Tax relief available to the self-employed

The time of year has arrived for self-assessed taxpayers to get their affairs in order. This means you must submit a tax return (Form 11) every year to Revenue. The traditional date that the tax return had to be filed by was always the 31st October but if you use ROS (Revenue Online Service) you have until the 12th November. It is important to note that you must register as a ROS customer to avail of the online service.

Tax is a subject that can become complex and is a topic that people tend to avoid. Our expert taxation team can solve any taxation issues you are having and save you money. A huge number of self-employed people in Ireland are unaware of their tax obligations and entitlements. Because of this, a lot of tax credits and reliefs go unclaimed.

Unclaimed Tax Relief

We have compiled a list of the tax reliefs available to self-employed people in Ireland to help you claim what you are entitled to:

Retirement Annuities Tax Relief

A retirement annuity refers to a personal pension. Annual contributions paid to Revenue approved pension schemes are tax-deductible. You are entitled to tax reliefs on contributions made (subject to conditions) if you:

  • Have self-employment income from a trade or profession
  • Have wages from a job that is not being pensioned in a company pension scheme.

Health Insurance Tax Relief

Employers paying premiums on behalf of employees are entitled to get a tax credit (maximum 200) at the end of the year.

Health insurance premiums paid by self-assessed individuals for themselves can claim relief through ‘Permanent Health Benefit’ on an income tax return.

Medical/Dental Expenses Tax Relief

If you pay medical expenses that are not covered by the State or by private health insurance, you can claim tax relief on some of those expenses.

These expenses include the costs involved in nursing home care.

Medical expenses- You can claim tax relief on medical expenses you pay for yourself and for any other person.

You can claim tax relief on medical expenses you pay for yourself and for any other person.

You can claim relief only if you cannot recover the expenses from any other source. You cannot claim tax relief for amounts already received or due to be received from:

  • A public or local authority
  • An insurance policy
  • Any other source, for example, compensation.

Rental property loan or business loan interest

Loans used to purchase or improve rented residential property qualify for tax relief on the interest paid. The amount that can be used as tax relief is limited to 85% of the amount of interest paid.

Regarding commercial properties, 100% interest relief is available.

Interest on your mortgage

There is a tax relief available on the interest you pay on a home mortgage loan.

The interest on a loan used to purchase, repair, develop or improve the home is valid for tax relief.

This tax-relief can be claimed at source.

Property-based tax relief

There are also tax reliefs available regarding rental properties. The following tax incentive schemes may be available to you if you own a rental property:

  • Home Renovation Incentive
  • Living City Initiative
  • Leasing of your farmland

It is important to note that Section 23 Relief or relief under the Countrywide Refurbishment Scheme cannot be claimed for work carried out after 31 July 2008 on:

  • Construction
  • Refurbishment
  • Conversion

Spouse/Home Carer Tax Credit

There is a tax relief available to married couples when one spouse works in the home caring for a dependant person.

In order to claim a Home Carer Tax Credit you must meet the following conditions:

  • You and your spouse are jointly assessed for tax
  • One spouse works at home to care for one or more dependant people
  • The spouse’s income must be below €7,200 to obtain the full tax credit. If the carer’s income is between €7,200 and €10,000 you are still entitled to claim a reduced tax credit.

Trust the experts

Submitting income tax returns can be stressful and time-consuming, especially for new business owners that may lack experience. Remember, it is essential that you declare all your income that was not subject to PAYE or you could land yourself with a hefty fine.

Russell and Co. Chartered Accountants have over 40 years’ experience working with self-assessed taxpayers. We ensure our clients are both staying compliant with tax legislation and availing of all tax reliefs available to them. Our services don’t end with taxation, we specialise in a range of areas like business coaching, liquidation and company formation.





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