Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I will deal with the different questions that have been put to me. I will begin with the shared point made by Deputies McGrath and Doherty on the issue of couples who are co-habiting but are not married. This is the reason I hesitated in giving a fuller answer to Deputy McGrath on an earlier section. I am aware of the legal reasons such couples are treated differently from married couples. I will come back to the committee with a note on this before Report Stage which will outline this further. I do not have the information on why this is the case to hand. I take Deputy McGrath's point that given all of the changes in our society, the nature of families and the composition of parenting, it is likely this will be a more prevalent issue in the future than it has been in our recent past.

On the questions Deputy Burton put to me regarding income and the non-drawdown of the home carer's tax credit, based on the information I have available to me it appears that the drawdown of this tax credit is quite high and it is very plausible that the reasons it is not being drawn down by some is not due to a lack of awareness of the credit. Rather, it is because by the time people check whether the credit would be of use of them they have availed of other credits which means the home carer's credit is of little or no use to them. That relates to the Deputy's second question. I am inclined to think she is right in terms of income and what this means for people's ability to draw down this credit.

Page 18 of the report we published, Review of the Home Carer Credit, indicated that most households availing of the credit only have a single income and the vast majority have an income of less than €60,000, with over one-third having an income of between €20,000 and €40,000. The report breaks down the data by gender and different income levels, which leads me to think, as I outlined in my earlier response, that the key reason it is not being drawn down is that other tax credits have been used up and those who are accessing the credit are on quite low incomes in the first place. By the time they consider whether they should access the home carer credit, it is no longer relevant or beneficial to them.

The Deputy's last point referred to how we deal with those who are on low incomes and the relevance of the tax code to them in terms of supporting them via redistribution. The Deputy is correct. The level of tax paid by citizens who have low incomes is now quite low. The ability of tax to act as a redistributive policy for such people is becoming less and less relevant because the amount of tax they are paying in the first place is becoming lower and lower compared to a number of years ago. In terms of giving support to those citizens, particularly those who are in work, other areas of policy, apart from tax, will be more important, such as the cost of medical and child care and other things with which the Deputy is familiar.

On the question put to me by Deputy Doherty, I will go through the conditions for the home carer tax credit. The married couple or civil partners must be jointly assessed. The home carer must care for one or more dependent persons, and there is a definition of "dependent persons", including a child for whom the person is in receipt of child benefit, a person over the age of 65 or a citizen who is permanently incapacitated. The dependent person cannot include a spouse or civil partner. They must normally reside together for the purposes of tax. To obtain the full credit, the home carer's income must not exceed €7,200 in the tax year and the couple must not claim the increased standard rate band for dual income couples in the year for which they wish to claim the home carer tax credit.