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Tax for second employment

  • 18-01-2013 07:57AM
    #1
    wicklaman83
    Registered Users, Registered Users 2 Posts: 321 ✭✭


    I am working average weekly hours with company A bringing home an average of €400 depending an allowances etc.

    I was asked to do a favour for a lad and did 2 nights cash work for €60 each but now he needs me to go on the books.

    Does anyone know how this will work out tax wise as i've been told company A has all my tax free credits so i'll be taxed in the high bracket of 42% of every euro. Would this be the case?


Comments

  • #2
    Nody
    Moderators, Category Moderators, Arts Moderators, Business & Finance Moderators, Entertainment Moderators, Society & Culture Moderators Posts: 18,474 CMod ✭✭✭✭Nody


    Sounds about right yes; basically you'd add on the additional income to your "normal" salary and pay tax accordingly. Due to the amounts involved it does not matter if you'd use the tax credits at company A or B as they will be used up fully and your tax remains the same.

    Only be careful with your hours worked in total (48h a week average is the upper limit).


  • #3
    Peanut2011
    Registered Users, Registered Users 2 Posts: 990 ✭✭✭Peanut2011


    OP, yes you are correct. The company A will use all your credits and company B will have to tax you at the higher rate for every cent you earn. You have options to split your tax credits but that would mean you would be taxed higher on earnings in company A which is probably not worth your while.

    And not just income tax but PRSI and so on will be deducted from earnings in company B as well.

    Due to these rules I had to give up my second job when the hours were reduced as the earning after all the tax was deducted was less than what was costing me to get there and back.


  • #4
    phoenix999
    Banned (with Prison Access) Posts: 581 ✭✭✭phoenix999


    OP, a single person can earn €32,800 @ the lower rate of 20% (over 600 per week) , the balance is taxed at @ 41%. On the information your provided, it is therefore highly unlikely you are going to be paying the high rate of tax. So the job is certainly more worthwhile. Simply ring the Revenue Commissioners and they will allocate the remainder of your allowances to the second job. This will ensure that you are only taxed at 20%.


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