# Calculating Tax



## Shay (31 Oct 2006)

Hi,

I feel that most paye workers just pick up there weekly/monthly pay slip and would'nt know exactly how to calculate all there deductions, I am one of them, I found out as much as I could on the government sites but there are things like pension deductions,EE Prsi,ER Prsi etc that i cant make out how I end up with my total net pay? How or where can I find out how everything is calculated down to the last cent or do I have to be an accoutant?

Any help at all is very much appreciated.


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## ClubMan (31 Oct 2006)

Try _Karl Grabe's_ tax calculator:

[broken link removed]

or the _HookHead _one:


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## Shay (1 Nov 2006)

Thanks ClubMan, Would you happen to know of any way I can do it week to week as I dont always get paid the same due to overtime and what not these seem to be for yearly calculations, thanks anyways.


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## ClubMan (1 Nov 2006)

You may be able to download an evaluation copy of one of the popular payroll packages and use that but I'm not sure if (m)any of them offer free trials any more. _Payback.ie_ used to but I'm not sure what the status us these days.


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## extopia (3 Nov 2006)

It wouldn't be out of order to ask whoever does the payroll in your company how the calculations are performed.


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## fergalfly (12 Apr 2007)

i just tried this link and it is no longer valid ... looks like that site only keeps the calculator for 3 years. In any case I found a link to the 2007 tax calculator at:



rgds,
Fergal


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## ClubMan (12 Apr 2007)

fergalfly said:


> i just tried this link and it is no longer valid ... looks like that site only keeps the calculator for 3 years. In any case I found a link to the 2007 tax calculator at:
> 
> 
> 
> ...


Thanks - I fixed the link in my post above.


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## hotelieur (12 Apr 2007)

You will normally get your details from the office of revenue commissioner in regards on your Tax Credit & SRCOP (Standard Rate Cut Off Points). 

Example:

Assuming:

Your SRCOP is 385.00 per week
Your Tax Credit is 29.22 per week

& You're getting 400.00 per week.

385.00 of the 400.00 will be taxed at 20% = 77.00
the remains of 15.00 will be taxed at 42% = 6.30

Your Gross Tax are now = 83.30

Then your Gross Tax minus your Tax Credit = Tax Payable
83.30 - 29.22 = 54.08

You pay Tax of €54.08.

If your earn below then your cut off points, your earnings will be taxed at 20% - Tax Credit = Tax Payable. If your Tax of 20% is lower than your Tax Credit, you will gain a Tax Refund; which your employer are responsible to give it to you.

I think I got this right. If not please correct me. Thanks. Cheers!

If you want a free evaluation of Payroll software go to http://www.collsoft.ie

It's easy & brilliant!


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## ClubMan (12 Apr 2007)

hotelieur said:


> the remains of 15.00 will be taxed at 42% = 6.30
> 
> ...
> 
> I think I got this right. If not please correct me.


Top rate tax as of 2007 is 41% and not 42%!


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## hotelieur (12 Apr 2007)

Thanks Clubman.

Top rate of Tax is 41% then.

Acknowledged.


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## ClubMan (12 Apr 2007)

Also - _PRSI_/health levy deductions would be separate and many people use the catch all term "tax" to include them. _PRSI_/health levy can be awkward to calculate!


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## Guest127 (13 Apr 2007)

I posted a few weeks ago about how I was having a little difficulty with the local taxation office. got back 3 p21's for 2004 2005 2006 and Dan Brown would have been proud of them. pure fiction. I visited the local office and explained that I was due refunds of approx €1400 over the 3 years and not the €51 they forwarded. ( the other p21's had all underpayments on them which they stated they were not collecting at this time.) took down all details and few weeks later received rebates totalling around €780. still incorrect so I visited a 2nd time and yesterday got another rebate of around €250. however even now there are a few glaring errors. OH's divideds on shares shown as income for BOTH of us in one p21. interest earned (on which dirt already deducted)  added to _dividends_. interest in building socities etc taxed at 42% ( even though dirt already collected) interest on loan notes in UK ( Again 20% tax already deducted) now inflated beyond the actual amount earned and no allowance for double taxation. this list is endless and the mind boggles. 
I am going to visit again today with the p21's for 2005 and 2006. I am going to let 2004 go as the amounts are insignificant for that year.

I equate this with trying to get BT to sort out my billing. I can see why most people would surrender at this stage.


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## Towger (13 Apr 2007)

You should see some of the stuff coming out of ROS system last year in peoples PC2's (Tax Certs). The information is now being imported directly into payrolls, so it is not being spotted until the employee comes along complaining that they got no pay this week and their payslip says they owe over 230K in tax.!!!
I have personally had figures euro converted twice,  miss keyed ,  and what can only be half of someone else’s Form 11 mixed up with mine. How they manage that with preprinted OCR forms it beyond me.

Towger


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## Welfarite (13 Apr 2007)

Cuchulainn, I'm glad I'm not working in Revenue and trying to work out your tax!


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## Guest127 (13 Apr 2007)

Welfarite; on my last visit to local tax office the official half joking said to me ' you should look for a job in here' 

have to say however that some of the mistakes are very basic and some are more worrying. on last visit I pointed out that building society interest etc on which dirt had been paid was full and final. this staff member nodded and replied that ' I _might _be right' however on the three p21's received today the tax on BS interest is included in overall income and while credit is given for the dirt element the overall result is that 42% is the tax they are collecting for this. and that is totally incorrect. I have  earned very little interst in the past year but I received a gratuity when I was taking the retirement package and this is currently in First Active at 4.2%. to declare interest on this next year would mean I would receive a fairly large tax bill. totally incorrect but trying to get the local tax office to agree is akin to pulling hens teeth. Basically its not good enough.

 I am now of  the opinion that the vast majority of tax payers who dont bother filling in tax forms are right. through no fault of my own ( employer making a deduction for pension purposes from gratuity) I would up being due tax refunds spread over the past 4 years. as this is unlikely to ever happen again its also unlikely I will ever bother filling in another tax form. Not much point in filling in a form if the staff dealing with it don't know the rules.  
Cheers


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## Welfarite (13 Apr 2007)

Sounds like a LOS issue! The problem as I see it with government public offices is that due to government's non-filling of posts to cover junior vacancies adn Maternity Leave, a lot of Temporary Clerical officers just out of or still at college end up filling the front line places, with no knowledge/experience of what they're actually doing. I'd ask for the head honcho if I were you! Still glad I don't work there....!


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## Protocol (13 Apr 2007)

Cuchulainn,

I also earn small amounts of deposit interest, on which I pay the normal 20% DIRT.

What happens on the P21 balancing statement is that the interest is added to my other incomes to be taxed.  So far it would be taxed at 42%.

Then I am given a tax credit of the DIRT already paid.  That saves 20%.

But also, the amount of interest is added to my SRCOP, saving me another 22% tax on the interest.

The end result is that I don't actually pay any extra tax on the interest through the P21.

I hope that makes sense.


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## Guest127 (13 Apr 2007)

it does. but they are NOT adding anything to the SRCOP. as an example of what I am dealing with . last year I earned a total of €17 interest. and €81 from the Credit Union. on the p21 for 2006 the interest is down as €81 and no addition to the SCROP.  Dividends are shown as €98 ( 81+17) again taxed at 42%.  So not alone are they not increasing the cut of point they are actually taxing me TWICE on the credit union dividend at 42%.UK interest is shown as €337 but the amount is actually €240. the double taxation credit is shown as €45 but it should be €48. all minor compared to 2005

in 2005 the p21 shows deposit interest as €76. ( this is the credit union dividend as the interest that year is under €1) Mrs Cu had dividends on her shares for €403. I am shown as having dividend shares of  €479 (presumably made up of €403 of mrs cu's and my interest of €76, but I should have zero under this heading) My uk interest is shown as €399 ( real amount is €265)and there is no double taxation relief ( €53). 

in both years the vodaphone shares are shown seperately as uk dividends ( no relief given either but the amounts are relatively small so it doesn't matter) 

worth bearing in mind is that these are the third set of p21's I have received. and the amount now due has dwindled to around €200.

I was in the tax office today but they were very busy so I am going to photocopy everything and write to them.
overall I havn't done too badly getting back the bulk of what is due but the other bits are niggling at me.
unless its absolutey necessary I wont be filling in any more tax declaration forms. Waste of time and energy.
cheers


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## xeresod (14 Apr 2007)

cuchulainn said:


> Dividends are shown as €98 ( 81+17) again taxed at 42%. So not alone are they not increasing the cut of point they are actually taxing me TWICE on the credit union dividend at 42%.


 
Credit union dividends _are_ liable for tax at your marginal rate, except in the case where you hold a 'Special Share Account' where the credit union deducts DIRT at source on the dividends.

If you do have a Special Share Account, then the dividend should be entered on the return in the section for deposit interest not the section for dividends.


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## Corcaioch (14 Apr 2007)

Cuchulainn, you are not entitled to Double Taxation credit in Ireland for tax suffered on the UK deposit interest.  As you are (I assume) non-resident in the UK you are entitled to a refund from the UK authorities of the tax deducted from the UK deposit interest.  Once it is refundable (whether refunded or not) the Irish Revenue should not grant you the credit.


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## Joe1234 (15 Apr 2007)

Welfarite said:


> I'd ask for the head honcho if I were you!



I believe that I deal with the same tax office as Cuchulainn, and was told that the "head honcho" does not take phone calls from the public.  I have been talking to various staff there, over the past 2 years, trying to get an issue resloved.  Some of the staff agree with my theory, but seem unwilling to do anything about it because " the computer calculates the tax this way."


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## Guest127 (16 Apr 2007)

Corcaioch said:


> Cuchulainn, you are not entitled to Double Taxation credit in Ireland for tax suffered on the UK deposit interest. As you are (I assume) non-resident in the UK you are entitled to a refund from the UK authorities of the tax deducted from the UK deposit interest. Once it is refundable (whether refunded or not) the Irish Revenue should not grant you the credit.


 

Corcaioch: I fully agree. and in 2003 downloaded the form from the british revenue site. completed it and handed it into my local tax office with my returns for 2002 and 2003. ( they have to sign and stamp it and forward it to the british revenue on your behalf) when I got back the revelant p21's there was no uk interest shown and therefore no tax. I rang the office and a member of staff informed me ' you paid tax at 20% already and thats what the dirt rate is so I am just ignoring it' for some odd reason I accept this would also be the case in future years. as it turns out I have to commence drawing down this 'loan' note shortly in order for it to be tax efficient  . ie keep withdrawals under €1270 to avoid CGT)

Joe 1234. Yep I agree. same office.
for what its worth I have been on to the credit union league this morning and they are having a meeting with the revenue later this week and will clarify the position.
my understanding was that Charlie McCreevy was 'annoyed' that thousands of credit union customers were receiving tax free dividends and not declaring them. He went into talks with the credit unions to 'level' this pitch with other banks/building socities and the result was that every credit union member was asked to complete a form authorising the credit union to deduct tax at 20% ( dirt in effect) and that anyone who completed this form was not liable to further tax on the dividend/interest. anyone who decided not to complete this form was liable for tax at full rate ( provided they declared it of course) from my correspondence with the credit union it would appear they are of the same opinion and as I state above are going to raise the matter with the revenue later this week.


another small example: when I was in the tax office in January I tried to sort out junior cu no 2's tax cert. the tax officer informed me ' he will have to come in himself' we cant take any instructions from you. All I was going to do was divide up his allowances between employer 1 ( whom he was with for the past two years part time) and employer 2 whom he had just commenced with and was now going to be the major employer) . 
came home. rang that 1890 number. got the letterkenny office ( asked naturally) and they did it over the phone. nothing could have been simpler.


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