Update on Notification of Taxation of Carer's Allowance and Carer's Benefit

From 1st January 2026, Revenue will be automatically notified when a person is awarded Carer’s Allowance or Carer’s Benefit. This replaces the previous process, whereby carers were required to self-declare receipt of either payment to Revenue. Depending on their personal circumstances, this may or may not have resulted in a tax liability. We know communication of this change from Revenue has caused real worry and confusion for many family carers; but it is important to emphasise that this does not represent any change in taxation policy, as Carer’s Allowance and Carer’s Benefit have always been taxable sources of income.

Following a meeting with Revenue, they have stated that this is a forward-looking process and therefore they will not be looking back at tax liabilities from previous years. Therefore, family carers who did not declare their receipt of Carer’s Allowance or Carer’s Benefit to Revenue prior to 1st January 2026 will not receive an outstanding tax bill for previous years as a result of this change unless, and this is really important to note, the carer themselves declare their liability for these years.

So, for example, where a carer or their partner chooses to make a claim for any tax relief, tax credits or medical expenses for earlier years, they must declare their receipt of Carer’s Allowance or Carer’s Benefit for the relevant years. This may give rise to a tax liability, depending on their personal circumstances. Therefore, carers should carefully consider the pros and cons of making such claims as it may result in a tax liability and in some cases the best course of action may be to simply do nothing at this point in time.

Revenue have stated that they will deal with all cases sympathetically and will ensure that any underpayment of tax is collected in a manner and timeline that is affordable to the carer and their family.

Revenue have a dedicated number dedicated phone number to support carers with queries on the above issues - 01 7383637.

Family Carers Ireland is continuing to lobby Government for Carer’s Allowance and Carer’s Benefit to be made tax exempt in line with other social welfare payments, including Jobseeker’s Allowance and Disability Allowance, for the abolition of the means test on Carer’s Allowance and for family carers to receive a fair and adequate payment.