Calculating Tax/Credits

K

kate2006

Guest
Hello,
Ive been onto revenue about this but cant get through to anyone who can give me a straight answer!

Next year I will be cutting down my work days from 5 to 3 days per week and I'm trying to calculate the approximate wage I'll get. I'm currently 45k @ 42%.

My husband is also on 45k and I'm wondering would it be more economical for us if he takes my tax credits in this situation.

Is there a formula or something of the sort which can work this out?

Thanks in advance. Kate.
 
Hi Kate
no formula here.......i assume you and the husband are jointly assessed to tax so should you not use your credits he wiil get them automatically so is the case in your standard cut-off

you dont mention how much your reduced salary is but ill guess it will be 3/5 of €45K being €27K
Gross Take Home Pay €27,000.00
Tax €2,280.00
Take Home Pay after Tax €24,720.00
Less PRSI €1,355.84
Net take home pay €23,364.16

you have used all your credits but have unused standard rate cut-off of €5K which your husband can use and save him tax of €5K at 22% being €1,100 per year
 
bazermc said:
Hi Kate
no formula here.......i assume you and the husband are jointly assessed to tax so should you not use your credits he wiil get them automatically so is the case in your standard cut-off

you dont mention how much your reduced salary is but ill guess it will be 3/5 of €45K being €27K
Gross Take Home Pay €27,000.00
Tax €2,280.00
Take Home Pay after Tax €24,720.00
Less PRSI €1,355.84
Net take home pay €23,364.16

you have used all your credits but have unused standard rate cut-off of €5K which your husband can use and save him tax of €5K at 22% being €1,100 per year
Click to expand...

WOW Baz!, that's an impressive answer, I'm currently trying to work out if I should break away from joint assessment as my husband has recently become self employed.... I think I will start a new thread and hope you tune in!!! Not tonight though, my brain cells are far to depleted.
 
Smithy

I would recommend joint assessment without even looking at figures - assuming you are working full time

Your husband will be assessed to tax on his accounts profits which can change from year to year against a salary which is usually fixed he will not be taxed on what he draws nor will he get a tax decution for his drawings unless he operates through a company

Therefore you will not know till the end of the year what his profits will be so say for example he has a bad year taxable profits less that standard rate cut-off by the time accounts are prepared it may be to late to go back to joint assessment given that the election must be made before april in the tax year thereby you could be losing out on his unused 20% cut-off

under joint assessment he will file a return enclosing his taxable profits and include your paye income and revenue will issue an assessment if he has unused cut-off that will more than likely generate a refund of your paye which can then be used against his liability should one arise or pay his preliminary tax for the next year
 
I think that the tax calculator is much better as it lists out month by month
 
Thanks very much to all who replied! Its given me a lot to go on!.
Kate
 
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