Many social welfare payments in Ireland are taxable—including Jobseeker's Benefit, Illness Benefit, and State Pension. Understanding which payments are taxed helps you know what you'll receive and whether you might be owed a refund.
Our specialists help people who've received social welfare payments claim back any overpaid tax. Here's what you need to know.
📊 Social Welfare & Tax
- Taxable: Jobseeker's Benefit, Illness Benefit, State Pension
- Not taxable: Jobseeker's Allowance, Disability Allowance
- How taxed: Through reduced tax credits
- Refund potential: If credits incorrectly reduced
Which Social Welfare Payments Are Taxable?
Taxable Payments
- Jobseeker's Benefit
- Illness Benefit
- State Pension (Contributory)
- Occupational Injury Benefit
- Maternity/Paternity Benefit
- Pandemic Unemployment Payment (PUP)
Non-Taxable Payments
- Jobseeker's Allowance
- Disability Allowance
- Carer's Allowance
- Child Benefit
- Working Family Payment
How Social Welfare Is Taxed
Taxable social welfare payments are usually taxed by reducing your tax credits. This means if you also have PAYE employment, you'll pay more tax on your wages.
However, issues can arise when:
- Credits are reduced incorrectly
- You weren't working when receiving the payment
- The payment amount was estimated incorrectly
💡 Real Example
John received Illness Benefit while also working part-time. His tax credits were reduced, but by more than they should have been. When we reviewed his tax, we found he'd overpaid €840. Combined with rent credit and flat rate expenses, his total refund was €2,320.
Jobseeker's Benefit & Tax
Jobseeker's Benefit (not Allowance) is taxable, but it's taxed differently depending on your circumstances:
- If you worked that year: Tax usually collected through reduced credits
- If you didn't work: You may not owe tax (credits exceed the benefit)
Many people on Jobseeker's Benefit don't end up owing tax because their total income is below the taxable threshold.
Other Reliefs You May Be Missing
Whether you received social welfare or not, you may be entitled to reliefs:
- Rent tax credit – up to €1,000/year
- Medical expenses – 20% relief
- Flat rate expenses – for many professions
- Emergency tax – from job changes
The average refund our clients receive is €1,080.
Received Social Welfare?
Our experts will check if you overpaid tax and find all your reliefs.
Start Your Free Review →No refund, no fee • Average refund €1,080 • TAIN: 77632V
Frequently Asked Questions
Will I owe tax on social welfare?
It depends on your total income. If your only income is social welfare and it's below the tax-free threshold, you may not owe anything.
What's the difference between Jobseeker's Benefit and Allowance?
Benefit is based on PRSI contributions and is taxable. Allowance is means-tested and not taxable.
How far back can I claim a refund?
Four years. In 2025, you can claim for 2021, 2022, 2023, and 2024.