Working after 66 and drawing state pension

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Alexod

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Hi Everyone. hope someone can advise. Im going to continue working full time for another year or two after reaching 66 this year.
I know that the state contributary pension will be taxed. Will it be taxed at source by DSW or will it be taxed through my paye ( employer ) ?
Will it mean paying more tax on my current salary. Grey area for me. Any advice welcome.
Thanks
 
Alexod said:
Hi Everyone. hope someone can advise. Im going to continue working full time for another year or two after reaching 66 this year.
I know that the state contributary pension will be taxed. Will it be taxed at source by DSW or will it be taxed through my paye ( employer ) ?
Will it mean paying more tax on my current salary. Grey area for me. Any advice welcome.
Thanks
Click to expand...

What should happen is that DSP will inform Revenue that they are paying you the SCP and Revenue will then reduce your yearly tax credits accordingly.

They probably won't calculate the credit reduction 100% accurately so you'll need to sort things out after year end by filing a tax return.
 
Alexod said:
Hi Everyone. hope someone can advise. Im going to continue working full time for another year or two after reaching 66 this year.
I know that the state contributary pension will be taxed. Will it be taxed at source by DSW or will it be taxed through my paye ( employer ) ?
Will it mean paying more tax on my current salary. Grey area for me. Any advice welcome.
Thanks
Click to expand...
I was told that a person who gets the CP has to get a confirmation of that in writing from the DSP. The letter has to be given to your employer- who will then inform Revenue about it. There will be no more PRSI deducted anymore from your salary after that.
You are getting your CP in full from the DSP. They will not deduct any tax from it.
As far as I know your tax will go up because your income has grown. CP is taxable. Your will get your new tax details from Revenue and your employer will deduct the new tax from your wages.
 
Marsupial said:
What should happen is that DSP will inform Revenue that they are paying you the SCP and Revenue will then reduce your yearly tax credits accordingly.

They probably won't calculate the credit reduction 100% accurately so you'll need to sort things out after year end by filing a tax return.
Click to expand...
Many thanks.Your reply is much appreciated.
 
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