Dealing with a married couple in the new regime of Revenue Clearance for income tax matters of a deceased spouse is slightly different from the normal treatment. In the case of a single person who dies you simply look at them in isolation and proceed as normal. This is not the case for married couples.

In cases where a person has died a married person (and the same is true for civil partners), you have to determine whether that married person was separately assessed or jointly assessed for income tax purposes. If they were separately assessed then you treat the deceased as a single person from the perspective of the income tax clearance procedure.

In a joint assessment situation, you will have to determine whether the deceased was the assessable spouse or the non-assessable spouse. Revenue refer to these as an AS or NAS.

Where the assessable spouse dies

Where the assessable spouse dies, you must do your form 11 or 12 for both spouses up to the date of death. The surviving NAS is assessable on their own income after the date of death. If the deceased assessable spouse was not a PAYE worker but a “chargeable person” the income tax return is the Form 11, and should be completed from 1 January to the date of death.

Where the non-assessable spouse dies

Where the non-assessable spouse dies you also do a return of income to include both spouses income up to the date of death. If the NAS who has died was a PAYE worker the return is Form 12. The Revenue indicate that the Form 12 should include the deceased NAS income to the date of death. Likewise if the non-assessable is an income tax person or a “chargeable person” as distinct from PAYE then the Form 11 is the form and should include the deceased person’s income and gains to his or her date of death.

Income Tax treatment of the surviving spouse

There are other rules that deal with the income tax treatment of a surviving spouse. These can be summarised as follows

If the NAS dies, then the surviving AS will continue to receive the married person tax credit and rate band for the year and they pay tax on their own income for the year and pay tax from on the late spouse’s income from 1 January to the date of death.

If the AS dies, then the surviving NAS receives an increased personal tax credit available to a widowed person in the year of death and is assessed on income from date of death of the deceased AS until the end of year.

The income tax rules relating to spouses are complex and it is best advised that solicitors working in this area seek professional advice from an accountant with familiarity of these rules.

I attach a link to the section of the Revenue website that deals with income tax treatment of the surviving spouse after the death of their spouse.

https://www.revenue.ie/en/life-events-and-personal-circumstances/death-and-bereavement/widowed-person-or-surviving-civil-partner/index.aspx

Hope this helps and if you have any probate, tax, capacity or will drafting queries please email me on ckelly@hcalaw.ie