Overpayment of wages assistance Required

Gun Shy

Hi
Hope this forum can help me in relation to the issue of Overpayment of wages, Firstly I'm aware of the 1991 act and accept that there is no way out for me and I have to pay it back, although I did try really hard.
Basically the issue is I was paid about 20.00 extra before tax for about 5 years, I now owe my employer circa 3000 euro which essentially is the full amount that I was overpaid over the 5 years before tax prsi etc.
I may be incorrectly thinking that I should only have to pay back the net amount ie less all taxes prsi etc. and revenue should cough up the rest.?
In the final paragraph of my appeal I included this
    "Could you also clarify for me the situation with any levies, taxes, PRSI or otherwise I would have paid in relation to the €3130.00 and how if any credit or reimbursement of these monies may be applied or otherwise taken into account ."
The reply I got back was this
"The deductions that will be applied to your salary to recover the total amount overpaid will reduce your taxable pay, thus effectively giving you PAYE, PRSI and pension relief spread over the duration of the repayment period. This will compensate you for the amounts previously deducted under these headings on the proportion of your salary that was overpaid. Accordingly, due to an administrative error, you had the benefit of an increased salary for an extended period and that benefit is now being reclaimed by your employer over an extended period."
Perhaps I just cant get my head around the math of this but I dont see how this statement could be correct. and Im still of the opinion that I should only have to repay the net amount and they should chase revenue for the remainder.
Can anyone help clarify this for me, if someone could explain the math to me id appreciate it as it would help me draft an appeal.
Thanks
GS

mari2222

Let me see if I can help:

Say you were paid 520 gross per week when it should have been 500. this happened over 250 weeks. You were taxed etc on the 520.

Now instead of paying you 500 per week, your employer will pay you 480 for the next 250 weeks. You will be taxed etc on 480.

Essentially you may either "win" or "lose" due to changes in tax credits/prsi over the years, but the extra 20 X 250 which you got on your gross pay will be offset by the 20 X 250 reduction in gross pay over the next 250 weeks.

Does this help you?

Gun Shy

So I'm essentially not losing out, BUT still having trouble getting round the math of it.

Thanks

GS

moneysurfing

Gun Shy wrote: »

So I'm essentially not losing out, BUT still having trouble getting round the math of it.

Thanks

GS

It's all about you and your employer how you can agree, best advice go to the private accountant or tax advisor before you sign something. If you sign you can't change it later, remember. Ask your employer give a copy of agreement before you sign it and ask for advice private acountant or tax advisor.

I had overpayment also - payed me night shift rate for more than one year, when discovered it - I owed them more than 7000eur, ha-ha
We agreed 128weekx60eur, and for luck PRSI charges gone down only last year, until PRSI changed I had before TAX 520 so when I paid back I get PRSI only from 460eur, this saved me cca 20eur weekly for more than half of the repayment period.