Maternity/Paternity Benefit

angeldelight

I went on maternity leave in the middle of May, prior to this I was on illness benefit. None of this is topped up by employer, I’ve had state benefit only.

Husband took two weeks paternity benefit in May - first week topped up to full salary by employer, second week received state benefit only. Both weeks went to employer who paid him.

I understand that the benefits are taxable HOWEVER I would have thought my credits would be enough to cover it. I worked for maybe 12 weeks of the year. Husbands salary in May was down 600 which we expected as he had a week unpaid, but June and July he’s down 300pm too... this is massive for us so he rang revenue today. The person he spoke to worked on it for the day then phoned him back and said maybe ring next week and someone else might be able to help but sure my maternity benefit makes up for the decrease in his wages. Which it doesn’t obviously, we were counting on him being on same wages after May and we’re going to be majorly struggling to afford unpaid leave come the end of maternity benefit so need to sort it. Can anyone advise?

Calahonda52

MB is 245/week or 1050 a month, unless you are getting a higher figure

At 20% your hubby will be down 200 or 400 if 40%...

What credits do you think you have left and why?

angeldelight

Calahonda52 wrote: »

MB is 245/week or 1050 a month, unless you are getting a higher figure

At 20% your hubby will be down 200 or 400 if 40%...

What credits do you think you have left and why?
You wont get the PAYE one
The PTA is 1650 or 137.5 a month, so 400 less 137 is close to 300?

Yep MB is 245 a week. However you are still entitled to the employee tax credit while in receipt of MB as well as the personal one. So my tax liability per week is €49 on the MB however my tax credits are enough to cover that

lashes34

You are still entitled to the PAYE credit while on MB.

Have they decreased your husbands credits and/or put him on a week 1 basis?

ibarelycare

Are you and your husband jointly assessed? Did you transfer your married person tax credit to him while you're on maternity leave? Don't forget that your tax credits are reduced by 20% when you're on maternity leave, so are you factoring this into your calculations?

angeldelight

Yes my husband has my 1650 PAYE credit - I have 1650 Personal credit plus 80 flat rate expenses

We spoke to someone who could explain it properly in Revenue today... basically they've annualised the maternity benefit so have calculated that my income will be 12740 (245*52) and won't change that until they hear back from Dept of Social Welfare how much I actually received after I go back to work So even though I'm only entitled to 6370 they've reduced my credits based on the 12740 sum and put us both on week one basis so we can't claim it back until next year when I'll be back at work and the extra money yes will be nice but it's now when I'm off and hoping to take unpaid leave that we actually are in need of it!

A truly ridiculous system

ibarelycare

That’s very strange. I work in a payroll bureau and process maternity for dozens of employees a month and I don’t think I’ve ever seen that. Unless it’s something they do for jointly assessed couples?? I don’t analyse every RPN/cert that comes in for maternity people but they’re regularly something I’ll spot check. Must have a closer look at some tomorrow to see!

lashes34

I've never seen that happen either. When I went on maternity leave, it crossed over two tax years so I done the calculations and rang the tax office to adjust my credits based on the benefit. There was no issue with it being done that way.

I would ring them again. There have been times I've rang Revenue to get clearance on something and they gave wrong advise. Literally hang up and ring again. You will get a different answer from each person. I would try again.

angeldelight

I’ll try give them a shout again during the week maybe. It shouldn’t be this hard

The guy today was very sure, very empathetic and said it didn’t make sense but there was nothing they could do.

Also they don’t do it for paternity benefit only MB... makes no sense

relax carry on

From the Revenue website

https://www.revenue.ie/en/jobs-and-pensions/taxation-of-social-welfare-payments/detailed-examples-of-taxation-of-payments.aspx

First, we ‘annualise’ the weekly amount of Maternity Benefit payable, and then we divide this by 52 to give the weekly figure.

We use a notional ‘annualised’ figure, but only the actual amount of weekly Maternity Benefit received is taxed this way.

The weekly adjusted tax credit and rate band apply for the duration of the Maternity Benefit payments only. They are readjusted after the last payment is received from DEASP. We can then remove the Maternity Benefit weekly element from the weekly tax credits and rate band.

spuddy

Thanks for this thread. My wife couldn't understand why her amended tax cert showed the reduction in higher rate tax band by 12,740. It does seem absurd given the State only provides 26 weeks' paid benefit!

angeldelight

It really bugs me to be honest - we’ll get a refund in 2020 but now is when we could do with having the money and I have to go back to work earlier because of it