Query on joint assessment

M

milly123

Registered User
Messages
162
Hi,

(38,400@ 20%
(with an increase
of 20,400 max.)
Balance @ 42%

Can anyone explain what this means, where you can get an increase of 20,400 max. I earn €65K and hubby earns €30K. We married last year and I am trying to figure out if we would be better off being jointly assessed.


Thanks in advance for your help,


Milly
 
Those are the income tax bands for married couple (both earning) for 2005. The figures for 2006 have increased to 41k with an increase of 23k.

Basically the 2005 figures mean you have a tax band of 20% available for the first 58,800 of income. The tax office divides it up as shown above unless you tell them otherwise. Because the 20% band is narrower for a two income married couple than two single earners, it means you get stung for more tax when you get married.

Whether you choose to be jointly or seperately assessed, you can still only have 58,000 between you at 20%, so I don't think it makes any difference really - although you can always run the numbers. The revenue claims its usually advantageous to be jointly assessed but I don't think it makes any difference unless one earner is earning less than the 20,400 above (meaning the higher earner gets the benefit of the wider 20% band at no cost to the lower earner.)

You can choose to divide your credits and tax bands up however you wish by the way. I suppose this can be an important issue if you have seperate finances, as many married couples seem to have these days!

You'll find all this information (and more) on the Revenue website.
 
milly123 said:
Hi,

(38,400@ 20%
(with an increase
of 20,400 max.)
Balance @ 42%

Can anyone explain what this means, where you can get an increase of 20,400 max. I earn €65K and hubby earns €30K. We married last year and I am trying to figure out if we would be better off being jointly assessed.


Thanks in advance for your help,


Milly
Click to expand...

Tax affairs are often easier to manage as jointly assessed. However, based on your figures there is no tax advantage to you being jointly assessed.
 
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