Dominic Hannigan (Meath East, Labour)
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80. To ask the Minister for Finance the way the change to civil partnership legislation has affected cohabiting couples who are seeking to share tax credits when one is working and the other is not; and if he will make a statement on the matter. [7246/14]

Michael Noonan (Limerick City, Fine Gael)
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A couple who enter into a civil partnership in accordance with the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 can avail of the same treatment for tax purposes as married couples including joint assessment. This includes the right to share tax credits and reliefs. The relevant taxation provisions extending this tax treatment to civil partners were set out in the Finance (No. 3) Act 2011. The tax legislation also provides for relief for maintenance payments made on the breakdown of the civil partnership in the same way as for separated or divorced spouses. Thus legally enforceable maintenance payments made for the benefit of a separated or former civil partner are fully deductible for tax purposes in the hands of the payer. There is also Capital Gains Tax relief for property transfers between civil partners or former civil partners on separation or on dissolution of a civil partnership.

In the case of cohabitants, and arising from the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010, the Finance (No. 3) Act 2011 introduced a new Part 44B into the Taxes Consolidation Act 1997 (TCA), which provides for the same maintenance relief as for a married couple or civil partners for a financially dependent cohabitant in the event of the cessation of the cohabiting arrangement. This tax relief applies to legally enforceable maintenance arrangements made under section 175 of the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010. There is also Capital Gains tax relief for property transfers arising from orders made under section 174 of the same Act.

Other than arrangements for redress on the break down of a cohabiting relationship, there are no provisions in the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 for legal recognition of such relationships. Cohabitants do not have the same legal rights and obligations as a married couple or a couple in a civil partnership. Where a couple is cohabiting, rather than married or in a civil partnership, each cohabitant is treated for the purposes of income tax as a separate and unconnected individual. Because each of them is a separate entity for tax purposes, credits, tax bands and reliefs cannot be transferred from one co-habitant to the other.