Separate or joint - confused ?

U

ukpokerguy

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Can someone help please ?

My wife and I are currently taxed as a married couple.

This year my wife started to receive a pension from an old job which has confused me somewhat as to the best course of action, as regards tax, going into 2025.

My salary is 42k
I receive a UK pension from a previous job there of 14k annually.
So my total earnings going into 2025 is 56k.

My wife receives invalidity benefit of 13k.
Her new pension is 6k.
So her total earnings going into 2025 is 19k.

Our total joint earnings are therefore 75k.

Given the above...what is the best way to optimize our tax for 2025 and onwards?

Thanks for any help and advise!
 
Unless their marriage is in trouble or there is some other extraneous personal reason to keep spouses' tax affairs separate, it's pretty difficult to imagine a set of financial circumstances where a married couple would benefit from separate assessment.
 
Cheers guys...you're probably right about the joint assessment thing.

Its just that the additional tax due will fall on me to pay - not my wife :(
 
With joint assessment, there is not me and hers - it's all one

How you divvy up your finances, is of no concern to Revenue

If this is causing you a problem, then you could apply for separate assessment, but then you would have to argue over how to split the tax thresholds and credits
 
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T McGibney said:
Unless their marriage is in trouble or there is some other extraneous personal reason to keep spouses' tax affairs separate, it's pretty difficult to imagine a set of financial circumstances where a married couple would benefit from separate assessment.
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Myself and my husband are married but separately assessed.

We have no children together and never will. He gets incapacitated child tax credit for 2 of his children from previous marriage.

We keep it separate so I do not get any benefit from the tax credit. I was separately assessed on my first marriage too.

I am very happy keeping somethings to myself makes life easier. In the future that might have to change if something were to happen but for now it works for us.
 
Sarah Ryan said:
Myself and my husband are married but separately assessed.

We have no children together and never will. He gets incapacitated child tax credit for 2 of his children from previous marriage.

We keep it separate so I do not get any benefit from the tax credit. I was separately assessed on my first marriage too.

I am very happy keeping somethings to myself makes life easier. In the future that might have to change if something were to happen but for now it works for us.
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But isn't your household income worse off for taking this approach? Obviously it's your prerogative to manage your tax affairs as you prefer, but from a purely financial perspective it may not make sense.
 
ClubMan said:
But isn't your household income worse off for taking this approach? Obviously it's your prerogative to manage your tax affairs as you prefer, but from a purely financial perspective it may not make sense.
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We are both high rate tax payers on a similar enough wage about 5k in the difference. I have been in continuous employment since I was 14 and I plan to stay that way unless illness or death knocks me off my feet.

In my eyes, it's not fair to profit from a generous tax credit that assists his special needs children.

My husband needs that money in his pocket not mine. We are married but when there are children from a previous marriage it's very hard to amalgamate things especially when they still are under the age of 18 and need to be maintained.

This arrangement keeps everybody happy most importantly his ex-wife.
 
Sarah Ryan said:
My husband needs that money in his pocket not mine. We are married but when there are children from a previous marriage it's very hard to amalgamate things especially when they still are under the age of 18 and need to be maintained.
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But if you were jointly better off with joint assessment then you could just give him the difference/excess. Otherwise the only party coming out better off may be the taxman and not your husband, his kids, his ex, or anyone else.
 
ClubMan said:
But if you were jointly better off with joint assessment then you could just give him the difference/excess. Otherwise the only party coming out better off may be the taxman and not your husband, his kids, his ex, or anyone else.
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It would want to be a massive saving to have to deal with that headache working out how much one owes the other, but given there is only a €5k difference between us, which should be less after my year end review I can't see it making much difference.

I like to get my tax credits in real time for my medical costs during the year, he likes to get his at the end of the year.
It's just easier and cleaner this way.

His dependants and taxes are his business, we still have our own bank accounts we only have a joint account for our mortgage.
 
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