Who qualifies
An individual paying premiums for a Permanent Health Benefit policy, also called Income Protection, that pays out a regular income if you cannot work due to illness or injury.
How to claim
Claim on Form 12 in myAccount under Other PAYE Tax Credits, or on Form 11 for self-assessed taxpayers. Provide the policy number and annual premium certificate from the insurer.
Detailed explanation
Permanent Health Benefit relief covers the premiums paid to insure your earned income against long-term illness or injury. From 2026 the relief is given at the marginal rate of income tax, up to a maximum premium of 10 percent of total income. So a higher rate taxpayer earning 80,000 euro could in theory claim relief on premiums up to 8,000 euro at 40 percent, generating up to 3,200 euro of tax savings. In practice premiums are typically 1 to 3 percent of insured income. The relief covers premiums for individual policies and for income protection elements within group employer schemes if the employee bears the cost. Where the employer pays the premium it is usually treated as a non-BIK fringe benefit, but the eventual claim payments are taxed as income. Where the employee pays the premium and claims relief, the eventual claim payments are also taxable but the premium relief equalises the tax treatment over time. The policy must guarantee continuation regardless of changes in health, and must pay benefits only when the insured is unable to follow their occupation. Pure critical illness or accident-only policies do not qualify, although they may have separate limited tax treatments. Ireland is one of the few EU countries that allows full marginal-rate relief on income protection premiums, making it a particularly cost-effective way for self-employed people to insure their income.
Worked example
David, a self-employed solicitor, pays 2,400 euro of income protection premiums in 2026 to insure 60 percent of his earnings. He is a higher rate taxpayer. Relief at 40 percent on 2,400 = 960 euro reduction in his income tax bill, making the net cost of cover only 1,440 euro.