Weekly Max @ 20%

ozanam

Hello All,

My partner gets paid weekly and works a jobs where she can pick her hours.

I have been googling around the last few hours and cannot make heads or tails of how tax for for a married couple.

We are just trying to figure out whats the right balance between how many hours she should work. some weeks she will do an extra shift and get paid less then the week previous.

What is the limit for a weeks pay to keep the tax at the normal rate and when does it become so much that it works out worse!

Scott

relax carry on

ozanam wrote: »

Hello All,

My partner gets paid weekly and works a jobs where she can pick her hours.

I have been googling around the last few hours and cannot make heads or tails of how tax for for a married couple.

We are just trying to figure out whats the right balance between how many hours she should work. some weeks she will do an extra shift and get paid less then the week previous.

What is the limit for a weeks pay to keep the tax at the normal rate and when does it become so much that it works out worse!

Scott

A single person has a standard rate cut off of 34,500 euro for the year. There's no additional standard rate cut off for a married person. You can move up to 9,000 euro between spouse's if you are jointly assessed for tax purposes. This could mean that one spouse could have a cut off of 43500 while the other spouse's cut off is reduced to 25,500 euro.

The above are annual figures. Divide your annual standard rate cut off by 52 to figure out what your weekly cut off is. For example if it's 34,500, then divide by 52 to get 663.50 euro weekly which can be earned at the standard rate of 20%.

Keep in mind the above is only in relation to your standard rate band. The second part of the PAYE tax system is tax credits which reduces the amount of tax you are due to pay at the standard rate.

namenotavailablE

Depending on the pay level, she may also be impacted by the loss of the PRSI credit.

This can work against her as follows:

* For weekly earnings between €352.01 and €424, the normal PRSI deducted from her earnings is reduced by a declining credit.
* Once her weekly earnings go above €424, there is no credit.
* This could result in her getting relatively little from a small increase in weekly earnings e.g. if gross earnings are €405 in a week I calculate a net of €369. If the gross was €425 in a week (€20 extra) this only gives a net of €380 i.e. the deductions account for 45% of the extra earnings.

Squatter

ozanam wrote: »

Hello All,

My partner gets paid weekly and works a jobs where she can pick her hours.

I have been googling around the last few hours and cannot make heads or tails of how tax for for a married couple.

We are just trying to figure out whats the right balance between how many hours she should work. some weeks she will do an extra shift and get paid less then the week previous.

What is the limit for a weeks pay to keep the tax at the normal rate and when does it become so much that it works out worse!

Scott

You call her your "partner" - are you married? (If so, then it's not a hanging offence to describe her as your spouse/wife!)

What's her hourly rate of pay? (And does she get an overtime rate if she works extra hours?)

Are you yourself in employment?

Answers to these will make it easier to advise you constructively.

whomitconcerns

We are just trying to figure out whats the right balance between how many hours she should work. some weeks she will do an extra shift and get paid less then the week previous.

What is the limit for a weeks pay to keep the tax at the normal rate and when does it become so much that it works out worse!

you cant get paid more gross in a week and come out with less than the previous week. Its not possible...maybe relook at your calcs. It doesn't work that way...as the other poster said you may not get as much proportionally but it will still be more.

Watergirl4

whomitconcerns wrote: »

you cant get paid more gross in a week and come out with less than the previous week. Its not possible...maybe relook at your calcs. It doesn't work that way...as the other poster said you may not get as much proportionally but it will still be more.

You can - it is possible if you go from no EE PRSI to some Ee PRSI - your gross might increase by 15 and PRSI by 32;

I just looked at a real live example that I have come across - where an ee earns 10.50ph - at 67 hours (fortnightly paid), she takes home €684 as gross is below PRSI threshold and at 68 hours takes home less as PRSI kicks in.

Watergirl4

sorry - it should - will edit

namenotavailablE

You're correct Watergirl4 - within a narrow pay rate, you can come out worse at a higher gross due to how PRSI rules work.

A weekly gross pay of €352 would net €341.48 (no PRSI deduction) for a single person with typical tax credits. Add €1 to that weekly pay and the PRSI kicks in (deduction of €2.29), resulting in €339.97 net.

I calculate that if you currently earn €352 gross per week, you'd need to go to €355.65 gross per week just to breakeven.

Bubbaclaus

namenotavailabl wrote: »

You're correct Watergirl4 - within a narrow pay rate, you can come out worse at a higher gross due to how PRSI rules work.

A weekly gross pay of €352 would net €341.48 (no PRSI deduction) for a single person with typical tax credits. Add €1 to that weekly pay and the PRSI kicks in (deduction of €2.29), resulting in €339.97 net.

I calculate that if you currently earn €352 gross per week, you'd need to go to €355.65 gross per week just to breakeven.

PRSI has been tapered in with the last 3 years so this can't happen anymore.

namenotavailablE

This can happen despite the effect of PRSI tapering!

Tapering is activated once you earn €352.01 to €424. Earn €352.01 or more in a week and you have an employee PRSI deduction. However, if you earn less than €352.01, you don't pay ANY employee PRSI. Here's an extreme scenario to illustrate my point:

* If I earn exactly €352.00 in a week, I would earn a net of €341.48 under PRSI class A0.
* Add a single cent to the weekly earnings and I become liable to (tapered) employee PRSI of €2.08 under PRSI class AX. My net is now €339.41, a reduction of €2.07

namenotavailablE

Here's the details of above: