Taxation status in retirement

Yorky

In an effort to calculate which tax band a retired couple would fall in to:

At today's rates, a couple each in receipt of a full State Pension (Contributory) would receive €24000 a year and each in receipt of a full UK State Pension (Contributory) would receive €12000 totalling €36000 a year, which happens to be the current tax exemption limit.

That leaves only an additional €9400 before being liable to tax at 41% or would Marginal Relief still apply?

And under joint assessment would the lower earner be assessed separately and if under the relevant thresholds, then only pay tax at the lower rate?

Thanks in advance

mari2222

Assessment is either joint or separate - it is usually better to be jointly assessed.

Schedule E is the tax schedule applicable to employees or pensioners.
The first 72800 earned in 2010 for a married couple is taxable at 20%. This is reduced by various tax credits.

For example, by receiving the Contributory Old Age pension, the taxpayers are entitled to the PAYE allowance, for 2010 this represents 3660 tax credit.

There is more info on www.revenue.ie