Cross Border Tax Credit Question

MeadowMuncher

Hi folks, forgive me if I go on a bit on this but just something that has been bugging me for a while and I want to make sure I am not doing anything wrong. I am from the South and have always lived and worked in the private sector in the South. My wife is originally from the North and has always and still does work in the public sector in the North. We got married 4 years ago and bought a house and both now live in the South. From we got married, I have been claiming my wifes tax credits in the South as she got a PPS number when she moved. My first question I suppose is this ok to claim my wifes tax credits?

We had our 1st child in 2011 and have been receiving child benefit in my name because my wife works in the North. But I have just logged onto by PAYE anytime today and it states that for 2013 I am claiming "Home Carers Tax Credit". Would this of automatically been added because I am claiming my wifes tax credits? Again is this ok to be claiming this credit?

If anyone can shed a bit light on this for me, I would be most grateful.

p.s. I am not trying to avoid paying tax that I should be paying, I just want to ensure what I am paying/claiming is correct.

Many Thanks

owiseone

you are entitled to home carer's tax credit if your spouse earns less than €5,080 a year. If she earns more than that you should not be getting it. It has been given automatically to you cos you are in receipt of child benefit and as your wife does not work in South there's no employment on record for her so it looks like she doesn't work. You should give Revenue a call ASAP or send them an email and let them know your wife works in North and how much she earns pa. Otherwise the longer you leave it the more tax you will owe when they eventually find out.

MeadowMuncher

Thanks for your reply owiseone. Will this mean I will lose my wifes personal tax credit and have to pay back this credit as I claimed it since we got married 4 years ago?

owiseone

You wouldnt be entitled to the married tax credit or the increased rate band but you can apply for aggregration relief where Revenue will assess you as a married couple based on your income and your wife's income.At the moment you are paying tax as a married man with one income.But as your wife works in another State you are only entitled to single credits. At the end of each year you can send in your p60 and a statement of your wife's income from Jan - Dec and Revenue will see if there is any benefit for you to be assessed as a married man based on the aggregration of both your incomes.

Did you let them know your wife works in the North when you informed them you were married? Is your wife taxed in the north as a married person or as a single person coz she could have the same problem with the Inland Revenue.

MeadowMuncher

When I was informing them that I was married, I did tell them that me wife worked in the north. I remember speaking to a few depts in the revenue to find what was the right thing to do but no one could give me an answer. All I got was u need to ring such a dept and I was sent round in circles!!!

So it looks like I need to cut my Personal Tax Credit in half and remove the Home carers tax credit. I suppose the easiest way to do this would be on the PAYE anytime?

My wife is taxed in the North as a single person.

owiseone

if you earn over €32,800 you would be getting an increased rate band of €9,000 as a married man with one income which you mightn't be entitled based on your wife's income so that would need to be changed as well but can't be done on paye anytime. Best sending them an email so it'l be sorted once and for all.