Jack Wall (Kildare South, Labour)
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Question 67: To ask the Minister for Finance the mechanism a person has to use in regard to employment opportunities (details supplied); and if he will make a statement on the matter. [11992/12]

Michael Noonan (Limerick City, Fine Gael)
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I am informed by the Revenue Commissioners that an individual's income from all sources, including income from employment, self-employment, pensions and investments, is taken into account in determining his or her annual income tax liability. The individual is entitled to tax credits which reduce this liability. An individual's civil status determines the level of tax credits available to them for the year of assessment. For 2012 these are:

· Single person's tax credit €1,650

· PAYE tax credit €1,650

· Widowed person/surviving civil partner tax credit €2,190

· Married persons/persons in a civil partnership tax credit €3,300

(where jointly assessed)

· Age tax credit (over 65) if single/ widowed/ surviving civil partner €245

· Age tax credit (over 65) if married/ in a civil partnership €490

The tax rate bands applicable to the individual for 2012 are as follows:-

· Single, widowed or surviving civil partner without dependent children - €32,800 @ 20%, balance @ 41%

· Single, widowed or surviving civil partner qualifying for one parent family tax credit - €36,800 @ 20%, balance @ 41%

· Married or in a civil partnership - one spouse or civil partner with income - €41,800 @ 20%, balance @ 41%

· Married or in a civil partnership - both spouses or civil partners with income - €41,800 @ 20% (with an increase of €23,800 max), balance @ 41%.

The increase in the standard rate tax band is restricted to the lower of €23,800 in year 2012 or the amount of the income of the spouse or civil partner with the lower income. The increase is not transferable between spouses or civil partners.

Individuals aged over 65 have no income tax liability if aggregate income for the year does not exceed €18,000, where single, or a joint income of €36,000, where married or in a civil partnership.

Marginal relief can be applied where one or both parties are over the age of 65, where an individual's income, or the joint income of a couple, exceeds the exemption limit. The taxpayer is given the benefit of paying the lesser of the tax on the excess of their income over the exemption limit at 40%, or alternatively the application of normal rate bands and credits.

Income is also subject to the Universal Social Charge (USC) at the following rates for 2012:-

· If the aggregate income is less than €10,036 for the year USC is not payable.

· Where the aggregate income is €10,036 or over:

o if the individual is under the age of 70 years the first €10,036 is charged at a rate of 2%, the next €5,980 is at a rate of 4% and the remainder is at a rate of 7%.

o If the individual is over the age of 70 years the first €10,036 is at a rate of 2% and the remainder is at a rate of 4%.

For USC purposes the income of each spouse or civil partner is considered separately.

The Universal Social Charge (USC) does not apply to payments made under the Social Welfare Acts and similar type payments. Given the limited information in this question I am unable to be more specific in my answer. However, further information on entitlements and liabilities is available from the local Revenue Office on request or the Revenue website at www.revenue.ie

The issue of whether this individual is required to make social insurance contributions to the Social Fund in respect of their self employed income, is a matter for the Minister for Social Protection.