Mary Upton (Dublin South Central, Labour)
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Question 139: To ask the Minister for Finance if his attention has been drawn to the fact that persons over 70 years who no longer qualify under the revised terms for medical cards and who voluntarily return their medical cards are liable to pay the income levy on their occupational pensions; if he will provide the number of persons in this category who returned their medical cards; the number of those in this category who might have been expected to return their cards; and if he will make a statement on the matter. [34816/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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Section 531B(2)(b) of the Taxes Consolidation Act 1997 provides that a person who has eligibility to a full medical card will have an exemption from the Income Levy for that year of assessment. Revenue have published Frequently Asked Questions to provide further clarification in this regard by stating that where a person had eligibility to a full medical card at any time during the year of assessment that the Income Levy would not be charged for that year of assessment.

In circumstances where an individual has voluntarily returned their medical card on the basis that they no longer meet the eligibility criteria, that person will retain the Income Levy exemption for the year of assessment when the card is surrendered. However, the Levy will apply to their aggregate income for the subsequent year of assessment, with reference to the exemption limit of €20,000 which applies for a single person over 65 years of age, or €40,000 which applies where either spouse is over 65 years.

The Department of Health and Children has advised that 12,101 medical cards were returned in 2009 by persons aged 70 years and over, who declared their income as being in excess of the medical card income guidelines. In addition, approximately 5,000 over 70s medical cards were removed from the medical card register in 2009 as part of the Health Service Executive's data quality exercise. The original total estimate of over 70s medical cards which would be returned was 20,000.