# Married taxation - some cases and queries



## Protocol

Sorry, I know there is a lot of info on there, but I am still confused about the allocation of the SRCOP to a married couple. I will present a few cases and would be very grateful for any explanations.

*1. Both spouses earning 20k*

Does one get a SRCOP of 41k, and the other gets 23k? 


*2. Both spouses earning 30k*.
Does one get a SRCOP of 41k and the second person 23k?
If so, is the unused 11k from the first person lost?? Or can it be transferred to the second earner?

Or can they get 32k SRCOP each?



*3. What about a couple each earning 40k*

Does one get 41k, and the other 23K, and so the 1k is lost??

Or can they get 32k SRCOP each?



*4. What about a couple each earning 50k?*


----------



## Audrey

I spoke to the Revenue yesterday and (I think!) they told me that one spouse HAS TO take at least 23,000 no matter what, and the other takes the balance.  In a Joint Assessment situation transfers cannot take place.  In a Separate Assessment situation tranfers CAN take place.  That's what I think they said anyway!!  Does that help at all?


----------



## ClubMan

Andrewa said:
			
		

> I spoke to the Revenue yesterday and (I think!) they told me that one spouse HAS TO take at least 23,000 no matter what


Only if they opt for joint/aggregated assessment rather than individual assessment or assessment as two single people.


> In a Joint Assessment situation transfers cannot take place.


The "both spouses working increase" in the standard rate band is *never* transferrable. Some other credits/allowances are not transferrable (e.g. _PAYE_ credit as far as I know). Other credits/allowances are transferrable.


----------



## asdfg

This is my understanding of how the individualisation works 

Provided you ask to be assessed as "Joint Assessed" or "Aggregated Assessment" 
You need to contact Revenue stating the amount of the SRCOP allocated to each spouse. 

The answer below are the limits within which SRCOP are allowed. You can allocate within these limits.   

Remember salaries/wages increase during the year. 



			
				Protocol said:
			
		

> *1. Both spouses earning 20k*
> 
> Does one get a SRCOP of 41k, and the other gets 23k?


 
*Ans: One spouse gets a SRCOP of 41K the other 23K*



			
				Protocol said:
			
		

> *2. Both spouses earning 30k*.
> Does one get a SRCOP of 41k and the second person 23k?
> If so, is the unused 11k from the first person lost?? Or can it be transferred to the second earner?
> 
> Or can they get 32k SRCOP each?


*Ans: Both can opt for 32K SRCOP*


			
				Protocol said:
			
		

> *3. What about a couple each earning 40k*
> 
> Does one get 41k, and the other 23K, and so the 1k is lost??
> 
> Or can they get 32k SRCOP each?


*Ans: One spouse can take 40K and the other 24K *



			
				Protocol said:
			
		

> *4. What about a couple each earning 50k?*


 
*Ans: Each spouse can take 32K each or 41K and 23K respectively.*

It ends up the same at the end of the year. You should ask for a balancing statement in Jan each year. You may have to complete some forms sent in P60s etc and calculations shown. Any underpayment / overpayment will then be made.


----------



## Lyndan

whats SRCOP??? sorry!!


----------



## asdfg

> whats SRCOP


 
Standard Rate Cut off point - The maximum amount you can earn at the lower rate of tax.


----------



## Lyndan

thanks!

Just had a really confusing conversation with someone in revenue about this, i have no idea how to get myself and husband assessed.

Does anyone know:

If I earn 41k and hubbie 34k.  

If i take the 38,400 allowance and only pay 42% on the remainder - 2,550

Does he pay 42% on his whole salary as i have taken his allowance?

Help appreciated


----------



## asdfg

First of all the main earner can take the SRCOP up to its max of 62,000 or each of you could take 31K 


> If i take the 38,400 allowance


 
It is not an allowance but the amount which you can earn at the lower rate of tax i.e. 20%
I am assuming this is what you meant

You can allocate the SRCOP wharever way you wish up to this limit of 62,000
I have worked the following figures using the figures above 
Salary 41K 
SRCOP 38.4
so 38.4 is taxed at 20% = 7,680
with the remainder 2.6 K taxed at 42% = 1,092
giving a total gross tax of 8,772 
you then deduct your credits for this figure to give the Net tax 

Your husbands figures are then calculated as follows
Salary 34K 
SRCOP 23.6K
so 23.6K taxed at 20% = 4,720 
balance 10.4K taxed at 42% = 4,368
Total gross tax of 9,088
Total gross tax bill for both for the year is 17,860

At the end of the year revenue will issue a balancing statement as follows
Salary 75K
SRCOP 62K
so 62K taxed at 20% = 12,400
and the remainder 13K taxed @ 42% 5460
giving a total tax of 17,860

Hope this makes sense. If not let me know and I'll try to explain. (Hope my calculations are correct)


----------



## Lyndan

ok thanks that makes a bit more sense!

So we are better off being jointly assessed then

Why cant they just tell you which way you would be better off!! then i wouldnt be sitting her with calculators trying to work it out...


----------



## ClubMan

Lyndan said:
			
		

> ok thanks that makes a bit more sense!
> 
> So we are better off being jointly assessed then
> 
> Why cant they just tell you which way you would be better off!! then i wouldnt be sitting her with calculators trying to work it out...


*Most *married couples will be better or at least no worse off on joint/aggregated assessment. This is stated in the _Revenue FAQ_/booklet. Couples on individual assessment should be taxed the same although they may have to reclaim any overpayment of taxes at the end of the tax year. Couples on assessment as two single people may end up worse off and pay more tax. I have never really understood why any couple would opt for this treatment or possibly even the second one above. Maybe somebody could explain when these would be suitable?


----------



## asdfg

My understanding is that if both couples are earning over the SRCOP then it does not matter what option they take and can even request to be taxed as individuals. One benefit of opting for the married option is where one income drops below the SRCOP the non use of the SRCOP can be transfered to the other earner. 


> I have never really understood why any couple would opt for this treatment or possibly even the second one above.


My explanation in the previous post is based on a married couple taxed jointly. There is no second one? 

Or perhaps I haven't made myself clear which some have accused me of (not on AAM I might add) .


----------



## ClubMan

There are *three *married taxation options:
[broken link removed]t (with nominated spouse)
[broken link removed]
[broken link removed] (as if they were not married at all)



			
				asdfg said:
			
		

> My understanding is that if both couples are earning over the SRCOP then it does not matter what option they take and can even request to be taxed as individuals.


 The first two usually or always have the same results with the exception that under option (2) the couple may need to balance their tax affairs for overpayment tax at the year end. Couples can (and will?) end up worse off under option (3). This is why I don't understand why a couple would ever choose it other than to assert their independence on tax matters from each other or something...? 


> One benefit of opting for the married option is where one income drops below the SRCOP the non use of the SRCOP can be transfered to the other earner.


 There is no one "married" option. There are three married options as outlined above.


> My explanation in the previous post is based on a married couple taxed jointly. There is no second one?


 There is indeed a second and a third option as above.


----------



## asdfg

> Couples can (and will?) end up worse off under option (3). This is why I don't understand why a couple would ever choose it other than to assert their independence on tax matters from each other or something...?


 
An example may explain 
Both spouses working and earning 40K & 45K respectively 
SRCOP 32 K each 
Tax as follows 
Assessment as individuals 
Salary 40K
32K @ 20% = 6,400
8K @ 42% = 3,360
Gross tax = 9,760

Salary 45K
32K @ 20% = 6,400
13K @ 42% = 5,460
Gross tax = 11,860
Total Gross tax 21,620

Assessment as joint with one partner taking increased tax band to 41K 
Salary 45K 
41K taxed @ 20% 8,200
4 taxed @ 42% 1,680
Gross tax 9,880
Salary 40K 
23K @ 20% 4,600
17K @ 42% 7,140
Gross tax 10,740
Total gross tax 21,620

As I said previously if both spouse are earning over the SRCOP then as far as i can see it doesn't matter which way they sort out their tax affairs 

If one earns less than the SRCOP then it will make a difference. 

In individual situation credits and unused SRCOP can't be transfered 

I also prev said 


> My explanation in the previous post is based on a married couple taxed jointly


 
There was no second option in that particular post. 

I realise that I did not explain the other options but I thought that it would be easier to explain matters in this particular circumstance without going into to much detail.


----------



## ClubMan

Apologies if I was dragging this off topic by adding all three married taxation options into the mix. I was not necessarily having a go at your explanations. Just that the married options other than joint/aggregated are still confusing to me in terms of when/why anybody would choose them.


----------



## asdfg

my understanding is that if both spouse are earning over the SRCOP for an individual currently 32K then it does not matter what way they choose to order their tax affairs. 

If however one spouse is earning less than 32K in a tax year then it is better to opt for joint assessment as the other spouse can increase the amount taxed on his/her income at the lower rate.
It is all sorted out at the end of the year anyway.


----------



## ClubMan

Surely that is not the case. For example even if each spouse is earning over the individual _SRCOP _opting for [broken link removed] will leave them worse off than joint/aggregated or individual married taxation (my underlining)?


> *15. What is Assessment as a Single Person?*
> 
> Assessment as a Single Person, (also referred to as Separate Treatment)          should not be confused with Separate Assessment. Under Assessment as a          Single Person each spouse is treated as a single person for tax purposes.
> Both spouses:
> 
> Are taxed on their own income
> Get tax credits and the standard rate cut-off point due to a single            person
> Pay their own tax
> Complete their own Return of Income form and claim their own tax credits.
> One spouse cannot claim relief for payments made by the other and there          is no right to transfer tax credits or standard rate cut-off point to          each other.


----------



## asdfg

While I understand (I think) the information provided by revenue, I think, when you work out/see a few examples you will see where I am coming from.   
Maybe I'm missing something but this is how we learn.

A few examples 

_*Assessed as single persons*_ 
Salary 1st spouse 42K 
SRCOP 32 @ 20% 6.4K
Bal 10 @ 42% 4.2
Total Gross Tax 10.6K

Salary 2nd spouse 42K 
SRCOP 32 @ 20% 6.4K
Bal 10 @ 42% 4.2
Total Gross Tax 10.6K
*Total Gross tax for the couple 21.2K*

*Assessed jointly - Elect to leave SRCOP at 32K each*
Salary 1st Spouse 42K 
SRCOP 32 @ 20% 6.4K
Bal 10 @ 42% 4.2
Total Gross Tax 10.6K

Salary 2nd spouse 42K 
SRCOP 32 @ 20% 6.4K
Bal 10 @ 42% 4.2
Total Gross Tax 10.6K
*Total Gross tax for the couple 21.2K*

*Assessed Jointly - Elect that one spouse takes the max SRCOP or 41K *
Salary 1st Spouse 42K 
SRCOP 41 @ 20% 8.2K
Bal 1 @ 42% 0.42K
Total Gross Tax 8.62K

Salary 2nd spouse 42K 
SRCOP 23 @ 20% 4.6K
Bal 10 @ 42% 7.98
Total Gross Tax 12.58K
*Total Gross tax for the couple 21.2K*

In all three examples above one for individual assessment and the other two for joint assessment, where both spouse earn over the SRCOP the gross tax payable is the same.


----------



## ClubMan

Do those calculations deal only with the rate bands/_SRCOPs_ and not necessarily additional credits some of which will be transferreable under joint/aggregated and separate assessment but not necessarily under taxation as two single people? Note that the [broken link removed] illustrate how a couple could be worse off on assessment as two single people versus the other two options and they also say:


> This basis of assessment [assessment as two single people] can be unfavourable in some circumstances because          any unused tax credits or standard rate cut-off point cannot be transferred.          Home Carer's Tax Credit cannot be claimed in respect of a spouse who cares          for a dependent person and who may otherwise qualify for the relief.


 I still can't understand why any married couple would opt for this unless they wanted to keep their tax affairs separate (or secret!) from each other for some reason?


----------



## asdfg

I don't think the issue of additional credits comes into it as both taxpayers will be paying a significant amount of tax. The increase in tax credit would have to be fairly large to wipe out the gross tax (see examples in prev post). Most married couples would have tax credits of less than 7,000 (with one spouse having to take at least 1,490 leaving the assessable spouse taking the balance) so once their gross tax bill is greater than 7,000 it does not matter which option for assessment of tax they take. There are no tax credits to transfer.  


The revenue worked examples are based on an example of one earner over the SRCOP and one less than the SRCOP. Of course this will be unfavourable if individually assessed.



> I still can't understand why any married couple would opt for this unless they wanted to keep their tax affairs separate (or secret!) from each other for some reason?


 
I agree everything in a marriage should be above board with nothing hidden. I am looking at the figures purely from the point of view of financial planning. The option is available to do individual assessment, my argument is that if both are earning over the SRCOP then it does not matter which option they choose.


----------



## ClubMan

asdfg said:
			
		

> The revenue worked examples are based on an example of one earner over the SRCOP and one less than the SRCOP. Of course this will be unfavourable if individually assessed.


 Fair enough. I need to study/think about this a bit more. 


> I agree everything in a marriage should be above board with nothing hidden.


 That was not my point. I don't care what way different couples handle their financial affairs. I just wondered why a couple would opt for assessment as single people. One possibility that I can think of is to do so in the year before _SSIA _maturity where the loss of any married tax "benefits" would be outweighed by the gain attributable to one or both spouses availing of the _SSIA _to _PRSA _transfer incentive. I want to crunch the numbers on this for our own situation (me working, wife not) and see if it might be worth doing so that my wife could avail of the offer and the benefits would outweight the costs.


> I am looking at the figures purely from the point of view of financial planning.


 Me too. Just wondering if/when assessment as single people is useful/beneficial.


----------



## xeresod

In most situations when I've came across married people assessed as single individuals, the couple were seperated (especially before divorce was leagalised). Their reason for choosing seperate treatment was simple - why give their credits/allowances to their ex or allow their ex to have knowledge of their current circumstances, especially if their ex was a person they may not have had contact with for years or a person they hate.

Also, not everybody is logical and reasoned and don't care if they may be missing out, they want seperate treatment and that's that!


----------



## ClubMan

Thanks _xeresod_.


----------



## BIG

One reason to keep them separate is that AFAIK the capital gain exemption limit is not doubled in joint assesement, so if bother spouses have shares/investment they would have an exemption of 2 x1270E rather than 1x1270E.


----------



## ClubMan

No - this is wrong. _CGT _is individualised in any case and the personal annual exemption is never transferrable between spouses (it used to be years ago). Married income tax treatment has no relevance to _CGT_ issues. What matters is whose name(s) the assets in question are held in. It may make sense for married couples to transfer assets between each other to avail of both _CGT_ allowances. For example...

Transferring shares to spouse to reduce CGT


----------



## lasertek

Hi

Quick question if you got married a few years ago and did not tell the tax man can you claim tax back retrospectively as if using Joint Assesment for those few years?  I know you can go back 4 or 5 years retrospectivley for other tax refunds!!

Cheers


----------



## ClubMan

The normal 4 year limit on backdated claims will still apply. I think that there may also be another rule which requires you to opt for your preferred married taxation before March 31st of any specific tax year so it's possible that you may not be able to backdate claims for married taxation refunds (e.g. claim joint/aggregated or separate married assessment for previous years in which you were taxed as two individuals). Best to just write to _Revenue _explaining your situation and asking them to see if they can rebalance your previous tax years for the preferred married treatment. See [broken link removed].


----------



## Clarkey

lasertek said:


> Hi
> 
> Quick question if you got married a few years ago and did not tell the tax man can you claim tax back retrospectively as if using Joint Assesment for those few years? I know you can go back 4 or 5 years retrospectivley for other tax refunds!!
> 
> Cheers


 
If you are on seperate *assessment* there is still the option to transfer unused credits and/or cut offs after the end of the tax year. If you have elected for seperate *treatment *this option is not available. 

All you need to do is ring the tax office quoting both your tax numbers and they will issue P21s as long as they have all pay and tax details on record. 2003 is the last year that a review can be requested for at this stage so any refunds due for years prior to this are now lost


----------



## ClubMan

Clarkey said:


> If you are on seperate *assessment* there is still the option to transfer unused credits and/or cut offs after the end of the tax year.


But it sounds like not only are they not on joint/aggregated married assessment but neither are they on separate (married) assessment but rather they are on assessment as two individuals in which case there is no transfer of credits etc. possible.


----------



## Clarkey

ClubMan said:


> But it sounds like not only are they not on joint/aggregated married assessment but neither are they on separate (married) assessment but rather they are on assessment as two individuals in which case there is no transfer of credits etc. possible.


 
All they have to do is ring revenue and inform them. They never opted for seperate treatment so the option is still there subject to time limits already mentioned. Dealt with exact same situation recently for a couple married but not on record with revenue as being married. Took around 12 phonecalls in the end (As usual) but he definitely can do this.


----------



## ClubMan

Can they backdate the (joint/aggregated or separate) married taxation for the previous 4 tax years so? Presumably no more than the normal 4 years though?


----------



## Clarkey

If you elect for seperate treatment no credits or cut off can be transferred and this is the case for previous years. If you elect for seperate assessment then reviews can be done for previous 4 years. If married couple never inform revenue they are married then refunds can be processed for the previous 4 years also. 

Many people also don't realise there is a year of marriage credit which works as follows:

If you are married in July 2004 you are taxed as a single person for that year. However after the end of the tax year the tax payable as a married couple is calculated and the difference is refunded on a pro rata basis e.g. married in July 2004 deemed to be married for half the year so half the difference in tax is refunded.


----------



## ClubMan

Thanks _Clarkey_.


----------



## Clarkey

ClubMan said:


> Thanks _Clarkey_.


 
No probs. Where will i send the bill


----------



## ClubMan

To _xeresod_!


----------



## lasertek

hey Guys

Thanks a million for that advice really good!!

Cheers


----------



## Aisling2323

its easy really! Men, and their solutions!!!!!

here is the answer:

both earning 20k  - they pay lower rate on everything as they are less than 43k (SRCOP for 2007) Lower earner is not earning 25k and therefore individualisation would not kick in, but its irrelevant in this scenario as total aggregate income is less than 43k.

both earning 30k - again, they pay the lower rate on everything as the lower earning spouse is earning at least 25k (therefore individualisation kicks in) Their new tax band is 68k in 2007. 

both earning 40k - one of them pays lower rate on everything. This leaves 28k left over on individualisation. Therefore the other spouse pays the lower on 28 k and the higher on 12 k ...

easy??
thought so .. 

The April edition of Business Plus drew my attention to this really cool article on individualisation (http://www.ionainstitute.ie) and now after reading it I'm answering all the tax individualisation questions on the net - befoe my boss comes back from his tea break (uuurgh!!!!)


----------



## Aisling2323

btw a couple each earning 50k works as follows:

One pays the lower until 43k and the higher on 7k

The other spouse pays the lower on 25 k and the higher on 25 k ..

easy!!!!!!!!!!!!!!


----------



## ClubMan

Aisling2323 said:


> its easy really! Men, and their solutions!!!!!


Huh!?


----------



## Headachecity

> Just wondering, are my and my hubbie mad?!. We got married last May and still haven't got around to ringing the tax office, we both earn €40k per annum, so we are not really missing out on anything.


I don't think that you are missing out but no harm in informing _Revenue _anyway just in case your circumstances change in the future and, for example, married joint/aggregated taxation might be more favourable to you.


> Thing is, once we tell them does my PPS number end and we both use my husbands or are so we still have 2 seperate PPS numbers?.


 You retain your existing _PPSNs._ 


> Also, I do all family/finance etc sort of things as Mrs X and in work I still use my maiden name, pps number tax etc still in maiden name & so is my Visa card. Is this wrong of me?.


 No - there is no onus on married women/couples to change their names.


----------



## Aisling2323

YES! YOU ARE! A LITTLE! Ring the revenue. Fill out a tax form and both of you sign it. You will each keep your seperate PPS numbers. Inform revenue of your new married name. When you submit your P60's for last tax year inform them that you are married. You will be entitled to a lot of tax back!!!!!!! that is the good news. Your rates are completely different as a married couple. They move from 34k to 68k in 2007 (2006 figures were a little different, can't remember exactly) i'll do a calculation and let you know what the figure is ..


----------



## Headachecity

Wow, are you serious???. I am just worried about that Tax credit my husband has been claiming for his other child, eventhough his ex is married to someone else he still supports his child & he has planned to ring to come off that tax credit, will they not question that when they see we are married now??.


----------



## ClubMan

Aisling2323 said:


> YES! YOU ARE! A LITTLE! Ring the revenue. Fill out a tax form and both of you sign it. You will each keep your seperate PPS numbers. Inform revenue of your new married name. When you submit your P60's for last tax year inform them that you are married. You will be entitled to a lot of tax back!!!!!!! that is the good news. Your rates are completely different as a married couple. They move from 34k to 68k in 2007 (2006 figures were a little different, can't remember exactly) i'll do a calculation and let you know what the figure is ..



If both spouses are paying high rate tax then I don't think there is any benefit  (or penalty) in opting for joint/aggregated married taxation. Perhaps you can clarify what you think they will gain with regard to a 2006 tax refund?


----------



## Aisling2323

sorry my dumb mistake - i did the calculations (while you were all wondering how dumb i was) there's no real change sooooooooory!!!

oops - what was it I said about men earlier?? !!!!!!!


----------



## Headachecity

I thought as much as I did calculate it myself before and saw no major change.
Aisling, we all have our bad days...it's due to being so perfect all week....LOL!!!.


----------



## ClubMan

Aisling2323 said:


> oops - what was it I said about men earlier?? !!!!!!!


Something really stupid and insulting if I recall correctly.


----------



## xeresod

Headachecity said:


> Wow, are you serious???. I am just worried about that Tax credit my husband has been claiming for his other child, eventhough his ex is married to someone else he still supports his child & he has planned to ring to come off that tax credit, will they not question that when they see we are married now??.


 
The One Parent Family Tax Credit your husband is claiming cannot be claimed by anybody living with someone as husband and wife wether married or not.

This means in your husbands case, he is not entitled to it and has not been since you started living together (or if was living with anybody else before you). 

He should contact Revenue and come to an arrangement to pay it back as soon as possible, as the longer he leaves it the higher the interest and penalties may be. 

Also, in general Revenue tend to be more lienient when the taxpayer comes forward and admits to a mistake, rather than waiting for Revenue to catch them.


----------



## Headachecity

Oh god, I knew it!. I have been at him for a long time to ring them up and come off it but he claimed he was entitled to claim it as he pays his ex €100 per week in maintenance plus other things he pays for. Some idiot told him about it and he listened to them instead of me.
I'm going to type up a letter to revenue about it on his behalf and get him to sign it to get this sorted!. We have had numerous arguments over it and I knew I was in the right..fit to be tied now!!


----------



## mmclo

But can you claim relief for maintenance payments??



Headachecity said:


> Oh god, I knew it!. I have been at him for a long time to ring them up and come off it but he claimed he was entitled to claim it as he pays his ex €100 per week in maintenance plus other things he pays for. Some idiot told him about it and he listened to them instead of me.
> I'm going to type up a letter to revenue about it on his behalf and get him to sign it to get this sorted!. We have had numerous arguments over it and I knew I was in the right..fit to be tied now!!


----------



## mo3art

Not for child maintenance anyway.  Somebody else might be able to clarify the situation as regards to spousal maintenance?


----------



## Headachecity

mo3art said:


> Not for child maintenance anyway. Somebody else might be able to clarify the situation as regards to spousal maintenance?


 
Thing is they were never married, both very young when they had the baby and she is near teens now.

He met me 3 years after he split up with her. He has been giving her maintenance and other assistance all the time eventhough she is now married to someone else and has other kids with this guy.

I did know you can claim the tax relief if you are not living with the child but paying maintenance but if you marry you have to come off it.


----------



## asdfg

From Revenue.ie/leaflets/iT9


> You do not qualify for One-Parent Family Tax Credit if:​
> 
> You are a person qualifying for the Married Person's
> Tax Credit​*or*​
> ​
> You are a person living together with another
> person as man and wife​​



​


----------



## mo3art

Well then he's not entitled to any tax relief at all.  Regardless of whether his ex has since married and has other children, he is still obliged to maintain his child until the child reaches 18 (or 23 in the case of the child remaining in full time education).

Even if you were cohabiting (living together as man and wife) he was not entitled to claim the single parents tax credit.  His best bet is to ring his local tax office himself, and then follow it up with a letter, explaining what his situation is.


----------



## Keentoinvest

34000 is the standard rate cut off point for a single person

Individual Assessment
Assuming you are both working both of you are taxed at anything under 34000 at a rate of 20%
Your partner is earning 28,000 
You are earning 60,000
neither you nor your partner can use the extra 6000 allowance that your partner is not using i.e balance between her salary and the standard rate cut off point.


Joint Assessment
Standard rate cut off point= 68k
Assuming you are both working both of you are taxed at anything under 34000 at a rate of 20%
Your partner is earning 28,000 
You are earning 60,000
You can take your partners unused allowance raising your threshold bringing more of your salary into the 20% bracket.

You earn more than you would have if you were individually assessed.
You only benefit where one partner is earning under the standard rate cut off point.


----------



## iamaspinner

Hi All! I've spent about an hour trying to make sense of this thread but it's still a load of Chinese to me. I'm basically trying to determine whether my wife and I should go joint or separate and how to fill in the 'b' section in the [broken link removed]. Could someone make a quick calculation for us please? One of us earns 77,000 and the other 40,000. Cheers!


----------



## Graham_07

iamaspinner said:


> Hi All! I've spent about an hour trying to make sense of this thread but it's still a load of Chinese to me. I'm basically trying to determine whether my wife and I should go joint or separate and how to fill in the 'b' section in the [broken link removed]. Could someone make a quick calculation for us please? One of us earns 77,000 and the other 40,000. Cheers!


 
Basically on those levels you could just split credits and cut-off between you equally as you each have some higher rate exposure. 

On Credits you can allocate however you want provided the PAYE credit of €1,830 must remain with each so you'd have €1,830 personal & €1,830 PAYE credit each. Or you could have one get €1,830+1830 personal + €1830 PAYE and leave the other with €1,830 PAYE only. It's up to you. 

On Cut-off point, you can earn €72,800 between you at 20% in 2009. You can split this not more than €45,400 to either. So you could go 50/50 or go €45,400 to the €77,000 earner and €27,400 to the €40,000 earner. Either way you will between you get €72,800 at the low rate.

A suggestion, would be keep your credits each and split the cut-off €45,400 - €27,400 in favour of the higher earner. The higher earner also could be the assessable spouse. 

Other posters might have alternative views.


----------



## dockingtrade

whether they are assesed jointly or separately would it not work out the same net tax as both are above th 36400?


----------



## iamaspinner

Thank you Graham. Suggestion well noted!

dockingtrade, my calculations work out the same too at €32,682. However, I haven't taken into account tax credits (which I think I finally begin to understand what the hell they are) or anything else. Is it likely these will make a significant difference?


----------



## jerrylow

Hi all

Have been married couple single earner for last 5 years. Wife earned €899 last year from part time job. I received a P21 balancing statement saying i owed tax. We receive the home carers tax credit so understand that SRCOP won't be increased. So my wifes income gets taxed at 41% or €368.59. However she is entitled to paye tax credit is she not of €1860 which cancels this tax amount. Howver on the P21 she has only been allocated €179.80 of her PAYE credit. Why is this ? Thanks for any help.
PS. Can't ring them today because they are on strike !


----------



## Graham_07

jerrylow said:


> Hi all
> 
> Have been married couple single earner for last 5 years. Wife earned €899 last year from part time job. I received a P21 balancing statement saying i owed tax. We receive the home carers tax credit so understand that SRCOP won't be increased. So my wifes income gets taxed at 41% or €368.59. However she is entitled to paye tax credit is she not of €1860 which cancels this tax amount. Howver on the P21 she has only been allocated €179.80 of her PAYE credit. Why is this ? Thanks for any help.
> PS. Can't ring them today because they are on strike !


 
The PAYE credit is limited to the value of the earnings so on €899 earnings PAYE credit due is 20% of that or €179.80.


----------



## Lydia

Hi,
Sorry to butt in on this thread but does anyone know if there are any calculators online that one could use to work out if I would eb better off being singly or jointly assessed with my husband? Currently I pay no higher tax but he does so I am guessing it might be more benefical for him to take my credits but I want to check first.
Thanks!!


----------



## Firehead

I'm very interested in this topic also as we are considering joint assessment, I just have a couple of queries regarding this - 

(1) If we apply to be jointly assessed this year, if there is a change in our financial circumstances can we then apply to go back to single assessment if we feel this would be more benefitical in the future?
(2) We are married 6 years, can the joint assessment be backdated for this period?
(3) If we decide to be jointly assessed is it just a matter of writing to the Tax Office quoting our PPS numbers and sending a copy of our marraige certificate?


----------



## thumpus

We are getting married in aug

i earn 48k my fiance works 4 days and earns 17,640k

i presume joint assessment is the way to go

what would be the best way to allocate our tax credits between us???


----------

