Best assessment option after marriage

shellycub

Hi everyone,

married in Feb this year. I earn around 50k and my husband is earning around 24k. Am getting very confused by the options for taxation and would really appreciate any advice/help.

First would we be best jointly assessed or separately?

Then which option is best to select
- divide tax credits and rate bands equally
- request to allocate all transferable tax credits and rate bands to the assessable spouse
or
- request to allocate all transferable tax credits and rate bands to the non assessable spouse

The more I try to read the more confused I get and don't want one of us to come out with less than before.

Thanks very much!

relax carry on

shellycub wrote: »

Hi everyone,

married in Feb this year. I earn around 50k and my husband is earning around 24k. Am getting very confused by the options for taxation and would really appreciate any advice/help.

First would we be best jointly assessed or separately?

Then which option is best to select
- divide tax credits and rate bands equally
- request to allocate all transferable tax credits and rate bands to the assessable spouse
or
- request to allocate all transferable tax credits and rate bands to the non assessable spouse

The more I try to read the more confused I get and don't want one of us to come out with less than before.

Thanks very much!

It really not that difficult. Jointly assessed and separately assessed are essentially the same thing. In a jointly assessed case the transferable rate band amount of 9000 euro and transferable credit amount of 1650 euro can take place at anytime during the year. It's handy to cover unexpected drops income such as unemployment periods etc in real time. In separate assessed cases the same transfer can take place but after the tax year end by the taxpayers filing tax returns.

Both spouses have their own rates bands and credits. Up to 9000 euro of one spouses rate band can be transferred to the other. Up to 1650 euro of one spouses personal tax credit can be transferred to the other.

In your situation your spouse is using up his own credits of 3300 euro to cover 16500 euro without paying PAYE (that's 3300 X 5). Your spouse is only using 24000 euro of his rate band meaning you can transfer up to the 9000 euro limit as he's not using it currently.

Either basis of assessment will work out the same for you. Jointly assessed means you'll benefit from the extra 9000 euro of rate band through the year but separately assessment means you have to wait to till the end of each year to get the benefit.

As you only got married this year, you'll have to wait until January next year to change your basis of assessment anyway.

namenotavailablE

Some of my Excel calculators might help:

Allocating standard rate band: http://taxcalc.eu/monthlyss/SRCOP%20allocation.xlsx
Net pay calculator: http://taxcalc.eu/monthlyss/Employee%20PAYE%20calculator.xlsm

Others are available at www.hookhead.com; www.taxcalc.ie; http://services.deloitte.ie/tc/

shellycub

Thank you both for your replies!