Tax Relief on Nursing Home Fees



Tax relief for Nursing Home Care

An individual may claim tax relief in respect of the costs (less any amount paid by a public or local authority, insurance scheme or other compensation) of maintaining a relative in a nursing home which has been approved by the Minister for Health and Children. 

Relief Due Any Non-Reimbursed Expenditure (i.e. after VHI Healthcare, Irish Life Healt, Laya Healthcare, Health Service Executive, Compensation Refunds). For the tax year 2007 and onwards there is no longer any disallowance of the first €125 (or €250 for a married couple). Prior to 2007 there is no relief due on: First €125 per person per year. First €250 per year for two dependent persons or more. Tax relief is available at the taxpayer's highest rate of tax and can be claimed by completing form Med 1. Relief can be claimed for expenses paid in each tax year, or for the year in which the expenses were incurred. Claims can be in respect of subscription year or tax year but must be consistent every year. Relief is given by way of repayment at the end of the year. 
An individual may claim tax relief in respect of costs incurred relating to a relative or any other person who is either over 65 or permanently incapacitated by reason of mental or physical infirmity.

In cases of hardship, PAYE taxpayers may be given the relief through the PAYE system on a weekly or fortnightly basis, to help meet the cost, rather than waiting until the end of the tax year.

If part of the costs of the nursing home are shared with other family members or relatives, an individual may claim in respect of the portion paid by him/her.

In some cases, the person residing in the nursing home may pay some of the costs from his/her own income and this can affect a claim. Before calculating the relief, any costs paid by the resident in the nursing home is deducted from the claim (or a maximum deduction of 60% of the resident's income ) For example:

You maintain a dependent in a Nursing Home and you claim relief in respect of the expenses, which total €15,000. Your dependent has an income of €8,000, which is available directly or indirectly towards the costs.

Health Expenses attributable to Dependent
Deduct: 60% of Dependent’s Income (i.e.) €8,000 x 60%
Health Expenses claimable by you


Employing a Carer - Tax Credit

Where a person is permanently incapacitated due to physical or mental infirmity, a tax allowance of up to €50,000 is available towards the cost of employing a person to care for the incapacitated person. This credit may be claimed either by the incapacitated person or by a relative including relatives by marriage.

Dependent Relative Tax Credit

This tax credit is available if you are maintaining either:

  • a relative of you or your spouse who is so incapacitated by old age or infirmity as to be unable to maintain himself/herself.
  • your or your spouse's widowed mother/father whether she/he is incapacitated or not
  • a child of yours who lives with you and on whose services you are dependent because of old age or infirmity.

You no longer need to qualify for the dependent relative tax credit in order to claim health expenses in respect of a dependent relative.



Covenants may still be made for people over 65 or those who are permanently incapacitated.

A Deed of Covenant is a legal document under which one person agrees to pay a certain sum of money each year to another person. The advantage is that the person paying the money can effectively not pay tax on it. The money is transferred to someone who does not have a taxable income or pays a lower rate of tax than the person giving the money.

The covenant is a legal document but you do not need to go to a lawyer to draw one up. The tax office will give you a standard form of covenant or you may get one from the bank. The covenant must be capable of lasting at least 6 years. The person who covenants the money may not end the covenant unilaterally but both parties may agree to end it. This may happen before the 6 years are up but that does not matter as long as it was capable of lasting when it was made.

There is no tax relief on most covenants, other than covenants for the benefit of the elderly (over 65), permanently incapacitated people, maintenance payments between spouses, research and the teaching of natural sciences and recognised human rights organisations. Most covenants are subject to a 5% income restriction, except for covenants for the permanently incapacitated and those for maintenance payments between spouses.



How to apply

Download and complete Form MED 1 (PDF) at the end of the tax year and send it with receipts for the expenses incurred together with your tax return form to your tax office.

Additional information is available in the Revenue information leaflets IT 45 "Tax Credits and Reliefs for over 65's" (PDF)and IT46 "Dependent Relative Tax Credit" (PDF) which are also available from any tax office, the Revenue website or from Revenue's forms and leaflets service at Lo Call 1890 306706.

Where to apply

Call or write to your local tax office.