempt from PRSI on the first €127 per week or €26 per week for employees on a modified PRSI rate. Employees earning €352 or less per week in 2009 or 2010 are exempt from PRSI and Health Contribution. However, where earnings exceed €352 per week in 2009 or 2010, the employee’s PRSI Free Allowance remains at €127 per week or €26 per week for employees on a modified PRSI rate. Employees earning €500 or less per week in 2009 or 2010 are exempt from Health Contribution.

Note: Recipients of a Social Welfare Widow’s or Widower’s Pension, Deserted Wife’s Benefit/Allowance or One-Parent Family Payment are exempt from paying the Health Contribution. Holders of a 'Full' Medical Card and people aged 70 and over are also exempt from this contribution.

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PRSI & Health Contributions - Self-Employed

Class S (Self-Employed)

Tax Year 2009
Self Employed Income chargeable as below: Total
3% PRSI and 3.333% Health Contribution on all income up to €75,036 6.333%
3% PRSI and 4% Health Contribution on all income from €75,036 to €100,100 7%
3% PRSI and 4.167% Health Contribution on all income over €100,100 7.167%
Tax Year 2010
Self Employed Income chargeable as below: Total
3% PRSI and 4% Health Contribution on all income up to €75,036 7%
3% PRSI and 5% Health Contribution on all income over €75,036 8%

Self-employed persons are exempt from Health Contribution where the annual income is €26,000 or less in 2009 or 2010. The minimum annual PRSI contribution is €253.

Note: Recipients of a Social Welfare Widow’s or Widower’s Pension, Deserted Wife’s Benefit/Allowance or One-Parent Family Payment are exempt from paying the Health Contribution. Holders of a 'Full' Medical Card and people aged 70 and over are also exempt from this contribution.
Any PRSI and Health Contribution queries should be directed to Department of Social Protection, Information Service at (01) 7043000 or at www.welfare.ie External link

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Further Information

If you are a PAYE customer your tax affairs are now dealt with in the region where you live. Check our contact details for more information.

If you are calling from outside the Republic of Ireland phone +353-1-7023011.

If you are taxed under the Self Assessment system you may contact the Revenue office shown on your notice of assessment.

Forms and Leaflets

To request any Revenue Form or Leaflet LoCall 1890 306 706 (ROI only), +353 1 7023050 (from abroad), visit any Revenue Office or see: Leaflets and Forms.

Please note that the rates charged for the use of 1890 (LoCall) numbers may vary among different service providers.

Accessibility

If you are a person with a disability and require this leaflet in an alternative format the Revenue Access Officer can be contacted at: accessofficer@revenue.ie

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PAYE Anytime

The quickest and easiest way to keep your tax up to date is to use PAYE Anytime. PAYE Anytime is an internet system that lets you do business with Revenue electronically 365 days a year. You must register first. Registration is quick and easy. See PAYE Anytime for more information.

Revenue
December 2009

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