Switching to job share - tax and pension implications

Hi all. I'm looking for some advice please.

I'm earning approx 75k gross. annually. my wife is earning approx 41k annually gross. she is a SNA and thinking about job share.

How could this affect us financially if she does the job share. we have two kids but not paying for child care currently thanks to family, but it's putting pressure on. everyone

she would be working 2 days one week 3 days the next and so on. could I take some of her tax credits? would her pension be reduced? I guess I'm just wondering of an overall picture of how it would look for one or two years of her doing job share.

thanks as always,

Dublin85 said:

would her pension be reduced?

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Assuming that she's a public servant, if she starts working 50% of normal hours, then she will take two years to accrue a year's pension benefit.

I see. well she has avcs built up at least. she informed there that she would be using parental leave and it's kind of unofficial job share. not sure what difference that would make of any.

she reckons that she would get paid for all the school holidays then. I wonder if I could take some of her credits, the overall loss of earnings combined net may be manageable!

I wonder if I could take some of her credits, the overall loss of earnings combined net may be manageable!

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If she moves to 50% of her current salary, then she'll be earning €20.5k p/a. Standard rate tax on that would be about €4k.

Her tax credits would be €4k too, so there'd be no credits left to transfer to you!

(Also, if you're jointly assessed for tax then you will benefit from any unused part of her tax credits at year end.)

She shouldn't be doing anything unofficial and if she does go into a job share agreement then it should be down in writing. Otherwise, chances are, something is going to come back to bite.

She also needs to check what the impact on PRSI contributions will be. I've had cases in the past where to ensure PRSI contributions were maximised, both job sharers had to work one week at the start of a year (I think it has to do with when Jan 1st falls).

In theory though, she is halving her salary and pension contributions.

Dublin85 said:

she would be working 2 days one week 3 days the next and so on.

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She should gain 52 class A Prsi contributions per year from this arrangement.

If the weekdays she works vary each week she needs to be careful.

The Prsi week changes every year. It starts on the 1st January each year. So this year it starts on Wednesdays.

If for instance she was to work this year, week one, Wednesday, Thursday and Friday. And week 2, Monday and Tuesday.
She would only qualify for 1 Prsi contribution for that 2 week period.

The critical thing is to have minimum earnings of 38 euro per Prsi week.

Sna's are paid fortnightly by the dept of Education and earn 2 prsi contributions no matter which pattern they work.
Some staff use parental leave on the week off from job sharing so not entirely sure how that works except they don't use parental leave on holiday weeks so get paid for holidays.
Again not sure how that all works but can guarantee for a straight forward job sharing as an SNA you get 2 credits per fortnight irrespective of work patterns.

thanks for the great info all. that's handy that she gets 2 credits per fortnight no matter the days she works. I think it's worth it for a year. we will be down some money but home life will improve alot