Health insurance paid by your employer: the tax, and the relief to claim

Employer-paid health insurance is taxed as a benefit on the full premium. You can claim back 20% of up to €1,000 an adult and €500 a child in myAccount.

When your employer pays your health insurance, the premium is a benefit in kind (a taxed perk from work). It is added to your pay and taxed with income tax, USC and PRSI. Many people don't realise they can then claim some of it back. Someone paying their own policy gets the relief automatically, but you have to claim it.

What is taxed

Every health insurance policy carries tax relief at source (TRS): the insurer gives a discount on the premium and recovers it from Revenue. When your employer pays, they get that discount, but you are taxed on the full premium, before the discount. That is why you are entitled to claim the relief yourself.

The relief

For policies from 1 January 2026, relief is at 20% on:

• each adult: the premium, up to €1,000, so a credit of up to €200
• each child under 21: the premium, up to €500, so up to €100

Before 2026, a lower 'blended' rate could apply to policies that covered treatment that doesn't qualify for health expenses relief. That still applies to the dental part of a policy.

An example

An employee on €55,000 in 2026 whose employer pays a policy of €1,900 for them and €600 for their child:

The relief is capped, so on a dearer policy it covers a smaller share. It can only reduce income tax: it does nothing for USC and PRSI. And it is limited to what your employer actually paid. If you pay part of the premium yourself, that part already had its relief through the discount.

How to claim

In myAccount:

• this year: 'Manage your tax for the current year', add a new credit, then 'Medical Insurance Relief' under Health
• an earlier year: 'Review your tax for the previous 4 years', request a Statement of Liability (Revenue's end-of-year summary), then complete the Income Tax Return

You will need the policy start date, who it covers and their ages, the cost for each person, and what your employer paid. Your insurer can give you the breakdown and your employer the amount. Claims for 2022 must be made by 31 December 2026.

Not taxed

• one medical check-up a year, where it is offered to all staff
• a GP your employer pays a retainer to
• insurance your employer takes out to cover its own sick pay costs

Work it out

• Total compensation →
• PAYE calculator →
• Health expenses relief →

Sources

• Revenue: Taxable employer benefits (medical insurance, shares and others) (checked 16/10/2026)
• Revenue: Health expenses: what are qualifying expenses? (checked 16/10/2026)

General information, not tax advice. HeyPenny is not a tax agent.