Social welfare taxation Secondary benefits and work James

Social welfare, taxation, Secondary benefits and work James Mc. Clean Job Coach Employment Response North West 1

Key questions you need to ask. What benefit are you on? Rules and regulations on your Benefit What will you keep? What will you lose? +’s and –’s “Measure twice and cut once!” JAMES MCCLEAN ERNW 2

Types of payment you will most likely encounter. DA Disability Allowance DB Disability Benefit. (ILLNESS BENEFIT) IP Invalidity Pension BP Blind Pension UA Unemployment Assistance (Dole) (JOBSEEKERS ALLOWANCE) UB Unemployment Benefit (Stamps) (JOBSEEKERS BENEFIT) Disablement Pension / Unemployability Supplement. JAMES MCCLEAN ERNW 3

Stamp based versus Means tested Stamp based means you must have a certain number of Stamps or PRSI contributions to qualify. Means tested means that your “means” and possibly means of your spouse or partner may be taken into account when calculating eligibility. JAMES MCCLEAN ERNW 4

• ILLNESS BENEFIT(FORMERLY DB) Disability Benefit. Unable to work due to illness or disability. Must have PRSi contributions to qualify for this payment. (Be careful! As if you have less than 260 paid contributions you may only receive this for 12 months) Generally seen as a short term payment (If you were off work for two weeks or so with the “flu” this is the payment you would be receiving) JAMES MCCLEAN ERNW 5

• IP Invalidity Pension Longer term version of Disability Benefit. Generally you would need to be on DB for at least one year before you would apply for this payment unless in exceptional circumstances such as diagnosed as terminally ill etc. Higher rate of payment than DB and also includes free travel and is a “passport” to applying for other secondary benefits such as free TV licence, electric and phone JAMES MCCLEAN ERNW 6

• Disablement Pension If you have had an injury at work and have claimed occupational injury benefit then you may qualify for this. The injury must have resulted in a residual disability. < 20% loss of faculty then you receive a lump sum payment. >20% loss you may be awarded a pension payable along with other payment such as JAMES MCCLEAN DB or IP. 7 ERNW

Job Seekers Benefit Very similar to UA except you are entitled to draw this benefit based on your PRSI contributions so you are not means tested. Normally look at your record of contributions from two years previously so if you were making claim in 2007 then you would need to have the correct amount of contributions in 2005. JAMES MCCLEAN ERNW 8

MEANS TESTED PAYMENTS DA Disability Allowance Paid in recognition of the difficulty that an individual with a disability will have in obtaining employment as opposed to someone of the same age and sex who does not have a disability. Individuals means are assessed but for someone living with parents then income of parents are not taken into account. JAMES MCCLEAN ERNW 9

Blind Pension Similar to Disability Allowance Person may qualify for Blind Supplement as well but will probably lose it if taking up employment due to means testing by Health Services Executive who administer the Supplement. If you have been working and acquire Blindness then you MIGHT also qualify for Disability benefit as well. JAMES MCCLEAN ERNW 10

JOB SEEKERS ALLOWANCE Your means and means of your partner / spouse are taken into account. To qualify you must fulfil three conditions : You must be AVAILABLE, FIT FOR AND ACTIVELY SEEKING FULL TIME EMPLOYMENT. JAMES MCCLEAN ERNW 11

REHABILITATIVE EMPLOYMENT If you take up Rehabilitative Employment, while on Disability Allowance or Blind Pension the first E 120 of earnings is disregarded in the means test. If on Invalidity Pension or Disability Benefit you may be permitted to work up to 20 hours. You will require medical evidence from your GP and written approval from the Department of Social Welfare. Employment on a CE scheme may be treated as rehabilitative. JAMES MCCLEAN ERNW 12

EARNINGS ABOVE € 120. 00 PER WEEK. DA +BP From June 2006, earnings above € 120. 00 per week removed at rate of 50% e. g. 50 cent in the euro. UP TO A MAXIMUM OF € 350 PER WEEK EARNINGS. ANYTHING ABOVE € 350 PER WEEK RESULTS IN DEDUCTION OF EURO FOR EURO. Earn € 350. 00 per week then lose € 115. 00 from DA or BP Earn € 360. 00 per week and lose € 125. 00 from DA or BP JAMES MCCLEAN ERNW 13

Example of effects on partners means tested payment. If working 1, 2 or 3 days earning € 120. 00 per week. they would disregard approx € 44. 44 and then deduct half of the difference off partners payment so € 120. 00 -€ 44. 44= € 75. 56 / 2= € 37. 28 deduction from spouse/partner payment. If working 4, 5 or 6 days earning € 120. 00 per week. they would disregard approx € 88. and then half of the difference off partners payment so € 120. 00 -€ 88. 88= € 31. 12/2= € 15. 56 deduction from spouse/partner payment. If both working then both would lose the above rates. JAMES MCCLEAN ERNW 14

Rules for working whilst on Job Seekers Allowance • Contrary to belief you CAN legally work whilst drawing “Dole”! • Maximum days of work are 3 in each working week. • Example : Single person working 3 days and earning € 70. 00 per day. • Disregard first € 10. 00 per day, they lose 60% of balance from Dole. So € 60. 00*60% =€ 36. 00 multiplied by 3 days =€ 108. 00 deducted from “Dole” payment of € 185. 80. Income would be, earnings = € 210. 00 +Dole of € 77. 80. • There is NO € 10 disregard if person is married so they would lose 60% of the whole € 70. 00 per day worked which is a deduction of € 42. 00 per day of their Dole. JAMES MCCLEAN ERNW 15

DB or IP Rehabilitative employment • Before anyone on DB or IP can take up employment and keep their benefit they must ABSOLUTELY apply to Social and Family affairs to do so. This is called applying for an exemption. The work must be classed as “Rehabilitative” BY the Department and an exemption will normally be granted for 6 or 12 months. A further exemption may be granted at the end of that period if the work is deemed to be rehabilitative or fitting that person out for taking up alternative employment or that the persons health, e. g. Mental health is improving through engagement in that employment. Normally takes about 6 weeks for exemption to be granted or not. • The person can work up to 20 hours per week and they can earn as much as they want / can without it affecting the rate of IP they are receiving. Spouse/partner's payment be be affected if it is means tested. JAMES MCCLEAN ERNW 16

Rules for working whilst on Job Seekers Benefit • You can work up to a maximum of 3 days per week and you lose a days JSB for each day worked, even if you only work for 2 hours in a day it is classed as a days work. Income disregards or amount earned do not affect your UB payment. • Remember whether on UA or UB you are expected to be actively seeking full time employment on the days you are not working so if a client only wants to or is unable due to illness / disability to seek full time employment then this payment may not suit them as they may be asked to provide evidence of pursuing full time employment by their Social and Family Affairs office. • If a client becomes ill or disabled whilst in receipt of UA or UB they can apply for DB, IP, DA, BP or possibly Supplementary Allowance or Occupational Injury Benefit. JAMES MCCLEAN ERNW 17

Retention of Secondary benefits • Generally, you will automatically retain any secondary benefits you are receiving such as Free Travel, when engaged in APPROVED rehabilitative employment but be aware that means tested payments or benefits such as Rent allowance, Medical card, Mobility allowance, Blind Welfare allowance etc MIGHT be affected by earnings either up to or above the € 120. 00 threshold mentioned. For example there is a disregard by The HSE of € 120. 00 per week from rehabilitative employment when assessing for Rent Allowance but there is no automatic disregard when assessing Medical card eligibility and it is solely at the discretion of each HSE area office whether to grant the medical card or not. JAMES MCCLEAN ERNW 18

FAS SUPPORTS Wage Subsidy Scheme- Fas provide financial support to an employer who takes on a person with a disability. Workplace/Equipment Adaptation Grant. Provides funding up to make the workplace more accessible or equipment easier to use Supported Employment Programme- In conjunction with the Health Board, a job coach is available to approach employers and assist in any way they can. JAMES MCCLEAN ERNW 19

OTHER FAS SUPPORTS Job Interview interpreter grant Personal reader grant Disability awareness training grant. Employee JAMES MCCLEAN ERNW Retention Grant 20

WAGE SUBSIDY SCHEME Biggest difference with old ESS scheme is that employee, if qualifying, CAN NOW access back to Work Allowance as well. Additional costs subsidy Employment Assistance officer. JAMES MCCLEAN ERNW 21

BACK TO WORK ALLOWANCE Retain percentage of social welfare along with unlimited wages over a 3 year period. Retain Medical Card and Free Travel for the 3 years. Retain percentage of Rent Allowance on a sliding scale for 3 years (possibly 4!) JAMES MCCLEAN ERNW 22

Taxation New employee must gain a Tax Credit (used to be Tax free allowance) or employer is obliged to tax their earnings at emergency tax rate. This is refundable after Tax credit has been applied for and gained, refund is paid directly by the employer if claimed during the same tax year, if claimed after that then apply to Revenue Commissioners. Fill a Form 12 A and send to Revenue commissioners to gain your Tax Credit JAMES MCCLEAN ERNW 23

What is Taxable and what is not? Disability Allowance is Not Taxable income. Blind Pension IS Taxable but recipients are entitled to extra Tax credits. First 6 weeks of Disability Benefit is Not taxable and after that only the adult portion is taxable i. e. any DB claimed for dependent children is not taxable at all. Income arising from investments made with compensation arising from court awards for example a road traffic accident and where this is the sole or main income for the person then it is exempt from DIRT. and certain other taxes. JAMES MCCLEAN 24 ERNW

Pay Related Social Insurance ALL employees MUST have some form of “stamp” put on for them by the Employer. Class J stamp at least but if earnings are more than approx. € 36 per week then class “A” stamp is required. Employees holding a Medical Card only have to put on a class A 2 stamp. JAMES MCCLEAN ERNW 25

What does a “Stamp” entitle me to? Occupational Injury Benefit (employees are covered for accident or disease that occurs during course of their employment duties, even travelling directly to or from their employment!) Build up entitlement to Stamp based payments / benefits such as DB, IP, Contributory Old age pension, Dental and optical benefits JAMES MCCLEAN ERNW 26

Disabled Persons Grant This is a grant paid by the County Council to adapt houses for people with disabilities. Works include provision of ramps, widening of doorways, adding a downstairs bedroom or bathroom etc. They pay 90% of the cost up to a maximum for private houses. Where a house is being built specifically for a person with a disability there is a specified grant for that as well. Apply to the local Co. Council JAMES MCCLEAN ERNW 27

Free Travel Pass Who qualifies? Everyone over 66 and living in the state Anyone on Disability Allowance, Blind Pension or Invalidity Pension People who transferred to Retirement Pension from DA or Invalidity at 65 Anyone receiving Carer’s Allowance Note: You may also apply for a Companion Pass if you are medically certified as unfit to travel alone JAMES MCCLEAN ERNW 28

Transport and Travel Disabled person’s parking card Allows people to park in designated parking areas and free of charge in disc parking areas. It is valid for 2 years and costs 25 euro. It applies to the person not the car. You will automatically qualify if you have a primary medical certificate. Can be used abroad. Forms available from Irish wheelchair association, Ballinagappa road, Clane, co. Kildare. Tel 045 893094 or disabled drivers association Ballindine, Co Clare JAMES MCCLEAN ERNW 29

Transport and Travel Disabled Drivers and Passengers Tax Relief You must have a Primary Medical Certificate. You may claim a refund /exemption of VAT and VRT on the price of the car and a refund of VAT on price of any necessary adaptations. Repayment of excise duty on fuel up to 600 gallons a year. Exemption from motor tax. JAMES MCCLEAN ERNW 30

Transport and Travel Motorised Transport Grant This is a means tested Health Board grant towards buying/adapting a car for someone with a severe disability to help them get or keep employment. You must be over 17 and under 66 and hold a driving licence. In certain cases family member can be the driver If you get the grant you will not get Mobility Allowance for 3 years. JAMES MCCLEAN ERNW 31

Transport and Travel Procedures Mobility Allowance This is a means tested Health Board payment for people who are unable to walk or for whom the exertion required to walk would be dangerous. You must be between 16 and 66. It is paid monthly and you will only get the lower rate if you claim the Disabled Drivers and Passengers Relief. JAMES MCCLEAN ERNW 32

Rent Allowance If your client moves to rented accommodation to pursue employment they may qualify for Rent Allowance from the local HSE. Please check with your area what is the maximum permissible rent as say for example the “cap” is € 85 per week and your client moves into a flat at € 90 per week then they would not be entitled to any Rent Allowance. Local Authority housing rent is normally based on income so if client is unemployed then they would be on the lowest rent but this might increase if they take up employment but there is a limit to the amount of increase on rent they can apply each year and now many local authorities are disregarding a certain amount of income from Rehabilitative employment for people with disabilities when reviewing rents. JAMES MCCLEAN ERNW 33

Household Benefits package People on DA, BP, or IP can apply for this which would give them free T. V. Licence, free electricity units, free telephone units and they may also qualify for Living Alone Allowance and free fuel. People on DB cannot apply for the household benefits package but it is worth checking eligibility if they are living with someone who would qualify in their own right They are better to apply before they take up employment JAMES MCCLEAN ERNW 34