20% Pay Cut; How much will this actually cost

J

johnjoe100

Guest
Hi,

Myself and my girlfriend both finished college last year and we both went into graduate jobs. With our combined income of 46,000 we decided we could just about afford to move out and live on our own, so we have been renting since.

We've just about been managing to survive, paying city rent prices and and all the other additional costs of living out of home, but my girlfriend has just been told that from May, she will be cut down to 4 days a week, so basically a 20 percent pay cut. (HSE cutting funding to another invaluable community resource)

Her graduate salary was just under 22,000, and I am trying to figure out exactly how much this pay cut will actually affect her take home pay.

From her payslips:

Weekly Gross 417.83

-PAYE 13.18
-Income Levy 4.18
-PRSI ee 11.63

Take Home 388.84


Weekly tax credit 70.39
Weeekly cut off 700


I would be really grateful if someone could help make out how much of a difference will make to her weekly take home pay.

Also, her employer said that they could also cut back their days to three a week, and that they could then "sign on" for the other two days. I didn't realise this was possible, does anyone know how this operates? Would it be worth considering, or would the tax man eventually recoup all this money.

Thanks in advance,

John
 
... Her graduate salary was just under 22,000, and I am trying to figure out exactly how much this pay cut will actually affect her take home pay...

Weekly take home pay. (Single) Old Annual Salary €21,727.16
Selected Tax year is 2009
Gross Take Home Pay = € 417.83
Tax = € 17.36
Take Home Pay after Tax = € 400.47
Less PRSI = € 11.63
Net take home pay = € 388.84

Weekly take home pay. (Single) New Annual Salary €17,381.73
Selected Tax year is 2009
Gross Take Home Pay = € 334.26
Tax = € 0.00
Take Home Pay after Tax = € 334.26
Less PRSI = € 0.00
Net take home pay = € 334.26

So about €55 / week less.

Use this to play around with numbers - http://www.taxcalc.eu/
 
Does your girlfriend claim tax relief on her rent?It is €400 a year max.Also,if she went on a three day week,she would get pay of €250 and jsb of €102 plus a tax refund of about €20 a week.The tax refund would last only a few months .Finally,investigate if she would be eligible for a medical card
 
Your girlfriend will most likely receive a refund of PAYE paid in the earlier weeks of this year. Additionally, she'll switch PRSI class to A0 which will save her the €11.63 PRSI per week and also the income levy of €4.18.

Bottom line- in the weeks that she's getting the refund of PAYE I calculate that her weekly net will be €337.79 and therafter she will be receiving approx €334.26.
 
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