Written answers

Tuesday, 23 May 2006

9:00 pm

Photo of David StantonDavid Stanton (Cork East, Fine Gael)
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Question 117: To ask the Minister for Finance the criteria to be fulfilled for a person to receive the one parent family credit; and if he will make a statement on the matter. [19431/06]

Photo of David StantonDavid Stanton (Cork East, Fine Gael)
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Question 126: To ask the Minister for Finance the number of people in receipt of the one parent family tax credit; the cost to the Exchequer of this tax credit for each year since the year 2003 respectively; and if he will make a statement on the matter. [19432/06]

Photo of Brian CowenBrian Cowen (Laois-Offaly, Fianna Fail)
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I propose to take Questions Nos. 117 and 126 together.

The one parent family tax credit is a credit that can be claimed by a single parent (whether widowed, single, deserted, separated or divorced) who has a dependent child resident with him/her for the whole or part of the relevant tax year.

A child includes a child of the claimant, a stepchild, a formally adopted child, an informally adopted child or any child (who is not a child of the claimant) of whom the claimant has custody and maintains at his or her own expense.

A child is regarded as a dependant to the claimant if he or she is:

∙born during the tax year or is under 18 years at the beginning of the year.

∙over 18 years and receiving full-time education or undergoing a full-time training course for a trade or profession for a minimum of two years; or

∙permanently incapacitated either physically or mentally from maintaining himself or herself and become so before reaching 21 years of age (or had become permanently incapacitated after reaching the age of 21 years but while he or she had been receiving full-time education).

The one-parent family tax credit is not due in the case of an unmarried cohabiting couple or in the case of an individual who is entitled to the married person's tax credit.

I am informed by the Revenue Commissioners that the estimated cost to the Exchequer of the one parent family tax credit, and the associated numbers of income earners availing of it, are as set out in the following table:

One parent family tax credit — cost to Exchequer and numbers availing of it*
Tax Year 2003 2004 2005
Cost to Exchequer €145m €150m €160m
Numbers availing 104,700 107,900 110,200
* (Figures are rounded, provisional and subject to revision).

The numbers availing of the credit represent income earners who were in a position to absorb at least some of the one parent family tax credit and thereby give rise to an Exchequer cost. They do not include the numbers of potential claimants whose entitlements to other tax credits were sufficient to reduce their liability to tax to nil. A married couple who has elected or has been deemed to have elected for joint assessment is counted as one tax unit.

The figures shown in the table are estimates which are derived from the Revenue tax forecasting model using actual data for the year 2002 adjusted to reflect actual or estimated growth in employment and wages for the year in question.

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