Christmas is one of the most expensive times for families, with the average family in Ireland reported to spend around €2,654 in December – €870 more than any other month of the year (from Business Group Retail Ireland).
To meet these costs, many people look for ways to save money or reduce their spending. But before looking for ways to save money or reduce costs at this time of year, you should check if you are eligible for a tax rebate.
Applying for a Tax Rebate
The average rebate for Irish Tax Rebate customers is €1,092 – which could go a long way towards your Christmas expenses.
So many people across Ireland are due a tax rebate that they simply aren’t aware of. As your spending increases and costs begin to climb in the lead up to Christmas, now is the perfect time to get your money back.
The 4 Year Rule When Claiming Tax Back
You can claim tax back for up to 4 years, so if you haven’t claimed a rebate recently you could be due even more money back. Right now, you can claim tax back for 2017, 2018, 2019, and 2020. However, you should be aware that to carry out a review of your taxes for 2017, it must be done before the end of this year. If you don’t claim your rebate before the end of the year you may lose out on a potential rebate for 2017.
Don’t forget to allow for processing time – if you want to claim for 2016 our experts recommend you should start your application in mid-December, particularly if you have any medical receipts or Med 2 forms from your dentist.
Tax Implications for Christmas Bonuses
Many employees receive a Christmas/end of year bonus from their employers in recognition of their hard work over the course of the year. This bonus is generally paid via payroll and is taxable at your marginal rate of tax. Many bonus recipients are often left disappointed when they realise that over half of their bonus has been taken in tax.
However, there is an alternative to receiving your bonus directly via your payroll. Vouchers up to the value of €500.00 per year can be granted tax-free from an employer. This can be a voucher from a specific retail outlet, or one that is accepted by a wide range of stores. For a higher rate taxpayer, this could mean a tax saving of €260.00 on a €500.00 payment
Tax Rebates in the New Year – Your Details are Live
The year is coming to an end which means a new tax year will begin. 2019 was the last year that P60’s were issued by employers due to PAYE Modernisation. Now you will receive an Employment Detail Summary online in January and can immediately apply for a tax rebate for 2019. Our accountants discuss the changes to the PAYE System in greater detail in this article.
Get Your Money Back
There’s no doubt that Christmas is an expensive time of year – but there are many ways to claim your money back, helping you get the New Year off to a good financial start. Your first point of call should be to see if you are due a rebate – which should help ease the costs considerably!
So many people do not claim tax back simply because they are unaware of the relief they are eligible for. Check out our Tax Tips to learn everything you need to know about Irish taxes, or apply for a rebate using our 60-second application form to get your money back before Christmas!