Married to Stay at Home Mother

J

JustSomeone

Registered User
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23
Hi,

We've had a baby, and agreed that my wife will stay at home for a couple of years. We're both PAYE workers.

I've asked Revenue what tax credits etc I can transfer from her salary to mine, and have been told that my Standard Rate tax ceiling will be raised by €9,000 and my tax credits will be raised by €1,760 from now - with an increase in (I think) in the credits later in in the year when budget changes come into effect.

Does anyone know when that increase in tax credits comes in? I thought all these things were January 1 now?

Is that it? It seems a little unfair to me. By my reckoning, if we were both working, each earning half my salary, we could avail of more credits and a higher standard rate tax ceiling. But because it's just me working, we get a reduced tax benefit?

Is there anything else I should be doing? I've registered for the online service so that I can review my current tax credits to make sure that they're up to date.


Thanks always for the clear advice.
 
JustSomeone said:
I've asked Revenue what tax credits etc I can transfer from her salary to mine, and have been told that my Standard Rate tax ceiling will be raised by €9,000 and my tax credits will be raised by €1,760 from now - with an increase in (I think) in the credits later in in the year when budget changes come into effect.
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Budget changes in bands/credits take effect from January 1st 2008.

[broken link removed]

When did/will your wife stop working?
Is that it? It seems a little unfair to me. By my reckoning, if we were both working, each earning half my salary, we could avail of more credits and a higher standard rate tax ceiling. But because it's just me working, we get a reduced tax benefit?
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That's individualisation for you.
Is there anything else I should be doing?
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You might also be entitled to claim this:

[broken link removed]

And check this key post in case there is anything else to which you are entitled:

Are you paying too much tax? A guide to tax credits
 
The problem with the home carers tax credit and they don't make it clear in IT 66 (see example 5) that is only of benefit there the main earner is earning less than approx 41k.
 
Towger said:
The problem with the home carers tax credit and they don't make it clear in IT 66 (see example 5) that is only of benefit there the main earner is earning less than approx 41k.
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I don't understand how this is the case.

The home carers' tax credit reduces in benefit with increases in the earnings of the lower earner, not the main earner.
 
Towger said:
The problem with the home carers tax credit and they don't make it clear in IT 66 (see example 5) that is only of benefit there the main earner is earning less than approx 41k.
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If the home carer has no income then this is irrelevance since the married couple two spouses earning increase in the SRCOP is not available as an option. Which seems to be the situation in the specific case in question in this thread.
 
Indeed. The home carer in this case doesn't have an income.

The revenue helpster I was on to advised that I would be entitled to the full whack. But maybe she didn't have visibility of my earnings.

That's a bummer.

Thanks again for the info.
 
If you qualify for the credit and the stay at home spouse has no earnings then the credit is worth €900 off your gross tax bill.
 
Where are you getting this about an income ceiling? There is no income ceiling other than what the home carer spouse might earn which is nothing in your case. What the working spouse earns is irrelevant to qualification for the credit. It is relevant to how much tax you get back as a result of the credit since relief is at your marginal rate. I'm in the same boat and we qualify for the credit.
 
You can get the Home Carer TC or Increased Standard Rate Cut Off Point. See example 5 of IT66:

Example 5​

Home Carer has investment income of
£6,000.​

Spouse has income of £41,500.

Calculate whether the Home Carer’s Tax Credit or the increased
Standard Rate Cut Off Point is more beneficial.
Home Carer’s Tax Credit computation
Home Carer has investment income of £6,000.​

Therefore Home Carer’s Tax Credit of £310 is due.

i.e. £6,000 - £5,080 = £920 ÷ 2
= £460 restriction
£770 less £460 = £310 Home Carer’s Tax Credit​

£43,000 x 20% = £8,600​

£4,500 x 41% = £1,845​

Total £10,445

Less
Home Carer’s tax credit £310​

Tax (before relief for Personal tax credits) £10,135

Increased SRCORP computation
The tax position is:
(£43,000 + £4,500) x 20% = £9,500
Tax (before relief for Personal tax credits) £9,500
The increased Standard Rate Cut Off Point is more
beneficial in this example.​




The devil is in the detail, they should have it in the Introduction/conditions.
BTW the editor converted the '€'s to '£'s!!
 
I got the 41k from Towger on this thread. And it's all *if*... I don't know if it's true or not. Are you already successfully getting this allowance?
 
Towger said:
You can get the Home Carer TC or Increased Standard Rate Cut Off Point.
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Surely he cannot get the increased SRCOP if his wife stops earning or earns less than €5,080 (not sure if this was changed in Budget 2008)?
 
JustSomeone said:
I got the 41k from Towger on this thread. And it's all *if*... I don't know if it's true or not. Are you already successfully getting this allowance?
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Yes. Your income level is irrelevant. Did you read the leaflet linked earlier?

And, if your wife has no income for 2008 then ignore the suggestions about the increased SRCOP option since it is not relevant to you. If she has any income for 2008 then it is an option and you should check based on the example in the leaflet which is the more advantageous option for your specific circumstances. If she has income less than €5,080 then you qualify for the full credit.
 
Towger, the choice between the increases SRCOP and the Home Carer's Credit only arises when the home carer has an income in their own right. This isn't the case in the OP's situation.
 
Nige said:
Towger, the choice between the increases SRCOP and the Home Carer's Credit only arises when the home carer has an income in their own right. This isn't the case in the OP's situation.
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Yep, no income. Currently on unpaid leave, working out her notice.

Thanks again for all the info.
 
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