Taxes Consolidation Act 1997 section 188

Age exemption and associated marginal relief

Section 188 provides for income tax exemption for individuals aged 65 or over whose total income does not exceed a specified exemption limit, and for marginal relief where total income exceeds the exemption limit but is less than twice that limit.

• Individuals aged 65 or over are exempt from income tax if their total income does not exceed €36,000 (married couples/civil partners jointly assessed) or €18,000 (single, widowed, or assessed as single).
• The exemption limit is increased by €575 for each of the first two qualifying children and by €830 for each additional qualifying child, with only one increase allowed per child.
• Where total income exceeds the exemption limit but is less than twice the limit, marginal relief caps the income tax payable at 40% of the amount by which total income exceeds the exemption limit.
• The exemption applies only to income tax; USC and PRSI remain payable, and total income for these purposes includes worldwide income from all sources, even if not chargeable to Irish tax.