Families missing out on nursing home rebates
Experts say thousands fail to claim tax back on senior care costs
TENS of thousands of people may be missing out on refunds from the State for the cost of nursing home care, tax experts have said.
Following an assessment of the most recent Revenue figures for nursing home relief, tax refund specialists discovered that just 6,800 people claimed the relief in 2016 with a total value of €32.8million, despite 30,000 people being in nursing homes nationwide. Eileen Devereux, commercial director at Taxback.com, said these figures show that many people are unaware of the tax reliefs available to them, or believe the process of applying for a refund would be ‘too much hassle’.
However, she stressed the application process for claiming tax is ‘very straightforward’.
‘Like almost all tax reliefs available in Ireland – the nursing home relief is under utilised, and the statistics support this contention,’ she said.
‘Many nursing home occupants have part of their fees paid under the Fair Deal scheme, but these people can still claim relief on their contributions.’
With most nursing home fees starting at €50,000 at least, tax relief at the lowest rate would still entitle the payer to a rebate of €10,000.
As many nursing home fees are paid by siblings or children of the occupants, those paying tax at the higher rate could be eligible for up to €20,000 on fees of €50,000.
‘Frequently fees are paid out of the individual’s estate, while it is often the case that payment of the costs falls to family members,’ Ms Devereux said.
‘The point is that everyone who contributes is entitled to claim something – and the refunds due can be significant amounts of money.’
She added that while the group is ‘conscious that the paying of 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, a pragmatic family discussion on how to maximise the tax relief is warranted in all cases’.
When contacted by the Irish Daily Mail, a spokesperson for Revenue said the figures of those claiming nursing home relief ‘do not necessarily indicate the number of people entitled to relief on nursing home expenses’.
They added that for a nursing home resident or someone paying their costs to benefit from the relief, they must be in receipt of income, and be liable to or have paid tax in the same year the fees are paid.
‘Each year, Revenue issues letters to PAYE taxpayers with a history of paying tax in the past four years without claiming credits or reliefs, reminding them that they may be entitled to make a claim on or before December 31,’ they added.
CEO of Nursing Homes Ireland, Tadhg Daly said all nursing home residents and their families should take full advantage of the tax relief available to them.
‘With the full costs of nursing home care not covered by the Fair Deal scheme or the medical card, it is very important people are aware of financial relief that is available to support them to avail of the specialist care provided by nursing homes,’ Mr Daly said.
Fianna Fáil’s spokesperson for older people, Mary Butler said nursing home costs are a ‘major burden on thousands of families’, adding that more needs to be done to make people aware of their entitlements. ‘Ensuring that forms are quick, easy and readily available when you pay your nursing home fees would be a welcome step,’ she said.
Tax relief on nursing home expenses can be claimed at the payer’s highest rate of tax up to 40% under certain conditions.
These include if the nursing home provided 24-hour on-site nursing care, the expenses are for diagnostic procedures carried out on the advice of a registered practitioner, and the maintenance or treatment expenses involved are associated with the services of a practitioner.
‘Too much hassle’
‘Major burden on families’