Tax Appeals Commission determination 06TACD2020 regarding Income Tax, 2020

• Administrative Decision Number: 06TACD2020
• Date: 19 December 2019
• Subject Matter: Income Tax
• Respondent: REVENUE COMMISSIONERS

06TACD2020

BETWEEN/

APPELLANT

Appellant

V

REVENUE COMMISSIONERS

Respondent

DETERMINATION

Introduction and Background

1. This appeal relates to a tax repayment claim in respect of tax relief on nursing homes

fees paid by the Appellant in the years 2013 to 2016. At issue is the rate of tax at which

those nursing home fees should be relieved.

2. During the tax years 2013-2016, the major portion of the Appellant’s income was

deposit interest subject to DIRT (Deposit Interest Retention Tax). The Appellant also

had nursing home expense deductions relieved under S.469 TCA 1997 in these years.

The Appellant has lodged a claim for relief in respect of qualifying nursing home

expenses incurred by him in relation to his own care for the years 2013-2016

inclusive.

1. The Appellant was born on REDACTED and therefore over the age of 65 for the years

under appeal. The Appellant qualified for repayment of Deposit Interest Retention

Tax (DIRT) in accordance with S.267 TCA 1997, based on his age and level of taxable

2

income in 2013 to 2016. This is not in dispute. What is in dispute is the quantum of

the relief in each year under appeal.

2. For the years under appeal, the Appellant has income taxable under Schedule E TCA

1997 (Other Income), in addition to substantial deposit interest, chargeable under

Schedule D Case IV TCA 1997. The deposit interest was subject to DIRT at a rate of

33% for 2013 and at a rate of 41% for the years 2014, 2015 and 2016.

3. According to the Appellant, Revenue, in their notices of assessment for each year

under appeal, have relieved the nursing home expenses firstly against the Appellant's

Other Income and then the deposit interest chargeable at the higher DIRT rate. The

effect of this treatment is that the Appellant's refund is reduced by €18,683 as per the

table below.

Refund Calculation

Year Appellant Revenue Difference

2013 € 18,926 €15,613 €3,313

2014 30,527 25,157 5,370

2015 30,168 24,554 5,614

2016 27,526 23,140 4,386

18,683

4. In each of the tax years in dispute the S.469 TCA 1997 nursing homes fees paid were

in excess of the Other Income.

5. The Appellant has argued that he is entitled to apply the lower band rates of tax to his

taxable income, after nursing home expenses have been set off against his total

income for tax purposes. The Appellant argues that the effect of this would be to lower

the overall liability for a particular tax year with a corresponding increase in his tax

refund, when credit for DIRT incurred by him is taken into account.