Tax credits reduce your income tax bill euro for euro. They are not deductions from income but direct reductions from the tax calculated on that income. A credit of €2,000 reduces the tax you pay by €2,000, regardless of whether you are a standard rate or higher rate taxpayer. Budget 2027 increased several of the main credits. This page sets out the full 2027 list with amounts and the conditions that determine whether each credit is available to you.
How Tax Credits Work in Practice
Your gross income is first reduced by any allowable deductions – pension contributions, certain expenses – to arrive at taxable income. Tax is then calculated at 20% and 40% depending on how much falls above the standard rate band. Tax credits are applied after that calculation to reduce the resulting tax figure. The total credits available to you determine how much of that calculated tax you actually pay. Unused credits cannot be refunded – they reduce tax to zero but not below zero.
Personal and Employee Tax Credits 2027
| Credit | 2027 Amount | Who Can Claim |
|---|---|---|
| Personal Tax Credit | €2,000 | All taxpayers |
| Employee (PAYE) Tax Credit | €2,000 | PAYE employees |
| Earned Income Credit | €2,000 | Self-employed; those without PAYE credit |
| Home Carer Tax Credit | €1,950 | One spouse caring full-time at home |
| Single Person Child Carer Credit | €1,900 | Single parents with qualifying children |
| Widowed Person or Surviving Civil Partner Credit | €2,190 | Year of bereavement plus 5 subsequent years |
| Age Tax Credit | €245 | Individuals aged 65 or over in the tax year |
| Blind Person’s Credit | €1,650 | Registered blind; €3,300 if both spouses blind |
| Incapacitated Child Credit | €3,500 | Child permanently incapacitated before 21 |
| Dependent Relative Credit | €245 | Maintaining a dependent relative |
All credits are claimed through the income tax return for the year in question. PAYE employees have credits allocated to their tax credit certificate automatically. Self-assessed individuals must claim them on the annual return.
Housing and Rental Credits 2027
| Credit | 2027 Amount | Conditions |
|---|---|---|
| Rent Tax Credit | €1,000 (single) / €2,000 (couple) | Tenants in private rented accommodation; must be registered tenancy |
| Help to Buy (HTB) | Up to €30,000 | First-time buyers purchasing a new build |
| Mortgage Interest Relief | Variable | Tracker mortgage holders – applied at source |
The Rent Tax Credit is available to tenants, not landlords, and covers rent paid on a principal private residence. The credit is claimed after the year end on the Revenue myAccount portal. Individuals who rent a room from a private landlord in a registered tenancy qualify; those in HAP or RAS arrangements do not. The credit does not apply to rent paid to a local authority.
Medical and Health Credits
| Credit | 2027 Amount | Notes |
|---|---|---|
| Medical Insurance Relief | At 20% on qualifying premiums | Relief at source applied by insurer |
| Health Expenses Relief | At 20% on qualifying expenses | Claimed on tax return; GP visits, consultants, dental |
| Nursing Home Expenses | At 40% for nursing home fees | Claimed at the higher rate |
| Tuition Fees Relief | At 20%; max qualifying fee €7,000 | Third-level tuition above €3,000 |
Medical insurance relief is applied at source by your insurer, which means your premium is effectively already reduced by the tax relief when you pay it. Health expenses not covered by insurance are claimed by the individual on their tax returns after the year ends. Receipts must be held for six years in case Revenue requests them.
Employment and Work-Related Credits
| Credit | 2027 Amount | Who Can Claim |
|---|---|---|
| Seafarer’s Allowance | €6,350 | Seafarers spending 161+ days at sea in tax year |
| Fisher Tax Credit | €1,270 | Commercial fishing vessel crew members |
| Remote Working Relief | €3.20 per day | Employed remote workers; claimed by employee |
| Employment of Carer Relief | Up to €75,000 deductible | Employing a carer for incapacitated individual |
Business and Investment Credits
The Employment and Investment Incentive (EII) allows individuals to invest in qualifying SMEs and claim income tax relief at 30% on the investment in the year it is made, rising to a further 10% if retained for four years. The Start-Up Relief for Entrepreneurs (SURE) scheme offers similar relief for individuals leaving PAYE employment to start a business, allowing them to reclaim PAYE tax paid in previous years. The Startup Capital Incentive (SCI) provides an alternative route for entrepreneurs who may not have qualifying PAYE history.
How to Claim Credits You May Have Missed
Revenue allows claims for credits going back four years. A PAYE employee who never claimed health expenses, the carer credit, or tuition fees in prior years can submit those claims now and receive a refund. The process runs through myAccount on the Revenue Online Service. Where multiple years are involved, it is worth reviewing all unclaimed credits across the four-year window rather than addressing them one year at a time.
Questions About Tax Credits 2027
Can a couple claim both the personal credit and the home carer credit?
Yes, where one spouse is a full-time carer at home and the other is the earner. The working spouse claims the standard personal and employee credits. The couple also claims the home carer credit of €1,950, provided the stay-at-home spouse’s income does not exceed €9,600 in the year. A proportionately reduced credit is available where income is between €9,600 and €13,500.
Does a self-employed person get both the personal credit and the earned income credit?
Yes. A self-employed individual can claim the personal tax credit of €2,000 and the earned income credit of €2,000, giving a combined credit of €4,000. This is now equivalent to the credit position of a PAYE employee claiming the personal and employee credits. The parity was achieved in Budget 2027 when both credits were set at €2,000.
Can I claim the Rent Tax Credit if I am paying rent to a family member?
Only if the tenancy is formally registered with the Residential Tenancies Board. Informal family arrangements that are not registered do not qualify. Revenue cross-checks Rent Tax Credit claims against RTB data. Registering the tenancy also protects both parties legally.
How is health expenses relief claimed?
Health expenses relief is claimed on the annual income tax return. PAYE employees file a claim through myAccount, selecting the relevant year and entering the qualifying expenses. Receipts are not submitted to Revenue but must be kept. The relief is paid as a tax rebate after the claim is processed. Claims can go back four years.
Does the Age Tax Credit apply automatically at 65?
No. It must be claimed. PAYE employees should notify Revenue through myAccount when they reach 65 so the credit is added to their tax credit certificate. Self-assessed individuals claim it on the annual return. The credit applies for the full year in which the individual turns 65, not from their birthday.
What is the condition for the Single Person Child Carer Credit?
The credit applies to a single person who is the primary carer of a qualifying child and who is not cohabiting with a partner. Where two individuals share custody, the credit can be claimed by one of them or split by agreement. Only one person can hold the primary entitlement to the credit in a given year.
Is medical insurance relief on top of what the insurer already applies?
No. The insurer applies the standard 20% relief at source when calculating your premium. The premium you pay is already net of the tax relief. If you pay your own premium rather than having it paid by your employer, you simply pay the reduced amount. If your employer pays, the gross premium is a benefit-in-kind on which tax is charged, but the relief offsets that charge.
Can I still claim if Revenue has already issued my P21 for a previous year?
Yes. A P21 or end-of-year certificate for prior years does not prevent a subsequent claim for missed credits. Revenue can issue an amended P21 or process the claim through the four-year look-back mechanism. Amounts owed are refunded by electronic fund transfer.
Making Sure You Claim What You Are Entitled To
The credits most commonly missed by PAYE employees are health expenses, tuition fees, the Rent Tax Credit, and the Incapacitated Child Credit. For self-assessed individuals, the earned income credit and the home carer credit are frequently underutilised. A systematic review of credits claimed against credits available takes a short time but can produce a meaningful refund, particularly where multiple years are reviewed at once.
How We Help Clients Identify Unclaimed Credits
When we prepare income tax returns for clients, we include a review of credits claimed in prior years and flag any unclaimed entitlements. For clients who have been self-filing, we often find a backlog of unclaimed credits that can be recovered through the four-year window. If you have never had your credits reviewed professionally, it is worth requesting a review before filing your 2027 return.
