YOUR PENSION
There was no increase in the weekly state pension and a puny €2 increase in the weekly fuel allowance (which is paid during the cold months to people who are dependent on long-term social welfare payments, and who are unable to provide for their own heating needs).
Many pensions will be in line for the €5 increase in the living alone allowance — which is paid to pensioners and people with disabilities who live alone — though it’s a small increase. “Pensioners would have been aided by a general increase in the weekly state pension to help combat increases in the cost of living,” said Eamon O’Connor, tax manager with PwC.
“Pensions have seen a moderate but steady increase in recent Budgets, and many pensioners will be disappointed that this trend has not continued.”
An increase in the income tax exemption limit for those aged 65 or over would have helped pensioners, according to Robert Dowley, partner with KPMG.
Under that exemption, people aged 65 or above can receive income of up to €18,000 a year without paying income tax, in the case of a single individual, or €36,000 in the case of a couple.
“For an elderly individual with relatively modest rental income or a pension from their former employment, inflationary increases to their pensions can have the effect of disproportionately increasing the level of income tax payable in certain instances,” said Dowley. “Such an individual would have benefited from increases to either the exemption limits or to personal tax credits or tax rate bands.” Budget 2020 should help to ease the medical bills faced by many pensioners. There will be an extra 56,000 medical cards for those over 70, a small cut in prescription charges, and the monthly threshold for the Drug Payment Scheme (DPS) will fall from €124 to €114 from January 2020.
As the DPS limits the amount that an individual or family will pay for approved prescribed drugs and medicines each month, it is invaluable for those who continually face high medical bills.
However, the upcoming monthly limit of €114 will still be a far cry from the €90 monthly cap which applied about 10 years ago — so there is still room for improvement here.