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Usage of PAYE Tax credit

  • 31-01-2010 10:29am
    #1
    AugustusMinimus
    Registered Users, Registered Users 2 Posts: 4,564 ✭✭✭


    Simple enough question.

    The PAYE tax credit (or fraction of) can only be used against relevant PAYE income.

    Hence, the general rule if PAYE Income is less than €9,150 (€1,830/.20) then you apportion the PAYE credit at 20% of the persons PAYE income. The logic being you can use as much credit as you need to wipe out your income tax.

    But what in the case of a person having other Schedule D income where an individual is paying tax at the 41% rate.

    Is it expressly said in the Tax Acts that in such a case, you can't treat the PAYE income as being taxed at 41% and hence you could claim the PAYE credit at a rate of 41% of your PAYE Income.

    I know this will only come up where a person will have substantial Sch D Income and where their Schedule E income is less that €9,150 but I have seen it come up a few times in tax comps.


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