Paschal Donohoe (Dublin Central, Fine Gael)
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A review of the home carer tax credit was carried out this year by my Department and Revenue following the methodology outlined in the tax expenditure guidelines. The review was carried out to inform future policy making in this area and forms part of my Department’s ongoing commitment to reviewing tax expenditures on a regular basis.

The issue raised by the Deputy was specifically addressed in this report following our discussion of this matter on Committee Stage last year. I hope the report, which is entitled "Review of the Home Carers Tax Credit" and as the Deputy acknowledged, was published on budget day, would meet the needs outlined by the Deputy and that, therefore, he would agree that an additional report is not necessary.

I will deal with the awareness of the credit and progress since we last discussed this issue. The report concludes that awareness of the credit is reasonably high. To further demonstrate this, data from Revenue indicates that around 119,800 families claimed the home carer tax credit in 2017 but only 83,800 families benefited from either the full or partial credit. It is, therefore, not accurate to suggest that people are not aware of their entitlements because there may be genuine reasons, as the Deputy has touched on, as to why they have not been able to or decided not to use the credit. For 2017, the total cost of the home carer tax credit was approximately €83.5 million. As the Deputy indicated, it could be because that potential claimants' entitlement to other tax credits was sufficient to reduce their tax liability to nil without needing to avail of the home carer tax credit.

Although the administration of the tax code is a matter for Revenue, I have been advised that Revenue contacts PAYE taxpayers to remind them that there is a four-year time limit for claiming additional tax credits and reliefs. For example, in 2018, 127,632 letters issued to all PAYE taxpayers who had not claimed additional credits or reliefs from 2014 to 2018 reminding them that they may be entitled to make a claim on or before 31 December 2018. Since this communication, an additional 474 claims were made for the home carer tax credit and I understand that similar letters have been issued by Revenue this year.

Furthermore, as the Deputy will be aware, Revenue pre-populates the annual tax returns of self-assessed taxpayers with the home carer tax credit where it was claimed in the previous year. Revenue also automatically grants the home carer tax credit where it identifies eligible persons whose circumstances indicate that they would benefit from the credit. For these reasons, I am satisfied that everything is already being done to ensure that everyone gets the full value of their tax entitlements and given that a review of the credit has just been conducted, I do not believe there is a need to carry out another report, as the Deputy has suggested. I would ask that he keep this in mind but if he or the committee has further views about what we can do to draw attention to this credit, I would be very happy to hear them and to see if we can engage on it.