How much tax do I pay?

andyd12

Hi,
I work for a guy and get paid 500 euro per week take home. I don't deal with any of the taxes! His accountant does it all so I have no pay slip etc.

I am only working with him for the summer as I am in college the rest of the time so I am guessing I am on a 20% tax rate. What would my employer have to pay before tax to pay me 500 after tax? I am 30 yrs old and single if that makes any difference.
I am trying to push for more take home pay and am wondering what taxes are involved as I am sure that will be his defence when I do ask him.
Thanks

Victor

andyd12 wrote: »

His accountant does it all so I have no pay slip etc.

That sounds awfully dodgy.

Based on this (check the details) http://services.deloitte.ie/tc/Default.aspx you seem to be on €31,000 gross annually (€596/week gross).

If you want €600/week net, you would need €40,060 gross annually (€770/week gross).

Between these points, depending on your tax credits, you would start to pay 40% tax.

Note that your employer also needs to pay 12% PRSI.

whomitconcerns

Well sounds like you might not be posting any tax at all in those circumstances.. But assuming you are, is around 25k net so about 32k gross per year

bmwguy

Is it exactly 500 you are paid? Are you paid in cash?

If the answer to either or both of those is yes I'd say you are paying no tax at all.

andyd12

bmwguy wrote: »

Is it exactly 500 you are paid? Are you paid in cash?

If the answer to either or both of those is yes I'd say you are paying no tax at all.

Yes I am paid 500 exactly and no its paid into my bank account.

Really Interested

Assuming the following

1 you have not used credits for any othe employment
2 you work only 12 weeks for the year
3 you have no earlier or later income

Then as your income was €6000 for the year according to http://services.deloitte.ie/tc/ there would be zero liability

Really Interested

whomitconcerns wrote: »

Well sounds like you might not be posting any tax at all in those circumstances.. But assuming you are, is around 25k net so about 32k gross per year

You must have missed this in OP "I am only working with him for the summer as I am in college the rest of the time"

andyd12

Really Interested wrote: »

Assuming the following

1 you have not used credits for any othe employment
2 you work only 12 weeks for the year
3 you have no earlier or later income

Then as your income was €6000 for the year according to http://services.deloitte.ie/tc/ there would be zero liability

Yes I was thinking the same.
All of these are correct, 12 weeks there or there abouts.
What do you mean by zero liability?
Thanks

Zenify

Really Interested wrote: »

Assuming the following

1 you have not used credits for any othe employment
2 you work only 12 weeks for the year
3 you have no earlier or later income

Then as your income was €6000 for the year according to http://services.deloitte.ie/tc/ there would be zero liability

Completely right.

You wouldn't have a tax liability, but your employer should still be putting it through the books. This would benefit you as he would have to pay your prsi (future social benefits to this). You have a legal right to receive a payslip.

http://www.citizensinformation.ie/en/employment/employment_rights_and_conditions/pay_and_employment/pay_slip.html

Really Interested

andyd12 wrote: »

Yes I was thinking the same.
All of these are correct, 12 weeks there or there abouts.
What do you mean by zero liability?
Thanks

Assuming you only earn 6000 for the year then as you are below PRSI limits and you have a tax credit that you will not have used in full then you given none of the 6000 in any tax, PRSI or USC.

Really Interested

Zenify wrote: »

Completely right.

You wouldn't have a tax liability, but your employer should still be putting it through the books. This would benefit you as he would have to pay your prsi (future social benefits to this). You have a legal right to receive a payslip.

http://www.citizensinformation.ie/en/employment/employment_rights_and_conditions/pay_and_employment/pay_slip.html

In fact it's in the employers interest to record the income so he has a tax reduction on his side. I would assume the employer is correctly recording it as anything else would be stupid.

andyd12

Really Interested wrote: »

Assuming you only earn 6000 for the year then as you are below PRSI limits and you have a tax credit that you will not have used in full then you given none of the 6000 in any tax, PRSI or USC.

OK thanks so are you saying if I earn 6000 in the year, I don't pay any tax ??
I thought my tax credit was for 1700 or something

andyd12

Really Interested wrote: »

In fact it's in the employers interest to record the income so he has a tax reduction on his side. I would assume the employer is correctly recording it as anything else would be stupid.

He is pretty legit with tax as he works does work for some schools so has to be legit for them.
So by employing me, he can avail of a tax break?

Really Interested

andyd12 wrote: »

OK thanks so are you saying if I earn 6000 in the year, I don't pay any tax ??
I thought my tax credit was for 1700 or something

Every Tax payer has a tax credit of €1650 plus if you are PAYE then you have an additional €1650 credit.

So if a person only earns say €6000 at a tax rate of 20% then the tax die is €1200 but the person has a credit of €3300 so no tax due.

PRSI also has a credit system if I remember €612 a year so at rate of 4% PRSI so less than €15000 no PRSI and USC does not apply on income of less than €13000 a year. So on all heads nothing due.

Victor

andyd12 wrote: »

So by employing me, he can avail of a tax break?

Anything he pays you is a business expense for him. So if the business gets €20,000 and he pays you €5,000, he has no tax liability (other than employers PRSI).

If he isn't putting you through the books, and the business gets €20,000 and he pays you €5,000, he has a tax liability on the €15,000. He likely has a marginal tax rate of 40%, so it would be better for him to put you through the books.

The exception would be if he is trying to launder undeclared income.

allthedoyles

This is rampant in the construction industry at the moment . Its to do with employees just starting and they decide to pack it in after a few weeks or temp job may only last a few weeks .
It reduces paperwork as no sooner has a new employee been registered and p45 has to be issued .

Ciaran

Really Interested wrote: »

PRSI also has a credit system if I remember €612 a year so at rate of 4% PRSI so less than €15000 no PRSI

PRSI doesn't work cumulatively. If you're paid €352 or more in a week, you pay PRSI that week.