Income protection insurance is a type of insurance that will cover you for loss of income in the event of illness or disability. It’s most often used as a means to protect against issues relating to long-term sickness or injury, but it can also be useful if your job requires you to relocate, travel abroad or work irregular hours. Income protection isn’t available through all health insurers so make sure you check this with your provider before signing up.
What is income protection insurance?
Income protection insurance is a type of life insurance that pays out a monthly amount to you if you’re unable to work due to illness or accident. It can also be used as an additional income source, as it can be used to pay off debts and mortgages.
You may be wondering if this type of insurance is deductible when filing your taxes with Revenue Ireland after taking out your policy. The answer is yes–but only up to certain limits!
How much tax will I pay on the insurance?
- The amount of tax you pay on the income protection tax deductible depends on the type of policy that you have.
- The rate for each type of insurance is different, so make sure to check with your provider before signing up for a policy.
- If you’re unsure about how much tax will be deducted from your premium, contact them directly and ask them what their standard rates are!
Is life insurance deductible from my tax bill?
Life insurance is not deductible from your tax bill. If you have life insurance, it is not deductible from your tax bill.
Medical expenses for yourself and dependents are generally deductible if they exceed 7% of your income (for 2019). After meeting this threshold, medical expenses can be deducted up to an amount equal to 10% of your adjusted gross income (AGI) subject to certain limitations. For example: If a person’s AGI was $50,000 in 2019, then his or her medical expenses could be deducted up until $5,000 ($50k x 10%). However, once that threshold has been reached then no additional medical deductions are allowed unless they are incurred due to blindness/permanent disability or long-term care needs (see below).
Mortgage interest paid by homeowners on their primary residence is also tax deductible in Ireland at 70%. Taxpayers who own more than one property must apportion their mortgage interest accordingly between each property owned so as not exceed the 70% limit when calculating their final tax liability for the year . You should contact us before entering into any formal agreement with any lender so we can advise you accordingly.”
Can I get an advance on my home loan if I take out income protection coverage?
If you take out income protection insurance, then the answer is yes. You can get an advance on your home loan if you meet the bank’s criteria to be eligible for an advance. The amount of this advance will depend on your income and debt situation.
How does income protection work in Ireland?
Income protection is a type of insurance that protects you against loss of income if you become sick or injured. If you have an illness or injury that prevents you from working, this can cause financial stress as well as emotional distress.
Income protection will pay out a percentage of earnings (usually 70%-80%) if the insured person is unable to work due to sickness or injury. It also covers any extra expenses incurred by the insured person during their recovery period, such as childcare costs and travel expenses related to medical treatment.
How much cover do I need? This depends on your circumstances; however, it’s generally best to get enough cover so that even if something happens that prevents both parents from working at once, there will still be some income coming into the household each month until one parent recovers sufficiently enough again so they can return back full time employment themselves again.”
Income Protection Insurance in Ireland can be used for a variety of reasons including debts, illness and as an additional income source.
Income Protection Insurance in Ireland can be used for a variety of reasons including debts, illness and as an additional income source.
Because it is not a tax deductible expense, you will not receive any money back from Revenue when you pay your income protection insurance premium. However, if you were to claim on the policy at some point then this would be considered as taxable income and therefore could impact your overall tax bill for the year (depending on how much was paid out).
Conclusion
If you’re thinking about getting Income Protection Insurance, we hope this article has given you some insight into how it works and what kind of tax benefits can be gained from taking out such a policy. We know that it can be difficult trying to make sense of all the different types of cover available on the market today, so feel free to contact us if there’s anything else we can help with.