Tax Calculation Thread

exaisle

arleitiss wrote: »

Hi Again,

I logged into my revenue account this morning and it says:
EUR 1650 in Personal Credits and EUR 1650 in Employer Credits.

What does this mean?

Also - where can I see how much I can claim back? (or is it undisclosed until you request claim-back)?

It says "Employee Credits". If you're in an employment, then it's correct.

arleitiss

exaisle wrote: »

It says "Employee Credits". If you're in an employment, then it's correct.

Yes sorry, Employee Credits.

Muahahaha

Hi all, I am trying to figure out how capital allowances for taxis then relate to taxable income. Im reading Revenues guidance notes from here
https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-11/11-00-04.pdf

Example
A taxi cost €50,000 in October 2005 and is used exclusively for the trade of
operating a taxi. The accounts are made up each year to 31 December. Wear
and tear allowances are calculated as follows:
€
Cost of Taxi 50,000
W & T @ 40% for 2005 20,000
TWDV 31/12/2005 30,000
W & T @ 40% for 2006 12,000
TWDV 31/12/2006 18,000
W & T @ 40% for 2007 7,200
TWDV 31/12/2007 10,800
W & T @ 40% for 2008 4,320
TWDV 31/12/2008 6,480

So in the example above how do the allowances granted then relate to income. Eg in 2005 it states 20,000 is allowed for wear and tear. Does that then mean that when it comes to calculating net profit that an individual subtracts 20,000 for that year from their net profit? Or is it the case that the 20,000 is allowed for against your final tax bill for that year? And if so what if your tax bill is under 20k, can the remainder be brought forward to subsequent years?

mike_456

Hello,

I've stopped working on December 27 for previous employer and I'm starting to work for new company on January 10.

Since it's different year now, what should I give to new employer? P45 from December? Or should I request new Tax Credit Certificate from Revenue for the 2018 year and give it to new company?

Thanks

namenotavailablE

You need to contact Revenue to advise them of the new employer's tax number/ name to ensure that your new payroll department/ person receives the certificate of tax credits for 2018.

L.Jenkins

mike_456 wrote: »

Hello,

I've stopped working on December 27 for previous employer and I'm starting to work for new company on January 10.

Since it's different year now, what should I give to new employer? P45 from December? Or should I request new Tax Credit Certificate from Revenue for the 2018 year and give it to new company?

Thanks

Do you have an account with revenue.ie? A lot of employers are pushing new employees to register their employment online these days. If you do have a P45 available, then yes, provide it to them, but they will still need to provide a P2C to revenue to register you also.

buffalo

I couldn't see anything on the thread, but I'm trying to work out what the impact of marriage will have on tax paid by myself and my partner.

When following the rules on http://www.citizensinformation.ie/en/money_and_tax/tax/income_tax/taxation_of_married_people.html I just end up with the same amount before and after.

If I'm on 50k and she's on 35k for example, how does it work? Assuming tax band change at 35k for rounding.

Before:
50k = 35k @20%, 15k @40% (7k+6k)
35k = 35k @20% (7k)
Total of 20k tax

After:
50k = 43.5k @20%, 6.5k @40% (8.7k+2.6k)
35k = 25.5k @20%, 9.5k @40% (5.1k+3.8k)
Total of 20.2k tax

Is there only really a saving when one partner is below the 35k cutoff point?

Bobby1984

buffalo wrote: »

Is there only really a saving when one partner is below the 35k cutoff point?

Yes

namenotavailablE

I've a macro enabled Excel spreadsheet uploaded (only for Windows and requires Excel 2007 or greater) which allows you to check various net income scenarios- see http://taxcalc.eu/monthlyss to download.

Other calculators:
Karl's web app is good for a quick calculation: http://taxcalc.eu
Hookhead's calculator is at http://www.virtualaccountant.ie/Tools/tax2018.jsp
Deloittes: http://services.deloitte.ie/tc/
Taxcalc.ie: http://taxcalc.ie/budget-2018/

Sorry if this is the wrong place to ask this.

I was working as a contractor until the end of January of this year and on the first of February started working as a permanent employee. I just noticed on my payslip that I seem to be paying more tax than i should be.

I entered my figures into virtualaccountant.ie and I seem to be paying about 1200 euros more tax than I should be. Can anyone advise on how I rectify this?

CIARAN_BOYLE

Deleted User wrote: »

Sorry if this is the wrong place to ask this.

I was working as a contractor until the end of January of this year and on the first of February started working as a permanent employee. I just noticed on my payslip that I seem to be paying more tax than i should be.

I entered my figures into virtualaccountant.ie and I seem to be paying about 1200 euros more tax than I should be. Can anyone advise on how I rectify this?

Wanna show us your payslip (personal details hlocked out so we can see what the actual problem is. Otherwise the generic answer is to fix it on revenue's myaccount service.

CIARAN_BOYLE

CIARAN_BOYLE wrote: »

Wanna show us your payslip (personal details hlocked out so we can see what the actual problem is. Otherwise the generic answer is to fix it on revenue's myaccount service.

Sure.

PRSI Class A
PRSI sub class 1
Std rate cut off 0
Tax credit 0.
Gross payment:6251.66
Total deductions: 3309.21
Net payment: 2942.37

Net tax: 2541
PRSI: 254.56
USC: 509.12

Last 3 months numbers are all about the same.

Now that ive typed all that out it looks like its not taking account of my cut off rate or personal tax credit.

relax carry on

[Deleted User] wrote: »

Sure.

PRSI Class A
PRSI sub class 1
Std rate cut off 0
Tax credit 0.
Gross payment:6251.66
Total deductions: 3309.21
Net payment: 2942.37

Net tax: 2541
PRSI: 254.56
USC: 509.12

Last 3 months numbers are all about the same.

Now that ive typed all that out it looks like its not taking account of my cut off rate or personal tax credit.

You have zero credits and rate band applied to your new job. Did you register your new employment with revenue?

https://www.revenue.ie/en/online-services/services/paye-services/add-a-job-or-a-pension.aspx

relax carry on

relax carry on wrote: »

You have zero credits and rate band applied to your new job. Did you register your new employment with revenue?

https://www.revenue.ie/en/online-services/services/paye-services/add-a-job-or-a-pension.aspx

I logged into revenue.ie and my new job is there but my old one is there too. How do I remove it and get my tax credits applied?

relax carry on

[Deleted User] wrote: »

I logged into revenue.ie and my new job is there but my old one is there too. How do I remove it and get my tax credits applied?

Instructions should be in the below link about moving credits and rate band. You may have to contact Revenue to get the old job ceased.

https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-38/38-06-04.pdf

LucyIrish06

Hey folks, need a bit of help with my tax, just to make sure its right.
Im not good with numbers and never will be and trying to figure out if my tax is correct is causing smoke to come out of my ears! (probably one of the most important things to understand as an adult and there was never a mention of it in school, studying the stem to a leaf seems to be more important!)

Ill try my best give as much details as possible.
Currently make 26,559 a year (Tiz ****e)
Get paid 1021.50 every fortnightly before tax, deductions are as follows: Tax paid=77.37, PRSI=40.86 & USC=13.50 totaling up to 131.73 in wage reduction.
Im single, Dad left my siblings and myself the house so dont pay a mortgage, no kids, no car etc..

Im very uneducated when it comes to numbers so hoping someone could help. Thanks!

namenotavailablE

Those figures look correct assuming that you have a full medical card.

Here's what my spreadsheet shows:

allthedoyles

@Lucy - Also note that if you lose your full medical card you will pay an extra €7.60 fortnightly in USC .

p to the e

Wondering if anyone can advise. I recently got married and was advised to inform the revenue. I thought it was a simple "tick the box" but saw there are different methods of assessment. I currently earn approx €42,000 per year and my wife earns somewhere in the ball park of 15-20,000. Am I right in saying that joint assessment is the way to go and I take all the tax credits?

helimachoptor

Wonder if anyone can help, myself and wife both tax at the higher rate have a rental property (sister in law is an accountant but away)

In short we rent to the council, mortgage is basically €12K per annum, rent is 14K per annum

For some reason filling out the F11, we are being pegged as €4.3K in tax, it hasnt been that high since we started renting.

Any ideas (until our accountant comes back :pac:)

namenotavailablE

@ p to the e: Yes- the option to go for is 'joint assessment'. It's pretty much up to yourselves how the credits and standard rate band are split (although your wife can't transfer the 'Employee credit' [assuming that she's an employee]).
I'd suggest each of you taking the amount of your income as standard rate band.

@ helimachoptor: You're taxed on rental income - allowable expenses. The full mortgage isn't deductible from rent- just the interest component (as you're renting to a Local Authority, you might qualify for 100% of the interest being deducted. Normally, it's 85%).
There are more details available here: [LINK]

helimachoptor

namenotavailabl wrote: »

@ helimachoptor: You're taxed on rental income - allowable expenses. The full mortgage isn't deductible from rent- just the interest component (as you're renting to a Local Authority, you might qualify for 100% of the interest being deducted. Normally, it's 85%).
There are more details available here: [LINK]

Cheers that's what I thought, didn't have many expenses last year

aaaaaaaahhhhhh

Can someone please give me a high level example of how income tax is calculated when you either change job or get a salary increase mid year?

I think its based on cumulative Gross for the year so far, then 20233@20% and 40% @ the remainder but even if I do this it still doesn't work out.

So for example if I was on 15k in Jan to June and am now on 25k July to Dec, how does that work in the system?

namenotavailablE

I'm not sure where you're getting the €20233 from but here's how the pay review works for a person with the standard tax data of a single person between month 6 and month 7 (pay goes from an annual equivalent of €30000 to €50000):



The month 7 pay is a bit higher than the 'regular monthly pay' because in the first 6 months you'd have some unused standard rate band which helps to reduce the amount you're taxed at 40% in July. My calculator shows that it goes from €3303 to €3243 and then evens out at €3045 from September onwards.

Peterk88

Hey guys and gals l,

Have a query, my wife and myself are wondering about tax credits i earn about 44000before tax a year she yearns about 29000 before tax..any idea what the best way to split tax credits would be?

We currently have a tax credit of 75 euro each a week? Is this right? We have a tax relief for our kids too is that’s prob included.

El Grifo

Peterk88 wrote: »

Hey guys and gals l,

Have a query, my wife and myself are wondering about tax credits i earn about 44000before tax a year she yearns about 29000 before tax..any idea what the best way to split tax credits would be?

We currently have a tax credit of 75 euro each a week? Is this right? We have a tax relief for our kids too is that’s prob included.

2 elements to tax calcs, tax credits and standard rate cut-off point (srcop).
On credits what credit do you have for kids? Apart from incapacitated child credit or home Carer credit (where one spouse is largely a stay at home parent) there is no tax credit for having children.
If credits are €75 each pw that seems more than just basic married so there must be something else in there. Your tax credit cert would be needed to explain it. Given incomes and credit amounts as you outlined there’s no real reason to change those. Both are paying tax and the credits come off that.

However it’s the standard rate cut-off point that’s important. How is that currently divided? Couple both working can potentially earn €69,100 pa before hitting higher rate. This can be moved around but maximum swing would be €43,550 to one and €25,550 to other. If your Srcop is currently divided equally i.e. €34,550 each then it would benefit you to adjust that in your favour as your wife is earning less than that at €29,000 and you are earning more. In other words she is not using some of her 20% srcop but you’d be paying 40% as is.

If she had say €30,000 srcop you could have €39,100 so all hers would be at 20% and you’d pay more at 20%and less at 40%. So cash flow wise you’d see an improvement during the year. Of course your srcop may already reflect a split like that in which case you’re getting the best you can.

If there is any srcop wastage during the year it can always be sorted at year end by requesting a balancing statement (P21).

namenotavailablE

I've a free spreadsheet for helping with suggested SRCOP splits downloadable at http://taxcalc.eu/monthlyss - it's the 'Allocating SRCOP between spouses' one on that page.

Based on earnings of €44000 and €29000, I'd allocate a total of €40100 to the higher earner and €29000 to the lower earner. This maximises immediate cashflows so you don't have to wait until Jan 2019 to recover any unused SRCOP.

sacamano

I have a Form 12 question if anyone is able to help answer it. I have some medical expenses for 2017 so I've entered that total in the 'Other medical expenses' field. But I'm not sure whether to fill in the 'Dental and/or medical expenses refunded field' as I only received the refunds for these 2017 expenses in early 2018. I think I should leave it at zero but input it in the Form 12 for 2018, but could someone confirm?

El Grifo

sacamano wrote: »

I have a Form 12 question if anyone is able to help answer it. I have some medical expenses for 2017 so I've entered that total in the 'Other medical expenses' field. But I'm not sure whether to fill in the 'Dental and/or medical expenses refunded field' as I only received the refunds for these 2017 expenses in early 2018. I think I should leave it at zero but input it in the Form 12 for 2018, but could someone confirm?

Medical expenses can be claimed either in the year of payment or in the year to which the treatment refers. Others may disagree but if you received refunds of 2017 expenses, even if in 2018 then I would deduct them from the claim for 2017.Suppose you don’t have a claim in 2018, that refund could then end up being omitted and you would have overclaimed. Again I’m open to correction on this.

AngryLips

I'm trying to figure out the relationship between USC, PRSI and PAYE. Do these three different taxes get applied on gross pay or are they ordered in some way? ie USC on gross, PRSI on gross net of USC, PAYE on gross net of USC+PRSI?