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Not paying PAYE?

  • 06-06-2012 6:07pm
    #1
    B0X
    Registered Users, Registered Users 2 Posts: 1,026 ✭✭✭


    I was just looking at my P60 and I noticed i'm not paying any tax.

    Now I dont work very many hours (~€70 a week) and previously my tax credits would always be more than I earned (something like €71 a week).

    My gross pay came to €3770 for the year and my tax credits are now €3300, shouldn't I be paying tax on that 470?

    What do I do about this?

    Thanks


Comments

  • #2
    relax carry on
    Registered Users, Registered Users 2 Posts: 4,123 ✭✭✭relax carry on


    B0X wrote: »
    I was just looking at my P60 and I noticed i'm not paying any tax.

    Now I dont work very many hours (~€70 a week) and previously my tax credits would always be more than I earned (something like €71 a week).

    My gross pay came to €3770 for the year and my tax credits are now €3300, shouldn't I be paying tax on that 470?

    What do I do about this?

    Thanks

    It does not work like that.

    There are two elements to the paye system, rate band and credits.
    Rate band is how much you can earn in a year at the 20% rate of tax. Last year it was 32800.
    So your 3770 is within that 20% rate. Your tax due before tax credits was 20% of 3770 (equals 754)

    You then take your credits from the 754 figure to give your actual tax due. As they were more than the 754 figure, no tax was due.
    So your P60 is correct.

    http://www.revenue.ie/en/personal/faqs/how-do-i-work-out-my-tax.html


  • #3
    B0X
    Registered Users, Registered Users 2 Posts: 1,026 ✭✭✭B0X


    Oh ok, thanks for clearing that up.

    I'm also not paying the USC, does that get taken from the tax credits too?


  • #4
    relax carry on
    Registered Users, Registered Users 2 Posts: 4,123 ✭✭✭relax carry on


    B0X wrote: »
    Oh ok, thanks for clearing that up.

    I'm also not paying the USC, does that get taken from the tax credits too?

    Last year the threshold for paying the USC was around 4000 Euro for the year. You were under the threshold so you shouldn't have paid any last year.
    This year is different. You should be paying the USC at the 2% rate unless for some reason you have an exemption marker on your 2012 tax credit/usc cert.

    http://www.revenue.ie/en/tax/usc/index.html


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