Wife wanting to give up work. Advice on tax implications?

Perkins135

Hi everyone,
Just looking for a small bit of advice if anyone might know anything about it.
I'm farming part time with a full time job bringing in decent enough money. All the farm income is taxed at the highest rate (53% when you take in all the stealth tax).
My wife has been working part time bringing home about €12k a year and with a new baby on board she is talking about giving up work for a while.
Just wondering, if she did give up work, what are the potential tax implications? And are there any ways of bringing the tax bill down that might not be very obvious for a tax idiot like myself.
Thanks.

bbam

Could she be employed to do admin duties and paperwork??

Perkins135

Of course she could if it meant a smaller tax bill ..
any suggestions will be listened to.

joejobrien

Best speak with an your accountant and professional advice, but office work is a good start:rolleyes:

Perkins135

Ive been onto the accountant. Hes straight as an arrow. Wouldn't listen when I asked about her working for the farm. How would it work out?

MayoSalmon

Perkins135 wrote: »

Ive been onto the accountant. Hes straight as an arrow. Wouldn't listen when I asked about her working for the farm. How would it work out?

Get a new accountant:P

freedominacup

You should be able to get all of her tax credits.

Perkins135

Ye if I go straight down the line can get all her credits and unused bands and all that. but loads of people saying if I employ her would be well worth it, but noone can tell me how to go about it or how much it could be worth

Masala

You should be able to get all of her tax credits.

That wont be any great help...

Her only Tax Credit probably the PAYE €1,650 ??? Don't think that is transferable.

C4d78

You'll be able to earn twice as much before you pay tax at the marginal rate if you enter a partnership. Best bet

Farmer Pudsey

You are taxed as a sole trader. You can employ your wife however her wages will be treated as director fees. She can earn about 8K it will cost you about 500 euro in PRSI. A lot will depend on if you have large drawings, You can also pay her enough to use some or all the 20%. use tax calculator to calculator to calculate different senario's.


http://www.deloitte.ie/tc/

C4d78

Farmer Pudsey wrote: »

You are taxed as a sole trader. You can employ your wife however her wages will be treated as director fees. She can earn about 8K it will cost you about 500 euro in PRSI. A lot will depend on if you have large drawings, You can also pay her enough to use some or all the 20%. use tax calculator to calculator to calculate different senario's.


http://www.deloitte.ie/tc/

Would entering a partnership with spouse not be the best bet. Double the tax bands?

Farmer Pudsey

C4d78 wrote: »

Would entering a partnership with spouse not be the best bet. Double the tax bands?

Makes little or no difference it is just a matter of using up tax bands.