Income tax/ relief/ tuition fees question

Arthur Rimbaud

This might be a stupid question but I'm not sure I have my understanding of tuition fee reliefs right, so here goes...

Pat has a gross salary on €33,000.00 per annum. Pat pays €1650.00 per year in income tax.

Then lets say Pat does starts a part time postgraduate course at University, where the postgraduate fees can be written off for PAYE income tax purposes. The fees are €4,000.00 per annum.

Revenue allows income tax relief on tuition fees for this course, at 20%, and there is a €1250.00 disregard.

Therefore, fee (€4,000) - disregard (€1,250) = €2750
€2750 x 20% = €550

Pat's income tax obligation is down to (€1,650.00 - €550.00) = €1,100.00

Is this correct? Tuition fees are charged at 20% like that, and it only affects income tax, no other deductions, right?

Greenmachine

Arthur Rimbaud wrote: »

This might be a stupid question but here goes...

Pat has a gross salary on €33,000.00 per annum. Pat pays €1650.00 per year in income tax.

Then lets say Pat does starts a part time postgraduate course at University, where the postgraduate fees can be written off for PAYE income tax purposes. The fees are €4,000.00 per annum.

Revenue allows income tax relief on tuition fees for this course, at 20%, and there is a €1250.00 disregard.

Therefore, fee (€4,000) - disregard (€1,250) = €2750
€2750 x 20% = €550

Pat's income tax obligation is down to (€1,650.00 - €550.00) = €1,100.00

Is this correct?

Off by a mile according the email I received from the revenue regarding fees. The disregard is in fact €2250. See quote. "Please note that the first €2,250 of full time tuition fees is disregarded in respect of each claim"

Arthur Rimbaud

Yes they are correct that is the disregard for full time, alright, but this question would be specifically in respect of part time fees.

I'm trying to work out whether it is to someone's net benefit to take the tax relief, or else have the fee paid by the employer as a company expense, and reduce the burden on Pat proportionally, by reducing his total tax liability (gross wages)

I imagine that for most people, they are better off having their company pay for the fees, and their gross income reduced accordingly, so the tax relief is of no real value in cases like that.

Greenmachine

Arthur Rimbaud wrote: »

Yes they are correct that is the disregard for full time, alright, but this question would be specifically in respect of part time fees.

I'm trying to work out whether it is to someone's net benefit to take the tax relief, or else have the fee paid by the employer as a company expense, and reduce the burden on Pat proportionally, by reducing his total tax liability (gross wages)

I imagine that for most people, they are better off having their company pay for the fees, and their gross income reduced accordingly, so the tax relief is of no real value in cases like that.

Okay didn't realise the disregard was different for part-time.