January - Know your rights Citizens Information Centre
Changes to Child Benefit
January 2012
Question
I have four children. The last two are twins. What Child Benefit payment I will get in 2012?
Answer
Child Benefit is payable to the parents or guardians of children under 16 years of age. It is also payable where a child is under 18 years of age if the child is in full-time education, FÁS Youthreach training or has a disability. It was announced in Budget 2012 that the rates of payment of Child Benefit will be standardised for all children at €140 per child per month over the next two years.
Child Benefit stays at €140 per month for each of the first two children. From January 2012 the rate for the third child is reduced to €148 from €167 and for the fourth and each subsequent child to €160 from €177.
The additional monthly payment for twins and triplets continues. Child Benefit for twins is one and a half times the normal monthly rate for each child. In your case, since you have two children already, the twins are the third and fourth children in the family. Therefore the monthly payment for the twins is €222 (€148 x 1.5) and €240 (€160 x 1.5).
While the additional monthly payment for twins and triplets has been maintained, the grant of €635 paid at birth, at 4 years of age and at 12 years of age for these multiple births will no longer be paid.
The rates of Child Benefit payment for 2012 are as follows:
Number of children Rates
1 child €140
2 children €280
3 children €428
4 children €588
5 children €748
6 children €908
7 children €1,068
8 children €1,228
Further information is available from the Citizens Information Centre below.
Know Your Rights has been compiled by Co Wicklow Citizens Information Service which provides a free and confidential service to the public.
Bray Citizens Information Centre 3/ 4 The Boulevard, Quinsboro Road
Tel: 0761 07 6780
Arklow Citizens Information Centre 73 Lower Main Street
Tel: 0761 07 6750
Wicklow Citizens Information Centre 9/10 Lower Mall
Tel: 0761 07 6840
Outreach Centres in
Baltinglass Tel: 086 048 1880
Blessington Tel: 086 048 1881
Glendalough Tel: 0404 45611
Carnew Tel: 053 94 26555
Information is also available online at www.citizensinformation.ie and from the Citizens Information Phone Service, Lo-call 0761 07 4000.
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Universal Social Charge
January 2012
Question
Has there been any change to the Universal Social Charge in Budget 2012?
Answer
The Universal Social Charge (USC) is a tax payable on your gross income. It is also payable on notional income (benefit-in-kind payments) and it is deducted before pension contributions. All Department of Social Protection payments (including State pensions and Child Benefit) and similar payments (for example, CE schemes and Back to Education Allowance) and income on which DIRT has been paid are exempt from the USC.
Everyone (including medical card holders) is liable to pay the USC if their gross income is over a certain threshold in a year. For 2012, the income threshold has increased from €4,004 to €10,036. If your income is over €10,036 you pay the USC on all your income.
There is no change to the rates of the USC which are:
• 2% on the first €10,036
• 4% on the next €5,980
• 7% on the balance
People over 70 are not liable for the 7% rate but pay at 2% on income up to €10,036 and at 4% on all their income above €10,036.
Where a new employee is paying PAYE on an emergency basis, the emergency basis rate of the USC that applies is 7% and it applies to all of the salary/wage.
For 2012 the deduction of the USC has changed to a cumulative basis, similar to the manner in which PAYE is deducted. As with PAYE tax credits and rate bands, the USC rates and thresholds to be applied to employees will be issued to employers by the Revenue Commissioners on Employer Tax Credit Certificates (P2Cs).
Further information is available from the Citizens Information Centre below.
Know Your Rights has been compiled by Co Wicklow Citizens Information Service which provides a free and confidential service to the public.
Bray Citizens Information Centre 3/ 4 The Boulevard, Quinsboro Road
Tel: 0761 07 6780
Arklow Citizens Information Centre 73 Lower Main Street
Tel: 0761 07 6750
Wicklow Citizens Information Centre 9/10 Lower Mall
Tel: 0761 07 6840
Outreach Centres in
Baltinglass Tel: 086 048 1880
Blessington Tel: 086 048 1881
Glendalough Tel: 0404 45611
Carnew Tel: 053 94 26555
Information is also available online at www.citizensinformation.ie and from the Citizens Information Phone Service, Lo-call 0761 07 4000.
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One-Parent Family Payment
January 2012
Question
I understand that a number of changes are being made to the One-Parent Family Payment. Can you please give the details?
Answer
One-Parent Family Payment (OFP) is a payment for men and women who are bringing children up without the support of a partner. To get this payment you must meet certain conditions and you must satisfy a means test.
For 2012, the upper age limit of the youngest child for new claimants is reduced from 14 years to 12 years of age. This new upper age limit does not apply to existing claimants. It is planned to reduce the youngest child age limit for new claimants to 7 years of age on a phased basis.
The means test for OFP has been amended from January 2012. When assessing the means of both new and existing claimants, the amount of earnings from employment or self-employment that is fully disregarded is reduced from €146.50 to €130.00 per week. Half the weekly earnings over this amount continues to be disregarded.
If you have earnings above €425 you are not entitled to OFP. Up to 2012, if you had been getting OFP for a continuous period of at least 52 weeks and your earnings went above €425, you were entitled to a transitional payment. The transitional payment was the same as one-half of your rate of OFP and was paid for 6 months. From January 2012, this transitional payment is discontinued. Existing recipients of the temporary payment are not affected.
Previously, if you were working and getting OFP you might qualify for half-rate Jobseeker's Benefit, Illness Benefit or Incapacity Supplement when you stopped working. From January 2012, these half-rate payments are not available to new applicants for Jobseeker’s Benefit, Illness Benefit and Incapacity Supplement.
Further information is available from the Citizens Information Centre below.
Know Your Rights has been compiled by Co Wicklow Citizens Information Service which provides a free and confidential service to the public.
Bray Citizens Information Centre 3/ 4 The Boulevard, Quinsboro Road
Tel: 0761 07 6780
Arklow Citizens Information Centre 73 Lower Main Street
Tel: 0761 07 6750
Wicklow Citizens Information Centre 9/10 Lower Mall
Tel: 0761 07 6840
Outreach Centres in
Baltinglass Tel: 086 048 1880
Blessington Tel: 086 048 1881
Glendalough Tel: 0404 45611
Carnew Tel: 053 94 26555
Information is also available online at www.citizensinformation.ie and from the Citizens Information Phone Service, Lo-call 0761 07 4000.
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Mortgage Interest Relief
January 2012
Question
I’m confused about the changes that were made to Mortgage Interest Relief in Budget 2012. I’m a first-time buyer who started paying my mortgage in 2006. When will my entitlement expire and what rate of relief am I entitled to?
Answer
Tax relief for home mortgage interest is not given through the tax system but your mortgage lender gives you the benefit of the tax relief on the interest you pay. This is called tax relief at source or TRS. Your mortgage repayments are reduced by the amount of the tax credit due.
In Budget 2012 it was announced that qualifying loans taken out after 31 December 2003 and before 1 January 2013 will continue to get relief up to the end of 2017. This means that you will continue to qualify for relief at the applicable rate for the next 6 years. The relief will be abolished completely by the end of 2017.
The rate of mortgage interest relief for first-time buyers is 25% in years 1 and 2 of a mortgage, 22.5% in years 3, 4 and 5, and 20% for years 6 and 7. After 7 years the rate is the same as for non-first-time buyers at 15%.
However, if you are a first-time buyer who started paying your mortgage between 1 January 2004 and 31 December 2008, Budget 2012 provides for a special rate of mortgage interest relief of 30% for the tax years 2012 to 2017.
The amount of interest on which you can get relief is subject to upper limits as follows:
Single Married/in a civil partnership/ widowed/surviving civil partner
First-time buyer €10,000 €20,000
Non-first-time buyer €3,000 €6,000
Adjustments to your tax relief should be made automatically by your mortgage lender. You don’t need to claim relief on your annual tax return or to contact your local Revenue office.
Further information is available from the Citizens Information Centre below.
Know Your Rights has been compiled by Co Wicklow Citizens Information Service which provides a free and confidential service to the public.
Bray Citizens Information Centre 3/ 4 The Boulevard, Quinsboro Road
Tel: 0761 07 6780
Arklow Citizens Information Centre 73 Lower Main Street
Tel: 0761 07 6750
Wicklow Citizens Information Centre 9/10 Lower Mall
Tel: 0761 07 6840
Outreach Centres in
Baltinglass Tel: 086 048 1880
Blessington Tel: 086 048 1881
Glendalough Tel: 0404 45611
Carnew Tel: 053 94 26555
Information is also available online at www.citizensinformation.ie and from the Citizens Information Phone Service, Lo-call 0761 07 4000.
