Monday 16 December 2019

Can we get tax credits for our autistic son?

Your Questions

Stack of euros
Stack of euros

Sandra Clarke

We recently discovered our 18-month-old son is autistic. As well as being concerned for his emotional welfare, we are worried we will not be able to afford the treatment and care he needs.

 I understand we may be entitled to a tax credit - how valuable is that credit and how do I know if we're eligible for it?

Jean, Enniskerry, Co Wicklow

 

Sandra Clarke replies: The incapacitated child tax credit is worth €3,300 a year. This credit may be split between both parents or claimed solely by one parent. You can claim this tax credit as long as your son is either physically or mentally permanently incapacitated.

Acute autism is considered a permanent disability - that is, it will prevent your son being able to look after himself independently when he reaches 18.

You can therefore claim this credit by completing a claim form. You need to provide the following information on the form - your son's name and date of birth, his PPS number, and the nature of the incapacity. The completed form should then be returned to your local tax office.

In cases where it is not obvious that the child's incapacity is of a serious and permanent nature, a doctor's certificate should be submitted with the initial claim.

You may claim either the incapacitated child tax credit or the dependent relative tax credit. However, you cannot claim both for the same child. As the incapacitated child credit is more valuable, I would recommend you claim it.

 

I am returning to Ireland after working in Australia for five years. Where do I stand when it comes to tax credits now - and how else will my stint abroad affect my tax record here?

Donal, Glencolmcille, Co Donegal

 

Sandra Clarke replies: Firstly, your residence status for tax purposes has to be established. So you must establish if you are resident in the tax year you return to Ireland. You will be resident if you spend 183 days or more in Ireland during the tax year. However, in your case, if you return in 2014, you will not be resident.

The next question is if you are ordinarily resident in Ireland. Where you are returning to Ireland and you remain resident for three consecutive tax years, you will become ordinarily resident from the beginning of the fourth tax year. Therefore you are not ordinarily resident for 2014.

Next: are you domiciled in Ireland? Every individual acquires a domicile of origin at birth. Assuming you were born in Ireland, you would be considered domiciled in Ireland for tax purposes.

Assuming you return in 2014, for tax purposes you are non-resident, non-ordinarily resident but domiciled in Ireland.

You will therefore be taxable in Ireland on all your Irish income. You may be considered tax resident for 2014 in Australia and therefore liable to Australian tax on your worldwide income, including Irish income.

However, non-resident individuals are entitled to a proportion of allowances and tax credits.

You may be entitled to reliefs due under the terms of a double-taxation agreement. A double charge to tax is prevented by either exempting the income from tax in one of the countries, or allowing a credit in one country for the tax paid in the other country on the same income.

  • Sandra Clarke is partner with BCC Accountants in Co Meath

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