Information

Almost all income is subject to taxation. Your social welfare payment may or may not be taxable but even if it is taxable, you may not actually have to pay tax on it.

If you are getting a social welfare payment you will get a PAYE Tax Credit in addition to your normal tax credits. As a result, if a social welfare payment is your only source of income you may not pay tax because your tax liability does not exceed your tax credits.

However, if you have a social welfare payment and another source of income, you may have to pay tax. In this case, your taxable social welfare payment and your other income are added together. You are taxed on the total amount. There is no mechanism for taxing social welfare payments at source (before they are paid to you). Your non-social welfare income, for example, employment income, determines how tax due is paid.

For example, you are getting Jobseeker’s Benefit (JB) for part of the week, and working for the other half. Your employment income is taxed through the Pay As You Earn (PAYE) system and you get your tax credits in the normal way. In order to tax your Jobseeker’s Benefit, your standard rate cut off point is reduced by the amount of the payment. You then effectively pay tax on both the JB and job income, but it is collected from the employment income.

The technical term for this is ‘coding in’ of credits. If your social welfare payment was not coded in, you would have to pay tax as a self-employed person and in a lump sum by 31 October each year.

Rules

Jobseeker's Benefit is generally taxable, but the first €13 each week is exempt from tax. Jobseeker's Benefit payable to short-time workers is not taxable. The Child Dependant Increase payable with Jobseeker's Benefit is also not taxable.

Jobseeker’s Allowance, Pre-Retirement Allowance or Farm Assist are not taxable.

How to Apply

Contact your regional tax office:

Use the Revenue contact locator to find the Lo-call number for your region.

You can find more detailed Revenue contact details for your region on the Revenue website.

There is more useful information on tax in Getting a tax refund