Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie
Hi there,
There is an issue with role permissions that is being worked on at the moment.
If you are having trouble with access or permissions on regional forums please post here to get access: https://www.boards.ie/discussion/2058365403/you-do-not-have-permission-for-that#latest

Marginal Relief

  • 24-05-2012 8:07pm
    #1
    To Alcohol
    Registered Users, Registered Users 2 Posts: 526 ✭✭✭


    Hi

    Was looking for help on the taxation of a retired couple who have a pension of 24,000 between them but have a small farm with income of between 12,000 and 20,000.

    Say for example it was 20,000 that would give a total income of 44,000. Would they be still entitled to Marginal relief if they earned this amount? Is there a set income where Marginal relief no longer applies?

    Also is the Pension taxed under schedule E and the additional farm income Schedule D ?

    One last one, if there is a tax liability are they entitled to the PAYE credit?

    Many thanks in advance.


Comments

  • #2
    Shane732
    Registered Users, Registered Users 2 Posts: 4,998 ✭✭✭Shane732


    To Alcohol wrote: »
    Hi

    Was looking for help on the taxation of a retired couple who have a pension of 24,000 between them but have a small farm with income of between 12,000 and 20,000.

    Say for example it was 20,000 that would give a total income of 44,000. Would they be still entitled to Marginal relief if they earned this amount? Is there a set income where Marginal relief no longer applies?

    Also is the Pension taxed under schedule E and the additional farm income Schedule D ?

    One last one, if there is a tax liability are they entitled to the PAYE credit?

    Many thanks in advance.

    You should find the details you're looking for in relation marginal relief in IT8

    http://www.revenue.ie/en/tax/it/leaflets/it8.html#section5

    The majority of pensions are taxed under Sch E and PAYE deducted thereon. The farm income would be taxable under Sch. D.

    There is a point when marginal relief is no longer beneficial (i.e. the point when being taxed under the normal rules yields a lower tax liability). Off the top of my head I don't know the figure but it's a relatively simple calculation.

    Yes they should be entitled to a PAYE credit in relation to the pension. Just be aware that depending on how the income is split etc... that they might not get a full PAYE credit, it might be restricted to the tax liability on the pension is lower than the PAYE credit.


  • #3
    To Alcohol
    Registered Users, Registered Users 2 Posts: 526 ✭✭✭To Alcohol


    Shane732 wrote: »
    You should find the details you're looking for in relation marginal relief in IT8

    http://www.revenue.ie/en/tax/it/leaflets/it8.html#section5

    The majority of pensions are taxed under Sch E and PAYE deducted thereon. The farm income would be taxable under Sch. D.

    There is a point when marginal relief is no longer beneficial (i.e. the point when being taxed under the normal rules yields a lower tax liability). Off the top of my head I don't know the figure but it's a relatively simple calculation.

    Yes they should be entitled to a PAYE credit in relation to the pension. Just be aware that depending on how the income is split etc... that they might not get a full PAYE credit, it might be restricted to the tax liability on the pension is lower than the PAYE credit.

    Thanks for the above. Thats a fantastic help. The pension is 12000 each. I assume they get the full PAYE each then?


Advertisement