Tax Benefits for Carers
04th July 2016
What's Carer's Allowance, and Do I Qualify for It?
Carer's Allowance is a benefit you get if you're looking after someone who can't take care of themselves properly. You don't need to be related to the person you're caring for. If you're giving up a chunk of your daily life to make someone else's worth living, you could be eligible.
Generally, it takes about 35 hours of caring duties a week to qualify. Keep in mind that claiming Carer's Allowance for looking after someone might affect the benefits they get. If the government's paying you for someone's care, they might cut what they're paying them.
What If I'm Not the Only Person Looking After Someone?
Only one carer can claim Carer's Allowance for a single person. If you're splitting the duties, you'll have to sort out who gets the benefit between yourselves. Also, if you're looking after more than one person, you can only claim the benefit for one of them.
What Else Does It Take to Qualify for Carer's Allowance?
In addition to spending at least 35 hours on caring duties, there are a few other boxes to tick before you qualify. The main one is that the person you're caring for actually needs the help you're giving them. That means they have to be eligible for the Personal Independence Payment or a similar benefit. On top of that, you also need to be earning no more than £110 per week.
If you're getting other benefits yourself, you might qualify but still not get the actual money for it. If your benefits stack up to £62.10 or more a week, you won't get the allowance. However, it might still be worth claiming. Depending on your circumstances, you might get a boost to your other benefits or a drop in your Council Tax.
What Do I Do If Things Change?
Any time something changes that might affect your Carer's Allowance, you need to tell the government straight away. Maybe the person your caring for goes went into hospital, or the hours you're spending with them temporarily dropped. Whatever changed, you have to report it.
What's the Difference Between Carer's Allowance and Carer’s Credit?
Carer's Credit is a way of keeping your National Insurance payments going when you're giving up time to be a carer. You generally get it automatically when you're claiming Carer's Allowance. In fact, you can sometimes get Carer's Credit even when you don't qualify for Carer's Allowance.
The rules can be tricky to grasp, but if you're a RIFT client then you'll have peace of mind that all this is taken care of within your claim or self assessment submission.
Will I Have to File a Self Assessment Tax Return?
Even if you're a full-time carer with no other job, you may still have to pay tax. If you've got taxable income, which includes things like Carer's Allowance, it all counts toward your normal Personal Allowance. If you're making more than your allowance, then you'll be paying tax.
How you pay will depend on your circumstances. If you've got income that's already being taxed PAYE, you might be able to pay through your tax code. Otherwise, you'll probably need to register for Self Assessment and file a yearly tax return.
Can I get Help Understanding or Handling This?
Yes! If you're confused or worried about your self assessment tax situation, talk to RIFT. We're the UK's top experts in fixing tax troubles. Just phone or email to find out what we can do for you.