Income Protection Tax Relief in Ireland (2026 Guide)

10-second summary: Income protection premiums qualify for tax relief in Ireland because approved policies fall under Revenue’s Permanent Health Insurance (PHI) rules.

Yes, income protection insurance premiums qualify for tax relief in Ireland.

Relief is available at your marginal tax rate, either 20% or 40%, and applies to premiums up to a maximum of 10% of your total income.

So if you pay tax at 40%, you can claim back 40% of your income protection premiums.

However, if you are on a claim,  income protection payments are treated as income and are therefore subject to income tax, USC and PRSI.

Is income protection tax deductible in Ireland?

Yes.

Income protection premiums qualify for tax relief because approved policies fall under Revenue’s Permanent Health Insurance (PHI) rules.

If you pay the premiums yourself, you can claim relief at your marginal tax rate.

So someone paying the higher rate of tax could reduce the real cost of their policy by up to 40%.

All income protection policies we arrange at lion.ie qualify for this tax relief.

How much tax relief can you claim?

Tax relief applies to income protection premiums up to a maximum of 10% of your total income.

The relief is given at your marginal tax rate.

For example:

This is one of the reasons income protection is often more affordable than people first think.

What about executive income protection and tax relief?

If you run your own company, income protection can sometimes be paid for by the business instead of you personally.

In that case the company normally claims corporation tax relief on the premiums.

There is also typically no Benefit-in-Kind for the employee.

This structure is usually called executive income protection and can be a very tax-efficient way for company directors to arrange cover.

How do you claim tax relief on income protection?

One of the most common questions we hear is:

“Where do I claim income protection on my tax return?”

You can claim the relief through your Revenue MyAccount.

The steps are straightforward:

• If you haven’t done so already, register for MyAccount.
• Under PAYE Services, select Manage Your Tax.
• Choose Claim Tax Credits.
• Under Health, select Permanent Health Insurance.
• Enter the premiums you paid during the year.

If your employer allows it, the premium can sometimes be deducted from your gross salary instead. This is less common in the private sector.

If you’re self-employed and your company pays the premium, the company typically handles the tax treatment.

Here is the official Revenue guidance:

Permanent Health Insurance Contributions – Revenue

And here’s a step-by-step guide we created explaining how to claim the relief:

How to claim income protection tax relief

Can you claim income protection tax relief for previous years?

Yes.

If you forgot to claim tax relief in previous years, you can usually claim it back for the last four years through Revenue.

To do this:

1. Log in to Revenue MyAccount.
2. Select Review your tax.
3. Request a Statement of Liability.
4. Under Health and Insurance, select Permanent Health Insurance.
5. Enter the premiums paid for the relevant year.
6. Upload supporting documents if requested.

Revenue will review the claim and refund any overpaid tax.

Are income protection payments taxable?

Yes.

Income protection benefits are designed to replace the income you would have earned if you were still working.

Because of that, the payments are taxed as income.

Income protection payments are therefore subject to:

The insurer normally deducts the correct tax before the payment is made.

Over to you

If you’re on the fence about income protection and have some concerns, please call me on 05793 20836 and we can go through them.

I’m not here to convince you or persuade you; only you can decide but I am happy to answer any questions.

Alternatively, if you have made up your mind and want some help , please complete this questionnaire and we’ll send some options.

PS: you can schedule a callback here if that suits you better.

Editor’s note: This article was originally published in 2022 and has been reviewed and updated in 2026 to reflect current Revenue rules and how income protection tax relief works in Ireland.