Tax Credits

[Johno]

I am a director of a company and also a full time employee of the same company, on a salary etc.

My wife was self employed for about 7 years paying her tax and prsi etc and has a tax clearance cert. She has changed employment and is now an employee of a company earning a basic salary of €45,000.

Her weekly pay is €553.00 which gives her an annual net pay of €28,756. We are taxed as a married couple and I would be the higher earner and would be claiming her credits of about €1500 pa.(so I only found out today)

I have an employee earning a basic of €40,000 and net pay is just over €2,900. He is married but his wife is not working.

Where are we going wrong? Does the above net pay seem right?

Thanks

Johno

 

[asdfg]

The net pay for your employee appears correct. He is getting 38,400 taxed at 20% with the remainder taxed at 42%

With your wife it appears that she is being taxed 19,000 @ 20% with the remainder at 42% with no credits being allowed to her. You may have elected for this option at some stage in the past.

You need to make sure that you are allowed earn 39,800 i.e. double the single rate of 29,400 minus 19,000 @ 20% with the remainder @ 42% and that you are claiming all the available credits Marriage credits PAYE credits *2, bin collection credit etc

The figures that you are both allowed earn at the lower rate are set out in your tax credit certificate which is sent out to you early in the new year (Jan Feb 2005) Details of cut off point etc is forwarded to the employer.
You could ring the tax office and ask for a copy. Have your RSI number ready. Your wife may have to do the same. Bear in mind that the tax office is extreamly busy at this time of year.

At this late stage you may have to wait till next year and make a claim direct to revenue.

Hope this makes sense, if not let me know and I'll try to explain in more detail.

 

[Johno]

asdfg,

Thanks for your advise, I'll take it up with the tax office in January.

Johno