Having a family member go into a nursing home can be quite an emotional transition. Sometimes it gets easier with time, and sometimes it doesn’t. So maybe you might be trying to avoid the financial side of things or at least just get the boxes ticked. However, it could mean that you aren’t claiming the tax back that you are entitled to.
Tax experts at taxback.com say that an assessment of the most recent Revenue figures for nursing home relief reveal that, while there are 30,000 people in nursing homes nationwide, just 6,800 claimed the relief (which all fee payers are entitled to) in 2016.
Also, the average refund received is significantly lower than one would expect at €5,000, meaning even those who do apply for the relief may not be maximising their full entitlement.
Eileen Devereux, commercial director at taxback.com says: “Like almost all tax reliefs available in Ireland, the nursing home relief is underutilised. Anyone paying nursing home fees, either for themselves or for someone else, is eligible to claim relief at their marginal rate of tax. Many nursing home occupants in the country have part of their fees paid under the Fair Deal Scheme, but these people can still claim relief on their contributions.
“The fact that just 6,800 people out of 30,000 claimed the relief in 2016 says to us that many are simply not aware of the tax reliefs available – or perhaps some believe that applying for the refund would be too much hassle. We want to stress to these people that the application process really is very straight forward.”
Taxback.com say that many nursing home fees are paid by the children of the occupants, or are spread across siblings, some of whom could be paying tax at the higher rate and would be eligible for an even-greater relief of up to €20,000 on fees of €50,000.
Irish Country Living is aware that paying nursing home fees is a sensitive area in most families and often fraught with tension as it can highlight the differences in income and tax relief of siblings but a pragmatic family discussion on how to maximise the tax relief is warranted in all cases.
If you need more information on this, taxback.com teamed up with Nursing Homes Ireland (NHI) in 2017 to produce a free Nursing Home Finance & Tax Guide, aimed at ensuring anyone who is paying for nursing homes and the costs associated claims all the reliefs and refunds available to them.
It also covers:
Nursing home expenses – If you are paying nursing home fees for yourself or a parent or loved one, you can claim relief on nursing home expenses at your highest rate of tax subject to certain conditions.Fair Deal Scheme – Operated by the Health Service Executive (HSE), the scheme aims to provide financial support to people who need long-term nursing home care. Under Fair Deal, you make a contribution towards the cost of the care and, if your accessed contribution is less than the amount of the fees, the HSE will pay the rest. While you can claim tax relief on the contribution you make, you can’t claim any relief on the contribution made by the HSE.Dependent Relative Tax Credit – If you’re caring for a dependent relative you may qualify for the Dependent Relative Tax Credit. Medical expenses – If you pay for medical costs, either for yourself or a loved one, you can claim medical expenses at a rate of 20%. There are a variety of expenses on the list.Kidney patients – Kidney patients are entitled to a number of additional reliefs to the normal health expenses. For example, you can claim relief on the cost of travelling to and from the hospital if you or your loved one travels regularly for dialysis treatment. If you’re travelling in your own car you can claim relief at €0.27/mile or €0.17/km (2017).Medical appliances – You can claim relief on the cost of purchasing, maintaining and repairing medical appliances for yourself or on behalf of a loved one (that you’ve been advised to use by a registered practitioner).How much does it cost to get your home successfully from one end of the year to the next? Try somewhere in the region of €16,374 a year. That, according to research by AA Home Insurance, is €350 more than the cost of running a house last year.
So why such a jump in price? It comes down to the fact that the research takes into consideration all the running costs of a home; from broadband to heating, to the cost of domestic appliances as well as the mortgage. And it’s the increase in mortgages for people that have purchased a secondhand home in Ireland that is driving up the price. Average values increased from €224,500 during the third quarter of last year to €243,000 in the third quarter of this year. Those who took out a 90% mortgage this year are likely to pay €10,069.08 per annum – an increase of 1.86% on last year.
“While the continued climb of house prices has been one of the major stories of 2018, it’s not just the cost of mortgage repayments or getting your foot on the property ladder that have risen in the past 12 months,” Conor Faughnan, AA director of consumer affairs stated.
“Home heating and electricity costs have also surged in the past year meaning that even those who were fortunate enough to acquire their home when property prices were a little lower have seen their wallets take a significant hit.”
While the AA bases its calculations on those of a new buyer, there is also the ‘negative equity generation’ – homeowners who bought their house at the peak of the boom.
The AA gives figures for that group too, assuming the house was bought in 2007. That group currently pays €5,605.44 more on their mortgage repayments than their counterparts who purchased their homes in the third quarter of this year.
Maintenance, repair and contingency funds is the second single most expensive bill for Irish householders and has increased by 0.7% on 2017. The AA estimates that the average homeowner is likely to spend or set aside €1,255.56 each year to keep up with wear and tear.
This figure equates to almost 8% of the overall estimated cost of owning and running a home.
Heading away to the Christmas markets? Or getting away to a sunny destinations? With consumers planning trips for Christmas shopping, one little job to add to your to-do list before departing is to download the ECC-Net travel app. A handy little item, it helps consumers find out about their rights quickly and get over any language barriers they may encounter when availing of those rights.
So if for example, you are in Spain at the car rental counter and notice there is damage with the car when picking it up, the app will provide a translation in Spanish to help you tell the trader about the issue and the requirement for written confirmation of the damage. Available to download on android and iOS devices, the app also covers topics such as retail purchases, air travel, accommodation, emergency numbers and more.
The app was developed by the European Consumer Centres Network, which ECC Ireland is part of.
Having a family member go into a nursing home can be quite an emotional transition. Sometimes it gets easier with time, and sometimes it doesn’t. So maybe you might be trying to avoid the financial side of things or at least just get the boxes ticked. However, it could mean that you aren’t claiming the tax back that you are entitled to.
Tax experts at taxback.com say that an assessment of the most recent Revenue figures for nursing home relief reveal that, while there are 30,000 people in nursing homes nationwide, just 6,800 claimed the relief (which all fee payers are entitled to) in 2016.
Also, the average refund received is significantly lower than one would expect at €5,000, meaning even those who do apply for the relief may not be maximising their full entitlement.
Eileen Devereux, commercial director at taxback.com says: “Like almost all tax reliefs available in Ireland, the nursing home relief is underutilised. Anyone paying nursing home fees, either for themselves or for someone else, is eligible to claim relief at their marginal rate of tax. Many nursing home occupants in the country have part of their fees paid under the Fair Deal Scheme, but these people can still claim relief on their contributions.
“The fact that just 6,800 people out of 30,000 claimed the relief in 2016 says to us that many are simply not aware of the tax reliefs available – or perhaps some believe that applying for the refund would be too much hassle. We want to stress to these people that the application process really is very straight forward.”
Taxback.com say that many nursing home fees are paid by the children of the occupants, or are spread across siblings, some of whom could be paying tax at the higher rate and would be eligible for an even-greater relief of up to €20,000 on fees of €50,000.
Irish Country Living is aware that paying nursing home fees is a sensitive area in most families and often fraught with tension as it can highlight the differences in income and tax relief of siblings but a pragmatic family discussion on how to maximise the tax relief is warranted in all cases.
If you need more information on this, taxback.com teamed up with Nursing Homes Ireland (NHI) in 2017 to produce a free Nursing Home Finance & Tax Guide, aimed at ensuring anyone who is paying for nursing homes and the costs associated claims all the reliefs and refunds available to them.
It also covers:
Nursing home expenses – If you are paying nursing home fees for yourself or a parent or loved one, you can claim relief on nursing home expenses at your highest rate of tax subject to certain conditions.Fair Deal Scheme – Operated by the Health Service Executive (HSE), the scheme aims to provide financial support to people who need long-term nursing home care. Under Fair Deal, you make a contribution towards the cost of the care and, if your accessed contribution is less than the amount of the fees, the HSE will pay the rest. While you can claim tax relief on the contribution you make, you can’t claim any relief on the contribution made by the HSE.Dependent Relative Tax Credit – If you’re caring for a dependent relative you may qualify for the Dependent Relative Tax Credit. Medical expenses – If you pay for medical costs, either for yourself or a loved one, you can claim medical expenses at a rate of 20%. There are a variety of expenses on the list.Kidney patients – Kidney patients are entitled to a number of additional reliefs to the normal health expenses. For example, you can claim relief on the cost of travelling to and from the hospital if you or your loved one travels regularly for dialysis treatment. If you’re travelling in your own car you can claim relief at €0.27/mile or €0.17/km (2017).Medical appliances – You can claim relief on the cost of purchasing, maintaining and repairing medical appliances for yourself or on behalf of a loved one (that you’ve been advised to use by a registered practitioner).How much does it cost to get your home successfully from one end of the year to the next? Try somewhere in the region of €16,374 a year. That, according to research by AA Home Insurance, is €350 more than the cost of running a house last year.
So why such a jump in price? It comes down to the fact that the research takes into consideration all the running costs of a home; from broadband to heating, to the cost of domestic appliances as well as the mortgage. And it’s the increase in mortgages for people that have purchased a secondhand home in Ireland that is driving up the price. Average values increased from €224,500 during the third quarter of last year to €243,000 in the third quarter of this year. Those who took out a 90% mortgage this year are likely to pay €10,069.08 per annum – an increase of 1.86% on last year.
“While the continued climb of house prices has been one of the major stories of 2018, it’s not just the cost of mortgage repayments or getting your foot on the property ladder that have risen in the past 12 months,” Conor Faughnan, AA director of consumer affairs stated.
“Home heating and electricity costs have also surged in the past year meaning that even those who were fortunate enough to acquire their home when property prices were a little lower have seen their wallets take a significant hit.”
While the AA bases its calculations on those of a new buyer, there is also the ‘negative equity generation’ – homeowners who bought their house at the peak of the boom.
The AA gives figures for that group too, assuming the house was bought in 2007. That group currently pays €5,605.44 more on their mortgage repayments than their counterparts who purchased their homes in the third quarter of this year.
Maintenance, repair and contingency funds is the second single most expensive bill for Irish householders and has increased by 0.7% on 2017. The AA estimates that the average homeowner is likely to spend or set aside €1,255.56 each year to keep up with wear and tear.
This figure equates to almost 8% of the overall estimated cost of owning and running a home.
Heading away to the Christmas markets? Or getting away to a sunny destinations? With consumers planning trips for Christmas shopping, one little job to add to your to-do list before departing is to download the ECC-Net travel app. A handy little item, it helps consumers find out about their rights quickly and get over any language barriers they may encounter when availing of those rights.
So if for example, you are in Spain at the car rental counter and notice there is damage with the car when picking it up, the app will provide a translation in Spanish to help you tell the trader about the issue and the requirement for written confirmation of the damage. Available to download on android and iOS devices, the app also covers topics such as retail purchases, air travel, accommodation, emergency numbers and more.
The app was developed by the European Consumer Centres Network, which ECC Ireland is part of.
This is a subscriber-only article
SHARING OPTIONS: