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Tax refund when unemployed or out of work sick

Introduction

You can get a refund of tax you have already paid if you were employed and find yourself unemployed. You may also get a tax refund if you are out of work due to illness. You can also get tax back if you are still employed but have paid more tax than you were liable for.

Another way to get tax back is through tax relief on services or products that you have bought. Some of the cost of certain services and products can be recouped from the tax you have already paid to the Revenue Commissioners, for example, tax relief for employing a carer and tax relief for third level education fees. The amount of relief you get depends on the amount of tax you have paid.

This document is not looking at getting tax back through the various forms of tax relief. Find out more information about tax credits and relief.

This document explains how to get a tax refund if you have worked and are now unemployed, getting Illness Benefit or short-term Occupational Injury Benefit, or if you are still employed but think you have paid more tax than you were liable to pay.

Why would I get a tax refund?

There are a number of reasons why you may now be liable to pay less tax than previously thought and due a refund. Your tax liability may be reduced because you are on unpaid sick leave or have become unemployed.

For PAYE workers your tax liability is spread out evenly over the year. To ensure that this is achieved, your tax liability is normally calculated on a cumulative basis. Any tax credits and standard rate cut-off point, which is not used in a pay period, is carried forward to the next pay period within that tax year.

This means that when an employer calculates your tax liability, they actually calculate the total tax due from 1 January to the date which your most recent wages are paid. This means if your income is reduced, for example, by sickness or unemployment, you will have unused tax credits and may be due a tax refund.

You may also get a refund if your tax liability has been incorrectly calculated by your employer and you have overpaid tax.

A tax refund may also be paid if you have purchased goods or services for which you can claim tax relief.

Rules

If you are unemployed or out of work sick

If tax has been deducted from your pay since 1 January last and you are now unemployed you may be entitled to a tax refund. If you have not paid any tax, you will not be due a refund.

Jobseeker’s Benefit (JB), Illness Benefit (IB) and payments under the Occupational Injury Benefit (OIB) Scheme (including Injury Benefit, Disablement Benefit and Incapacity Supplement) are all taxable sources of income. However, the first €13 per week of Jobseeker’s Benefit is not taxable. Any Increase for a Qualified Child paid with a payment under the OIB scheme is not taxable. The first 6 weeks (36 days) of Illness Benefit are taxable (from January 2012).

If you are getting Jobseeker’s Benefit, Illness Benefit, or a payment under the Occupational Injury Benefit Scheme and make a claim for a tax refund, the taxable proportion of your JB, IB or OIB payment and your wages are added together to determine if you are entitled to a refund. You can get an example of how your tax refund is calculated if you are unemployed or out of work sick in 2011 (this changed in 2012).

If you are employed and think you may have overpaid tax

If you think your employer has incorrectly calculated your tax liability you must submit your P60 and written details of your claim. If your spouse or civil partner is working you must also submit his or her P60. A P60 is given to you by your employer at the end of each year.

Rates

Unemployed or out of work sick

The amount of tax refund depends on:

  • The length of time you have been unemployed
  • The amount of tax you have paid
  • The amount of tax credits you have used
  • The amount of your weekly social welfare payment

How your tax refund is paid

Revenue will issue a cheque if you are unemployed and due a tax refund.

If you are out of work sick, when you return to work your employer usually refunds your tax in your first week's wages.

How to apply

Unemployed

You should apply from the date you become unemployed, however, if emergency tax was being deducted by your former employer you should apply immediately.

You should apply 8 weeks from the date you became unemployed, if you are getting another income which is taxable, this includes taxable social welfare payments.

Your application for a tax repayment because you are unemployed or out of work sick, must be made on tax repayment Form P50 and sent to your district tax office with Parts 2 and 3 of your P45.

Unpaid sick leave

When you return to work from unpaid sick leave, you should notify your local Revenue Office of the amount of Illness Benefit paid during your illness. Revenue will then issue you with your correct Tax Credit Certificate. Your employer will also get a copy (showing totals only) and refund any tax you are due, when you return to work.

Where to apply

For further information on getting a tax refund, contact the Revenue Commissioners.

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 here.

Page updated: 24 January 2012

Language

Gaeilge

Related Documents

  • PAYE overpayments and underpayments of tax
    This document explains how you can find out if you have underpaid or overpaid tax. It also explains how to get a refund of tax or pay tax you may owe.
  • Taxation of social welfare payments
    Social welfare payments may or may not be deemed taxable in Ireland. Information about how which social welfare payments are taxable and how they are taxed.
  • Help with low pay
    Tax and social welfare assistance is available for low income earners and their families. Information on available schemes and how to apply.

Contact Us

If you have a question relating to this topic you can contact the Citizens Information Phone Service on 0761 07 4000 (Monday to Friday, 9am to 8pm) or you can visit your local Citizens Information Centre.